By Marisa Wong
New York, May 21 - Royal Bank of Canada priced $12.28 million of contingent income autocallable securities due May 20, 2016 linked to the common stock of Ford Motor Co., according to a 424B2 filing with the Securities and Exchange Commission.
If Ford Motor stock closes at or above the downside threshold level - 75% of the initial share price - on a quarterly determination date, investors will receive a contingent payment of $0.205 for each $10.00 note. Otherwise, no contingent payment will be made for that period.
If the closing share price is greater than or equal to the initial price on any of the first 11 quarterly determination dates, the notes will be automatically redeemed at par plus the contingent payment.
If the notes are not called and the final share price is greater than or equal to the downside threshold level, the payout at maturity will be par plus the contingent payment. If the final share price is less than the downside threshold level, the payout will be a number of Ford Motor shares equal to $10.00 divided by the initial share price or, at the issuer's option, a cash amount equal to the value of those shares.
RBC Capital Markets, LLC is the agent. Distribution will be through Morgan Stanley Smith Barney LLC.
| Issuer: | Royal Bank of Canada
|
| Issue: | Contingent income autocallable securities
|
| Underlying stock: | Ford Motor Co. (Symbol: F)
|
| Amount: | $12,279,390
|
| Maturity: | May 20, 2016
|
| Coupon: | 2.05% if closing price is at least 75% of initial price on quarterly determination date; otherwise, none
|
| Price: | Par
|
| Payout at maturity: | If final share price is at least 75% of initial price, par plus contingent quarterly payment; otherwise, 0.6631 Ford Motor shares per $10.00 principal amount, or, at RBC's option, equivalent cash amount of those shares
|
| Initial price: | $15.08
|
| Downside threshold: | $11.31, 75% of initial share price
|
| Call: | Par plus contingent payment if closing share price greater than or equal to initial price on any of first 11 quarterly determination dates
|
| Pricing date: | May 17
|
| Settlement date: | May 22
|
| Agent: | RBC Capital Markets, LLC with distribution through Morgan Stanley Smith Barney LLC
|
| Fees: | 2.25%
|
| Cusip: | 78008Y509
|
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