By Jennifer Chiou
New York, April 17 - Royal Bank of Canada priced $23.9 million of contingent income autocallable securities due April 18, 2013 linked to the common stock of Chesapeake Energy Corp., according to a 424B2 filing with the Securities and Exchange Commission.
If Chesapeake Energy stock closes at or above the downside threshold level - 75% of the initial share price - on a quarterly determination date, investors will receive a contingent payment of $0.4125 for each $10.00 note. Otherwise, no contingent payment will be made that quarter.
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 Chesapeake Energy shares equal to $10.00 divided by the initial share price or, at Morgan Stanley's option, a cash amount equal to the value of those shares.
RBC Capital Markets, LLC is the agent, and Morgan Stanley Smith Barney LLC is the dealer.
| Issuer: | Royal Bank of Canada
|
| Issue: | Contingent income autocallable securities
|
| Underlying stock: | Chesapeake Energy Corp. (NYSE: CHK)
|
| Amount: | $23.9 million
|
| Maturity: | April 18, 2013
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| Contingent payment: | If Chesapeake Energy stock closes at or above downside threshold level on quarterly determination date, $0.4125 per note; otherwise, no contingent payment will be made that quarter
|
| Price: | Par of $10.00
|
| Payout at maturity: | If final share price is greater than or equal to downside threshold level, par plus contingent payment; otherwise, 0.50125 Chesapeake Energy shares or cash amount equal to value of those shares
|
| Call: | Automatically at par plus contingent payment if closing share price is greater than or equal to initial share price on June 22, 2012, Sept. 22, 2012 or Dec. 22, 2012
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| Initial share price: | $19.95
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| Downside threshold level: | $14.9625, 75% of initial share price
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| Pricing date: | April 13
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| Settlement date: | April 18
|
| Agent: | RBC Capital Markets, LLC with Morgan Stanley Smith Barney LLC
|
| Fees: | 1.5%
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| Cusip: | 78008C192
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