By Toni Weeks
San Luis Obispo, Calif., May 8 - Royal Bank of Canada priced $2.75 million of trigger phoenix autocallable optimization securities due Nov. 7, 2014 linked to the American Depositary Shares of BHP Billiton Ltd., according to a 424B2 filing with the Securities and Exchange Commission.
If BHP Billiton ADSs close at or above the trigger price - 75% of the initial share price - on a quarterly observation date, the issuer will pay a contingent coupon for that quarter at the rate of 11.52%. Otherwise, no coupon will be paid that quarter.
If the ADSs close at or above the initial price on any quarterly observation date, the notes will be called at par of $10 plus the contingent coupon.
If the notes are not called and BHP Billiton ADSs finish at or above the trigger price, the payout at maturity will be par plus the contingent coupon. Otherwise, investors will be exposed to the share price decline from the initial price.
UBS Financial Services Inc. and RBC Capital Markets, LLC are the underwriters.
Issuer: | Royal Bank of Canada
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Issue: | Trigger phoenix autocallable optimization securities
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Underlying ADSs: | BHP Billiton Ltd (Symbol: BHP)
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Amount: | $2,749,300
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Maturity: | Nov. 7, 2014
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Coupon: | 11.52% per year if shares close at or above trigger price on observation date for that quarter
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Price: | Par of $10
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Payout at maturity: | Par plus contingent coupon if BHP Billiton ADSs finish at or above trigger price; otherwise, par plus stock return
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Call: | At par plus contingent coupon if BHP Billiton ADSs close at or above initial price on any quarterly observation date
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Initial share price: | $67.59
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Trigger price: | $50.69, 75% of initial share price
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Pricing date: | May 3
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Settlement date: | May 8
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Underwriters: | UBS Financial Services Inc. and RBC Capital Markets, LLC
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Fees: | 1.5%
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Cusip: | 78008Y202
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