Published on 8/5/2014 in the Prospect News Structured Products Daily.
New Issue: RBC prices $6.91 million 7.2% callable reverse convertibles linked to three stocks
By Jennifer Chiou
New York, Aug. 5 – Royal Bank of Canada priced $6.91 million of 7.2% callable reverse convertible notes due Nov. 12, 2015 linked to the worst performing of three equity securities, Merck & Co., Inc., Yahoo! Inc. and Freeport-McMoRan Copper & Gold Inc., according to a 424B2 filing with the Securities and Exchange Commission.
Interest is payable quarterly.
The notes will be called at par if each stock closes at or above the respective initial share price on any quarterly call date beginning on Oct. 31.
If the notes are not called, the payout at maturity will be par in cash unless the price of any stock falls below its barrier price, 65% of its initial price, during the life of the notes and the worst-performing stock finishes below its initial price, in which case the payout will be a number of shares of the worst-performing stock equal to $1,000 principal amount divided by the initial price.
RBC Capital Markets, LLC is the agent.
| Issuer: | Royal Bank of Canada
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| Issue: | Callable reverse convertible notes
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| Underlying stocks: | Merck & Co., Inc. (Symbol: MRK), Yahoo! Inc. (Symbol: YHOO) and Freeport-McMoRan Copper & Gold Inc. (Symbol: FCX)
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| Amount: | $6.91 million
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| Maturity: | Nov. 12, 2015
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| Coupon: | 7.2%, payable quarterly
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| Price: | Par
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| Payout at maturity: | Par in cash unless any stock finishes falls below barrier price during life of notes and worst-performing stock finishes below initial level, in which case number of shares of the worst-performing stock equal to $1,000 divided by the initial price
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| Call option: | At par if each stock closes at or above the respective initial share price on any quarterly call date beginning on Oct. 31
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| Initial prices: | $56.74 for Merck, $35.81 for Yahoo!, $37.22 for Freeport-McMoRan
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| Barrier prices: | $36.88 for Merck, $23.28 for Yahoo!, $24.19 for Freeport-McMoRan, 65% of initial stock prices
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| Pricing date: | July 31
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| Settlement date: | Aug. 12
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| Agent: | RBC Capital Markets, LLC
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| Fees: | None
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| Cusip: | 78010UXV4
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