RBC plans contingent income autocallable notes linked to Hess

By Marisa Wong

Madison, Wis., Aug. 20 - Royal Bank of Canada plans to price contingent income autocallable securities due August 2016 linked to the common stock of Hess Corp., according to an FWP filing with the Securities and Exchange Commission.

If Hess stock closes at or above the downside threshold level, 75% of the initial share price, on a quarterly determination date, the notes will pay a contingent coupon of 2% for that quarter.

If the closing share price is greater than or equal to the initial share price on any of the first 11 quarterly determination dates, the notes will be automatically redeemed at par of $10 plus the contingent coupon.

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 coupon. Otherwise, the payout will be a number of Hess 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 Wealth Management is handling distribution.

The notes are expected to price Aug. 23 and settle three business days later.

The Cusip number is 78009Q273.

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