UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

SCHEDULE 14A

(RULE 14a-101)

SCHEDULE 14A INFORMATION

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Securities Exchange Act of 1934

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SAN JUAN BASIN ROYALTY TRUST

(Name of Registrant as Specified in its Charter)

(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)

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On November 4, 2016, the San Juan Basin Royalty Trust submitted the following supplemental presentation to representatives of Institutional Shareholder Services Inc.:

San Juan Basin Royalty Trust

Compass Bank, Trustee

Supplemental Investor Presentation:

Solicitation of Proxies Against

Southwest Bank’s Takeover as Trustee

November 4, 2016

Name

Title

[telephone]

[email]

[Month Year]

Southwest Bank Misleads on Trust Expenses

The Trust’s general and administrative (G&A) expenses increased in recent

quarters

not

from

inefficient

management

but

due

to

increased

audit

and

legal

costs

related

to

the

ConocoPhillips

litigation.

Southwest Bank claims that the Trust’s G&E expenses increased significantly

since

Ms.

Anderson’s

departure,

but

it

fails

to

tell

you

that:

As disclosed in the Trust’s Form 10-K and 10-Q filings with the SEC, the

increased costs are primarily related to the Trust’s litigation against

Burlington, a subsidiary of ConocoPhillips, which began in 2014 and is

scheduled for trial in March 2017. Litigation expenses have increased this

year as the parties prepare for trial, engage expert witnesses, continue

discovery and attend mediation sessions.

These

expenses

would

have

been

the

same

even

if

Ms.

Anderson

were

still

the

trust

officer.

She

acknowledges

that

she

would

use

the

same

litigation

team

Compass

Bank

uses.

Compass

Bank

believes

this

litigation

is

worth

pursuing.

The

Trust’s

claim

is

for

monetary

relief

in

excess

of

$12

million.

2

Southwest Bank Misleads on Trust Expenses (cont’d)

When

litigation

expenses

are

excluded,

Trust

G&A

expenses

have

been

consistent,

generally

rising in the first quarter (as expenses increase with annual reporting obligations) and falling

again by the end of the year. Ms. Anderson’s departure during the fourth quarter of 2015 did not

impact the Trust’s G&A

expenses. 

Note: For a reconciliation of adjusted G&A

expenses to reported G&A

expenses, see the

appendix at the end of this presentation. Adjusted G&A

expenses for 3Q 2016 excludes expenses

incurred in responding to Southwest Bank’s self-interested proxy campaign.

Aside from litigation expenses, increased G&A

expenses since Ms. Anderson’s departure are

primarily attributable to costs of updating SOX compliance procedures and auditing

ConocoPhillips information.

$-

$200,000

$400,000

$600,000

$800,000

$1,000,000

$1,200,000

Q1 2015

Q2 2015

Q3 2015

Q4 2015

Q1 2016

Q2 2016

Q3 2016

Total general and administrative expenses

Adjusted general and administrative expenses

Ms. Anderson leaves

Compass Bank

3

Southwest Bank Misleads on Conflicts of Interests

Southwest Bank and Ms. Anderson should know that Compass Bank has no

conflict of interest.

•

Southwest Bank claims that Compass Bank has a “demonstrated” conflict of interest because Charles

McMahen,

a

director

of

BBVA

Compass,

also

serves

as

an

independent

outside

director

of

Enterprise

Products Holdings. Affiliates of Enterprise gather and process gas attributable to the Trust’s royalty

properties.

•

Had Southwest Bank and Ms. Anderson understood how the Trust operates, they would know that there is

no

conflict

of

interest:

•

Enterprise and its affiliates process gas for ConocoPhillips, not the Trust. The Trust has only an interest

in the net proceeds from ConocoPhillips’ sale of the gas. This is disclosed in the Trust’s Form 10-K

filings.

(1)

•

ConocoPhillips, as the principal operator of the properties underlying the Trust’s royalty, determines

which service providers to use, negotiates the terms of the contracts with them, and is a party to the

contracts.

•

The Trust is NOT a party to any of the purchase, gathering or processing contracts.

•

ConocoPhillips entered into a contract with Enterprise in 2011 during Ms. Anderson’s tenure at

Compass Bank. Ms. Anderson reviewed the contract, which will not terminate until 2026.  This is also

disclosed

in

the

Trust’s

Form

10-K

filings.

(1)

•

Compass Bank reviewed the terms of the 2011 Enterprise contract with a third-party consultant to

confirm

that

they

were

fair

to

the

Trust.

(2)

•

Ms. Anderson should understand this. In making this argument, she and Southwest Bank demonstrate

that either they do not understand how the Trust operates or they intend to mislead unit holders.

_________

(1)

See the Trust’s annual report on Form 10-K for the year ended December 31, 2015, pages 13-14.

(2)

See the Trust’s annual report on Form 10-K for the year ended December 31, 2011, page 9.

4

Southwest Bank Misleads on Conflicts of Interests (cont’d)

Southwest Bank claims that Compass Bank has a conflict of interest because

its parent company holds shares of ConocoPhillips.

Southwest

Bank

fails

to

tell

you

that

the

shares

are

held

on

behalf of

bank

customers

as

part

of

routine

trust

and

investment

services.

Compass Bank has no pecuniary interest in the shares.

Southwest

fails

to

tell

you

that

the

number

of

shares

is

extremely

small,

amounting to about 0.003% of the outstanding shares of ConocoPhillips.

The fact that Compass Bank has ongoing litigation against ConocoPhillips

to recover underpayment of royalties is further evidence that Compass

Bank has no conflict of interest.

5

Southwest Bank Misleads on Analyst Information

Southwest

Bank

cites

to

“independent”

research

by

an

analyst

and

claims

that the analyst received no response from Compass Bank to a December

2015 inquiry.

Southwest

Bank

fails

to

tell

you

that

the

analyst,

McDep,

acknowledges

in its research reports that it has received compensation from Southwest

Bank

for

prior

research

services.

(1)

Southwest

Bank

does

not

disclose

the

amount paid to the analyst.

Southwest

Bank

fails

to

tell

you

that

the

2015

“inquiry”

was

a

letter

from

the “independent” analyst in support of Ms. Anderson’s effort to cause

Compass Bank to resign as trustee in connection with her 2015

departure.  The letter did not solicit a response from Compass Bank.

(1) See disclaimer at http://www.mcdep.com/sjt151021.pdf.

6

Southwest Bank Misleads on Time to Vote

Southwest Bank claims that Compass Bank is trying to restrict unit holder

voting by allowing 28 days to vote. 

Southwest

Bank

fails

to

tell

you

that

a

voting

period

of

about

30

days

is

generally recognized as sufficient time to vote.

Southwest

Bank

fails

to

tell

you

that

it

originally

sent

proxy

cards

to

most

unit holders starting on October 14, 2016, effectively giving them 38

days to vote.

Southwest

Bank

fails

to

tell

you

that

Compass

Bank

responded

to

Southwest Bank’s demand for unit holder lists beginning on August 31,

2016. This allowed Southwest Bank to begin contacting unit holders 82

days before the meeting.

7

Appendix

–

Reconciliation

of

Trust

G&A

Expenses

Below is a reconciliation of the total G&A

expenses reported in the Trust’s filings with the SEC for

the quarters indicated, adjusted to exclude audit and legal costs incurred in connection with the

ConocoPhillips litigation and responding to Southwest Bank’s proxy campaign.

(1) Expenses for the third quarter of 2016 include $88,000 in expenses incurred in responding to Southwest Bank’s proxy

campaign.

Q1 2015

Q2 2015

Q3 2015

Q4 2015

Q1 2016

Q2 2016

Q3 2016

Reported G&A

Expenses

$     661,738

$     498,750

$     401,966

$     605,982

$     1,022,436

$     886,134

$     499,462

Litigation and Related Expenses(1)

$     174,282

$     115,732

$     104,628

$     168,139

$        485,572

$     382,831

$     219,609

Adjusted G&A

Expenses

$     487,456

$     383,017

$     297,338

$     437,843

$        536,864

$     503,303

$     279,852

8

Disclaimer

In response to the demand by Southwest Bank and Robert Lansford, a senior business

development officer at Southwest Bank, the Trust has called a special meeting and

filed with the U.S. Securities and Exchange Commission (“SEC”) on October 25, 2016,

a definitive proxy statement in connection with the solicitation of proxies from unit

holders of the Trust at the special meeting. The Trust will furnish copies of proxy

materials to the unit holders, together with a BLUE proxy card. UNIT HOLDERS ARE

URGED TO READ CAREFULLY THE PROXY STATEMENT AND ANY OTHER RELEVANT

DOCUMENTS FILED WITH THE SEC AS THEY BECOME AVAILABLE BECAUSE THEY

CONTAIN IMPORTANT INFORMATION. These documents, including the proxy

statement (and amendments and supplements thereto) and other documents filed by

the Trust with the SEC, will be available for no charge on the SEC’s

website at

www.sec.gov and at the Trust’s website at www.sjbrt.com. Copies may also be

obtained

by

contacting

Kaye

Wilke

by

phone

at

(866)

809-4553,

by

email

at

sjt.us@bbva.com

or by mail at San Juan Basin Royalty Trust, c/o Compass Bank, Trust

Department, Attn: Investor Relations, 300 W. 7th Street, Suite B, Fort Worth, Texas

76102.

Compass Bank, as trustee of the Trust, may be deemed to be a participant in the

solicitation of proxies in connection with the special meeting. Information regarding

Compass Bank’s interests in the Trust by security holdings and otherwise is set forth in

the Trust’s Annual Report on Form 10-K for the year ended December 31, 2015, and

in the Trust’s subsequent Quarterly Reports on Form 10-Q.

9