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CONTRACTS AND AGREEMENTS | 9 Months Ended
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Sep. 30, 2021
CONTRACTS AND AGREEMENTS |
CONTRACTS AND AGREEMENTS | NOTE 4 — CONTRACTS AND AGREEMENTS Marketing Agent Agreement USL is party to a marketing agent agreement, dated as of November 13, 2007, as amended from time to time, with the Marketing Agent and USCF, whereby the Marketing Agent provides certain marketing services for USL as outlined in the agreement. The fee of the Marketing Agent, which is borne by USCF, is equal to 0.06% on USL’s assets up to $3 billion and 0.04% on USL’s assets in excess of $3 billion. In no event may the aggregate compensation paid to the Marketing Agent and any affiliate of USCF for distribution-related services exceed 10% of the gross proceeds of USL’s offering. The above fee does not include website construction and development, which are also borne by USCF. Custody, Transfer Agency and Fund Administration and Accounting Services Agreements USCF engaged The Bank of New York Mellon, a New York corporation authorized to do a banking business (“BNY Mellon”), to provide USL and each of the Related Public Funds with certain custodial, administrative and accounting, and transfer agency services, pursuant to the following agreements with BNY Mellon dated as of March 20, 2020 (together, the “BNY Mellon Agreements”), which were effective as of April 1, 2020: (i) a Custody Agreement; (ii) a Fund Administration and Accounting Agreement; and (iii) a Transfer Agency and Service Agreement. USCF pays the fees of BNY Mellon for its services under the BNY Mellon Agreements and such fees are determined by the parties from time to time. Brown Brothers Harriman and Co. (“BBH&Co.”) previously served as the Administrator, Custodian, Transfer Agent and Fund Accounting Agent for USL and the Related Public Funds prior to BNY Mellon commencing such services on April 1, 2020. Certain fund accounting and fund administration services rendered by BBH&Co. to USL and the Related Public Funds terminated on May 31, 2020 to allow for the transition to BNY Mellon. Brokerage and Futures Commission Merchant Agreements USL entered into a brokerage agreement with RBC Capital Markets LLC (“RBC”) to serve as USL’s FCM effective October 10, 2013. USL has engaged each of RCG Division of Marex Spectron (“RCG”), E D & F Man Capital Markets Inc. (“MCM”) and Macquarie Futures USA LLC (“MFUSA”) to serve as an additional FCM to USL effective on May 28, 2020, June 5, 2020, and December 3, 2020, respectively. The agreements with USL’s FCMs require the FCMs to provide services to USL in connection with the purchase and sale of Oil Futures Contracts and Other Oil-Related Investments that may be purchased and sold by or through the applicable FCM for USL’s account. In accordance with the FCM agreements, USL pays each FCM commissions of approximately $7 to $8 per round-turn trade, including applicable exchange, clearing and NFA fees for Oil Futures Contracts and options on Oil Futures Contracts. Such fees include those incurred when purchasing Oil Futures Contracts and options on Oil Futures Contracts when USL issues shares as a result of a Creation Basket, as well as fees incurred when selling Oil Futures Contracts and options on Oil Futures Contracts when USL redeems shares as a result of a Redemption Basket. Such fees are also incurred when Oil Futures Contracts and options on Oil Futures Contracts are purchased or redeemed for the purpose of rebalancing the portfolio. USL also incurs commissions to brokers for the purchase and sale of Oil Futures Contracts, Other Oil-Related Investments or short-term obligations of the United States of two years or less (“Treasuries”). ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | Nine months |  | Nine months | ​
​ | ​ | ended | ​ | ended | ​
​ | ​ | September 30, 2021 | ​ | September 30, 2020 | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Total commissions accrued to brokers | ​ | $ | 22,248 | ​ | $ | 89,983 | ​
Total commissions as annualized percentage of average total net assets | ​ |  | 0.02 | % |  | 0.07 | %
Commissions accrued as a result of rebalancing | ​ | $ | 14,868 | ​ | $ | 26,140 | ​
Percentage of commissions accrued as a result of rebalancing | ​ |  | 66.83 | % |  | 29.05 | %
Commissions accrued as a result of creation and redemption activity | ​ | $ | 7,380 | ​ | $ | 63,843 | ​
Percentage of commissions accrued as a result of creation and redemption activity | ​ |  | 33.17 | % |  | 70.95 | %
​ The decrease in total commissions accrued to brokers for the nine months ended September 30, 2021, compared to the nine months ended September 30, 2020, was due primarily to a lower number of crude oil futures contracts being held and traded. ​ NYMEX Licensing Agreement USL and the NYMEX entered into a licensing agreement on April 10, 2006, as amended on October 20, 2011, whereby USL was granted a non-exclusive license to use certain of the NYMEX’s settlement prices and service marks. Under the licensing agreement, USL and the Related Public Funds, other than BNO, USCI, and CPER, pay the NYMEX an asset-based fee for the license, the terms of which are described in Note 3. USL expressly disclaims any association with the NYMEX or endorsement of USL by the NYMEX and acknowledges that “NYMEX” and “New York Mercantile Exchange” are registered trademarks of the NYMEX.

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