SCHEDULE 13D: Investment Group Led by J. Luther King, Jr. Discloses 7.2% Stake in TXO Partners, L.P. Following Recent Unit Purchases

A group of investment entities and individuals, including J. Luther King, Jr., has disclosed a combined beneficial ownership of 7.2% in TXO Partners, L.P. common units, following recent purchases in an underwritten public offering.

Summary

• LKCM Investment Partnership, L.P., LKCM Private Discipline Master Fund, SPC / PDLP Morningstar, LLC, Luther King Capital Management Corporation, and J. Luther King, Jr. (collectively, the "Reporting Persons") beneficially own an aggregate of 3,801,974 Common Units of TXO Partners, L.P., representing approximately 7.2% of the outstanding Common Units as of May 15, 2025.
• On May 15, 2025, LKCM Investment Partnership, L.P. purchased an additional 333,333 Common Units at $15.00 per unit in an underwritten public offering.
• On May 15, 2025, LKCM Private Discipline Master Fund, SPC / PDLP Morningstar, LLC purchased an additional 166,667 Common Units at $15.00 per unit in the same underwritten public offering.
• J. Luther King, Jr. also acquired 3,000 Common Units on January 31, 2024, and 3,500 Common Units on January 31, 2025, through the vesting of phantom units as a board member.
• The Reporting Persons have entered into a lock-up agreement, effective May 13, 2025, for 60 days, restricting the sale or disposition of their Issuer securities without underwriter consent.
• The Common Units were acquired for investment purposes, and the Reporting Persons intend to review their investment and may acquire or dispose of units in the future.

Sentiment

Score: 7

Explanation: The filing indicates a significant and active investment by a reputable group, including participation in a capital raise and board representation, suggesting a positive long-term view. The lock-up is a standard procedure for such offerings and not inherently negative.

Positives

• Increased beneficial ownership by a significant investment group, including J. Luther King, Jr., signaling confidence in TXO Partners, L.P.
• The participation of the Reporting Persons in the underwritten public offering indicates support for the Issuer's capital raising efforts.
• J. Luther King, Jr. and Rick Settle, an employee of LKCM, serve on the board of directors of the General Partner, providing direct oversight and strategic input from a major investor.

Negatives

• The lock-up agreement restricts the Reporting Persons from selling their shares for 60 days, which could temporarily limit liquidity for these specific large holders.

Risks

• The Reporting Persons' future actions regarding their investment, including potential disposal of Common Units, could impact the Issuer's stock price.
• The lock-up agreement, while standard for offerings, temporarily restricts the Reporting Persons' ability to react to market changes by selling their shares.

Future Outlook

The Reporting Persons intend to continuously review their investment in TXO Partners, L.P. based on various factors, including the Issuer's business, financial condition, and market conditions. They reserve the right to take future actions, which may include further acquisitions or disposals of Common Units, and to engage in discussions with the Issuer's management regarding operations and strategic direction.

Management Comments

• "The Reporting Persons have acquired Common Units for investment purposes."
• "The Reporting Persons from time to time intend to review their investment in the Issuer on the basis of various factors, including the Issuer's business, financial condition, results of operations and prospects, general economic and industry conditions, the securities markets in general and those for the Issuer's securities in general, as well as other developments and other investment opportunities."
• "Based upon such review, the Reporting Persons intend to take such actions in the future as they deem appropriate in light of the circumstances existing from time to time, which may include further acquisitions of Common Units or disposal of Common Units currently owned by the Reporting Persons or otherwise acquired by the Reporting Persons, either in the open market or privately negotiated transactions, with or without prior notice."
• "JLK and Rick Settle, an employee of LKCM, serve on the board of directors of the General Partner. In such capacity, JLK and Mr. Settle, as well as other representatives of LKCM, expect to engage in communications from time to time with one or more shareholders, officers or members of the Issuer or the General Partner, including discussions regarding the Issuer's operations and strategic direction and ideas that, if effected, could result in, among other things, any of the matters identified in Item 4(a)-(j) of Schedule 13D."

Industry Context

This Schedule 13D filing reflects a significant investment by a prominent investment management group in an energy sector limited partnership. Such filings are common in the investment landscape, indicating active portfolio management and strategic positioning by institutional investors in companies they believe offer long-term value or strategic influence.

Related Party Transactions

• J. Luther King, Jr. acquired 3,000 Common Units on January 31, 2024, and 3,500 Common Units on January 31, 2025, upon vesting of phantom units issued to him as a member of the board of directors of the General Partner.

Stakeholder Impact

• Shareholders: The increased institutional ownership by a prominent investment group could be viewed positively, potentially signaling confidence and stability. The lock-up agreement temporarily reduces potential selling pressure from these large holders.
• Management/Board: The presence of J. Luther King, Jr. and Rick Settle on the General Partner's board indicates active investor engagement and potential influence on strategic decisions.
• Creditors: The capital raise implied by the underwritten public offering could strengthen the Issuer's financial position, potentially benefiting creditors.

Next Steps

• The 60-day lock-up period for the Reporting Persons will end around July 12, 2025, after which they will be free to dispose of their shares without underwriter consent.
• The Reporting Persons intend to continue reviewing their investment and may engage in further acquisitions or disposals of Common Units.
• J. Luther King, Jr. and Rick Settle are expected to continue engaging with the Issuer's management and board regarding operations and strategic direction.

Key Dates

Keywords

TXO Partners, Common Units, Schedule 13D, Beneficial Ownership, LKCM Investment Partnership, LKCM Private Discipline Master Fund, Luther King Capital Management, J. Luther King Jr., Underwritten Public Offering, Lock-Up Agreement, Investment Management, SEC Filing