Published on 7/25/2013 in the Prospect News Structured Products Daily.
New Issue: RBC sells $4.21 million contingent income autocallables tied to PepsiCo, Starbucks
By Marisa Wong
Madison, Wis., July 25 - Royal Bank of Canada priced $4.21 million of contingent income autocallable securities due July 28, 2016 linked to the worse performing of PepsiCo, Inc. shares and Starbucks Corp. shares, according to a 424B2 filing with the Securities and Exchange Commission.
The notes will pay a contingent payment of 2.4% per quarter that each stock closes at or above its 75% downside threshold level on a quarterly determination date.
The notes will be called at par plus the contingent payment if each stock closes at or above its initial level on any of the first 11 quarterly redemption determination dates.
The payout at maturity will be par plus the final contingent payment unless any stock finishes below its 75% downside threshold level, in which case investors will receive a number of shares of the worse performing stock equal to $10 divided by the initial price or, at the issuer's option, the cash equivalent.
RBC Capital Markets, LLC is the agent with distribution through Morgan Stanley Smith Barney LLC.
| Issuer: | Royal Bank of Canada
|
| Issue: | Contingent income autocallable securities
|
| Underlying stocks: | PepsiCo, Inc. (Symbol: PEP), Starbucks Corp. (Symbol: SBUX)
|
| Amount: | $4,214,650
|
| Maturity: | July 28, 2016
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| Contingent payment: | 2.4% per quarter that each stock closes at or above downside threshold level for that quarter
|
| Price: | Par of $10
|
| Payout at maturity: | If stocks finish at or above downside threshold level, par plus contingent payment; otherwise, number of shares of worse performing stock equal to $10 divided by initial price or, at issuer's election, cash equivalent
|
| Call: | At par plus contingent payment if both stocks close at or above initial prices on any of the first 11 quarterly determination dates
|
| Initial share prices: | $86.20 for PepsiCo, $67.66 for Starbucks
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| Barrier level: | $64.65 for PepsiCo, $50.75 for Starbucks; 75% of initial share price
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| Pricing date: | July 23
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| Settlement date: | July 26
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| Agent: | RBC Capital Markets, LLC
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| Distribution: | Morgan Stanley Smith Barney LLC
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| Fees: | 2.25%
|
| Cusip: | 78008Y889
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