RBC to price contingent income autocallables linked to Michael Kors

By Toni Weeks

San Luis Obispo, Calif., July 9 - Royal Bank of Canada plans to price contingent income autocallable securities due July 2016 linked to Michael Kors Holdings Ltd. shares, according to an FWP with the Securities and Exchange Commission.

The notes will pay a contingent quarterly coupon of 3.3125% to 3.8125% if Michael Kors stock closes at or above the 70% barrier level on the determination date for that quarter.

If the shares close at or above the applicable redemption threshold level on any of the first 11 quarterly determination dates, the notes will be called at par plus the contingent coupon. The redemption threshold level will be 95% of the initial share price for the first four determination dates, 90% of the initial share price for the next four determination dates and 85% of the initial share price for the final three determination dates.

If Michael Kors stock finishes at or above the 70% trigger level, the payout at maturity will be par plus the contingent payment.

Otherwise, investors will receive a number of shares of Michael Kors stock equal to $10 divided by the initial share price or, at the issuer's option, the cash value of those shares.

The notes (Cusip: 78008Y848) will price July 12 and settle three business days later.

RBC Capital Markets, LLC is the agent with Morgan Stanley Smith Barney LLC as dealer.

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