By Angela McDaniels
Tacoma, Wash., Aug. 19 – Royal Bank of Canada priced $7.57 million of contingent income autocallable securities due Aug. 20, 2015 linked to the ordinary shares of Michael Kors Holdings Ltd., according to a 424B2 filing with the Securities and Exchange Commission.
If Michael Kors shares close at or above the downside threshold level, 75% of the initial share price, on a quarterly determination date, the notes will pay a contingent payment that quarter at an annualized rate of 11.25%.
The notes will be called at par of $10 plus the contingent coupon if Michael Kors shares close at or above the initial share price on any quarterly determination date other than the final determination date.
If the final share price is greater than or equal to the downside threshold level, the payout at maturity will be par plus the final contingent coupon. Otherwise, investors will receive a number of Michael Kors shares equal to $10 divided by the initial share price or, at the issuer’s option, a cash amount equal to the value of those shares.
RBC Capital Markets, LLC is the agent. Morgan Stanley Smith Barney LLC is handling distribution.
| Issuer: | Royal Bank of Canada
|
| Issue: | Contingent income autocallable securities
|
| Underlying stock: | Michael Kors Holdings Ltd. (Symbol: KORS)
|
| Amount: | $7,571,390
|
| Maturity: | Aug. 20, 2015
|
| Coupon: | 11.25% per year, payable quarterly if Michael Kors shares close at or above downside threshold level on determination date for 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 final contingent coupon; otherwise, number of Michael Kors shares equal to $10 divided by initial share price or, at issuer’s option, cash amount equal to value of those shares
|
| Call: | At par plus contingent coupon if Michael Kors shares close at or above initial share price on any quarterly determination date other than final determination date
|
| Initial share price: | $78.06
|
| Downside threshold: | $58.55, 75% of initial share price
|
| Pricing date: | Aug. 15
|
| Settlement date: | Aug. 20
|
| Agent: | RBC Capital Markets, LLC
|
| Distribution: | Morgan Stanley Smith Barney LLC
|
| Fees: | 1.5%
|
| Cusip: | 78011Y256
|
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