RBC to price 34% reverse convertibles linked to Freeport-McMoRan

By Angela McDaniels

Tacoma, Wash., Feb. 3 - Royal Bank of Canada plans to price reverse convertible notes due May 18, 2009 linked to the common stock of Freeport-McMoRan Copper & Gold, Inc., according to a 424B2 filing with the Securities and Exchange Commission.

The three-month notes will pay 8.5% for an annualized coupon of 34%. Interest will be payable monthly.

The payout at maturity will be par unless Freeport-McMoRan stock falls below the barrier price - 65% of the initial share price - during the life of the notes and finishes below the initial share price, in which case the payout will be a number of Freeport-McMoRan shares equal to $1,000 divided by the initial share price or, at the bank's option, the value of those shares in cash.

The notes are expected to price Feb. 12 and settle Feb. 18.

RBC Capital Markets Corp. is the agent.

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