By Marisa Wong
Morgantown, W.Va., Dec. 29 – Royal Bank of Canada priced $2 million of autocallable contingent coupon barrier notes with memory coupon due Dec. 27, 2019 linked to the lesser performing of the common stocks of Bristol-Myers Squibb Co. and Johnson & Johnson, according to a 424B2 filing with the Securities and Exchange Commission.
If each stock closes at or above its barrier price, 70% of the initial share price, on a quarterly observation date, the issuer will pay a contingent coupon for that quarter at the annual rate of 9% plus the memory coupon, which is the product of (a) the contingent coupon and (b) the number of contingent coupon payments, if any, that were not previously paid on their coupon payment dates because one or both of the stock prices was less than its barrier price on the corresponding observation date.
Beginning Dec. 21, 2017, the notes will be called at par plus the contingent coupon if each stock closes at or above its initial price on any quarterly observation date.
If the notes are not called, the payout at maturity will be par plus the contingent coupon unless the final share price of the lesser-performing stock is less than its 70% trigger price, in which case investors will lose 1% for every 1% that the lesser-performing stock finishes below its initial share price.
RBC Capital Markets, LLC is the underwriter.
| Issuer: | Royal Bank of Canada
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| Issue: | Autocallable contingent coupon barrier notes with memory coupon
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| Underlying stocks: | Bristol-Myers Squibb Co. (Symbol: BMY) and Johnson & Johnson (Symbol: JNJ)
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| Amount: | $2,003,000
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| Maturity: | Dec. 27, 2019
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| Coupon: | If each stock closes at or above its barrier price on a quarterly observation date, the issuer will pay a contingent coupon for that quarter at the annual rate of 9% plus the memory coupon
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| Memory coupon: | Product of (a) the contingent coupon and (b) the number of contingent coupon payments, if any, that were not previously paid on their coupon payment dates because one or both of the stock prices was less than its barrier price on the corresponding observation date
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| Price: | Par
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| Payout at maturity: | Par plus the contingent coupon unless the final share price of the lesser-performing stock is less than its trigger price, in which case investors will lose 1% for every 1% that the lesser-performing stock finishes below its initial share price
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| Call: | Beginning Dec. 21, 2017, at par plus the contingent coupon if each stock closes at or above its initial price on any quarterly observation date
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| Initial share prices: | $58.69 for Bristol-Myers and $115.31 for Johnson & Johnson
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| Barrier/trigger prices: | $41.08 for Bristol-Myers and $80.72 for Johnson & Johnson; 70% of initial share prices
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| Pricing date: | Dec. 21
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| Settlement date: | Dec. 27
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| Underwriter: | RBC Capital Markets, LLC
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| Fees: | 2.25%
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| Cusip: | 78012KXP7
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