Published on 6/25/2014 in the Prospect News Structured Products Daily.
New Issue: RBC prices $5.1 million 8.75% callable reverse convertibles linked to three stocks
By Toni Weeks
San Luis Obispo, Calif., June 25 – Royal Bank of Canada priced $5.1 million of 8.75% issuer callable reverse convertible notes due July 8, 2015 linked to the worst performing of three equity securities, Coca-Cola Co., McDonald’s Corp. and Starbucks Corp., according to a 424B2 filing with the Securities and Exchange Commission.
Interest is payable at maturity.
The notes may be called at par plus accrued interest beginning Oct. 23, 2014.
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, 75% 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: | Issuer callable reverse convertible notes
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| Underlying stocks: | Coca-Cola Co. (Symbol: KO), McDonald’s Corp. (Symbol: MCD) and Starbucks Corp. (Symbol: SBUX)
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| Amount: | $5.1 million
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| Maturity: | July 8, 2015
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| Coupon: | 8.75%, payable at maturity
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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
|
| Call option: | At par plus accrued interest on or after Oct. 23, 2014
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| Initial prices: | $41.73 for Coca-Cola, $101.91 for McDonald’s, $76.73 for Starbucks
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| Barrier prices: | $31.30 for Coca-Cola, $76.43 for McDonald’s, $57.55 for Starbucks, 75% of initial prices
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| Pricing date: | June 23
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| Settlement date: | July 7
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| Agent: | RBC Capital Markets, LLC
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| Fees: | None
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| Cusip: | 78010UXU6
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