eUNITs trust to offer $24 million units linked to S&P 500 Composite

By Angela McDaniels

Tacoma, Wash., Jan. 24 - eUnits 2 Year U.S. Market Participation Trust: Upside to Cap / Buffered Downside plans to sell $24 million of units of beneficial interest in an initial public offering, according to an amended N-2 filing with the Securities and Exchange Commission.

The trust expects to sell 2,352,942 units for $10.20 each. Up to $0.20 of the offering price will be paid as a sales load to the underwriter, Eaton Vance Distributors, Inc. Units placed to fee accounts will be offered at $10.00 each.

The trust seeks to provide returns based on the performance of the S&P 500 Composite Stock Price index.

The trust first announced plans to issue units on Sept. 20, 2010. At the time, it was called the eUNITs 2 Year U.S. Equity Market Participation Trust: Enhanced Upside to Cap / Buffered Downside.

The initial net asset value is $10.00 per unit.

The trust plans to conclude its investment activities on Jan. 24, 2014, at which time it will distribute its net assets to the unitholders.

The trust seeks to provide a return equal to any percentage increase in the index, subject to a cap of 17% to 23%. Unitholders will receive only the initial net asset value of the units if the index declines by 15% or less and will lose 1% for every 1% that the index declines beyond 15%.

The trust will purchase Treasuries and futures contracts on the index with tenors that are the same as the expected investment life of the trust. The contracts will be structured so that the trust will receive cash from the counterparties if the index increases over the term of the contracts. The trust will have to pay cash to the counterparties if the index decreases by more than 15%.

The trust has applied to list the units on NYSE Amex under the symbol "ETUA."

Eaton Vance Management is the investment adviser and administrator. Parametric Risk Advisors LLC is the subadviser. The units are subject to an annual management fee of 0.75%.

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