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that are based on natural gas. The total market value of the Futures Contracts purchased on that day was $9,958,080 at the time of purchase. USNG established cash deposits equal to $10,001,000 at the time of the initial sale of units. The majority of those cash assets were held at USNGs custodian bank while less than 20% of the cash balance was held as margin deposits with UBS Securities LLC, USNGs commodity broker (the Futures Commission Merchant), relating to the Futures Contracts purchased.
In its initial offering USNG registered 30,000,000 units and as of September 30, 2007 USNG has issued 20,600,000 leaving 9,400,000 units remaining to be issued. Unlike funds that are redeemed under the Investment Company Act of 1940, as amended, units that have been redeemed by USNG cannot be resold by USNG without registration of their offering with the SEC. As a result, USNG anticipates that further offering of its units will be registered with the SEC in the future in anticipation of additional issuances.
As of September 30, 2007, the total unrealized loss on natural gas futures contracts owned or held on that day was $(13,529,200) and USNG established cash deposits that were equal to $433,103,469. The majority of those cash assets were held at USNG's custodian bank while less than 31% of the cash balance was held as margin deposits with USNG's future commission merchant for the GAS Futures Contracts purchased. The ending per Unit NAV on September 30, 2007 was $38.21.
USNGs expenses consist of management fees, brokerage fees and commissions, certain offering costs, licensing fees and the fees and expenses of the independent directors of the General Partner. The management fee that USNG pays to the General Partner is calculated as a percentage of the total net assets of USNG. For total net assets of up to $1 billion, the management fee is 0.60%, and for total net assets over $1 billion, the management fee is 0.50% on the incremental amount of assets. During the period from April 18, 2007 through September 30, 2007, the daily average total net assets of USNG were approximately $163,215,433. At no time during
the period from April 18, 2007 to September 30, 2007, did the total net assets of USNG exceed $1 billion. The management fee paid by USNG amounted to $445,377, which was calculated at the 0.60% rate and accrued daily.
USNG pays for all brokerage fees, taxes and other expenses, including licensing fees for the use of intellectual property, ongoing registration or other fees paid to the SEC, the Financial Industry Regulatory Authority (FINRA) and any other regulatory agency in connection with subsequent offers and sales of its units and all legal, accounting, printing and other expenses associated therewith. For the period from April 18, 2007 through September 30, 2007, USNG did not incur any ongoing registration fees. USNG is responsible for paying the fees and expenses, including directors' and officers' liability insurance, of the independent
directors of the General Partner who are also audit committee members. USNG shares these fees with United States Oil Fund, LP (USOF) based on the relative assets of each fund, computed on a daily basis. These fees for calendar year 2007 are estimated to be a total of $276,000 for both funds.
USNG also incurs commissions to brokers for the purchase and sale of Futures Contracts, Other Natural Gas-Related Investments or short-term obligations of the United States of two years or less (Treasuries). During the period from April 18, 2007 through September 30, 2007, total commissions paid to brokers amounted to $158,534. Prior to the initial offering, USNG had estimated that its annual level of such commissions was expected to be 0.13% of total net assets. As an annualized percentage of total net assets, the figures for the period from April 18, 2007 through September 30, 2007 represent approximately 0.21% of total net assets.
However, there can be no assurance that commission costs and portfolio turnover will not cause commission expenses to rise further in future quarters.
Expenses incurred from April 18, 2007 through September 30, 2007 in connection with organizing USNG and the initial offering costs of the units were borne by the General Partner, and are not subject to reimbursement by USNG.
USNG seeks to invest its assets such that it holds Futures Contracts and Other Natural Gas-Related Investments in an amount equal to the total net assets of the portfolio. Typically, such investments do not require USNG to pay the full amount of the contract value at the time of purchase, but rather require USNG to post an amount as a margin deposit against the eventual settlement of the contract. As a result, USNG