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Item 1. Business

2024-02-29 compared with 2023-03-01 · 298 added, 398 removed, 839 unchanged (45% of the section changed)

The Trust and the Funds

Teucrium Commodity Trust (“Trust”), a Delaware statutory trust organized on September 11, 2009, is a series trust consisting of six series:

Teucrium Corn Fund (“CORN”), Teucrium Sugar Fund (“CANE”), Teucrium Soybean Fund (“SOYB”), Teucrium Wheat Fund (“WEAT”), Teucrium Agricultural Fund (“TAGS”) and Hashdex Bitcoin Futures ETF (“DEFI”).

All of the series of the Trust are collectively referred to as the “Funds”

and singularly as the “Fund.”

Collectively, CORN, CANE, SOYB and WEAT are referred to as the “Agricultural Funds.” 

Each Fund is a commodity pool that is a series of the Trust.

The Funds issue common units, called “Shares,”

representing fractional undivided beneficial interests in a Fund.

The Trust and the Fund operate pursuant to the Trust’s Fifth Amended and Restated Declaration of Trust and Trust Agreement (the “Trust Agreement”), dated April 26, 2019.

The Trust Agreement may be found on the SEC’s EDGAR filing database at: 

Teucrium Commodity Trust (“Trust”), a Delaware statutory trust organized on September 11, 2009, is a series trust consisting of six series:

All of the series of the Trust are collectively referred to as the “Funds” and singularly as the “Fund.” Collectively, CORN, CANE, SOYB and WEAT are referred to as the “Agricultural Funds.” Each Fund is a commodity pool that is a series of the Trust.

The Funds issue common units, called “Shares,” representing fractional undivided beneficial interests in a Fund.

The Trust and the Fund operate pursuant to the Trust’s Fifth Amended and Restated Declaration of Trust and Trust Agreement (the “Trust Agreement”), dated April 26, 2019.

The Trust Agreement may be found on the SEC’s EDGAR filing database at:

https://www.sec.gov/Archives/edgar/data/1471824/000165495419004852/ex31.htm.

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The principal office is located at Three Main Street, Suite 215, Burlington, Vermont 05401.

The Sponsor is registered as a commodity pool operator (“CPO”) and a commodity trading adviser (“CTA”) with the Commodity Futures Trading Commission (“CFTC”) and is a member of the National Futures Association (“NFA”).

Teucrium Investment Advisors, LLC, a wholly owned subsidiary of Teucrium Trading, LLC, is a Delaware limited liability company, which was formed on January 4, 2022.

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The Trust and the Funds operate pursuant to the Trust Agreement.

Under the Trust Agreement, the Sponsor is solely responsible for management and conducts or directs the conduct of the business of the Trust, the Fund, and any series of the Trust that may from time to time be established and designated by the Sponsor.

The Sponsor is required to oversee the purchase and sale of Shares by Authorized Purchasers and to manage the Fund’s investments, including to evaluate the credit risk of FCMs and swap counterparties and to review daily positions and margin/collateral requirements.

The Sponsor has the power to enter into agreements as may be necessary or appropriate for the offer and sale of the Fund’s Shares and the oversight of the Trust’s activities.

Under the Trust Agreement, the Sponsor is solely responsible for management and conducts or directs the conduct of the business of the Trust, the Funds, and any series of the Trust that may from time to time be established and designated by the Sponsor.

The Sponsor is required to oversee the purchase and sale of Shares by Authorized Purchasers and to manage the Funds' investments, including to evaluate the credit risk of FCMs and swap counterparties and to review daily positions and margin/collateral requirements.

The Sponsor has the power to enter into agreements as may be necessary or appropriate for the offer and sale of the Funds' Shares and the oversight of the Trust’s activities.

Accordingly, the Sponsor is responsible for selecting service providers such as the Trustee, Administrator, Distributor, the independent registered public accounting firm of the Trust, and any legal counsel employed by the Trust.

The Sponsor is also responsible for preparing and filing periodic reports on behalf of the Trust with the SEC and will provide any required certification for such reports.

No person other than the Sponsor and its principals was involved in the organization of the Trust or the Fund.

Teucrium Trading, LLC designed the Funds to offer liquidity, transparency, and capacity in single‐commodity investing for a variety of investors, including institutions and individuals, in an exchange‐traded product format.

No person other than the Sponsor and its principals was involved in the organization of the Trust or the Funds.

Teucrium Trading, LLC designed the Funds to offer liquidity, transparency, and capacity in single‐commodity investing for a variety of investors, including institutions and individuals, in an exchange‐traded product format.

The Funds have also been designed to mitigate the impacts of contango and backwardation, situations that can occur in the course of commodity trading which can affect the potential returns to investors.

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On June 7, 2010, the initial Form S-1 for CORN was declared effective by the U.S.

Securities and Exchange Commission (“SEC”).

On June 8, 2010, four Creation Baskets for CORN were issued representing 200,000 shares and $5,000,000.

CORN began trading on the New York Stock Exchange (“NYSE”) Arca on June 9, 2010.

The current registration statement for CORN was declared effective by the SEC on April 7, 2022.

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On September 19, 2011, CANE, SOYB, and WEAT started trading on the NYSE Arca.

The current registration statements for CANE and SOYB were 

declared effective by the SEC on April 7, 2022.

The current registration statements for CANE and SOYB were declared effective by the SEC on April 7, 2022.

This registration statements for CANE and SOYB registered an indeterminate number of shares each.

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On September 14, 2022, the Form S-1 for DEFI was declared effective by the SEC.

On September 15, 2022, five Creation Baskets for DEFI were issued representing 50,000 shares and $1,250,000. 

DEFI began trading on the NYSE Arca on September 16, 2022. 

On September 15, 2022, five Creation Baskets for DEFI were issued representing 50,000 shares and $1,250,000.

DEFI began trading on the NYSE Arca on September 16, 2022.

This registration statement for DEFI registered an indeterminate number of shares.

Investing Strategy

The investment objective of the Agriculture Funds and DEFI is to have the daily changes in the NAV of the Fund’s Shares reflect the daily changes in a weighted average of the closing settlement prices for certain futures contracts (“Futures Contracts”) for the commodity or cryptocurrency specified in the Fund’s name.

(This weighted average is referred to herein as the Fund’s “Benchmark,”

the Futures Contracts that at any given time make up a Fund’s Benchmark are referred to herein as the Fund’s “Benchmark Component Futures Contracts,”

and the commodity or cryptocurrency specified in the Underlying Fund’s name is referred to herein as its “Specified Commodity or Specified Cryptocurrency.”) The investment objective of TAGS is to provide daily investment results that reflect the combined daily performance of the Agricultural Funds.

Please note that as described in the “ Subsequent Events ” note to the financial statements included in Part II of this filing, and as reported by the Trust on a Form 8-K filed with the Securities and Exchange Commission on January 3, 2024 (File No.

001-34765), DEFI merged into an unaffiliated trust on January 3, 2024, and is no longer a series of the Trust.

Information regarding DEFI provided in this report is as of December 31, 2024.

The investment objective of the Agriculture Funds and DEFI is to have the daily changes in the NAV of each Fund’s Shares reflect the daily changes in a weighted average of the closing settlement prices for certain futures contracts (“Futures Contracts”) for the commodity or cryptocurrency specified in the Fund’s name.

(This weighted average is referred to herein as the Fund’s “Benchmark,” the Futures Contracts that at any given time make up a Fund’s Benchmark are referred to herein as the Fund’s “Benchmark Component Futures Contracts,” and the commodity or cryptocurrency specified in the Fund’s name is referred to herein as its “Specified Commodity" or "Specified Cryptocurrency.”) The investment objective of TAGS is to provide daily investment results that reflect the combined daily performance of the Agricultural Funds (depending on the context, sometimes referred to as the "Underlying Funds").

Each Fund pursues its investment objective by investing in a portfolio of Futures Contracts that expire in a specific month and trade on a specific exchange in the designated commodity comprising the Benchmark, or, in the case of TAGS, shares of the Agricultural Funds.

Consistent with applicable provisions of the Trust Agreement and Delaware law, the Funds have broad authority to make changes to a Fund’s operations.

Consistent with this authority, each Fund, in its sole discretion and without shareholder approval or advance notice, may change its investment objective, Benchmark, or investment strategies.

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The reasons for and circumstances that may trigger any such changes may vary widely and cannot be predicted.

However, by way of example, the Funds may change the term structure or underlying components of the Benchmark in furtherance of the Fund’s investment objective of tracking the price of the specified commodity or cryptocurrency for future delivery (or, for TAGS, the investment objective of tracking the combined performance of the Underlying Funds) if, due to market conditions, a potential or actual imposition of position limits by the CFTC or futures exchange rules, or the imposition of risk mitigation measures by a futures commission merchant restricts the ability of the Fund (or, for TAGS, an Underlying Fund) to invest in the current Benchmark Futures Contracts. 

The Funds would file a current report on Form 8-K and a prospectus supplement to describe any such change and the effective date of the change.

Shareholders may modify their holdings of the Fund’s shares in response to any change by purchasing or selling Fund shares through their broker-dealer.

However, by way of example, the Funds may change the term structure or underlying components of the Benchmark in furtherance of a Fund’s investment objective of tracking the price of the specified commodity or cryptocurrency for future delivery (or, for TAGS, the investment objective of tracking the combined performance of the Underlying Funds) if, due to market conditions, a potential or actual imposition of position limits by the CFTC or futures exchange rules, or the imposition of risk mitigation measures by a futures commission merchant restricts the ability of the Fund (or, for TAGS, an Underlying Fund) to invest in the current Benchmark Futures Contracts.

The Fund would file a current report on Form 8-K and a prospectus supplement to describe any such change and the effective date of the change.

Shareholders may modify their holdings of the Fund’s shares in response to any change by purchasing or selling Fund shares through their broker-dealer.

The Investment Objectives of the Funds

The investment objective of CORN is to have the daily changes in the NAV of the Fund’s Shares reflect the daily changes in the corn market for future delivery as measured by the Benchmark.

The Benchmark is a weighted average of the closing settlement prices for three futures contracts for corn (“Corn Futures Contracts”) that are traded on the Chicago Board of Trade (“CBOT”):

The investment objective of CORN is to have the daily changes in the NAV of the Fund’s Shares reflect the daily changes in the corn market for future delivery as measured by the Benchmark.

The Benchmark is a weighted average of the closing settlement prices for three futures contracts for corn (“Corn Futures Contracts”) that are traded on the Chicago Board of Trade (“CBOT”):

CORN Benchmark

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December following the third to expire

The investment objective of SOYB is to have the daily changes in the NAV of the Fund’s Shares reflect the daily changes in the soybean market for future delivery as measured by the Benchmark.

The Benchmark is a weighted average of the closing settlement prices for three futures contracts for soybeans (“Soybean Futures Contracts”) that are traded on the Chicago Board of Trade (“CBOT”):

The investment objective of SOYB is to have the daily changes in the NAV of the Fund’s Shares reflect the daily changes in the soybean market for future delivery as measured by the Benchmark.

The Benchmark is a weighted average of the closing settlement prices for three futures contracts for soybeans (“Soybean Futures Contracts”) that are traded on the CBOT:

SOYB Benchmark

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Expiring in the November following the expiration of the third to expire contract

The investment objective of CANE is to have the daily changes in the NAV of the Fund’s Shares reflect the daily changes in the sugar market for future delivery as measured by the Benchmark.

The Benchmark is a weighted average of the closing settlement prices for three futures contracts for No.

11 sugar (“Sugar Futures Contracts”) that are traded on the ICE Futures US (“ICE”):

CANE Benchmark

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Expiring in the March following the expiration of the third to expire contract

The investment objective of WEAT is to have the daily changes in the NAV of the Fund’s Shares reflect the daily changes in the wheat market for future delivery as measured by the Benchmark.

The Benchmark is a weighted average of the closing settlement prices for three futures contracts for wheat (“Wheat Futures Contracts”) that are traded on the Chicago Board of Trade (“CBOT”):

The investment objective of WEAT is to have the daily changes in the NAV of the Fund’s Shares reflect the daily changes in the wheat market for future delivery as measured by the Benchmark.

The Benchmark is a weighted average of the closing settlement prices for three futures contracts for wheat (“Wheat Futures Contracts”) that are traded on the CBOT:

WEAT Benchmark

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December following the third to expire

The investment objective of TAGS is to provide daily investment results that reflect the combined daily performance of four other commodity pools, specifically CORN, SOYB, CANE and WEAT (the “Underlying Funds”).

The investment objective of TAGS is to provide daily investment results that reflect the combined daily performance of the “Underlying Funds.

Under normal market conditions, the Fund seeks to achieve its investment objective generally by investing equally in shares of each Underlying Fund and, to a lesser extent, cash equivalents.

The Fund’s investments in shares of Underlying Funds are rebalanced, generally on a daily basis, in order to maintain approximately a 25% allocation of the Fund’s assets to each Underlying Fund:

TAGS Benchmark

Underlying Fund

The investment objective of DEFI is to have the daily changes in the NAV of the Fund’s Shares reflect the daily changes of the price of the Hashdex U.S.

Bitcoin Futures Fund Benchmark (the “Benchmark”), less expenses from the Fund’s operations.

The Benchmark is currently the average of the closing settlement prices for the first to expire and second to expire bitcoin futures contracts (“Bitcoin Futures Contracts”) listed on the Chicago Mercantile Exchange Inc.

(“CME”).

The investment objective of DEFI is to have the daily changes in the NAV of the Fund’s Shares reflect the daily changes of the price of the Hashdex U.S.

Bitcoin Futures Fund Benchmark (the “Benchmark”), less expenses from the Fund’s operations.

DEFI Benchmark

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Second to expire

As noted, the Agricultural Funds and DEFI seek to achieve their investment objective by investing under normal market conditions in Benchmark Component Futures Contracts (“Futures Contracts”) of the Fund or, in certain circumstances, in other Futures Contracts for its Specified Commodity.

As noted, the Agricultural Funds and DEFI seek to achieve their investment objective by investing under normal market conditions in Benchmark Component Futures Contracts (“Futures Contracts”) of the Fund or, in certain circumstances, in other Futures Contracts for its Specified Commodity.

In addition, and to a limited extent, a Fund also may invest in exchange traded options on Futures Contracts for its Specified Commodity.

Once position limits or accountability levels on Futures Contracts on a Fund’s Specified Commodity are applicable, each Fund’s intention is to invest first in contracts and instruments such as cash-settled options on Futures Contracts and forward contracts, swaps and other over the counter transactions that are based on the price of its Specified Commodity or Futures Contracts on its Specified Commodity (collectively, “Other Commodity or Cryptocurrency Interests,”

and together with Futures Contracts, “Commodity or Cryptocurrency Interests”).

By utilizing certain or all of these investments, the Sponsor will endeavor to cause each Fund’s performance to closely track that of its Benchmark.

The Sponsor operates the Agricultural Funds and DEFI with the intent to never hold a Benchmark Component Futures Contract once it becomes the next to expire contract (commonly called the “spot”

Accordingly, the positions of each Fund in its Specified Commodity or Cryptocurrency Interests are changed or “rolled”

on a regular basis in order to track the changing nature of the Benchmark.

Using CORN as an example, five times a year (on the dates on which certain Corn Futures Contracts expire), a particular Corn Futures Contract will no longer be a Benchmark Component Futures Contract, and the Corn Fund’s investments will have to be changed accordingly.

By utilizing certain or all of these investments, the Sponsor will endeavor to cause each Fund’s performance to closely track that of its Benchmark.

The Sponsor operates the Agricultural Funds and DEFI with the intent to never hold a Benchmark Component Futures Contract once it becomes the next to expire contract (commonly called the “spot” contract).

Accordingly, the positions of each Fund in its Specified Commodity or Cryptocurrency Interests are changed or “rolled” on a regular basis in order to track the changing nature of the Benchmark.

Corn Futures Contracts traded on the CBOT expire on a specified day in the following five months:

March, May, July, September, and December.

Therefore, in terms of the Benchmark, in June of a given year the next to expire or “spot month”

Corn Futures Contract will expire in July of that year, and the Benchmark Component Futures Contracts will be the contracts expiring in September of that year (the second to expire contract), December of that year (the third to expire contract), and December of the following year.

Therefore, in terms of the Benchmark, in June of a given year the next to expire or “spot month” Corn Futures Contract will expire in July of that year, and the Benchmark Component Futures Contracts will be the contracts expiring in September of that year (the second to expire contract), December of that year (the third to expire contract), and December of the following year.

As another example using CORN, in November of a given year the Benchmark Component Futures Contracts will be the contracts expiring in March, May and December of the following year.

(The Teucrium Corn Fund is designed to roll or replace its contracts five times per year but will always hold a December Corn Futures Contract as an “anchor”

month.) The Sponsor will determine if the investments of a Fund will be “rolled”

in one day or over a period of several days, in order that any trading does not signal unwanted market movements and to make it more difficult for third parties to profit by trading ahead based on such expected market movements.

Such “roll”

periods are posted to the website well in advance of the “roll”

The Sponsor employs a “neutral”

investment strategy intended to track the changes in the Benchmark of each Fund regardless of whether the Benchmark goes up or goes down.

A Fund’s “neutral”

investment strategy is designed to permit investors generally to purchase and sell the Fund’s Shares for the purpose of investing indirectly in the commodity specific market in a cost-effective manner.

(The Teucrium Corn Fund is designed to roll or replace its contracts five times per year but will always hold a December Corn Futures Contract as an “anchor” month.) The Sponsor will determine if the investments of a Fund will be “rolled” in one day or over a period of several days, in order that any trading does not signal unwanted market movements and to make it more difficult for third parties to profit by trading ahead based on such expected market movements.

Such “roll” periods are posted to the website well in advance of the “roll” date.

The Sponsor employs a “neutral” investment strategy intended to track the changes in the Benchmark of each Fund regardless of whether the Benchmark goes up or goes down.

A Fund’s “neutral” investment strategy is designed to permit investors generally to purchase and sell the Fund’s Shares for the purpose of investing indirectly in the commodity specific market in a cost-effective manner.

Such investors may include participants in the specific industry and other industries seeking to hedge the risk of losses in their commodity specific related transactions, as well as investors seeking exposure to that commodity market.

Accordingly, depending on the investment objective of an individual investor, the risks generally associated with investing in the commodity specific market and/or the risks involved in hedging may exist.

In addition, an investment in a Fund involves the risks that the changes in the price of the Fund’s Shares will not accurately track the changes in the Benchmark, and that changes in the Benchmark will not closely correlate with changes in the price of the commodity on the spot market.

The Sponsor does not intend to operate any Fund in a fashion such that its per share NAV equals, in dollar terms, the spot price of the commodity or the price of any particular commodity specific Futures Contract.

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The closing level of each Benchmark is calculated on each business day by U.S.

Bank Global Fund Services (“Global Fund Services”) based on the closing price of the futures contracts for each of the underlying Benchmark Component Futures Contracts and the notional amounts of such Benchmark Component Futures Contracts.

Each Benchmark is rebalanced periodically to ensure that each of the Benchmark Component Futures Contracts is weighted in the same proportion as in the investment objective for each Fund.

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NOTIONAL AMT.

CBOT corn futures JUL23

CBOT corn futures MAY24

CBOT corn futures JUL24

CBOT corn futures DEC24

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NOTIONAL AMT.

CBOT wheat futures JUL23

CBOT wheat futures MAY24

CBOT wheat futures JUL24

CBOT wheat futures DEC24

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The price relationship between the near month Futures Contract to expire and the Benchmark Component Futures Contracts will vary and may impact both the total return of each Fund over time and the degree to which such total return tracks the total return of the price indices related to the commodity of each Fund.

In cases in which the near month contract’s price is lower than later expiring contracts’

prices (a situation known as “contango”

in the futures markets), then absent the impact of the overall movement in commodity prices the value of the Benchmark Component Futures Contracts would tend to decline as they approach expiration.

In cases in which the near month contract’s price is higher than later expiring contracts’

prices (a situation known as “backwardation”

in the futures markets), then absent the impact of the overall movement in a Fund’s prices the value of the Benchmark Component Futures Contracts would tend to rise as they approach expiration, all other things being equal.

The total portfolio composition for each Fund is disclosed each business day that the NYSE Arca is open for trading on the Sponsor’s website.

In cases in which the near month contract’s price is lower than later expiring contracts’ prices (a situation known as “contango” in the futures markets), then absent the impact of the overall movement in commodity prices the value of the Benchmark Component Futures Contracts would tend to decline as they approach expiration.

In cases in which the near month contract’s price is higher than later expiring contracts’ prices (a situation known as “backwardation” in the futures markets), then absent the impact of the overall movement in a Fund’s prices the value of the Benchmark Component Futures Contracts would tend to rise as they approach expiration, all other things being equal.

The total portfolio composition for each Fund is disclosed each business day that the NYSE Arca is open for trading on the Sponsor’s website.

The website for the Agricultural Funds and the Sponsor is www.teucrium.com .

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The website(s) are accessible at no charge.

The website disclosure of portfolio holdings is made daily and includes, as applicable, the name and value of each Futures Contract (or Underlying Fund in the case of TAGS), other commodity or cryptocurrency interests and the amount of cash and cash equivalents held in the Fund’s portfolio. 

Consistent with achieving a Fund’s investment objective of closely tracking the Benchmark, the Sponsor may for certain reasons cause a Fund to enter into or hold Futures Contracts other than the Benchmark Component Futures Contracts and/or Other Commodity or Cryptocurrency Interests.

Other Commodity or Cryptocurrency Interests that do not have standardized terms and are not exchange traded, referred to as “over the counter”

Commodity or Cryptocurrency Interests, can generally be structured as the parties to the Commodity or Cryptocurrency Interest contract desire.

Other Commodity or Cryptocurrency Interests that do not have standardized terms and are not exchange traded, referred to as “over the counter” Commodity or Cryptocurrency Interests, can generally be structured as the parties to the Commodity or Cryptocurrency Interest contract desire.

Therefore, each Fund might enter into multiple and/or over the counter Interests intended to replicate the performance of each of the Benchmark Component Futures Contracts for a Fund, or a single over the counter Interest designed to replicate the performance of the Benchmark as a whole.

Assuming that there is no default by a counterparty to an over the counter Interest, the performance of the Interest will necessarily correlate with the performance of the Benchmark or the applicable Benchmark Component Futures Contract.

Each Fund might also enter into or hold Interests other than Benchmark Component Futures Contracts to facilitate effective trading, consistent with the discussion of the Fund’s “roll”

In addition, each Fund might enter into or hold Interests that would be expected to alleviate overall deviation between the Fund’s performance and that of the Benchmark that may result from certain market and trading inefficiencies or other reasons.

By utilizing certain or all of the investments described above, the Sponsor will endeavor to cause the Fund’s performance to closely track that of the Benchmark of each Fund.

An “exchange for related position”

(“EFRP”) can be used by each Agricultural Fund as a technique to facilitate the exchanging of a futures hedge position against a creation or redemption order, and thus each Fund may use an EFRP transaction in connection with the creation and redemption of shares.

Each Fund might also enter into or hold Interests other than Benchmark Component Futures Contracts to facilitate effective trading, consistent with the discussion of the Fund’s “roll” strategy.

By utilizing certain or all of the investments described above, the Sponsor will endeavor to cause the Fund’s performance to closely track that of the Benchmark of each Fund.

An “exchange for related position” (“EFRP”) can be used by each Agricultural Fund as a technique to facilitate the exchanging of a futures hedge position against a creation or redemption order, and thus each Fund may use an EFRP transaction in connection with the creation and redemption of shares.

The market specialist/market maker that is the ultimate purchaser or seller of shares in connection with the creation or redemption basket, respectively, agrees to sell or purchase a corresponding offsetting futures position which is then settled on the same business day as a cleared futures transaction by the FCMs.

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Each Fund reports all activity related to EFRP transactions under the procedures and guidelines of the CFTC and the exchanges on which the futures are traded.

The Funds seek to earn interest and other income (“interest income”) from cash equivalents that it purchases and, on the cash it holds through the Custodian or other financial institutions.

The Funds seek to earn interest and other income (“interest income”) from cash equivalents that it purchases and, on the cash they hold through the Custodian or other financial institutions.

The Sponsor anticipates that the interest income will increase the NAV of each Fund.

The Funds apply the interest income to the acquisition of additional investments or use it to pay its expenses.

The Funds apply the interest income to the acquisition of additional investments or use it to pay their expenses.

If the Fund reinvests the earned interest income, it makes investments that are consistent with its investment objectives as disclosed.

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Any cash equivalent invested by a Fund will be deemed by the Sponsor to be of investment grade quality.

As of December 31, 2022, available cash balances in each of the Funds were invested in the First American Government Obligations Fund - Class X, in the Goldman Sachs Financial Square Government Fund –

Institutional Class, in demand deposits at Capital One, and in commercial paper with maturities of ninety days or less.

As of December 31, 2023, available cash balances in each of the Funds were invested in the First American Government Obligations Fund - Class X, in the Goldman Sachs Financial Square Government Fund – Institutional Class, in demand deposits at Capital One, and in commercial paper with maturities of ninety days or less.

Additionally, the CORN, SOYB, CANE, WEAT and DEFI Funds may invest a portion of the amount of funds required to be deposited with the FCM as initial margin in U.S.

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The Sponsor anticipates managing each Fund in a way that tracks the stated Benchmark.

The Agricultural Funds’

Benchmarks do not hold spot futures and therefore do not anticipate letting the commodity Futures Contracts of any Fund expire, thus avoiding delivery of the underlying commodity.

Instead, the Sponsor will close out existing positions, for instance, in response to ordinary scheduled changes in the Benchmark or, if at the Sponsor’s sole discretion, it otherwise determines it would be appropriate to do so, will reinvest the proceeds in new Commodity or Cryptocurrency Interests.

Positions may also be closed out to meet redemption orders, in which case the proceeds from closing the positions are not reinvested. DEFI does hold spot month futures, but the Fund will trade or roll these contracts on the exchange before delivery or receipt of the underlying cryptocurrency is required.

The Agricultural Funds’ Benchmarks do not hold spot futures and therefore do not anticipate letting the commodity Futures Contracts of any Fund expire, thus avoiding delivery of the underlying commodity.

Positions may also be closed out to meet redemption orders, in which case the proceeds from closing the positions are not reinvested.

DEFI does hold spot month futures, but the Fund will trade or roll these contracts on the exchange before delivery or receipt of the underlying cryptocurrency is required.

Market Outlook

Commodities in general are primarily priced and traded in US dollars. 

As such global trade can be influenced by relative currency valuations, which are largely dependent on a nation’s fiscal strength, monetary policy, and general economic health. 

Furthermore, US fiscal and monetary policy is of particular importance given that commodities are largely priced in US dollars. 

Interest rates, money supply, fiscal spending (including deficit spending), and tax policy can all have an impact on the relative value of the US dollar. 

In addition to measuring US dollar strength relative to international currencies, market participants also pay close attention to US dollar strength relative to consumer goods. 

The Consumer Price Index (CPI) , and the Personal Consumption Expenditures Index (PCE), are two popular indexes measuring the changes in costs of consumer goods priced in US dollars. 

Higher CPI and PCE levels signal inflation, whereas lower CPI and PCE levels suggest deflation. 

Higher inflation expectations may result in increased investor demand for commodities. 

Commodities in general are primarily priced and traded in US dollars.

As such global trade can be influenced by relative currency valuations, which are largely dependent on a nation’s fiscal strength, monetary policy, and general economic health.

Furthermore, US fiscal and monetary policy is of particular importance given that commodities are largely priced in US dollars.

Interest rates, money supply, fiscal spending (including deficit spending), and tax policy can all have an impact on the relative value of the US dollar.

In addition to measuring US dollar strength relative to international currencies, market participants also pay close attention to US dollar strength relative to consumer goods.

The Consumer Price Index (CPI) , and the Personal Consumption Expenditures Index (PCE), are two popular indexes measuring the changes in costs of consumer goods priced in US dollars.

Higher CPI and PCE levels signal inflation, whereas lower CPI and PCE levels suggest deflation.

Higher inflation expectations may result in increased investor demand for commodities.

The Corn Market

Corn is currently the most widely produced livestock feed grain in the United States.

The two largest demands of the United States’

corn crop are used in livestock feed and ethanol production.

The two largest demands of the United States’ corn crop are used in livestock feed and ethanol production.

Corn is also processed into food and industrial products, including starch, sweeteners, corn oil, beverages and industrial alcohol.

The United States Department of Agriculture (“USDA”) publishes weekly, monthly, quarterly and annual updates for U.S.

domestic and worldwide corn production and consumption, and for other grains such as soybeans and wheat which can be used in some cases as a substitute for corn.

These reports are available on the USDA’s website, www.usda.gov, at no charge.

The outlook provided below is from the January 12, 2024 USDA report.

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For example, in late February 2022, Russia invaded Ukraine, significantly amplifying existing geopolitical tensions among Russia and other countries in the region and in the west.

The responses of countries and political bodies to Russia’s actions, Ukraine’s military response and the potential for wider conflict may increase financial market volatility.

Generally, these adverse effects may cause continued volatility in the price of corn, corn futures, and the share price of the Fund.

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Given all of the above factors, the Sponsor has no ability to discern when current high levels of volatility will subside.

Recent geopolitical, economic and inflationary events may have impacted the level of “backwardation”

that the funds holdings experienced and potentially placed upward pressure on the prices of a wide variety of commodities.

As a result, near to expire contracts can trade at a higher price than longer to expire contracts, a situation referred to as “backwardation.”

Putting aside the impact of the overall movement in prices of corn and corn futures, the Benchmark Component Futures Contracts (the corn futures contracts that the Fund invests in to achieve its investment objective) would tend to rise as they approach expiration.

Recent geopolitical, economic and inflationary events may have impacted the level of “backwardation” that the fund's holdings experienced and potentially placed upward pressure on the prices of a wide variety of commodities.

As a result, near to expire contracts can trade at a higher price than longer to expire contracts, a situation referred to as “backwardation.” Putting aside the impact of the overall movement in prices of corn and corn futures, the Benchmark Component Futures Contracts (the corn futures contracts that the Fund invests in to achieve its investment objective) would tend to rise as they approach expiration.

This backwardation may benefit the Fund because it will sell more expensive contracts and buy less expensive contracts on an ongoing basis.

Conversely, in the event of a corn futures market where near to expire contracts trade at a lower price than longer to expire contracts, a situation referred to as “contango,”

then absent the impact of the overall movement in corn prices the value of the Benchmark Component Futures Contracts would tend to decline as they approach expiration.

Conversely, in the event of a corn futures market where near to expire contracts trade at a lower price than longer to expire contracts, a situation referred to as “contango,” then absent the impact of the overall movement in corn prices the value of the Benchmark Component Futures Contracts would tend to decline as they approach expiration.

If the price of corn and corn futures were to decline, for example, because of a resolution of the Russia-Ukraine conflict, the Fund would experience the negative impact of contango.

The United States is the world’s leading producer and exporter of corn.

For the Crop Year 2022-23, the United States Department of Agriculture (“USDA”) estimates that the U.S.

The United States is the world’s leading producer and exporter of corn.

For the Crop Year 2023-24, the United States Department of Agriculture (“USDA”) estimates that the U.S.

will produce approximately 32% of all the corn globally, of which about 14% will be exported.

For 2022-23, based on the January 12, 2023 USDA reports, global consumption of 1,165 Million Metric Tons (MMT) is expected to be slightly higher than global production of 1,156 MMT.

For 2023-24, based on the January 12, 2023 USDA reports, global consumption of 1,211 Million Metric Tons (MMT) is expected to be slightly lower than global production of 1,236 MMT.

If the global demand for corn is not equal to global supply, this may have an impact on the price of corn.

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Major import nations include Mexico, Japan, the European Union (EU), South Korea, Egypt, and parts of Southeast Asia.

China’s production at 277 MMT is approximately 7% less than its domestic usage.

According to the USDA, global corn consumption has increased 598% from crop year 1960/1961 to 2022/2023 as demonstrated by the graph below and is projected to continue to grow in coming years.

China’s production at 289 MMT is approximately 6% less than its domestic usage.

According to the USDA, global corn consumption has increased 618% from crop year 1960/1961 to 2023/2024 as demonstrated by the graph below and is projected to continue to grow in coming years.

Consumption growth is the result of a combination of many factors including:

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Three grades of corn are deliverable under CBOT Corn Futures Contracts:

Number 1 yellow, which may be delivered at 1.5 cents over the contract price;

Number 2 yellow, which may be delivered at the contract price;

and Number 3 yellow, between a 2 and 4 cents per bushel under contract price depending on broken corn and foreign material and damage grade factors.

Number 1 yellow, which may be delivered at 1.5 cents over the contract price; Number 2 yellow, which may be delivered at the contract price; and Number 3 yellow, between a 2 and 4 cents per bushel under contract price depending on broken corn and foreign material and damage grade factors.

There are five months each year in which CBOT Corn Futures Contracts expire:

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Futures contracts may be either bought or sold, long or short.

The U.S Commodity Futures Trading Commission weekly releases the “Commitment of Traders”

(COT) report, which depicts the open interest as well as long and short positions in the market.

The U.S Commodity Futures Trading Commission weekly releases the “Commitment of Traders” (COT) report, which depicts the open interest as well as long and short positions in the market.

Market participants may use this report to gauge market sentiment.

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Global soybean production is concentrated in the U.S., Brazil, Argentina and China.

The United States Department of Agriculture (“USDA”) has estimated that, for the Crop Year 2022-23, the United States will produce approximately 116 MMT of soybeans or approximately 30% of estimated world production, with Brazil production at 153 MMT.

Argentina is projected to produce about 46 MMT.

For 2022-23, based on the January 12, 2023 USDA report, global consumption of 379 MMT is estimated slightly lower than global production of 388 MMT.

The United States Department of Agriculture (“USDA”) has estimated that, for the Crop Year 2023-24, the United States will produce approximately 113 MMT of soybeans or approximately 28% of estimated world production, with Brazil production at 157 MMT.

Argentina is projected to produce about 50 MMT.

For 2023-24, based on the January 12, 2024 USDA report, global consumption of 384 MMT is estimated slightly lower than global production of 399 MMT.

If the global demand for soybeans is not equal to global supply, this may have an impact on the price of soybeans.

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domestic and worldwide soybean production and consumption.

These reports are available on the USDA’s website, www.usda.gov, at no charge.

The outlook provided below is from the January 12, 2024 USDA report.

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For example, in late February 2022, Russia invaded Ukraine, significantly amplifying existing geopolitical tensions among Russia and other countries in the region and in the west.

Global response to Russia’s actions, the larger overarching tensions, and Ukraine’s military response may increase financial market volatility

generally, have severe adverse effects on global economic markets, and cause volatility in the price of agricultural products, including agricultural futures, and the share price of the Fund.

Global response to Russia’s actions, the larger overarching tensions, and Ukraine’s military response may increase financial market volatility generally, have severe adverse effects on global economic markets, and cause volatility in the price of agricultural products, including agricultural futures, and the share price of the Fund.

The price per bushel of soybeans in the United States is primarily a function of both U.S.

and global production and demand.

The price per bushel of soybeans can be affected by the price of corn;

because corn and soybeans are planted on the same acres, farmers must choose which crop to plant each year.

The price per bushel of soybeans can be affected by the price of corn; because corn and soybeans are planted on the same acres, farmers must choose which crop to plant each year.

If corn prices rise enough to incentivize the planting of corn over soybeans, the supply and price of soybeans could be affected.

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Given all of the above factors, the Sponsor has no ability to discern when current high levels of volatility will subside.

Recent geopolitical, economic and inflationary events may have impacted the level of “backwardation”

that the funds holdings experienced and potentially placed upward pressure on the prices of a wide variety of commodities.

As a result, near to expire contracts trade at a higher price than longer to expire contracts, a situation referred to as “backwardation.”

Putting aside the impact of the overall movement in prices of soybeans and soybean futures, the Benchmark Component Futures Contracts (the soybean futures contracts that the Fund invests in to achieve its investment objective) would tend to rise as they approach expiration.

As a result, near to expire contracts trade at a higher price than longer to expire contracts, a situation referred to as “backwardation.” Putting aside the impact of the overall movement in prices of soybeans and soybean futures, the Benchmark Component Futures Contracts (the soybean futures contracts that the Fund invests in to achieve its investment objective) would tend to rise as they approach expiration.

This backwardation may benefit the Fund because it will sell more expensive contracts and buy less expensive contracts on an ongoing basis.

Conversely, in the event of a soybean futures market where near to expire contracts trade at a lower price than longer to expire contracts, a situation referred to as “contango,”

then absent the impact of the overall movement in soybean prices the value of the Benchmark Component Futures Contracts would tend to decline as they approach expiration.

Conversely, in the event of a soybean futures market where near to expire contracts trade at a lower price than longer to expire contracts, a situation referred to as “contango,” then absent the impact of the overall movement in soybean prices the value of the Benchmark Component Futures Contracts would tend to decline as they approach expiration.

If the prices of soybean and soybean futures were to decline, for example the Fund would experience the negative impact of contango.

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Soybean oil is also converted to biodiesel and renewable diesel for use as fuel.

Standard Soybean Futures Contracts trade on the CBOT in units of 5,000 bushels, although 1,000 bushel “mini-sized”

Soybean Futures Contracts also trade.

Standard Soybean Futures Contracts trade on the CBOT in units of 5,000 bushels, although 1,000 bushel “mini-sized” Soybean Futures Contracts also trade.

Three grades of soybeans are deliverable under CBOT Soybean Futures Contracts:

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The Sugar Market

Sugarcane accounts for nearly 80% of the world’s sugar production, while sugar beets account for the remainder of the world’s sugar production.

Sugarcane accounts for nearly 79% of the world’s sugar production, while sugar beets account for the remainder of the world’s sugar production.

Sugar manufacturers use sugar beets and sugarcane as the raw material from which refined sugar (sucrose) for industrial and consumer use is produced.

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Ethanol is an important by-product of sugarcane processing.

Additionally, the material that is left over after sugarcane is processed is used to manufacture paper, cardboard, and “environmentally friendly”

eating utensils.

Additionally, the material that is left over after sugarcane is processed is used to manufacture paper, cardboard, and “environmentally friendly” eating utensils.

As a general matter, the occurrence of a severe weather event, natural disaster, terrorist attack, geopolitical events, outbreak, or public health emergency as declared by the World Health Organization, the continuation or expansion of war or other hostilities, or a prolonged government shutdown may have significant adverse effects on the Fund and its investments and alter current assumptions and expectations.

For example, in late February 2022, Russia invaded Ukraine, significantly amplifying existing geopolitical tensions among Russia and other countries in the region and in the west.

The responses of countries and political bodies to Russia’s actions, the larger overarching tensions, and Ukraine’s military response and the potential for wider conflict may increase financial market volatility generally, have severe adverse effects on global economic markets, and cause volatility in the price of agricultural products, including agricultural futures, and the share price of the Fund.

The price per pound of sugar in the United States is primarily a function of both U.S.

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Russian production of sugar comes primarily from sugar beets.

Ukraine’s sugar production is small and relatively inconsequential to global sugar markets.

Now at question is the ability of farmers in both countries to plant this season’s sugar beet crop.

Ukraine’s sugar production is small and relatively inconsequential to global sugar markets.

Now at question is the ability of farmers in both countries to plant this season’s sugar beet crop.

Volatility, trading volumes, and prices in global sugar markets have risen dramatically and are expected to continue indefinitely at extreme elevated levels.

Given all of the above factors, the Sponsor has no ability to discern when current high levels of volatility will subside.

Recent geopolitical, economic and inflationary events may have impacted the level of “backwardation”

that the funds holdings experienced and potentially placed upward pressure on the prices of a wide variety of commodities.

As a result, near to expire contracts trade at a higher price than longer to expire contracts, a situation referred to as “backwardation.”

Putting aside the impact of the overall movement in prices of sugar and sugar futures, the Benchmark Component Futures Contracts (the sugar futures contracts that the Fund invests in to achieve its investment objective) would tend to rise as they approach expiration.

As a result, near to expire contracts trade at a higher price than longer to expire contracts, a situation referred to as “backwardation.” Putting aside the impact of the overall movement in prices of sugar and sugar futures, the Benchmark Component Futures Contracts (the sugar futures contracts that the Fund invests in to achieve its investment objective) would tend to rise as they approach expiration.

This backwardation may benefit the Fund because it will sell more expensive contracts and buy less expensive contracts on an ongoing basis.

Conversely, in the event of a sugar futures market where near to expire contracts trade at a lower price than longer to expire contracts, a situation referred to as “contango,”

then absent the impact of the overall movement in sugar prices the value of the Benchmark Component Futures Contracts would tend to decline as they approach expiration.

Conversely, in the event of a sugar futures market where near to expire contracts trade at a lower price than longer to expire contracts, a situation referred to as “contango,” then absent the impact of the overall movement in sugar prices the value of the Benchmark Component Futures Contracts would tend to decline as they approach expiration.

If the prices of sugar and sugar futures were to decline, for example, because of a resolution of the Russia-Ukraine conflict, the Fund would experience the negative impact of contango.

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11 Futures Contract is the world benchmark contract for raw sugar trading.

This contract prices the physical delivery of raw cane sugar, delivered to the receiver’s vessel at a specified port within the country of origin of the sugar.

11 Futures Contracts trade on ICE Futures US and the NYMEX in units of 112,000 pounds.

The United States Department of Agriculture (“USDA”) publishes two major reports annually on U.S.

domestic and worldwide sugar production and consumption.

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In addition, the USDA publishes periodic, but not as comprehensive, reports on sugar monthly.

These reports are available on the USDA’s website, www.usda.gov, at no charge.

The USDA’s November 2022 report for the 2022-23 Marketing year estimated global production of 183.2 MMT as higher production in Brazil, China, and Russia is expected to more than offset declines in the European Union, India and Ukraine.

Consumption is expected to rise due to growth in markets including China, Indonesia, and Russia.

Stocks are forecast lower as growth in global consumption exceeds the rise in production.

Global sugar consumption may fluctuate year over year due to any number of reasons which may include, but is not limited to, economic conditions, global health concerns, international trade policy.

These reports are available on the USDA’s website, www.usda.gov, at no charge.

The USDA’s November 2023 report for the 2023-24 Marketing year estimated global production of 183.5 MMT with higher production in Brazil and India expected to more than offset declines in Thailand and Pakistan.

Consumption is expected to rise due to growth in markets including India and Pakistan.

Stocks are forecast lower to help meet domestic demand and higher exports from markets including Brazil and Thailand.

Sugar is a staple commodity used pervasively across the globe so that any contractions in consumption may only be temporary as has historically been the case.

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Futures contracts may be either bought or sold long or short.

The U.S Commodity Futures Trading Commission weekly releases the “Commitment of Traders”

(COT) report, which depicts the open interest as well as long and short positions in the market.

The U.S Commodity Futures Trading Commission weekly releases the “Commitment of Traders” (COT) report, which depicts the open interest as well as long and short positions in the market.

Market participants may use this report to gauge market sentiment.

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Wheat by-products are used in livestock feeds.

Wheat is the principal food grain produced in the United States, and the United States’

output of wheat is typically exceeded only by that of China, the European Union, Russia, and India.

The United States Department of Agriculture (“USDA”) estimates that for 2022-23, the principal global producers of wheat will be the EU, Russia, Ukraine, China, India, the United States, Australia, and Canada.

Wheat is the principal food grain produced in the United States, and the United States’ output of wheat is typically exceeded only by that of China, the European Union, Russia, and India.

The United States Department of Agriculture (“USDA”) estimates that for 2023-24, the principal global producers of wheat will be the EU, Russia, Ukraine, China, India, the United States, Australia, and Canada.

generates approximately 6% of global production, with approximately 40% of that being exported.

For 2022-23, based on the January 12, 2023 USDA report, global consumption of 790 MMT is estimated to be slightly higher than production of 781 MMT.

For 2023-24, based on the January 12, 2024 USDA report, global consumption of 796 MMT is estimated to be slightly higher than production of 785 MMT.

If the global demand of wheat is not equal to global supply, this may have an impact on the price of wheat.

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domestic and worldwide wheat production and consumption.

These reports are available on the USDA’s website, www.usda.gov, at no charge.

The outlook provided herein is from the January 12, 2023 USDA report.

These reports are available on the USDA’s website, www.usda.gov, at no charge.

The outlook provided herein is from the January 12, 2024 USDA report.

For example, in late February 2022, Russia invaded Ukraine, significantly amplifying already existing geopolitical tensions among Russia and other countries in the region and in the west.

The responses of countries and political bodies to Russia’s actions, the larger overarching tensions, and Ukraine’s military response and the potential for wider conflict may increase financial market volatility generally, have severe adverse effects on regional and global economic markets, and cause volatility in the price of wheat, wheat futures and the share price of the Fund.

The price per bushel of wheat in the United States is primarily a function of both U.S.

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Given all of the above factors, the Sponsor has no ability to discern when current high levels of volatility will subside.

Recent geopolitical, economic and inflationary events may have impacted the level of “backwardation”

that the funds holdings experienced and potentially placed upward pressure on the prices of a wide variety of commodities.

As a result, near to expire contracts trade at a higher price than longer to expire contracts, a situation referred to as “backwardation.”

Putting aside the impact of the overall movement in prices of wheat and wheat futures, the Benchmark Component Futures Contracts (the wheat futures contracts that the Fund invests in to achieve its investment objective) would tend to rise as they approach expiration.

Recent geopolitical, economic and inflationary events may have impacted the level of “backwardation” that the funds holdings experienced and potentially placed upward pressure on the prices of a wide variety of commodities.

As a result, near to expire contracts trade at a higher price than longer to expire contracts, a situation referred to as “backwardation.” Putting aside the impact of the overall movement in prices of wheat and wheat futures, the Benchmark Component Futures Contracts (the wheat futures contracts that the Fund invests in to achieve its investment objective) would tend to rise as they approach expiration.

This backwardation may benefit the Fund because it will sell more expensive contracts and buy less expensive contracts on an ongoing basis.

Conversely, in the event of a wheat futures market where near to expire contracts trade at a lower price than longer to expire contracts, a situation referred to as “contango,”

then absent the impact of the overall movement in wheat prices the value of the Benchmark Component Futures Contracts would tend to decline as they approach expiration.

Conversely, in the event of a wheat futures market where near to expire contracts trade at a lower price than longer to expire contracts, a situation referred to as “contango,” then absent the impact of the overall movement in wheat prices the value of the Benchmark Component Futures Contracts would tend to decline as they approach expiration.

If the prices of wheat and wheat futures were to decline, for example, because of a resolution of the Russia-Ukraine conflict, the Fund would experience the negative impact of contango.

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Futures contracts may be either bought or sold long or short.

The U.S Commodity Futures Trading Commission weekly releases the “Commitment of Traders”

(COT) report, which depicts the open interest as well as long and short positions in the market.

The U.S Commodity Futures Trading Commission weekly releases the “Commitment of Traders” (COT) report, which depicts the open interest as well as long and short positions in the market.

Market participants may use this report to gauge market sentiment.

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As of the date of this update, there are approximately 19 million bitcoins in circulation.

Bitcoin is maintained on the decentralized, open source, peer-to-peer computer network (the “Bitcoin Network”).

No single entity owns or operates the Bitcoin Network.

The Bitcoin Network is accessed through software and governs bitcoin’s creation and movement.

The source code for the Bitcoin Network, often referred to as the Bitcoin Protocol, is open-source, and anyone can contribute to its development.

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Miners validate transactions and are currently compensated for that service in bitcoin.

Developers maintain and contribute updates to the Bitcoin Network’s source code, often referred to as the Bitcoin Protocol.

Users access the Bitcoin Network using open-source software.

Anyone can be a user, developer, or miner.

Bitcoin is “stored”

on a digital transaction ledger commonly known as a “blockchain.”

A blockchain is a type of shared and continually reconciled database, stored in a decentralized manner on the computers of certain users of the digital asset and is protected by cryptography.

Bitcoin is “stored” on a digital transaction ledger commonly known as a “blockchain.” A blockchain is a type of shared and continually reconciled database, stored in a decentralized manner on the computers of certain users of the digital asset and is protected by cryptography.

The Bitcoin Blockchain contains a record and history for each bitcoin transaction.

New bitcoin is created by “mining.”

Miners use specialized computer software and hardware to solve a highly complex mathematical problem presented by the Bitcoin Protocol.

New bitcoin is created by “mining.” Miners use specialized computer software and hardware to solve a highly complex mathematical problem presented by the Bitcoin Protocol.

The first miner to successfully solve the problem is permitted to add a block of transactions to the Bitcoin Blockchain.

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Anyone can review the underlying code and suggest changes.

There are, however, a number of individual developers that regularly contribute to a specific distribution of bitcoin software known as the “Bitcoin Core.”

Developers of the Bitcoin Core loosely oversee the development of the source code.

There are, however, a number of individual developers that regularly contribute to a specific distribution of bitcoin software known as the “Bitcoin Core.” Developers of the Bitcoin Core loosely oversee the development of the source code.

There are many other compatible versions of the bitcoin software, but Bitcoin Core is the most widely adopted and currently provides the de facto standard for the Bitcoin Protocol.

The core developers are able to access, and can alter, the Bitcoin Network source code and, as a result, they are responsible for quasi-official releases of updates and other changes to the Bitcoin Network’s source code.

However, because bitcoin has no central authority, the release of updates to the Bitcoin Network’s source code by the core developers does not guarantee that the updates will be automatically adopted by the other purchasers.

Users and miners must accept any changes made to the source code by downloading the proposed modification and that modification is effective only with respect to those bitcoin users and miners who choose to download it.

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If a modification is accepted by only a percentage of users and miners, a division will occur such that one network will run the pre-modification source code and the other network will run the modified source code.

Such a division is known as a “fork.”

Competitive Environment

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Finally, there are exchange traded notes which are credit instruments, some of which may invest or mirror investments in agricultural commodities.

The Sponsor ’

The Sponsor ’ s Operations

The Sponsor established the Trust and caused the Trust to establish the first series, the Corn Fund, which commenced offering its Shares to the public on June 9, 2010.

Three additional series, namely the Sugar Fund, the Soybean Fund and the Wheat Fund, commenced offering of shares in September 2011 and the Teucrium Agricultural Fund commenced operation on March 28, 2012.

The Hashdex Bitcoin Futures ETF commenced operations on September 16, 2022. 

In addition to establishing these series, operating those series that have commenced offering their shares, and obtaining capital from a small number of outside investors in order to engage in these activities, the Sponsor also offers Commodity Trading Advisory services to U.S.

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Under the Trust Agreement, the Sponsor is solely responsible for the management, and conducts or directs the conduct of the business of the Trust, the Funds, and any series of the Trust that may from time to time be established and designated by the Sponsor.

The Sponsor is required to oversee the purchase and sale of Shares by Authorized Purchasers and to manage the Fund’s investments, including to evaluate the credit risk of futures commission merchants (FCMs) and swap counterparties and to review daily positions and margin/collateral requirements.

The Sponsor has the power to enter into agreements as may be necessary or appropriate for the offer and sale of the Fund’s Shares and the oversight of the Trust’s activities.

Accordingly, the Sponsor is responsible for selecting service providers for the Trust, such as the Trustee, Administrator, Distributor, the independent registered public accounting firm of the Trust, and any legal counsel employed by the Trust.

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No person other than the Sponsor and its principals was involved in the organization of the Trust or the Funds.

A portion of the aggregate common expenses of the Funds is related to the Sponsor or related parties of principals of the Sponsor;

A portion of the aggregate common expenses of the Funds is related to the Sponsor or related parties of principals of the Sponsor;

these are necessary services to the Trust and the Funds, which are primarily the cost of performing accounting and financial reporting, regulatory compliance, and trading activities that are directly attributable to the Trust and the Funds.

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of these amounts, $70,069 in 2023, $518,599 in 2022, and $1,052,715 in 2021 were waived by the Sponsor.

All asset-based fees and expenses for the Funds are calculated on the prior day’s net assets.

The Sponsor has an information security program and policy in place.

The program takes reasonable care to look beyond the security and controls developed and implemented for the Trust and the Funds directly to the platforms and controls in place for the key service providers.

Such review of cybersecurity and information technology plans of key service providers are part of the Sponsor’s disaster recovery and business continuity planning.

The Sponsor provides regular training to all employees of the Sponsor regarding cybersecurity topics, in addition to real-time dissemination of information regarding cybersecurity matters as needed.

The information security plan is reviewed and updated as needed, but at a minimum on an annual basis.

Ownership or “membership”

interests in the Sponsor are owned by persons referred to as “members.”

The Sponsor currently has three voting or “Class A”

members - Mr.

Ownership or “membership” interests in the Sponsor are owned by persons referred to as “members.” The Sponsor currently has three voting or “Class A” members - Mr.

Sal Gilbertie, Mr.

Dale Riker and Mr.

Miller III - and a small number of non-voting or “Class B”

members who have provided working capital to the Sponsor.

Miller III - and a small number of non-voting or “Class B” members who have provided working capital to the Sponsor.

Gilbertie and Riker each currently own 45.74%, and Mr.

Miller owns 8.52% of the Sponsor’s Class A membership interests.

Management of the Sponsor

In general, under the Sponsor’s Amended and Restated Limited Liability Company Operating Agreement, as amended from time to time, the Sponsor (and as a result the Trust and each Fund) is managed by the officers of the Sponsor.

The Chief Executive Officer of the Sponsor is responsible for the overall strategic direction of the Sponsor and has general control of its business.

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The Chief Operating Officer has primary responsibility for trade operations, trade execution, and portfolio activities with respect to the Fund.

The Chief Financial Officer, Chief Accounting Officer and Chief Compliance Officer acts as the Sponsor’s principal financial and accounting officers.

Furthermore, certain fundamental actions regarding the Sponsor, such as the removal of officers, the addition or substitution of members, or the incurrence of liabilities other than those incurred in the ordinary course of business and de minimis liabilities, may not be taken without the affirmative vote of a majority of the Class A members (which is generally defined as the affirmative vote of Mr.

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Since October 18, 2010, Mr.

Gilbertie has been an associated person of the Distributor under the terms of the Securities Activities and Services Agreement (“SASA”) between the Sponsor and the Distributor.

Additional information regarding the SASA can be found in the section of this disclosure document entitled “Plan of Distribution.”

From October 2005 until December 2009, Mr.

Gilbertie has been an associated person of the Distributor under the terms of the Securities Activities and Services Agreement (“SASA”) between the Sponsor and the Distributor.

Additional information regarding the SASA can be found in the section of this disclosure document entitled “Plan of Distribution.” From October 2005 until December 2009, Mr.

Gilbertie was employed by Newedge USA, LLC, an FCM and broker-dealer registered with the CFTC and the SEC, where he headed the Renewable Fuels/Energy Derivatives OTC Execution Desk and was an active futures contract and over the counter derivatives trader and market maker in multiple classes of commodities.

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Mullen-Rusin assisted in developing, instituting, and monitoring the effectiveness of processes and procedures to comply with all regulatory agency requirements.

Mullen-Rusin graduated from Boston College with a Bachelor of Arts and Science in Communications in 2009, where she was a four-year scholarship player on the NCAA Division I Women’s Basketball team.

In 2017, she earned a Master of Business Administration from Nichols College.

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Kahler was unemployed from September 7, 2018 until October 10, 2018, when he was reappointed as Chief Operating Officer.

Kahler is primarily responsible for making trading and investment decisions for the Funds, and for directing each Fund’s trades for execution. 

He maintains his main business office at 13520 Excelsior Blvd., Minnetonka, MN 55345. Mr.

Kahler is primarily responsible for making trading and investment decisions for the Funds, and for directing each Fund’s trades for execution.

He maintains his main business office at 13520 Excelsior Blvd., Minnetonka, MN 55345.

Kahler was registered as an Associated Person of the Sponsor on November 8, 2011 to September 7, 2018 and re-registered as an Associated Person on October 5, 2018.

Kahler was registered as a Branch Manager of the Sponsor on March 16, 2012 to September 7, 2018 and was registered again from October 5, 2018 to September 29, 2021. Prior to his employment with the Sponsor, Mr.

Kahler was registered as a Branch Manager of the Sponsor on March 16, 2012 to September 7, 2018 and was registered again from October 5, 2018 to September 29, 2021.

Prior to his employment with the Sponsor, Mr.

Kahler worked for Cargill Inc., an international producer and marketer of food, agricultural, financial and industrial products and services, from April 2006 until November 2011 in the Energy Division as Senior Petroleum Trader.

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Gilbertie, Riker, Kahler and Ms.

Mullen-Rusin are individual “principals,”

as that term is defined in CFTC Rule 3.1, of the Sponsor.

Mullen-Rusin are individual “principals,” as that term is defined in CFTC Rule 3.1, of the Sponsor.

These individuals are principals due to their positions and/or due to their ownership interests in the Sponsor.

Beneficial ownership interests of the principals, if any, are shown under the section entitled “Security Ownership of Principal Shareholders and Management”

below and any of the principals may acquire beneficial interests in the Fund in the future.

Beneficial ownership interests of the principals, if any, are shown under the section entitled “Security Ownership of Principal Shareholders and Management” below and any of the principals may acquire beneficial interests in the Fund in the future.

GFI Group LLC is a principal for the Sponsor under CFTC Rules due to its ownership of certain non-voting securities of the Sponsor.

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The Custodian and Administrator

In its capacity as the Fund’s custodian, the Custodian, currently U.S.

Bank, N.A., holds the Funds’

securities, cash and/or cash equivalents pursuant to a custodial agreement.

In its capacity as the Fund’s custodian, the Custodian, currently U.S.

Bank, N.A., holds the Funds’ securities, cash and/or cash equivalents pursuant to a custodial agreement.

Bancorp Fund Services, LLC, doing business as U.S.

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In addition, Global Fund Services also serves as Administrator for the Fund, performing certain administrative, accounting services, and preparing certain SEC and CFTC reports on behalf of the Fund.

For these services, the Funds pays fees to the Custodian and Global Fund Services set forth in the table entitled “Contractual Fees and Compensation Arrangements with the Sponsor and Third-Party Service Providers.”

The Custodian is located at 1555 North Rivercenter Drive, Suite 302, Milwaukee, Wisconsin 53212.

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The Distributor

The Fund employs Foreside Fund Services, LLC as the Distributor for the Fund. The Distribution Services Agreement among the Distributor, the Sponsor, and the Trust calls for the Distributor to work with the Transfer Agent in connection with the receipt and processing of orders for Creation Baskets and Redemption Baskets and the review and approval of all Fund sales literature and advertising materials.

The Distributor and the Sponsor have also entered into a Securities Activities and Service Agreement (the “SASA”) under which certain employees and officers of the Sponsor are licensed as registered representatives or registered principals of the Distributor, under “FINRA”

rules (“Registered Representatives”).

As Registered Representatives of the Distributor, these persons are permitted to engage in certain marketing activities for the Fund that they would otherwise not be permitted to engage in.

Under the SASA, the Sponsor is obligated to ensure that such marketing activities comply with applicable law and are permitted by the SASA and the Distributor’s internal procedures.

The Distributor’s principal business address is Three Canal Plaza, Suite 100, Portland, Maine 04101.

The Fund employs Foreside Fund Services, LLC, a wholly owned subsidiary of Foreside Financial Group, LLC (d/b/a ACA Group), as the Distributor for the Fund.

The Distribution Services Agreement among the Distributor, the Sponsor, and the Trust calls for the Distributor to work with the Transfer Agent in connection with the receipt and processing of orders for Creation Baskets and Redemption Baskets and the review and approval of all Fund sales literature and advertising materials.

The Distributor and the Sponsor have also entered into an agreement under which certain employees and officers of the Sponsor are licensed as registered representatives of the Distributor permitting these persons to engage in certain marketing activities for the Fund.

The Distributor’s principal business address is Three Canal Plaza, Suite 100, Portland, Maine 04101.

The Distributor is a broker-dealer registered with the U.S.

Securities and Exchange Commission (“SEC”) and a member of FINRA.

The sole Trustee of the Trust is Wilmington Trust Company, a Delaware banking corporation.

The Trustee’s principal offices are located at 1100 North Market Street, Wilmington, Delaware 19890-0001.

The Trustee is unaffiliated with the Sponsor.

The Trustee’s duties and liabilities with respect to the offering of Shares and the management of the Trust and the Fund are limited to its express obligations under the Trust Agreement.

The Trustee will accept service of legal process on the Trust in the State of Delaware and will make certain filings under the Delaware Statutory Trust Act.

The Trustee does not owe any other duties to the Trust, the Sponsor or the Shareholders.

The Trustee is permitted to resign upon at least sixty (60) days’

notice to the Sponsor.

The Trustee is permitted to resign upon at least sixty (60) days’ notice to the Sponsor.

If no successor trustee has been appointed by the Sponsor within such sixty-day period, the Trustee may, at the expense of the Trust, petition a court to appoint a successor.

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The Clearing Brokers

Effective as of December 1, 2022, E D & F Man Capital Markets, Inc., one the Fund’s clearing brokers, changed its name to “Marex Capital Markets Inc.

Effective as of December 1, 2022, E D & F Man Capital Markets, Inc., one the Fund’s clearing brokers, changed its name to “Marex Capital Markets Inc."

Currently, Marex Capital Markets, Inc.

(“Marex”), StoneX Financial Inc.

(“StoneX”) and Phillip Capital Inc.

(“Phillip Capital”) serve as the Funds’

clearing brokers to execute and clear futures contracts and provide other brokerage-related services.

Marex, StoneX  and Phillip Capital are each registered as a futures commission merchant (“FCM”) with the U.S.

(“Marex”), StoneX Financial Inc.

(“StoneX”) and Phillip Capital Inc.

(“Phillip Capital”) serve as the Funds’ clearing brokers to execute and clear futures contracts and provide other brokerage-related services.

Marex, StoneX and Phillip Capital are each registered as a futures commission merchant (“FCM”) with the U.S.

CFTC and are members of the NFA.

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The half-turn is recognized as an unrealized loss on the combined statements of operations, and a full turn is recognized as a realized loss on the combined statements of operations when a contract is sold.

For Bitcoin futures contracts, StoneX is paid $10.00 -$25.00 per half-turn exclusive of pass through fees for the exchange and NFA. 

Phillip Capital is paid $35.00 - $45.00 per half-turn exclusive of pass through fees for the exchange, NFA, execution fees and platform and exchange data fees. 

For Bitcoin futures contracts, StoneX is paid $10.00 -$25.00 per half-turn exclusive of pass through fees for the exchange and NFA.

Phillip Capital is paid $35.00 - $45.00 per half-turn exclusive of pass through fees for the exchange, NFA, execution fees and platform and exchange data fees.

Except as indicated below, there have been no material civil, administrative, or criminal proceedings pending, on appeal, or concluded against the Clearing Brokers or its principals in the past five (5) years.

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In a private litigation, plaintiffs allege, among other things, that Marex made certain fraudulent misrepresentations to them that they relied upon in connection with a futures account carried by Marex in its capacity as a futures commission merchant.

The plaintiffs allege claims of common law fraud, negligence, breach of fiduciary duty, breach of contract, breach of the duty of good faith and fair dealing and misrepresentation/omission and seek compensatory damages of approximately $2,029,659 plus interest, costs, attorneys’

fees and punitive damages.

Marex filed an Amended Answer and a Counterclaim in which Marex denies the substantive allegations against it and asserted a counterclaim for breach of contract, indemnification and legal fees.

Marex filed an Amended Answer and a Counterclaim in which Marex denies the substantive allegations against it and asserted a counterclaim for breach of contract, indemnification and legal fees.

On June 30, 2021, Marex received the Opinion and Order in which the judge ruled against the plaintiffs and in favor of Marex.

Judgment was entered in favor of Marex in the amount of $1,762,266.57, plus prejudgment interest and attorney’s fees and costs.

On September 29, 2021, Marex received an Opinion and Order in which the judge awarded Marex $1,402,234.32 in attorneys’

fees and costs.

Judgment was entered in favor of Marex in the amount of $1,762,266.57, plus prejudgment interest and attorney’s fees and costs.

On September 29, 2021, Marex received an Opinion and Order in which the judge awarded Marex $1,402,234.32 in attorneys’ fees and costs.

For a list of concluded actions, please go to http://www.nfa.futures.org/basicnet/welcome.aspx.

This link will take you to the Welcome Page of the NFA’s Background Affiliation Status Information Center (“BASIC”).

At this page, there is a box where you can enter the NFA ID of Marex Capital Markets, Inc.

(0002613) and then click “Go”.

You will be transferred to the NFA’s information specific to Marex.

Under the heading “Regulatory Actions,”

click “details”

and you will be directed to the full list of regulatory actions brought by the CFTC and exchanges.

(0002613) and then click “Go”.

You will be transferred to the NFA’s information specific to Marex.

Under the heading “Regulatory Actions,” click “details” and you will be directed to the full list of regulatory actions brought by the CFTC and exchanges.

Litigation Disclosure for Phillip Capital

Phillip Capital Inc.

(“Phillip Capital”) is a registered futures commission merchant and is a member of the NFA.

Its main office is located at 141 West Jackson Blvd., Suite 1531A, Chicago, Illinois 60604.

In the normal course of its business, Phillip Capital is involved in various legal actions incidental to its commodities business None of these actions are expected either individually or in aggregate to have a material adverse impact on Phillip Capital.

In the normal course of its business, Phillip Capital is involved in various legal actions incidental to its commodities business.

None of these actions are expected either individually or in aggregate to have a material adverse impact on Phillip Capital.

Except for the below, neither Phillip Capital nor any of its principals have been the subject of any material administrative, civil or criminal actions within the past five years.

On September 12, 2019, the U.S.

Commodity Futures Trading Commission issued an order settling charges against Phillip Capital Inc. (PCI) for allowing cyber criminals to breach PCI email systems, access customer information, and successfully withdrawing $1 million in PCI customer funds.

Commodity Futures Trading Commission issued an order settling charges against Phillip Capital Inc.

(PCI) for allowing cyber criminals to breach PCI email systems, access customer information, and successfully withdrawing $1 million in PCI customer funds.

The order found that PCI failed to disclose the cyber breach to its customers in a timely manner and that PCI failed to supervise its employees with respect to cybersecurity policy and procedures, a written information systems security program, and customer disbursements.

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neither admitted nor denied the rule violation upon which the penalty is based, the Clearing House Risk Committee found that Phillip Capital Inc.

violated CME Rule 980.A –

Required Records and Reports.

In accordance with the settlement offer, the Committee imposed a $50,000 fine for non-current books and records due to an issue with the firm’s middleware provider.

violated CME Rule 980.A – Required Records and Reports.

In accordance with the settlement offer, the Committee imposed a $50,000 fine for non-current books and records due to an issue with the firm’s middleware provider.

In a related matter, the CME Group had previously fined Phillip Capital Inc.

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Below is a list of material, administrative, civil, enforcement, or criminal complaints or actions filed against StoneX that are outstanding, and any enforcement actions or complaints filed against StoneX in the past five years which meet the materiality thresholds in CTFC regulations 4.24.(l) and 4.34(k).

● 

 On November 14, 2017, StoneX, without admission, denial, or liability, entered into a settlement with the Commodity Futures Trading Commission (“CFTC”).

The CFTC found that StoneX failed to have adequate compliance controls to identify trades improperly designated as EFRPs.

According to the CFTC Order, the firm failed to determine that the EFPs at issue had the necessary corresponding and related cash or OTC derivative position required for EFRPs.

The CFTC Order also found that the firm failed to ensure that the EFPs at issue were documented properly.

Finally, the firm failed to ensure that its employees involved in the execution, handling, and processing of EFRPs understood the requirements for executing, handing, and processing valid EFRPs.

StoneX, and its affiliate FCStone Merchant Services, jointly paid a $280,000 civil monetary penalty to the CFTC.

● 

 After a historic move in the natural gas market in November of 2018, StoneX experienced a number of customer deficits.

StoneX soon thereafter initiated NFA arbitrations, seeking to collect these debits, and has also been countersued and sued in a number of these arbitrations.

These accounts were managed by Optionsellers.com, (“Optionsellers”) who is a Commodity Trading Advisor (“CTA”) authorized by investors to act as attorney-in fact with exclusive trading authority over these investors’

trading accounts.

These accounts cleared through StoneX.

After this significant and historic natural gas market movement, the accounts declined below required maintenance margin levels.

StoneX’s role in managing the accounts was limited.

As a clearing firm, StoneX did not provide any investment advice, trading advice, or recommendations to customers of Optionsellers who chose to clear with StoneX.

Instead, it simply executed and cleared trades placed by Optionsellers on behalf of Optionsellers’

Instead, it simply executed and cleared trades placed by Optionsellers on behalf of Optionsellers’ customers.

Optionsellers is a CFTC registered CTA operating under a CFTC Rule 4.7 exemption from registration.

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Teucrium Trading, LLC, Sponsor

1.00% of average net assets annually for CORN, CANE, SOYB, and WEAT. 

0.94% of average net assets annually for DEFI.

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Foreside Fund Services, LLC, Distributor

Subject to a maximum of $625,812 for the Trust for the two-year period of May 1, 2021 to May 1, 2023 (the “two year offering period”), the Distributor receives:

0.01% of the Fund’s average daily net assets, and an aggregate annual fee of $100,000 for all Teucrium Funds.

For the two year offering period, the Distributor also receives expense reimbursements for sales and advertising review fees subject to a maximum of $6,000 per fund.

Under the Securities Activities and Service Agreement (the “SASA”), the Distributor receives compensation from the fund for its activities on behalf of all the Teucrium Funds.

For the two year offering period, the Distributor's compensation will not exceed $78,000 for all Teucrium Funds and will receive reimbursements relating to the registration, continuing education and other administrative expenses of the Registered Representatives for each offering, not to exceed $54,000 for all Teucrium Funds.

Subject to a maximum of $625,812 for the Trust for the two-year period of May 1, 2021 to May 1, 2023 and the two-year period of May 1, 2023 to May 1, 2025 (each, a “two year offering period”), the Distributor receives:

0.01% of the Fund’s average daily net assets, and an aggregate annual fee of $100,000 for all Teucrium Funds.

For the two year offering periods, the Distributor also receives expense reimbursements for sales and advertising review fees subject to a maximum of $6,000 per fund.

Under the Securities Activities and Service Agreement (the “SASA”), the Distributor receives compensation from each fund for its activities on behalf of all the Teucrium Funds.

For the two year offering periods, the Distributor's compensation will not exceed $78,000 for all Teucrium Funds and will receive reimbursements relating to the registration, continuing education and other administrative expenses of the Registered Representatives for each offering, not to exceed $54,000 for all Teucrium Funds.

Marex Capital Markets, Inc., Futures Commission Merchant and Clearing Broker

$4.50 per half-turn Futures Contract purchase or sale for corn, soybeans, wheat and sugar.

The Agricultural Funds pay $4.50 per Futures Contract half-turn for the purchase or sale for corn, soybeans, wheat and sugar exclusive of pass through fees for the exchange, NFA, execution fees, and platform and exchange data fees..

Phillip Capital Inc., Futures Commission Merchant and Clearing Broker

DEFI pays $35.00-$45.00 per Futures Contract half-turn exclusive of pass through fees for the exchange, NFA, execution fees, and platform and exchange data fees.

DEFI pays $35.00-$45.00 per Bitcoin Futures Contract half-turn exclusive of pass through fees for the exchange, NFA, execution fees, and platform and exchange data fees.

StoneX Financial Inc., Futures Commission Merchant and Clearing Broker

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Asset-based fees are calculated on a daily basis (accrued at 1/365 of the applicable percentage of NAV on that day) and paid on a monthly basis.

NAV is calculated by taking the current market value of the Fund’s total assets and subtracting any liabilities.

For each of the contractual agreements discussed above, the expense recognized in 2023 by the Trust and each Fund is detailed in the notes to the financial statements included in Part II of this filing.

Contractual Obligations

The primary contractual obligations of each Fund are with the Sponsor and certain other service providers.

Except for TAGS, which has no management fee, the Sponsor, in return for its services, will be entitled to a management fee calculated as a fixed percentage of each Agricultural Fund’s NAV, currently 1.00% of its average net assets.

The primary contractual obligations of each Fund are with the Sponsor and certain other service providers.

DEFI is contractually obligated to pay a monthly management fee to the Sponsor, based on average daily net assets, at a rate equal to 0.94% per annum.

(ii) expenses incurred in connection with registering additional Shares of the Fund or offering Shares of the Fund;

(iii) the routine expenses associated with the preparation and, if required, the printing and mailing of monthly, quarterly, annual and other reports required by applicable U.S.

federal and state regulatory authorities, Trust meetings and preparing, printing and mailing proxy statements to Shareholders;

(iv) the payment of any distributions related to redemption of Shares;

(v) payment for routine services of the Trustee, legal counsel and independent accountants;

(vi) payment for routine accounting, bookkeeping, compliance, distribution and solicitation‐

related services, custodial and transfer agency services, whether performed by an outside service provider or by affiliates of the Sponsor;

(vii) postage and insurance;

(viii) costs and expenses associated with client relations and services;

(ix) costs of preparation of all federal, state, local and foreign tax returns and any taxes payable on the income, assets or operations of the Fund;

and (xi) extraordinary expenses (including, but not limited to, legal claims and liabilities and litigation costs and any indemnification related thereto).

The Management Fee for DEFI is paid in consideration of the Sponsor’s services related to the management of the Fund’s business and affairs, including the provision of commodity futures trading advisory services.

DEFI pays all of its respective brokerage commissions, including applicable exchange fees, NFA fees and give‐up fees, and other transaction related fees and expenses charged in connection with trading activities for the Fund’s investments in CFTC regulated investments.

CORN, CANE, SOYB, WEAT and TAGS will also be responsible for all ongoing fees, costs and expenses of its operation, including (i) brokerage and other fees and commissions incurred in connection with the trading activities of the Fund; (ii) expenses incurred in connection with registering additional Shares of the Fund or offering Shares of the Fund; (iii) the routine expenses associated with the preparation and, if required, the printing and mailing of monthly, quarterly, annual and other reports required by applicable U.S.

federal and state regulatory authorities, Trust meetings and preparing, printing and mailing proxy statements to Shareholders; (iv) the payment of any distributions related to redemption of Shares; (v) payment for routine services of the Trustee, legal counsel and independent accountants; (vi) payment for routine accounting, bookkeeping, compliance, distribution and solicitation‐ related services, custodial and transfer agency services, whether performed by an outside service provider or by affiliates of the Sponsor; (vii) postage and insurance; (viii) costs and expenses associated with client relations and services; (ix) costs of preparation of all federal, state, local and foreign tax returns and any taxes payable on the income, assets or operations of the Fund; and (xi) extraordinary expenses (including, but not limited to, legal claims and liabilities and litigation costs and any indemnification related thereto).

DEFI bears other transaction costs related to the FCM capital requirements on a monthly basis.

The Sponsor pays all of the routine operational, administrative and other ordinary expenses of the Fund, generally as determined by the Sponsor, including but not limited to, fees and expenses of the Administrator, Custodian, Distributor, Transfer Agent, licensors, accounting and audit fees and expenses, tax preparation expenses, legal fees, ongoing SEC registration fees, individual Schedule K‐1 preparation and mailing fees, and report preparation and mailing expenses.

DEFI pays all of its non‐recurring and unusual fees and expenses, if any, as determined by the Sponsor.

Non‐recurring and unusual fees and expenses are unexpected or unusual in nature, such as legal claims and liabilities and litigation costs or indemnification or other unanticipated expenses.

DEFI pays all of its non‐recurring and unusual fees and expenses, if any, as determined by the Sponsor.

Non‐recurring and unusual fees and expenses are unexpected or unusual in nature, such as legal claims and liabilities and litigation costs or indemnification or other unanticipated expenses.

Extraordinary fees and expenses also include material expenses which are not currently anticipated obligations of the Fund.

Routine operational, administrative and other ordinary expenses are not deemed extraordinary expenses.

Toroso Investments, LLC (“Toroso”), Tidal ETF Services LLC (“Tidal”) and Victory Capital Management Inc.

(“Victory Capital”), Hashdex Asset Management Ltd.

(“Hashdex”) and the Sponsor (the “Parties”) have entered into an agreement (the “Support Agreement”) that sets forth certain terms and conditions applicable to the launch, marketing, promotion, development, and ongoing operation of DEFI, as well the respective rights in profits and obligations for expenses.

Toroso Investments, LLC (“Toroso”), Tidal ETF Services LLC (“Tidal”) and Victory Capital Management Inc.

(“Victory Capital”), Hashdex Asset Management Ltd.

The primary responsibilities and rights of each Party with respect to the Fund are described below:

The Support Agreement provides that Hashdex will provide to the other Parties research and analysis regarding bitcoin and bitcoin markets for use in the operation and marketing of the Fund.

Subject to mutual agreement of the Parties, Victory Capital will provide sub‐advisory and sales support services for the Fund.

The Sponsor, Toroso, Hashdex and Victory Capital are responsible for paying for all listing, legal, and regulatory costs and expenses incurred in connection with the regulatory process related to the launch of the Fund, including drafting the Fund’s registration statement, exchange listing fees, and other regulatory or service provider fees, as determined in the Support Agreement (“Start‐Up Costs”).

The Fund will not be responsible for the Start‐Up Costs.

Subject to mutual agreement of the Parties, Victory Capital will provide sub‐advisory and sales support services for the Fund.

The Fund will not be responsible for the Start‐Up Costs.

Each Party is responsible for its own internal expenses.

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The parties cannot anticipate the amount of payments that will be required under these arrangements for future periods as the NAV and trading levels to meet investment objectives for each Fund will not be known until a future date.

These agreements are effective for a specific term agreed upon by the parties with an option to renew, or, in some cases, are in effect for the duration of each Fund’s existence.

The parties may terminate these agreements earlier for certain reasons listed in the agreements.

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Shareholders are limited to (1) participants in DTC such as banks, brokers, dealers and trust companies (DTC Participants), (2) those who maintain, either directly or indirectly, a custodial relationship with a DTC Participant (Indirect Participants), and (3) those who hold interests in the Shares through DTC Participants or Indirect Participants, in each case who satisfy the requirements for transfers of Shares.

DTC Participants acting on behalf of investors holding Shares through such participant accounts in DTC will follow the delivery practice applicable to securities eligible for DTC’s Same-Day Funds Settlement System.

Shares are credited to DTC Participants securities accounts following confirmation of receipt of payment.

DTC has advised us as follows:

It is a limited purpose trust company organized under the laws of the State of New York and is a member of the Federal Reserve System, a “clearing corporation”

within the meaning of the New York Uniform Commercial Code and a “clearing agency”

registered pursuant to the provisions of Section 17A of the Exchange Act.

It is a limited purpose trust company organized under the laws of the State of New York and is a member of the Federal Reserve System, a “clearing corporation” within the meaning of the New York Uniform Commercial Code and a “clearing agency” registered pursuant to the provisions of Section 17A of the Exchange Act.

DTC holds securities for DTC Participants and facilitates the clearance and settlement of transactions between DTC Participants through electronic book-entry changes in accounts of DTC Participants.

Transfer of Shares

For all Funds, the Shares are only transferable through the book-entry system of DTC.

For all Funds, the Shares are only transferable through the book-entry system of DTC.

Shareholders who are not DTC Participants may transfer their Shares through DTC by instructing the DTC Participant holding their Shares (or by instructing the Indirect Participant or other entity through which their Shares are held) to transfer the Shares.

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Minimum Number of Shares

There are a minimum number of baskets and associated shares specified for each Fund in the Fund’s respective prospectus as amended from time to time.

Once the minimum number of baskets is reached, there can be no more redemptions until there has been a creation basket.

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The value of over the counter Commodity Interests will be determined based on the value of the commodity or Futures Contract underlying such Commodity Interest, except that a fair value may be determined if the Sponsor believes that a Fund is subject to significant credit risk relating to the counterparty to such Commodity Interest.

For purposes of financial statements and reports, the Sponsor will recalculate the NAV of a specific Fund where necessary to reflect the “fair value”

of a Futures Contract when the Futures Contract of such Fund closes at its price fluctuation limit for the day.

For purposes of financial statements and reports, the Sponsor will recalculate the NAV of a specific Fund where necessary to reflect the “fair value” of a Futures Contract when the Futures Contract of such Fund closes at its price fluctuation limit for the day.

Treasury Securities held by the Fund are valued by the Administrator using values received from recognized third-party vendors (such as Reuters) and dealer quotes.

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In addition, in order to provide updated information relating to the Funds for use by investors and market professionals, ICE Data Indices, LLC calculates and disseminates throughout the trading day an updated indicative fund value for each Fund.

The indicative fund value is calculated by using the prior day’s closing NAV per share of the Fund as a base and updating that value throughout the trading day to reflect changes in the value of the Fund’s Commodity or Cryptocurrency Interests during the trading day.

Changes in the value of short-term Treasury Securities and cash equivalents will not be included in the calculation of indicative value throughout the day.

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In addition, there may be some trading hours which may be limited to electronic trading only.

This means that there is a gap in time at the beginning and the end of each day during which the Fund’s Shares are traded on the NYSE Arca, when, for example, real-time CBOT trading prices for Corn Futures Contracts traded on such Exchange are not available.

As a result, during those gaps there will be no update to the indicative fund values.

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On any business day, an Authorized Purchaser may place an order with the transfer agent to create one or more baskets for a Fund.

For purposes of processing purchase and redemption orders, a “business day”

means any day other than a day when any of the NYSE Arca, CBOT, CME, ICE, or the New York Stock Exchange is closed for regular trading.

For purposes of processing purchase and redemption orders, a “business day” means any day other than a day when any of the NYSE Arca, CBOT, CME, ICE, or the New York Stock Exchange is closed for regular trading.

Purchase orders must be placed by noon (ET) or the close of regular trading on the New York Stock Exchange, whichever is earlier for CANE and TAGS.

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Delivery of Required Deposits

An Authorized Purchaser who places a purchase order is responsible for transferring to the account of that Fund with the Custodian the required amount of securities, commodity or cryptocurrency futures and/or cash by the end of the next business day following the purchase order date or by the end of such later business day, not to exceed three business days after the purchase order date, as agreed to between the Authorized Purchaser and the Custodian when the purchase order is placed (the “Purchase Settlement Date”).

Upon receipt of the deposit amount, the Custodian will direct DTC to credit the number of baskets ordered for the specific Fund to the Authorized Purchaser’s DTC account on the Purchase Settlement Date.

Because orders to purchase baskets must be placed by noon or 1:15 p.m., (ET), depending on the Fund, but the total payment required to create a basket during the continuous offering period will not be determined until 4:00 p.m., (ET), on the date the purchase order is received, Authorized Purchasers will not know the total amount of the payment required to create a basket at the time they submit an irrevocable purchase order for the basket.

The Fund’s NAV and the total amount of the payment required to create a basket could rise or fall substantially between the time an irrevocable purchase order is submitted and the time the amount of the purchase price in respect thereof is determined.

Rejection of Purchase Orders

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circumstances outside the control of the Sponsor, Distributor or transfer agent make it, for all practical purposes, not feasible to process creations of baskets;

there is a possibility that any or all of the Benchmark Component Futures Contracts of the Fund on the CBOT, ICE or CME from which the NAV of the Fund is calculated will be priced at a daily price limit restriction;

there is a possibility that any or all of the Benchmark Component Futures Contracts of the Fund on the CBOT, ICE or CME from which the NAV of the Fund is calculated will be priced at a daily price limit restriction;

if, in the sole discretion of the Sponsor, the execution of such an order would not be in the best interest of the Fund or its Shareholders.

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The redemption procedures allow Authorized Purchasers to redeem baskets and do not entitle an individual Shareholder to redeem any Shares in an amount less than a Redemption Basket, or to redeem baskets other than through an Authorized Purchaser.

By placing a redemption order, an Authorized Purchaser agrees to deliver the baskets to be redeemed through DTC’s book-entry system to a Fund by the end of the next business day following the effective date of the redemption order for all funds other than TAGS or by the end of the second business day for TAGS, or by the end of such later business day, not to exceed two business days after the effective date of the redemption order, as agreed to between the Authorized Purchaser, transfer agent and the Distributor when the redemption order is placed (the “Redemption Settlement Date”).

Prior to the delivery of the redemption distribution for a redemption order, the Authorized Purchaser must also have wired to the Sponsor’s account at the Custodian the non-refundable transaction fee due for the redemption order.

An Authorized Purchaser may not withdraw a redemption order without the prior consent of the Sponsor in its discretion.

Determination of Redemption Distribution

The redemption distribution from a Fund will consist of a transfer to the redeeming Authorized Purchaser of an amount of securities, commodity or cryptocurrency futures and/or cash that is in the same proportion to the total assets of the Fund (net of estimated accrued but unpaid fees, expenses and other liabilities) on the date the order to redeem is properly received as the number of Shares to be redeemed under the redemption order is in proportion to the total number of Shares outstanding on the date the order is received.

The redemption distribution from a Fund will consist of a transfer to the redeeming Authorized Purchaser of an amount of securities, commodity or cryptocurrency futures and/or cash that is in the same proportion to the total assets of the Fund (net of estimated accrued but unpaid fees, expenses and other liabilities) on the date the order to redeem is properly received as the number of Shares to be redeemed under the redemption order is in proportion to the total number of Shares outstanding on the date the order is received.

The Sponsor, directly or in consultation with the Custodian and Administrator, determines the requirements for securities, commodity futures and/or cash, including the remaining maturities of the Treasury Securities and proportions of Treasury Securities and cash that may be included in distributions to redeem baskets.

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Delivery of Redemption Distribution

The redemption distribution due from a Fund will be delivered to the Authorized Purchaser on the Redemption Settlement Date if the Fund’s DTC account has been credited with the baskets to be redeemed.

If the Fund’s DTC account has not been credited with all of the baskets to be redeemed by the end of such date, the redemption distribution will be delivered to the extent of whole baskets received.

Any remainder of the redemption distribution will be delivered on the next business day after the Redemption Settlement Date to the extent of remaining whole baskets received.

Pursuant to information from the Sponsor, the Custodian will also be authorized to deliver the redemption distribution notwithstanding that the baskets to be redeemed are not credited to the Fund’s DTC account by noon (ET) on the Redemption Settlement Date if the Authorized Purchaser has collateralized its obligation to deliver the baskets through DTC’s book entry-system on such terms as the Sponsor may from time to time determine.

Suspension or Rejection of Redemption Orders

The Sponsor may, in its discretion, suspend the right of redemption, or postpone the redemption settlement date, (1) for any period during which the NYSE Arca, CBOT, CME or ICE is closed other than customary weekend or holiday closings, or trading on the NYSE Arca or any of the applicable exchanges, is suspended or restricted, (2) for any period during which an emergency exists as a result of which delivery, disposal or evaluation of Treasury Securities is not reasonably practicable, (3) for such other period as the Sponsor determines to be necessary for the protection of the Shareholders, (4) if there is a possibility that any or all of the Benchmark Component Futures Contracts of the applicable Fund on the exchange from which the NAV of the Fund is calculated will be priced at a daily price limit restriction, or (5) if, in the sole discretion of the Sponsor, the execution of such an order would not be in the best interest of the Fund or its Shareholders.

For example, the Sponsor may determine that it is necessary to suspend redemptions to allow for the orderly liquidation of a Fund’s assets at an appropriate value to fund a redemption.

If the Sponsor has difficulty liquidating a Fund’s positions, e.g., because of a market disruption event in the futures markets or an unanticipated delay in the liquidation of a position in an over the counter contract, it may be appropriate to suspend redemptions until such time as such circumstances are rectified.

For example, the Sponsor may determine that it is necessary to suspend redemptions to allow for the orderly liquidation of a Fund’s assets at an appropriate value to fund a redemption.

None of the Sponsor, the Distributor, or the transfer agent will be liable to any person or in any way for any loss or damages that may result from any such suspension or postponement.

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The Trust and the Funds will continue to exist until terminated in accordance with the Trust Agreement.

The Sponsor’s authority includes, without limitation, the right to take the following actions:

To enter into, execute, deliver and maintain contracts, agreements and any other documents as may be in furtherance of the Trust’s purpose or necessary or appropriate for the offer and sale of the Shares and the conduct of Trust activities;

To establish, maintain, deposit into, sign checks and otherwise draw upon accounts on behalf of the Trust with appropriate banking and savings institutions, and execute and accept any instrument or agreement incidental to the Trust’s business and in furtherance of its purposes;

The Sponsor’s authority includes, without limitation, the right to take the following actions:

To supervise the preparation and filing of any registration statement (and supplements and amendments thereto) for the Fund;

To adopt, implement or amend, from time to time, such disclosure and financial reporting, information gathering, and control policies and procedures as are necessary or desirable to ensure compliance with applicable disclosure and financial reporting obligations under any applicable securities laws;

To make any necessary determination or decision in connection with the preparation of the Trust’s financial statements and amendments thereto;

To prepare, file and distribute, if applicable, any periodic reports or updates that may be required under the 1934 Act, the Commodity Exchange Act (the “CEA”) or rules and regulations promulgated thereunder;

To make any necessary determination or decision in connection with the preparation of the Trust’s financial statements and amendments thereto;

To pay or authorize the payment of distributions to the Shareholders and expenses of the Fund;

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In its sole discretion, to determine to admit an affiliate or affiliates of the Sponsor as additional Sponsors.

The Sponsor ’

s Obligations

The Sponsor ’ s Obligations

In addition to the duties imposed by the Delaware Trust Statute, under the Trust Agreement the Sponsor has the following obligations as a sponsor of the Trust:

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Invest, reinvest, hold uninvested, sell, exchange, write options on, lease, lend and, subject to certain limitations set forth in the Trust Agreement, pledge, mortgage, and hypothecate the estate of the Fund in accordance with the purposes of the Trust and any registration statement filed on behalf of the Fund;

Have fiduciary responsibility for the safekeeping and use of the Trust’s assets, whether or not in the Sponsor’s immediate possession or control;

Enter into and perform agreements with each Authorized Purchaser, receive from Authorized Purchasers and process properly submitted purchase orders, receive Creation Basket Deposits, deliver or cause the delivery of Creation Baskets to the Depository for the account of the Authorized Purchaser submitting a purchase order;

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Liability and Indemnification

Under the Trust Agreement, the Sponsor, the Trustee and their respective Affiliates (collectively, “Covered Persons”) shall have no liability to the Trust, the Fund, or to any Shareholder for any loss suffered by the Trust or the Fund which arises out of any action or inaction of such Covered Person if such Covered Person, in good faith, determined that such course of conduct was in the best interest of the Trust or the Fund and such course of conduct did not constitute gross negligence or willful misconduct of such Covered Person.

Subject to the foregoing, neither the Sponsor nor any other Covered Person shall be personally liable for the return or repayment of all or any portion of the capital or profits of any Shareholder or assignee thereof, it being expressly agreed that any such return of capital or profits made pursuant to the Trust Agreement shall be made solely from the assets of the applicable Teucrium Fund without any rights of contribution from the Sponsor or any other Covered Person.

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The Trust Agreement also provides that the Sponsor shall be indemnified by the Trust (or by a series separately to the extent the matter in question relates to a single series or disproportionately affects a specific series in relation to other series) against any losses, judgments, liabilities, expenses and amounts paid in settlement of any claims sustained by it in connection with its activities for the Trust, provided that (i) the Sponsor was acting on behalf of or performing services for the Trust and has determined, in good faith, that such course of conduct was in the best interests of the Trust and such liability or loss was not the result of gross negligence, willful misconduct, or a breach of the Trust Agreement on the part of the Sponsor and (ii) any such indemnification will only be recoverable from the assets of the applicable series.

The Sponsor’s rights to indemnification permitted under the Trust Agreement shall not be affected by the dissolution or other cessation to exist of the Sponsor, or the withdrawal, adjudication of bankruptcy or insolvency of the Sponsor, or the filing of a voluntary or involuntary petition in bankruptcy under Title 11 of the Bankruptcy Code by or against the Sponsor.

Notwithstanding the above, the Sponsor shall not be indemnified for any losses, liabilities or expenses arising from or out of an alleged violation of U.S.

federal or state securities laws unless (i) there has been a successful adjudication on the merits of each count involving alleged securities law violations as to the particular indemnitee and the court approves the indemnification of such expenses (including, without limitation, litigation costs), (ii) such claims have been dismissed with prejudice on the merits by a court of competent jurisdiction as to the particular indemnitee and the court approves the indemnification of such expenses (including, without limitation, litigation costs), or (iii) a court of competent jurisdiction approves a settlement of the claims against a particular indemnitee and finds that indemnification of the settlement and related costs should be made.

The payment of any indemnification shall be allocated, as appropriate, among the Trust’s series.

The Trust and its series shall not incur the cost of that portion of any insurance which insures any party against any liability, the indemnification of which is prohibited under the Trust Agreement.

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and (iii) the Sponsor undertakes to repay the advanced funds with interest to the Trust in cases in which it is not entitled to indemnification.

The Trust Agreement provides that the Sponsor and the Trust shall indemnify the Trustee and its successors, assigns, legal representatives, officers, directors, shareholders, employees, agents and servants (the “Trustee Indemnified Parties”) against any liabilities, obligations, losses, damages, penalties, taxes, claims, actions, suits, costs, expenses or disbursements which may be imposed on a Trustee Indemnified Party relating to or arising out of the formation, operation or termination of the Trust, the execution, delivery and performance of any other agreements to which the Trust is a party, or the action or inaction of the Trustee under the Trust Agreement or any other agreement, except for expenses resulting from the gross negligence or willful misconduct of a Trustee Indemnified Party.

Further, certain officers of the Sponsor are insured against liability for certain errors or omissions which an officer may incur or that may arise out of his or her capacity as such.

In the event the Trust is made a party to any claim, dispute, demand or litigation or otherwise incurs any liability or expense as a result of or in connection with any Shareholder’s (or assignee’s) obligations or liabilities unrelated to the Trust business, such Shareholder (or assignees cumulatively) is required under the Trust Agreement to indemnify the Trust for all such liability and expense incurred, including attorneys’

and accountants’

Withdrawal of the Sponsor

The Sponsor may withdraw voluntarily as the Sponsor of the Trust only upon ninety (90) days’

prior written notice to the holders of the Trust’s outstanding shares and the Trustee.

The Sponsor may withdraw voluntarily as the Sponsor of the Trust only upon ninety (90) days’ prior written notice to the holders of the Trust’s outstanding shares and the Trustee.

If the withdrawing Sponsor is the last remaining Sponsor, shareholders holding a majority (over 50%) of the outstanding shares of the Funds voting together as a single class (not including shares acquired by the Sponsor through its initial capital contribution) may vote to elect a successor Sponsor.

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If the Sponsor withdraws and a successor Sponsor is named, the withdrawing Sponsor shall pay all expenses as a result of its withdrawal.

Meetings of the Shareholders of the Trust’s Series may be called by the Sponsor and will be called by it upon the written request of Shareholders holding at least 25% of the Shares of the Trust or a Fund, as applicable (not including Shares acquired by the Sponsor through its initial capital contribution), to vote on any matter with respect to which Shareholders have a right to vote under the Trust Agreement.

The Sponsor shall deposit in the United States mail or electronically transmit written notice to all Shareholders of a Fund of the meeting and the purpose of the meeting, which shall be held on a date not less than 30 nor more than 60 days after the date of mailing of such notice, at a reasonable time and place.

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Specifically, the Trust Agreement provides that shareholders of the Funds holding shares representing at least a majority (over 50%) of the outstanding shares of the Funds voting together as a single class (excluding shares acquired by the Sponsor in connection with its initial capital contribution to any Trust series) may vote to (i) continue the Trust by electing a successor Sponsor as described above, and (ii) approve amendments to the Trust Agreement that impair the right to surrender Redemption Baskets for redemption.

(Trustee consent to any amendment to the Trust Agreement is required if the Trustee reasonably believes that such amendment adversely affects any of its rights, duties or liabilities.) In addition, shareholders of the Funds holding shares representing seventy-five percent (75%) of the outstanding shares of the Funds, voting together as a single class (excluding shares acquired by the Sponsor in connection with its initial capital contribution to any Trust series) may vote to dissolve the Trust upon not less than ninety (90) days’

notice to the Sponsor.

Shareholders have no voting rights with respect to the Trust or a Fund except as expressly provided in the Trust Agreement.

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Limited Liability of Shareholders

Shareholders shall be entitled to the same limitation of personal liability extended to stockholders of private corporations for profit organized under the general corporation law of Delaware, and no Shareholder shall be liable for claims against, or debts of the Trust or the Fund in excess of his share of a Fund’s assets.

The Trust or a Fund shall not make a claim against a Shareholder with respect to amounts distributed to such Shareholder or amounts received by such Shareholder upon redemption unless, under Delaware law, such Shareholder is liable to repay such amount.

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The Sponsor Has Conflicts of Interest

There are present and potential future conflicts of interest in the Trust’s structure and operation you should consider before you purchase Shares.

The Sponsor may use this notice of conflicts as a defense against any claim or other proceeding made.

The Sponsor’s principals, officers and employees, do not devote their time exclusively to the Funds.

Under the organizational documents of the Sponsor, Mr.

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In addition, the Sponsor expects that operating the Teucrium Funds and other Sponsor related activities will generally constitute the principal and full-time business activity of its principals, officers and employees.

Notwithstanding these obligations and expectations, the Sponsor’s principals may be directors, officers or employees of other entities, and may manage assets of other entities, including the other Teucrium Funds or other funds, through the Sponsor or otherwise.

In particular, the principals could have a conflict between his responsibilities to the Fund on the one hand and to those other entities on the other.

The Sponsor believes that it currently has sufficient personnel, time, and working capital to discharge its responsibilities to the Teucrium Funds in a fair manner and that these persons’

conflicts should not impair its ability to provide services to the Fund.

However, it is not possible to quantify the proportion of 

time that the Sponsor’s personnel will devote to the Funds and its management.

In particular, the principals could have a conflict between their responsibilities to the Fund on the one hand and to those other entities on the other.

The Sponsor believes that it currently has sufficient personnel, time, and working capital to discharge its responsibilities to the Teucrium Funds in a fair manner and that these persons’ conflicts should not impair its ability to provide services to the Fund.

However, it is not possible to quantify the proportion of time that the Sponsor’s personnel will devote to the Funds and its management.

The Sponsor and its principals, officers and employees may trade futures and related contracts for their own accounts.

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A conflict of interest may exist if their trades are in the same markets and at approximately the same times as the trades for the Fund.

A potential conflict also may occur when the Sponsor’s principals trade their accounts more aggressively or take positions in their accounts which are opposite, or ahead of, the positions taken by the Fund.

The Sponsor has sole current authority to manage the investments and operations of the Funds, and this may allow it to act in a way that furthers its own interests rather than your best interests, including the authority of the Sponsor to allocate expenses to and between the Funds.

Shareholders have very limited voting rights, which will limit their ability to influence matters such as amendment of the Trust Agreement, change in the Fund’s basic investment policies, or dissolution of a Fund or the Trust.

The Sponsor has sole current authority to manage the investments and operations of the Funds, and this may allow it to act in a way that furthers its own interests rather than your best interests, including the authority of the Sponsor to allocate expenses to and between the Funds.

The Sponsor serves as the Sponsor to the Teucrium Funds and may in the future serve as the Sponsor or investment adviser to commodity pools other than the Teucrium Funds.

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In addition, the Sponsor may be required to indemnify the officers and directors of the other pools, if the need for indemnification arises.

This potential indemnification will cause the Sponsor’s assets to decrease.

If the Sponsor’s other sources of income are not sufficient to compensate for the indemnification, it could cease operations, which could in turn result in Fund losses and/or termination of the Fund.

This potential indemnification will cause the Sponsor’s assets to decrease.

If the Sponsor acquires knowledge of a potential transaction or arrangement that may be an opportunity for a Fund, it shall have no duty to offer such opportunity to the Fund.

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The CFTC has delegated to the NFA responsibility for the registration of CPOs and FCMs and their respective associated persons.

The Sponsor and the Fund’s clearing broker are members of the NFA.

As such, they will be subject to NFA standards relating to fair trade practices, financial condition and consumer protection.

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The CFTC possesses exclusive jurisdiction to regulate the activities of commodity pool operators and commodity trading advisors with respect to "commodity interests," such as futures, swaps, and options, and has adopted regulations with respect to the activities of those persons and/or entities.

Under the Commodity Exchange Act (“CEA”), a registered commodity pool operator, such as the Sponsor, is required to make annual filings with the CFTC and the NFA describing its organization, capital structure, management and controlling persons.

In addition, the CEA authorizes the CFTC to require and review books and records of, and documents prepared by, registered commodity pool operators.

Pursuant to this authority, the CFTC requires commodity pool operators to keep accurate, current and orderly records for each pool that they operate.

The CFTC may suspend the registration of a commodity pool operator (1) if the CFTC finds that the operator’s trading practices tend to disrupt orderly market conditions, (2) if any controlling person of the operator is subject to an order of the CFTC denying such person trading privileges on any exchange, and (3) in certain other circumstances.

Suspension, restriction or termination of the Sponsor’s registration as a commodity pool operator would prevent it, until that registration were to be reinstated, from managing the Funds, and might result in the termination of a Fund if a successor sponsor is not elected pursuant to the Trust Agreement.

Neither the Trust nor the Funds are required to be registered with the CFTC in any capacity.

The Fund’s investors are afforded prescribed rights for reparations under the CEA.

Investors may also be able to maintain a private right of action for violations of the CEA.

The CFTC has adopted rules implementing the reparation provisions of the CEA, which provide that any person may file a complaint for a reparations award with the CFTC for violation of the CEA against a floor broker or an FCM, introducing broker, commodity trading advisor, CPO, and their respective associated persons.

The regulations of the CFTC and the NFA prohibit any representation by a person registered with the CFTC or by any member of the NFA, that registration with the CFTC, or membership in the NFA, in any respect indicates that the CFTC or the NFA has approved or endorsed that person or that person’s trading program or objectives.

The registrations and memberships of the parties described in this summary must not be considered as constituting any such approval or endorsement.

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Clearing organizations are also subject to the CEA and the rules and regulations adopted thereunder as administered by the CFTC.

The CFTC’s function is to implement the CEA’s objectives of preventing price manipulation and excessive speculation and promoting orderly and efficient commodity interest markets.

In addition, the various exchanges and clearing organizations themselves as SROs exercise regulatory and supervisory authority over their member firms.

The Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”) was enacted in response to the economic crisis of 2008 and 2009 and it significantly altered the regulatory regime to which the securities and commodities markets are subject.

To date, the CFTC has issued proposed or final versions of almost all of the rules it is required to promulgate under the Dodd-Frank Act, and it continues to issue proposed versions of additional rules that it has authority to promulgate.

Provisions of the new law include the requirement that position limits be established on a wide range of commodity interests, including agricultural, energy, and metal-based commodity futures contracts, options on such futures contracts and uncleared swaps that are economically equivalent to such futures contracts and options (“Reference Contracts”);

new registration and recordkeeping requirements for swap market participants;

capital and margin requirements for “swap dealers”

and “major swap participants,”

as determined by the new law and applicable regulations;

capital and margin requirements for “swap dealers” and “major swap participants,” as determined by the new law and applicable regulations;

reporting of all swap transactions to swap data repositories;

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change, the interpretation and implementation will change along with them.

Nevertheless, regulatory reform of any kind may have a significant impact on U.S.

Regulatory reform of any kind may have a significant impact on U.S.

regulated entities.

Position Limits, Aggregation Limits, Accountability Levels,  

Price Fluctuation Limits

Position Limits, Aggregation Limits, Accountability Levels, Price Fluctuation Limits

The CFTC and US futures exchanges impose limits on the maximum net long or net short speculative positions that any person may hold or control in any particular futures or options contracts traded on US futures exchanges.

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A Fund could be required to liquidate positions it holds in order to comply with position limits or may not be able to fully implement trading instructions generated by its trading models, in order to comply with position limits.

Any such liquidation or limited implementation could result in substantial costs to a Fund. 

Limits are generally applied on an aggregate basis to positions held in accounts that are subject to 10% or greater common ownership or control.

In December 2016, the CFTC adopted rule amendments that provide exemptions from the general requirement to aggregate all positions that are held pursuant to 10% or greater common ownership or control.

The Dodd-Frank Act significantly expanded the CFTC’s authority to impose position limits with respect to futures contracts and options on futures contracts, swaps that are economically equivalent to futures or options on futures, and swaps that are traded on a regulated exchange and certain swaps that perform a significant price discovery function.

In October 2020, the CFTC adopted new speculative position limits with respect to futures and options on futures on many physical commodities, including energy, metals and agricultural commodities (the “core referenced futures contracts“), and on economically equivalent swaps.

The CFTC’s new position limits rules include an exemption from limits for bona fide hedging transactions or positions.

A bona fide hedging transaction or position may exceed the applicable federal position limits if the transaction or position:

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or (C) services that a person provides, purchases, or anticipates providing or purchasing.

The CFTC’s new position rules set forth a list of enumerated bona fide hedges for which a market participant is not required to request prior approval from the CFTC in order to hold a bona fide hedge position above the federal position limit.

However, a market participant holding an enumerated bona fide hedge position still would need to request an exemption from the relevant exchange for exchange-set limits.

For non-enumerated bona fide hedge positions, a market participant may request CFTC approval which must be granted prior to exceeding the applicable federal position limit, except where there is a demonstrated sudden or unforeseen increase in bona fide hedging needs (in which case the application must be submitted within five business days after the market participant exceeds the applicable limit).

The compliance dates for the CFTC’s new federal speculative position limits are January 1, 2022 for the core referenced futures contracts and January 1, 2023 for economically equivalent swaps.

Position Aggregation.

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For example, a market participant is not required to aggregate positions in multiple accounts that it owns or controls if that market participant is able to satisfy the requirements of an exemption from aggregation of those accounts, including, where available, the independent account controller exemption.

Failure to comply with the independent account controller exemption or another exemption from the aggregation requirement could obligate the Sponsor to aggregate positions in multiple accounts under its control, which could include the Fund and other commodity pools or accounts under the Sponsor’s control.

In such a scenario, a Fund may not be able to obtain exposure to one or more contracts necessary to pursue its investment objective, or it may be required to liquidate existing contract positions in order to comply with a limit.

Such an outcome could adversely affect a Fund’s ability to pursue its investment objective or achieve favorable performance.

The CFTC amended its position aggregation rules in December 2016.

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An exchange may order a person who holds or controls a position in excess of a position accountability level not to further increase its position, to comply with any prospective limit that exceeds the size of the position owned or controlled, or to reduce any open position that exceeds the position accountability level if the exchange determines that such action is necessary to maintain an orderly market.

Position accountability levels could adversely affect a Fund’s ability to establish and maintain positions in commodity futures contracts to which such levels apply, if a Fund were to trade in such contracts.

Such an outcome could adversely affect a Fund’s ability to pursue its investment objective.

Daily Limits.

futures exchanges and some foreign exchanges have regulations that limit the amount of fluctuation in futures contract prices that may occur during a single business day.

These limits are generally referred to as “daily price fluctuation limits”

or “daily limits,”

and the maximum or minimum price of a contract on any given day as a result of these limits is referred to as a “limit price.”

Once a limit price has been reached in a particular contract, it is usually the case that no trades may be made at a different price than specified in the limit.

These limits are generally referred to as “daily price fluctuation limits” or “daily limits,” and the maximum or minimum price of a contract on any given day as a result of these limits is referred to as a “limit price.” Once a limit price has been reached in a particular contract, it is usually the case that no trades may be made at a different price than specified in the limit.

The duration of limit prices generally varies.

Limit prices may have the effect of precluding a Fund from trading in a particular contract or requiring the Fund to liquidate contracts at disadvantageous times or prices.

Either of those outcomes could adversely affect a Fund’s ability to pursue its investment objective.

Potential Effects of Positions Limits, Aggregation Limits, Accountability Levels, and Price Fluctuation Limits.

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If a Fund reached a position limit or accountability level or became subject to a daily limit, its ability to issue new creation units or reinvest income in additional commodity futures contracts may be limited to the extent these restrictions limit its ability to establish new futures positions, add to existing positions, or otherwise transact in futures.

Limiting the size of a Fund, or restricting a Fund’s futures trading, under these requirements could adversely affect a Fund’s ability to pursue its investment objective.

The aggregate position limits currently in place under the current position limits and the Aggregation Requirements are as follows for each of the commodities traded by the Funds:

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19,300 contracts

Cryptocurrency Futures Contracts

Spot Month Position Limit 

All Month and Single Month (excluding spot month)

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4,000 contracts

5,000 contracts

5,000 contracts

micro bitcoin

200,000 contracts

250,000 contracts

250,000 contracts

Margin for OTC Uncleared Swaps

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The Sponsor makes available, free of charge, on the website for each Fund, the annual reports on Form 10-K for the Trust, the quarterly reports on Form 10-Q for the Trust, current reports on Form 8-K and amendments to these reports as soon as reasonably practicable after these documents are filed with, or furnished to, the SEC.

The documents that the Trust has filed with, or furnished to, the SEC may be found on the Fund’s website under the heading “Documents.”

The website for the Sponsor and the Funds is www.teucrium.com.

These reports are also available from the SEC through that agency’s website at:

The documents that the Trust has filed with, or furnished to, the SEC may be found on the Fund’s website under the heading “Documents.” The website for the Sponsor and the Funds is www.teucrium.com.

These reports are also available from the SEC through that agency’s website at:

www.sec.gov and will be provided free of charge in paper or electronically on request.

The Sponsor makes available, free of charge, on the website for each Fund, the monthly statements of account required to be filed pursuant to Rule 4.22(h) under the Commodity Exchange Act.

The Sponsor also makes available, free of charge, on the website for each Fund, the Disclosure Document and the annual reports on From 10-K for the Trust, filed pursuant to Rule 4.12(c )(2) under the Commodity Exchange Act.

The Sponsor also makes available, free of charge, on the website for each Fund, the Disclosure Document and the annual reports on Form 10-K for the Trust, filed pursuant to Rule 4.12(c)(2) under the Commodity Exchange Act.

Intellectual Property

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business