Mills Music Trust (MMTRS) 10-Q 14 Nov 24 2024 Q3 Quarterly report Financial data

Cover Page

Cover Page	9 Months Ended
	Sep. 30, 2024 shares
Cover [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Sep. 30, 2024
Document Fiscal Year Focus	2024
Document Quarterly Report	true
Document Transition Report	false
Document Fiscal Period Focus	Q3
Entity Registrant Name	MILLS MUSIC TRUST
Entity Central Index Key	0000066496
Entity Address, State or Province	NY
Entity Incorporation, State or Country Code	NY
Entity Address, Address Line One	c/o HSBC Bank USA, N.A. Corporate Trust Issuer Services
Entity Address, Address Line Two	66 Hudson Boulevard East
Entity Address, City or Town	New York
Entity Address, Postal Zip Code	10001
Current Fiscal Year End Date	--12-31
City Area Code	212
Local Phone Number	525-1349
Entity Current Reporting Status	Yes
Entity File Number	000-02123
Entity Tax Identification Number	13-6183792
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Interactive Data Current	Yes
Entity Shell Company	false
Entity Common Stock, Shares Outstanding	277,712

Statements of Cash Receipts and

Statements of Cash Receipts and Disbursements - USD ($)	3 Months Ended			9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023		Sep. 30, 2024	Sep. 30, 2023
Operating Cash Flows, Direct Method [Abstract]
Receipts from EMI	$ 512,648	$ 467,307		$ 1,049,997	$ 956,256
Undistributed Cash at Beginning of Period	46	29,382	[1]	46	4,421	[2]
Disbursements — Administrative Expenses	(141,921)	(100,834)	[1]	(391,264)	(274,675)	[2]
Balance Available for Distribution	370,773	395,855		658,779	686,002
Cash Distributions to Unit Holders	(370,727)	(395,809)		(658,733)	(685,956)
Undistributed Cash at End of period	$ 46	$ 46		$ 46	$ 46
Cash Distribution per Unit (based on 277,712 Trust Units outstanding)	$ 1.33	$ 1.43		$ 2.37	$ 2.47
[1]Includes amounts reserved for administrative expenses in the aggregate amount of $29,334 attributable to the three-months ended June 30, 2023, which were actually paid by the Trust in July 2023.[2]Includes amounts reserved for administrative expenses in the aggregate amount of $4,375 attributable to the fourth quarter of 2022, which were actually paid by the Trust in the first quarter of 2023.

Statements of Cash Receipts a_2

Statements of Cash Receipts and Disbursements (Parenthetical) - USD ($)		3 Months Ended			9 Months Ended
	Jul. 31, 2023	Sep. 30, 2024	Sep. 30, 2023	Mar. 31, 2023	Sep. 30, 2024	Sep. 30, 2023
Number of Trust Units Outstanding		277,712	277,712		277,712	277,712
Administrative fees expense	$ 29,334			$ 4,375

Insider Trading Arrangements

Insider Trading Arrangements	9 Months Ended
	Sep. 30, 2024
Trading Arrangements, by Individual
Rule 10b5-1 Arrangement Adopted	false
Non-Rule 10b5-1 Arrangement Adopted	false
Rule 10b5-1 Arrangement Terminated	false
Non-Rule 10b5-1 Arrangement Terminated	false

Organization and Summary of Sig

Organization and Summary of Significant Accounting Policies	9 Months Ended
	Sep. 30, 2024
Accounting Policies [Abstract]
Organization and Summary of Significant Accounting Policies	NOTE 1. ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Organization and Background Mills Music Trust (the “ Trust Declaration of Trust Old Mills Contingent Portion Catalogue Asset Purchase Agreement The Contingent Portion amounts are currently payable by EMI Mills Music Inc. (“ EMI Corporate Trustee Individual Trustee Trustees Proceeds from Contingent Portion Payments The Trust receives quarterly payments of the Contingent Portion from EMI and distributes the amounts it receives to the registered owners of Trust certificates (the “ Unit Holders Trust Units Payments of the Contingent Portion to the Trust are based on royalty income which the Catalogue generates. The Trust does not own the Catalogue or any copyrights or other intellectual property rights and is not responsible for collecting royalties in connection with the Catalogue. As the current owner and administrator of the Catalogue, EMI is obligated under the Asset Purchase Agreement to use its best efforts to collect all royalties, domestic and foreign, in connection with the Catalogue and to remit a portion of its royalty income to the Trust as its Contingent Portion payment obligation, in accordance with the terms of the Asset Purchase Agreement. Calculation of the Contingent Portion The amount of each payment of the Contingent Portion is based on a formula set forth in the Asset Purchase Agreement. Prior to the first quarter of 2010, the Contingent Portion was calculated as an amount ranging from 65% to 75% of gross royalty income from the exploitation of the Catalogue for each quarterly period, less royalty expenses. In addition, the Contingent Portion was guaranteed to be at least a minimum of $167,500 per quarter (the “ Minimum Payment Obligation Beginning with the first quarter of 2010, the Asset Purchase Agreement provides for certain changes with respect to the calculation of the Contingent Portion. One such change is that the Minimum Payment Obligation is no longer in effect. The Trust is also of the view that the Contingent Portion payable to the Trust changed to a fixed 75% of gross royalty income from the exploitation of the Catalogue for each quarterly period, less royalty related expenses (the “ New Calculation Method Underpayments”) Quarterly Payment Period Amount of Deficiency March 31, 2016 $ 79,889 September 30, 2016 37,529 March 31, 2017 85,359 September 30, 2017 41,557 March 31, 2018 98,901 September 30, 2018 75,712 March 31, 2019 71,489 June 30, 2019 41,786 September 30, 2019 68,571 December 31, 2019 42,572 March 31, 2020 40,025 June 30, 2020 15,557 September 30, 2020 40,085 March 31, 2021 42,742 June 30, 2021 43,148 September 30, 2021 38,846 December 31, 2021 38,112 March 31, 2022 0 June 30, 2022 70,709 September 30, 2022 83,438 December 31, 2022 0 March 31, 2023 44,908 June 30, 2023 37,491 September 30, 2023 131,213 December 31, 202 3 40,761 March 31, 2024 43,909 June 30, 202 4 0 September 30, 2024 135,768 Total $   1,490,077 As of the date hereof, the Trust has not received the Underpayments, and EMI has expressly disagreed with the Trust. In addition, on October 1, 2020, the Trust engaged Citrin Cooperman & Company LLP, an accounting firm specializing in auditing royalty income (“ Citrin Audit Period Citrin Report The Trust can offer no assurance that it will be able to recover any of the Underpayments or other amounts identified in the Citrin Report, or that it will favorably resolve the dispute relating to the New Calculation Method with respect to future payments of the Contingent Portion. Cash Distributions to Unit Holders The Declaration of Trust provides for the distribution to the Unit Holders of all funds the Trust receives after payment of, or withholdings in connection with, expenses and liabilities of the Trust. For information regarding cash disbursements made to Unit Holders for the three and nine months ended September 30, 2024 and September 30, 2023 see the table headed “Statements of Cash Receipts and Disbursements” under Part I — Item 1, “Financial Statements”. The Copyright Catalogue The Catalogue is estimated to be composed of over 12,000 music titles (the “ Copyrighted Songs Top 50 Songs Listing 10-K Accounting Policies EMI typically makes payments to the Trust of the Contingent Portion in March, June, September and December for the prior calendar quarter. The payments received are accounted for on a cash basis, as are expenses of the Trust. The Declaration of Trust provides for the distribution of the amounts it receives in Contingent Portion payments to the Unit Holders after payment of, or withholdings in connection with, expenses and liabilities of the Trust. The Trust’s financial statements reflect only cash transactions and do not include transactions that would be recorded in financial statements presented on the accrual basis of accounting, as contemplated by generally accepted accounting principles in the United States. The Trust does not prepare a balance sheet or a statement of cash flows. These unaudited financial statements should be read in conjunction with the financial statements and related notes in the Trust’s Annual Report on Form 10-K

Income Taxes

Income Taxes	9 Months Ended
	Sep. 30, 2024
Income Tax Disclosure [Abstract]
Income Taxes	NOTE 2. INCOME TAXES No provision for income taxes has been made since the liability is that of the Unit Holders and not the Trust.

Governance of the Trust

Governance of the Trust	9 Months Ended
	Sep. 30, 2024
Business Combinations [Abstract]
Governance of the Trust	NOTE 3. GOVERNANCE OF THE TRUST The Trust does not have, nor does the Declaration of Trust provide for, officers, a board of directors or any employees. HSBC Bank, USA, N.A. is the Corporate Trustee of the Trust, and Lee Eastman is the Individual Trustee of the Trust. Pursuant to the Declaration of Trust, Trustees of the Trust serve until their removal or resignation, or in the case of an Individual Trustee, their incapacity or death. Michael Reiss resigned as an Individual Trustee of the Trust effective as of March 15, 2024, and his Individual Trustee seat is vacant as of November 14, 2024. On December 23, 2014, the Trust adopted a code of ethics (as defined in Item 406 of Regulation S-K https://www.hsbc.com/who-we-are/esg-and-responsible-business/our-conduct. The Trust is not a corporate entity and thus does not have an Audit Committee. The Trust has established a policy with regard to audit, audit-related and certain non-audit

Related Party Transactions

Related Party Transactions	9 Months Ended
	Sep. 30, 2024
Related Party Transactions [Abstract]
Related Party Transactions	NOTE 4. RELATED PARTY TRANSACTIONS The Trustees are paid in accordance with the Declaration of Trust, which provides that each Trustee shall receive annual compensation of $2,500, provided that such aggregate compensation to the Trustees as a group may not exceed 3% of the Contingent Portion amounts received by the Trust in any year. The Declaration of Trust also provides for the reimbursement of expenses reasonably incurred in the performance of a Trustee’s duties to the Trust, including clerical and administrative services. Accordingly, the Trustees are entitled to receive annual compensation and reimbursement for services performed for the Trust, including the Corporate Trustee’s services as the Registrar and Transfer Agent of the certificates representing the Trust Units. The Declaration of Trust also provides that if a Trustee performs unusual or extraordinary services, reasonable compensation for such services shall be paid, subject to the terms and conditions of the Declaration of Trust. Pursuant to the Declaration of Trust, disbursements were made as follows to the Trustees for the three and nine months ended September 30, 2024 and September 30, 2023: Three Months Nine Months Ended September 30 2024 2023 2024 2023 Corporate Trustee Fees and Expenses $ 625 $ 1,250 $ 1,875 $ 2,500 Individual Trustee Fees and Expenses 625 1,250 2,500 3,750 Transfer Agent and Registrar (1) 6,875 7,500 17,500 15,000 Total $ 8,125 $ 10,000 (2) $ 21,875 $ 21,250 (3) (1) These services are performed by the Corporate Trustee. (2) Includes amounts for the Corporate Trustee, and Transfer Agent and Registrar fees, in the aggregate amount of $4,375 attributable to the three- months ended June 30, 2023, which were actually paid by the Trust in July 2023. (3) Includes amounts for the Corporate Trustee, and Transfer Agent and Registrar fees, in the aggregate amount of $4,375 attributable to the fourth quarter of 2022, which were actually paid in the first quarter of 2023. The administrative office of the Trust is located at the offices of the Corporate Trustee, HSBC Bank, USA, N.A., Corporate Trust Issuer Services, 66 Hudson Boulevard East, New York, NY 10001. Except for fees paid to the Corporate Trustee in accordance with the Declaration of Trust, no expense is being charged or paid by the Trust for the office space and office equipment of the Corporate Trustee that is being utilized for the Trust.

Subsequent Events

Subsequent Events	9 Months Ended
	Sep. 30, 2024
Subsequent Events [Abstract]
Subsequent Events	NOTE 5. SUBSEQUENT EVENTS. None.

Organization and Summary of S_2

Organization and Summary of Significant Accounting Policies (Policies)	9 Months Ended
	Sep. 30, 2024
Accounting Policies [Abstract]
Organization and Background	Organization and Background Mills Music Trust (the “ Trust Declaration of Trust Old Mills Contingent Portion Catalogue Asset Purchase Agreement The Contingent Portion amounts are currently payable by EMI Mills Music Inc. (“ EMI Corporate Trustee Individual Trustee Trustees
Proceeds from Contingent Portion Payments	Proceeds from Contingent Portion Payments The Trust receives quarterly payments of the Contingent Portion from EMI and distributes the amounts it receives to the registered owners of Trust certificates (the “ Unit Holders Trust Units Payments of the Contingent Portion to the Trust are based on royalty income which the Catalogue generates. The Trust does not own the Catalogue or any copyrights or other intellectual property rights and is not responsible for collecting royalties in connection with the Catalogue. As the current owner and administrator of the Catalogue, EMI is obligated under the Asset Purchase Agreement to use its best efforts to collect all royalties, domestic and foreign, in connection with the Catalogue and to remit a portion of its royalty income to the Trust as its Contingent Portion payment obligation, in accordance with the terms of the Asset Purchase Agreement.
Calculation of Contingent Portion	Calculation of the Contingent Portion The amount of each payment of the Contingent Portion is based on a formula set forth in the Asset Purchase Agreement. Prior to the first quarter of 2010, the Contingent Portion was calculated as an amount ranging from 65% to 75% of gross royalty income from the exploitation of the Catalogue for each quarterly period, less royalty expenses. In addition, the Contingent Portion was guaranteed to be at least a minimum of $167,500 per quarter (the “ Minimum Payment Obligation Beginning with the first quarter of 2010, the Asset Purchase Agreement provides for certain changes with respect to the calculation of the Contingent Portion. One such change is that the Minimum Payment Obligation is no longer in effect. The Trust is also of the view that the Contingent Portion payable to the Trust changed to a fixed 75% of gross royalty income from the exploitation of the Catalogue for each quarterly period, less royalty related expenses (the “ New Calculation Method Underpayments”) Quarterly Payment Period Amount of Deficiency March 31, 2016 $ 79,889 September 30, 2016 37,529 March 31, 2017 85,359 September 30, 2017 41,557 March 31, 2018 98,901 September 30, 2018 75,712 March 31, 2019 71,489 June 30, 2019 41,786 September 30, 2019 68,571 December 31, 2019 42,572 March 31, 2020 40,025 June 30, 2020 15,557 September 30, 2020 40,085 March 31, 2021 42,742 June 30, 2021 43,148 September 30, 2021 38,846 December 31, 2021 38,112 March 31, 2022 0 June 30, 2022 70,709 September 30, 2022 83,438 December 31, 2022 0 March 31, 2023 44,908 June 30, 2023 37,491 September 30, 2023 131,213 December 31, 202 3 40,761 March 31, 2024 43,909 June 30, 202 4 0 September 30, 2024 135,768 Total $   1,490,077 As of the date hereof, the Trust has not received the Underpayments, and EMI has expressly disagreed with the Trust. In addition, on October 1, 2020, the Trust engaged Citrin Cooperman & Company LLP, an accounting firm specializing in auditing royalty income (“ Citrin Audit Period Citrin Report The Trust can offer no assurance that it will be able to recover any of the Underpayments or other amounts identified in the Citrin Report, or that it will favorably resolve the dispute relating to the New Calculation Method with respect to future payments of the Contingent Portion.
Cash Distributions to Unit Holders	Cash Distributions to Unit Holders The Declaration of Trust provides for the distribution to the Unit Holders of all funds the Trust receives after payment of, or withholdings in connection with, expenses and liabilities of the Trust. For information regarding cash disbursements made to Unit Holders for the three and nine months ended September 30, 2024 and September 30, 2023 see the table headed “Statements of Cash Receipts and Disbursements” under Part I — Item 1, “Financial Statements”.
The Copyright Catalogue	The Copyright Catalogue The Catalogue is estimated to be composed of over 12,000 music titles (the “ Copyrighted Songs Top 50 Songs Listing 10-K
Accounting Policies	Accounting Policies EMI typically makes payments to the Trust of the Contingent Portion in March, June, September and December for the prior calendar quarter. The payments received are accounted for on a cash basis, as are expenses of the Trust. The Declaration of Trust provides for the distribution of the amounts it receives in Contingent Portion payments to the Unit Holders after payment of, or withholdings in connection with, expenses and liabilities of the Trust. The Trust’s financial statements reflect only cash transactions and do not include transactions that would be recorded in financial statements presented on the accrual basis of accounting, as contemplated by generally accepted accounting principles in the United States. The Trust does not prepare a balance sheet or a statement of cash flows. These unaudited financial statements should be read in conjunction with the financial statements and related notes in the Trust’s Annual Report on Form 10-K

Organization and Summary of S_3

Organization and Summary of Significant Accounting Policies (Tables)	9 Months Ended
	Sep. 30, 2024
Accounting Policies [Abstract]
Schedule of Contingent Portion Payments	As a result of the New Calculation Method not being applied, EMI’s payments of the Contingent Portion have been deficient, in the Trust’s view, by the following amounts (the “ Underpayments”) Quarterly Payment Period Amount of Deficiency March 31, 2016 $ 79,889 September 30, 2016 37,529 March 31, 2017 85,359 September 30, 2017 41,557 March 31, 2018 98,901 September 30, 2018 75,712 March 31, 2019 71,489 June 30, 2019 41,786 September 30, 2019 68,571 December 31, 2019 42,572 March 31, 2020 40,025 June 30, 2020 15,557 September 30, 2020 40,085 March 31, 2021 42,742 June 30, 2021 43,148 September 30, 2021 38,846 December 31, 2021 38,112 March 31, 2022 0 June 30, 2022 70,709 September 30, 2022 83,438 December 31, 2022 0 March 31, 2023 44,908 June 30, 2023 37,491 September 30, 2023 131,213 December 31, 202 3 40,761 March 31, 2024 43,909 June 30, 202 4 0 September 30, 2024 135,768 Total $   1,490,077

Related Party Transactions (Tab

Related Party Transactions (Tables)	9 Months Ended
	Sep. 30, 2024
Related Party Transactions [Abstract]
Disbursements to Trustees	Pursuant to the Declaration of Trust, disbursements were made as follows to the Trustees for the three and nine months ended September 30, 2024 and September 30, 2023: Three Months Nine Months Ended September 30 2024 2023 2024 2023 Corporate Trustee Fees and Expenses $ 625 $ 1,250 $ 1,875 $ 2,500 Individual Trustee Fees and Expenses 625 1,250 2,500 3,750 Transfer Agent and Registrar (1) 6,875 7,500 17,500 15,000 Total $ 8,125 $ 10,000 (2) $ 21,875 $ 21,250 (3) (1) These services are performed by the Corporate Trustee. (2) Includes amounts for the Corporate Trustee, and Transfer Agent and Registrar fees, in the aggregate amount of $4,375 attributable to the three- months ended June 30, 2023, which were actually paid by the Trust in July 2023. (3) Includes amounts for the Corporate Trustee, and Transfer Agent and Registrar fees, in the aggregate amount of $4,375 attributable to the fourth quarter of 2022, which were actually paid in the first quarter of 2023.

Organization and Summary of S_4

Organization and Summary of Significant Accounting Policies - Additional Information (Detail)	3 Months Ended	9 Months Ended
	Mar. 31, 2010 USD ($)	Sep. 30, 2024 SONGS
Organization And Summary Of Significant Accounting Policies [Line Items]
Date of formation of Mills Music Trust		Dec. 03, 1964
Minimum payment of quarterly Contingent Portion | $	$ 167,500
Top 50 Songs in the Catalogue		EMI has provided the Trust with a listing of the top 50 earning songs in the Catalogue during the 2023 calendar year (the “Top 50 Songs”), together with certain copyright information with respect to each of the Top 50 Songs (the “Listing”). A copy of the Listing, as provided by EMI, is included in the Trust’s annual report on Form 10-K for the fiscal year ended December 31, 2023. The Listing does not include any information regarding Copyrighted Songs for the 2024 calendar year.
Minimum [Member]
Organization And Summary Of Significant Accounting Policies [Line Items]
Percentage of Contingent Portion of gross royalty income	65%
Maximum [Member]
Organization And Summary Of Significant Accounting Policies [Line Items]
Percentage of Contingent Portion of gross royalty income	75%
Top 50 Song Listing [Member]
Organization And Summary Of Significant Accounting Policies [Line Items]
Estimated number of songs in the Catalogue		12,000
Estimated number of songs producing royalty income		1,430
Top 50 Song Listing		50

Organization and Summary of S_5

Organization and Summary of Significant Accounting Policies - Schedule of Contingent Portion Payments (Detail) - USD ($)	3 Months Ended																												102 Months Ended
	Sep. 30, 2024	Jun. 30, 2024	Mar. 31, 2024	Dec. 31, 2023	Sep. 30, 2023	Jun. 30, 2023	Mar. 31, 2023	Dec. 31, 2022	Sep. 30, 2022	Jun. 30, 2022	Mar. 31, 2022	Dec. 31, 2021	Sep. 30, 2021	Jun. 30, 2021	Mar. 31, 2021	Sep. 30, 2020	Jun. 30, 2020	Mar. 31, 2020	Dec. 31, 2019	Sep. 30, 2019	Jun. 30, 2019	Mar. 31, 2019	Sep. 30, 2018	Mar. 31, 2018	Sep. 30, 2017	Mar. 31, 2017	Sep. 30, 2016	Mar. 31, 2016	Jun. 30, 2024
Accounting Policies [Abstract]
Deficiency in Contingent Portion payments	$ 135,768	$ 0	$ 43,909	$ 40,761	$ 131,213	$ 37,491	$ 44,908	$ 0	$ 83,438	$ 70,709	$ 0	$ 38,112	$ 38,846	$ 43,148	$ 42,742	$ 40,085	$ 15,557	$ 40,025	$ 42,572	$ 68,571	$ 41,786	$ 71,489	$ 75,712	$ 98,901	$ 41,557	$ 85,359	$ 37,529	$ 79,889	$ 1,490,077

Income Taxes - Additional Infor

Income Taxes - Additional Information (Detail)	9 Months Ended
	Sep. 30, 2024 USD ($)
Income Tax Disclosure [Abstract]
Provision for income taxes	$ 0

Related Party Transactions - Ad

Related Party Transactions - Additional Information (Detail)	9 Months Ended
	Sep. 30, 2024 USD ($)
Related Party Transaction [Line Items]
Trustee annual compensation	$ 2,500
Expenses charged or paid Trust for office space and office equipment	$ 0
Maximum [Member]
Related Party Transaction [Line Items]
Aggregate compensation percentage to Trustees	3%

Related Party Transactions - Di

Related Party Transactions - Disbursements to Trustees (Detail) - USD ($)		3 Months Ended			9 Months Ended
		Sep. 30, 2024	Sep. 30, 2023		Sep. 30, 2024	Sep. 30, 2023
Related Party Transaction [Line Items]
Trustee Fees and Expenses		$ 8,125	$ 10,000	[1]	$ 21,875	$ 21,250	[2]
Transfer Agent and Registrar	[3]	6,875	7,500		17,500	15,000
Individual Trustee Fees and Expenses [Member]
Related Party Transaction [Line Items]
Trustee Fees and Expenses		625	1,250		2,500	3,750
Corporate Trustee Fees and Expenses [Member]
Related Party Transaction [Line Items]
Trustee Fees and Expenses		$ 625	$ 1,250		$ 1,875	$ 2,500
[1]Includes amounts for the Corporate Trustee, and Transfer Agent and Registrar fees, in the aggregate amount of $4,375 attributable to the three- months ended June 30, 2023, which were actually paid by the Trust in July 2023.[2]Includes amounts for the Corporate Trustee, and Transfer Agent and Registrar fees, in the aggregate amount of $4,375 attributable to the fourth quarter of 2022, which were actually paid in the first quarter of 2023.[3]These services are performed by the Corporate Trustee.

Related Party Transactions - _2

Related Party Transactions - Disbursements to Trustees (Parenthetical) (Detail) - USD ($)		3 Months Ended
	Jul. 31, 2022	Mar. 31, 2023
Corporate Trustee Transfer Agent And Registrar [Member]
Related Party Transaction [Line Items]
Payment for administrative fees	$ 4,375	$ 4,375