RBC plans one-year contingent income autocallable notes tied to Tesoro

By Marisa Wong

Madison, Wis., Sept. 5 - Royal Bank of Canada plans to price contingent income autocallable securities due September 2014 linked to Tesoro Corp. shares, according to an FWP filing with the Securities and Exchange Commission.

If Tesoro stock closes at or above the downside threshold level, 60% of the initial share price, on a quarterly determination date, the notes will pay a contingent coupon of 2.625% for 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 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 Tesoro 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 with Morgan Stanley Wealth Management handling distribution.

The notes will price on Sept. 6 and settle three business days later.

The Cusip number is 78009Q372.

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