By Susanna Moon
Chicago, April 25 - Royal Bank of Canada priced $1.28 million of trigger phoenix autocallable optimization securities due April 26, 2012 linked to Rackspace Hosting, Inc. shares, according to a 424B2 filing with the Securities and Exchange Commission.
If Rackspace stock closes at or above the trigger price - 65% of the initial share price - on a quarterly observation date, the issuer will pay a contingent coupon of 16.75%.
If the stock closes at or above the initial price on any observation date, the notes will be called at par of $10 plus the contingent coupon.
If the notes are not called and Rackspace shares finish at or above the trigger price, the payout at maturity will be par. Otherwise, investors will be fully exposed to the share price decline.
UBS Financial Services Inc. and RBC Capital Markets, LLC are the underwriters.
| Issuer: | Royal Bank of Canada
|
| Issue: | Trigger phoenix autocallable optimization securities
|
| Underlying stock: | Rackspace Hosting, Inc. (NYSE: RAX)
|
| Amount: | $1,283,000
|
| Maturity: | April 26, 2012
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| Coupon: | 16.75% if Rackspace stock closes at or above the trigger price on a quarterly observation date
|
| Price: | Par of $10.00
|
| Payout at maturity: | If Rackspace shares finish at or above the trigger price, par; otherwise, exposure to losses
|
| Call option: | At par plus contingent coupon if share price is at or above initial price on any quarterly observation date
|
| Initial share price: | $43.92
|
| Trigger price: | $28.55, or 65% of initial share price
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| Pricing date: | April 20
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| Settlement date: | April 26
|
| Underwriters: | UBS Financial Services Inc. and RBC Capital Markets, LLC
|
| Fees: | 1.5%
|
| Cusip: | 78009C332
|
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