By Susanna Moon
Chicago, Aug. 25 – Royal Bank of Canada priced $1.37 million of contingent income autocallable securities due Aug. 29, 2016 linked to Marathon Oil Corp. shares, according to a 424B2 filing with the Securities and Exchange Commission.
The notes will pay a contingent quarterly coupon at an annual rate of 17% if the shares close at or above the 70% barrier level on the determination date for that quarter.
The notes will be called at par plus the contingent coupon if the stock closes at or above the initial price on any of the first three quarterly determination dates.
The payout at maturity will be par plus the final coupon unless the shares finish below the 70% barrier level, in which case investors will receive a number of Marathon shares equal to $10 divided by the initial price or, at the issuer’s option, the cash equivalent.
RBC Capital Markets, LLC is the agent with Morgan Stanley Wealth Management handling distribution.
Issuer: | Royal Bank of Canada
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Issue: | Contingent income auto-callable securities
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Underlying stock: | Marathon Oil Corp. (Symbol: MRO)
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Amount: | $1,370,850
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Maturity: | Aug. 29, 2016
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Coupon: | 17% annualized for each quarter that stock closes at or above barrier level on determination date for that quarter
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Price: | Par of $10
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Payout at maturity: | Par plus contingent coupon if stock finishes at or above barrier level; otherwise, 0.6357 Marathon shares
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Call: | At par plus contingent payment if stock closes at or above initial share price on any of first three determination dates
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Initial level: | $15.73
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Barrier level: | $11.01, 70% of initial price
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Pricing date: | Aug. 21
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Settlement date: | Aug. 26
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Agent: | RBC Capital Markets, LLC with Morgan Stanley Wealth Management handling distribution
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Fees: | 1.25%
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Cusip: | 78013D565
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