By Angela McDaniels
Tacoma, Wash., June 26 - Royal Bank of Canada priced $3.25 million of contingent income autocallable securities due June 27, 2013 linked to the common stock of JPMorgan Chase & Co., according to a 424B2 filing with the Securities and Exchange Commission.
If JPMorgan stock closes at or above the downside threshold level - 70% of the initial share price - on a quarterly determination date, investors will receive a contingent payment of $0.3875 for each $10.00 note. Otherwise, no contingent payment will be made for that period. The contingent payment is equivalent to 15.5% per year.
If the closing share price is greater than or equal to the initial share price on any of the first three 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 JPMorgan 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 is through Morgan Stanley Smith Barney LLC.
| Issuer: | Royal Bank of Canada
|
| Issue: | Contingent income autocallable securities
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| Underlying stock: | JPMorgan Chase & Co. (NYSE: JPM)
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| Amount: | $3.25 million
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| Maturity: | June 27, 2013
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| Contingent payment: | If JPMorgan stock closes at or above downside threshold on a quarterly determination date, $0.3875 per note; otherwise, no contingent payment will be made for that period
|
| Price: | Par of $10.00
|
| Payout at maturity: | If final share price is greater than or equal to downside threshold, par plus $0.3875; if final share price is less than downside threshold, 0.2776 JPMorgan shares or cash amount equal to value of those shares
|
| Call: | Automatically at par plus $0.3875 if closing share price is greater than or equal to downside threshold level on Sept. 27, 2012, Dec. 27, 2012 or March 27, 2013
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| Initial share price: | $35.99
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| Downside threshold: | $25.19, 70% of initial share price
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| Pricing date: | June 22
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| Settlement date: | June 27
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| Agent: | RBC Capital Markets LLC
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| Distribution: | Morgan Stanley Smith Barney LLC
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| Fees: | 1.5%
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| Cusip: | 78008D562
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