UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
DC 20549
FORM
8-K
CURRENT
REPORT
PURSUANT
TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Date of
Report (Date of earliest event reported): January 3,
2011
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UNITED
STATES NATURAL GAS FUND, LP
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(Exact
name of registrant as specified in its
charter)
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Delaware
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001-33096
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20-5576760
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(State
or other jurisdiction
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(Commission
File Number)
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(I.R.S.
Employer
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of
incorporation)
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Identification
No.)
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1320
Harbor Bay Parkway, Suite 145
Alameda,
California 94502
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(Address
of principal executive offices) (Zip
Code)
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Registrant's
telephone number, including area code: (510)
522-9600
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Not
Applicable
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(Former
name or former address, if changed since last
report)
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Check the
appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions (see General Instruction
A.2. below):
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o
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Written communication pursuant to
Rule 425 under the Securities Act (17 CFR
230.425)
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o
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Soliciting material pursuant to
Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
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o
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Pre-commencement communications
pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
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o
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Pre-commencement communications
pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4c))
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Item
1.01. Entry into a Material Definitive Agreement
The
general partner and limited partner of United States Natural Gas Fund, LP (the
“Registrant”) entered into the Third Amended and Restated Agreement of Limited
Partnership (“Amended Limited Partnership Agreement”) on December 31,
2010. The Amended Limited Partnership Agreement provides for the
operation of the partnership and the rights and obligations of the
partners.
The
Amended Limited Partnership Agreement amends and restates the Registrant’s
current limited partnership agreement, the Second Amended and Restated Agreement
of Limited Partnership, entered into on December 4, 2008 (the “Limited
Partnership Agreement”), in its entirety. The two key substantive
amendments, discussed below, provide for (i) the authority and procedures for
the Registrant to effect a pro rata distribution, subdivision or combination of
its units or partnership securities and (ii) all of the Registrant’s tax
accounting and reporting expenses to be directly borne by the
Registrant.
Distributions,
subdivisions or combinations of the Registrant’s units or partnership
securities:
Article
9.5.2 of the Amended Limited Partnership Agreement explicitly grants United
States Commodity Funds, LLC, the general partner of the Registrant (the “General
Partner”), authority to cause the Registrant to declare and effect a pro rata
distribution, subdivision or combination of units or other partnership
securities, and details the applicable procedures for effecting such a
distribution, subdivision or combination of units.
The
General Partner may declare and effect a pro rata distribution, subdivision or
combination of units so long as such event will not affect any unitholder’s
percentage interest in the Partnership except to the extent that a cash
distribution, e.g., in lieu of fractional units, or rounding of units alters
such percentage interest of the unitholders following such event in accordance
with the Amended Limited Partnership Agreement. Further, any amounts
calculated on a per unit basis or stated as a number of units must be
proportionately adjusted retroactive to the beginning of the Registrant’s
formation.
A
distribution, subdivision or combination of units is to be effected by the
General Partner via instruction to the Depository Trust Company (or its
nominee). The Depository Trust Company (“DTC”), upon receipt of such
an instruction, credits DTC participants’ accounts with payment or units in
amounts proportionate to their respective beneficial interests in units as shown
on the DTC’s (or its nominee’s) records. Payments by DTC participants
to indirect participants and beneficial owners holding units through DTC
participants and indirect participants are governed by standing instructions and
customary practice. Whenever a distribution, subdivision or
combination of units is declared, the General Partner is to select a date as of
which the distribution, subdivision or combination shall be effective and
provide 20 days’ advance notice thereof. Any distribution,
subdivision or combination of units must be made in accordance with any notice
of distribution, subdivision or combination of units issued by the General
Partner. The Registrant is precluded from issuing fractional units;
if a distribution, subdivision or combination of units would result in the
creation of fractional units, each fractional unit will be redeemed for cash
(unless otherwise provided by the notice of distribution, subdivision or
combination of units).
These
amendments to the Limited Partnership Agreement are being entered into in
anticipation of a proposed reverse unit split of the Registrant’s outstanding
publicly-traded partnership units that the Registrant may implement in the
future with the goals of (i) providing increased marketability and liquidity;
(ii) improving the Registrant’s tracking of the changes in percentage terms of
the price of natural gas delivered at the Henry Hub, Louisiana, as measured by
changes in the price of the “Benchmark Futures Contract” (as defined in the
Prospectus); and (iii) maintaining a value for Registrant’s units that is well
above the NYSE Arca’s minimum continued listing requirements. The
Registrant will issue a Current Report on Form 8-K prior to when the General
Partner would effect a reverse unit split.
Tax
accounting and reporting expenses to be directly borne by the
Registrant:
Article
3.1.2 of the Limited Partnership Agreement has been amended to provide that, as
of the effective date of the Amended Limited Partnership Agreement, the
Registrant will be responsible for all of the fees and expenses associated with
its tax accounting and reporting requirements, including the implementation of
service fees and base service fees previously paid by the General
Partner. The fee for implementation of service was a one-time set-up
fee that has already been paid by the General Partner and will not be borne by
the Registrant going forward. As of the effective date of the Amended
Limited Partnership Agreement, the Registrant will be responsible for paying the
base service fees that were previously paid by the General
Partner. The estimated cost of the Registrant’s base service fees
associated with its tax accounting and reporting requirements is $75,000 for the
calendar year ending December 31, 2011. Management has determined
that such fees may be appropriately allocated to the Registrant without
materially impacting the NAV of the Registrant or its ability to satisfy its
investment objective due to the increase in the Registrant’s assets under
management.
In
addition, the amendments to the Limited Partnership Agreement make other
conforming changes including, among other items, (i) the name of the General
Partner, which was changed from Victoria Bay Asset Management, LLC to United
States Commodity Funds, LLC in 2008, (ii) the fact that the Registrant’s units
are now listed on the NYSE Arca instead of the American Stock Exchange as a
result of the acquisition of the American Stock Exchange by NYSE Euronext in
2008, and (iii) changes to procedures for creation and redemption of units
consistent with the Registrant’s authorized purchaser agreements and existing
disclosure.
A copy of
the Third Amended and Restated Agreement of Limited Partnership is filed as
Exhibit 10.1 to this Current Report on Form 8-K and is incorporated herein by
reference.
Item
9.01. Financial Statements and Exhibits
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Exhibit Number
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Description
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10.1
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Third
Amended and Restated Agreement of Limited
Partnership.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
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UNITED
STATES NATURAL GAS FUND, LP
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By:
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United
States Commodity Funds LLC, its general partner
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Date: January
3, 2011
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By:
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/s/ Howard Mah
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Name:
Howard Mah
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Title: Chief
Financial Officer
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