By Marisa Wong
Morgantown, W.Va., April 5 – Royal Bank of Canada priced $1.06 million of direct investment notes due April 7, 2017 linked to the March 2016 RBC Capital Markets U.S. Equity Top Picks List, according to a 424B2 filing with the Securities and Exchange Commission.
The equally weighted list is composed of Air Lease Corp., Amphenol Corp., Aramark, Broadcom Ltd., Brookdale Senior Living Inc., Cerner Corp., Discover Financial Services, Dollar Tree, Inc., Dow Chemical Co., Endo International plc, Louisiana-Pacific Corp., Marathon Petroleum Corp., Microsemi Corp., ServiceNow, Inc., Newell Rubbermaid Inc., PNC Financial Services Group, Inc., Regency Centers Corp., Raytheon Co., Voya Financial, Inc., Whirlpool Corp. and Yum! Brands, Inc.
A top pick represents an RBC analyst’s best idea in the sector, which is expected to provide significant absolute total return over 12 months with a favorable risk-reward ratio.
Interest is payable quarterly. The amount of each interest payment, if any, will depend on the amount of dividends paid on each basket stock during the preceding quarter and will equal, for each $1,000 principal amount, 97.75% of the sum of the dividend amounts for each of the basket stocks.
The dividend amount for each stock equals (a) $1,000 divided by the initial price of the applicable stock multiplied by (b) the applicable component weighting multiplied by (c) 100% of the gross cash distributions (including ordinary and extraordinary dividends) per share declared by the applicable stock issuer where the date that the applicable stock has commenced trading ex-dividend on its primary U.S. securities exchange as to each relevant distribution occurs during the relevant interest calculation period.
For each $1,000 principal amount of notes, the payout at maturity will be the product of $977.50 and the percentage amount.
The percentage amount will equal an amount, expressed as a percentage, equal to (a) 100% plus (b) the sum of the weighted returns for the basket stocks. The payout will be less than par if the percentage amount is less than 102.3%.
RBC Capital Markets, LLC is the underwriter.
| Issuer: | Royal Bank of Canada
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| Issue: | Direct investment notes
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| Underlying: | March 2016 RBC Capital Markets U.S. Equity Top Picks List
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| Amount: | $1,061,000
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| Maturity: | April 7, 2017
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| Coupon: | 97.75% of sum of dividend amounts for each basket stock; payable quarterly but could be zero
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| Price: | Par
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| Payout at maturity: | For each $1,000 principal amount of notes, product of $977.50 and percentage amount, which equals 100% plus sum of weighted returns for basket stocks
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| Pricing date: | March 28
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| Settlement date: | March 31
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| Underwriter: | RBC Capital Markets, LLC
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| Fees: | 1.5%
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| Cusip: | 78012KLV7
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