Filed Pursuant to Rule 424(b)(2)
Registration Statement No. 333-259205
|
|||
Pricing Supplement
Dated November 22, 2021
To the Product Prospectus Supplement No. CCBN-1 Dated September 14, 2021, the Prospectus Supplement Dated September 14, 2021 and the Prospectus Dated September 14,
2021
|
|||
$500,000
Contingent Coupon Barrier Notes Linked to the Common Stock of Tesla Inc., Due November 28, 2022
Royal Bank of Canada
|
|||
Issuer:
|
Royal Bank of Canada
|
Stock Exchange Listing:
|
None
|
Trade Date:
|
November 22, 2021
|
Principal Amount:
|
$10,000 per Note
|
Issue Date:
|
November 26, 2021
|
Maturity Date:
|
November 28, 2022
|
Observation Dates:
|
Monthly, as set forth below.
|
Coupon Payment Dates:
|
Monthly, as set forth below.
|
Valuation Date:
|
November 22, 2022
|
Contingent Coupon Rate:
|
14.00% per annum
|
Initial Stock Price:
|
$1,156.87, which was the closing price of the Reference Stock on the Trade Date.
|
||
Final Stock Price:
|
The closing price of the Reference Stock on the Valuation Date.
|
||
Trigger Price and Coupon
Barrier:
|
$694.12, which is 60% of the Initial Stock Price (rounded to two decimal places).
|
||
Contingent Coupon:
|
If the closing price of the Reference Stock is greater than or equal to the Coupon Barrier on the applicable Observation Date, we will pay the Contingent Coupon
applicable to that Observation Date. You may not receive any Contingent Coupons during the term of the Notes.
|
||
Payment at Maturity (if held
to maturity):
|
We will pay you at maturity an amount based on the Final Stock Price:
For each $10,000 in principal amount, $10,000 plus the Contingent Coupon at maturity, unless the Final Stock Price is less than the Trigger Price.
If the Final Stock Price is less than the Trigger Price, then the investor will receive at maturity, for each $10,000 in principal amount, the number of shares of the
Reference Stock equal to the Physical Delivery Amount, or at our election, the cash value of those shares.
Investors in the Notes will lose some or all of their principal amount if the Final Stock Price is less than the Trigger Price.
|
||
Physical Delivery Amount:
|
For each $10,000 in principal amount, 8.64 shares of the Reference Stock, which is equal to $1,000 divided by the Initial Stock Price (rounded to two decimal places),
subject to adjustment as described in the product prospectus supplement.
|
||
Call Feature:
|
Not applicable. The Notes are not callable at our option, and are not subject to an automatic call, prior to maturity.
|
||
Observation Dates:
|
Monthly, as set forth below.
|
||
CUSIP/ISIN:
|
78013G2S3 / US78013G2S38
|
Per Note
|
Total
|
||
Price to public(1)
|
100.00%
|
$500,000
|
|
Underwriting discounts and commissions (1)
|
1.00%
|
$5,000
|
|
Proceeds to Royal Bank of Canada
|
99.00%
|
$495,000
|
|
|
Contingent Coupon Barrier Notes
Royal Bank of Canada |
General:
|
This pricing supplement relates to an offering of Contingent Coupon Barrier Notes (the “Notes”) linked to the common stock of Tesla Inc.
|
Issuer:
|
Royal Bank of Canada (“Royal Bank”)
|
Trade Date:
|
November 22, 2021
|
Issue Date:
|
November 26, 2021
|
Valuation Date:
|
November 22, 2022
|
Maturity Date:
|
November 28, 2022
|
Denominations:
|
Minimum denomination of $10,000, and integral multiples of $10,000 thereafter.
|
Contingent Coupon:
|
We will pay you a Contingent Coupon during the term of the Notes, periodically in arrears on each Coupon Payment Date, under the conditions described below:
• If the
closing price of the Reference Stock is greater than or equal to the Coupon Barrier on the applicable Observation Date, we will pay the Contingent Coupon applicable to that Observation Date.
• If the
closing price of the Reference Stock is less than the Coupon Barrier on the applicable Observation Date, we will not pay you the Contingent Coupon applicable to that Observation Date.
You may not receive a Contingent Coupon for one or more monthly periods during the term of the Notes.
|
Contingent Coupon
Rate:
|
14.00% per annum (approximately 1.1667% per month)
|
Observation Dates:
|
Monthly, on December 22, 2021, January 24, 2022, February 22, 2022, March 22, 2022, April 22, 2022, May 23, 2022, June 22, 2022, July 22, 2022, August 22, 2022,
September 22, 2022, October 24, 2022 and the Valuation Date.
|
Coupon Payment
Dates:
|
The Contingent Coupon, if payable, will be paid monthly on December 28, 2021, January 27, 2022, February 25, 2022, March 25, 2022, April 27, 2022, May 26, 2022, June 27,
2022, July 27, 2022, August 25, 2022, September 27, 2022, October 27, 2022 and the Maturity Date.
|
Record Dates:
|
The record date for each Coupon Payment Date will be one business day prior to that scheduled Coupon Payment Date; provided, however, that any Contingent Coupon payable
at maturity will be payable to the person to whom the payment at maturity will be payable.
|
Call Feature:
|
The Notes are not callable at our option, or subject to an automatic call, prior to maturity.
|
Initial Stock Price:
|
The closing price of the Reference Stock on the Trade Date, as set forth on the cover page of this pricing supplement.
|
Final Stock Price:
|
The closing price of the Reference Stock on the Valuation Date.
|
Trigger Price and
Coupon Barrier:
|
60% of the Initial Stock Price, as set forth on the cover page of this pricing supplement.
|
Payment at Maturity
(if held to maturity):
|
We will pay you at maturity an amount based on the Final Stock Price:
• If the
Final Stock Price is greater than or equal to the Trigger Price, we will pay you a cash payment equal to the principal amount plus the Contingent Coupon otherwise due on the Maturity Date.
|
|
|
Contingent Coupon Barrier Notes
Royal Bank of Canada |
• If the Final Stock Price is below the Trigger Price, you will receive at maturity, for each $10,000 in principal amount, the number of shares of the Reference Stock equal to the Physical Delivery Amount, or at
our election, the Cash Delivery Amount. If we elect to deliver shares of the Reference Stock, fractional shares will be paid in cash. The value of the cash or shares that you will receive in this case will be less than your principal
amount, if anything, resulting in a loss that is proportionate to the decline of the Reference Stock from the Trade Date to the Valuation Date.
Investors in the Notes will lose some or all of their principal amount if the Final Stock Price is less than the Trigger Price.
|
|
Physical Delivery
Amount:
|
For each $10,000 in principal amount, a number of shares of the Reference Stock equal to the principal amount divided by the Initial Stock Price, as set forth on the
cover page of this pricing supplement, subject to adjustment as described in the product prospectus supplement. Fractional shares will be paid in cash.
|
Cash Delivery
Amount:
|
The product of the Physical Delivery Amount multiplied by the Final Stock Price.
|
Calculation Agent:
|
RBC Capital Markets, LLC (“RBCCM”)
|
U.S. Tax Treatment:
|
By purchasing a Note, each holder agrees (in the absence of a change in law, an administrative determination or a judicial ruling to the contrary) to treat the Notes as
a pre-paid contingent income-bearing derivative contract linked to the Reference Stock for U.S. federal income tax purposes. However, the U.S. federal income tax consequences of your investment in the Notes are uncertain and the
Internal Revenue Service could assert that the Notes should be taxed in a manner that is different from that described in the preceding sentence. Please see the section below, “Supplemental Discussion of U.S. Federal Income Tax
Consequences” and the discussion (including the opinion of Ashurst LLP, our special U.S. tax counsel) in the product prospectus supplement dated September 14, 2021 under “Supplemental Discussion of U.S. Federal Income Tax Consequences,”
which apply to the Notes.
|
Secondary Market:
|
RBCCM (or one of its affiliates), though not obligated to do so, may maintain a secondary market in the Notes after the issue date. The amount that you may receive upon
sale of your Notes prior to maturity may be less than the principal amount.
|
Listing:
|
The Notes will not be listed on any securities exchange.
|
Settlement:
|
DTC global (including through its indirect participants Euroclear and Clearstream, Luxembourg as described under “Ownership and Book-Entry Issuance” in the prospectus).
|
Terms Incorporated
in the Master Note:
|
All of the terms appearing on the cover page and above the item captioned “Secondary Market” on pages P-2 and P-3 of this pricing supplement and the terms appearing
under the caption “General Terms of the Notes” in the product prospectus supplement, as modified by this pricing supplement.
|
|
|
Contingent Coupon Barrier Notes
Royal Bank of Canada |
|
|
Contingent Coupon Barrier Notes
Royal Bank of Canada |
Hypothetical Initial Stock Price:
|
$100.00*
|
|
Hypothetical Physical Delivery Amount:
|
100 shares ($10,000 divided by $100)
|
|
Hypothetical Trigger Price and Coupon Barrier :
|
$60.00, which is 60% of the hypothetical Initial Stock Price
|
|
Contingent Coupon Rate:
|
14.00% per annum (or approximately 1.1667% per month)
|
|
Contingent Coupon Amount:
|
$116.67 per month
|
|
Observation Dates:
|
Monthly
|
|
Principal Amount:
|
$10,000 per Note
|
Hypothetical Final
Stock Price
|
Percentage Change
of the Reference
Stock
|
Payment at Maturity
|
Physical Delivery
Amount as Number
of Shares of the
Reference Stock
|
Cash Delivery
Amount
|
$150.00
|
50.00%
|
$10,116.67*
|
n/a
|
n/a
|
$140.00
|
40.00%
|
$10,116.67*
|
n/a
|
n/a
|
$130.00
|
30.00%
|
$10,116.67*
|
n/a
|
n/a
|
$120.00
|
20.00%
|
$10,116.67*
|
n/a
|
n/a
|
$110.00
|
10.00%
|
$10,116.67*
|
n/a
|
n/a
|
$100.00
|
0.00%
|
$10,116.67*
|
n/a
|
n/a
|
$90.00
|
-10.00%
|
$10,116.67*
|
n/a
|
n/a
|
$80.00
|
-20.00%
|
$10,116.67*
|
n/a
|
n/a
|
$70.00
|
-30.00%
|
$10,116.67*
|
n/a
|
n/a
|
$60.00
|
-40.00%
|
$10,116.67*
|
n/a
|
n/a
|
$59.99
|
-40.01%
|
Physical or Cash Delivery Amount
|
100
|
$5,999.00
|
$50.00
|
-50.00%
|
Physical or Cash Delivery Amount
|
100
|
$5,000.00
|
$40.00
|
-60.00%
|
Physical or Cash Delivery Amount
|
100
|
$4,000.00
|
$30.00
|
-70.00%
|
Physical or Cash Delivery Amount
|
100
|
$3,000.00
|
$20.00
|
-80.00%
|
Physical or Cash Delivery Amount
|
100
|
$2,000.00
|
$10.00
|
-90.00%
|
Physical or Cash Delivery Amount
|
100
|
$1,000.00
|
$0.00
|
-100.00%
|
Physical or Cash Delivery Amount
|
100
|
$0.00
|
|
|
Contingent Coupon Barrier Notes
Royal Bank of Canada |
|
|
Contingent Coupon Barrier Notes
Royal Bank of Canada |
• |
You May Lose All or a Portion of the Principal Amount at Maturity — Investors in the Notes could lose all or a substantial portion of their principal amount if there
is a decline in the price of the Reference Stock between the Trade Date and the Valuation Date. If the Final Stock Price is less than the Trigger Price, the value of the shares of the Reference Stock or cash that you receive at maturity
will represent a loss of your principal that is proportionate to the decline in the closing price of the Reference Stock from the Trade Date to the Valuation Date. If you receive shares of the Reference Stock, their value could decrease
between the Valuation Date and the Maturity Date. Any Contingent Coupons received on the Notes prior to the Maturity Date may not be sufficient to compensate for any such loss.
|
• |
You May Not Receive Any Contingent Coupons — We will not necessarily make any coupon payments on the Notes. If the closing price of the Reference Stock on an
Observation Date is less than the Coupon Barrier, we will not pay you the Contingent Coupon applicable to that Observation Date. If the closing price of the Reference Stock is less than the Coupon Barrier on each of the Observation
Dates and on the Valuation Date, we will not pay you any Contingent Coupons during the term of, and you will not receive a positive return on your Notes. Generally, this non-payment of the Contingent Coupon coincides with a period of
greater risk of principal loss on your Notes. Accordingly, if we do not pay the Contingent Coupon on the Maturity Date, you will also incur a loss of principal, because the Final Stock Price will be less than the Trigger Price.
|
• |
The Contingent Coupon Feature Limits Your Potential Return — The return potential of the Notes is limited to the pre-specified Contingent Coupon Rate, regardless of
the appreciation of the Reference Stock. In addition, the total return on the Notes will vary based on the number of Observation Dates on which the Contingent Coupon becomes payable prior to maturity. You will be subject to the full
downside performance of the Reference Stock even though your potential return is limited to the Contingent Coupon Rate. As a result, the return on an investment in the Notes could be less than the return on a direct investment in the
Reference Stock.
|
• |
Your Return on the Notes May Be Lower than the Return on a Conventional Debt Security of Comparable Maturity — The return that you will receive on the Notes, which
could be negative, may be less than the return you could earn on other investments. Even if your return is positive, your return may be less than the return you would earn if you purchased one of our conventional senior interest bearing
debt securities.
|
• |
Payments on the Notes Are Subject to Our Credit Risk, and Changes in Our Credit Ratings Are Expected to Affect the Market Value of the Notes — The Notes are our senior
unsecured debt securities. As a result, your receipt of any Contingent Coupons, if payable, and the amount due on any relevant payment date is dependent upon our ability to repay our obligations on the applicable payment dates. This
will be the case even if the price of the Reference Stock increases after the Trade Date. No assurance can be given as to what our financial condition will be at any time during the term of the Notes.
|
• |
There May Not Be an Active Trading Market for the Notes-Sales in the Secondary Market May Result in Significant Losses — There may be little or no secondary market for
the Notes. The Notes will not be listed on any securities exchange. RBCCM and our other affiliates may make a market for the Notes; however, they are not required to do so. RBCCM or any other affiliate of ours may stop any market-making
activities at any time. Even if a secondary market for the Notes develops, it may not provide significant liquidity or trade at prices advantageous to you. We expect that transaction costs in any secondary market would be high. As a
result, the difference between bid and asked prices for your Notes in any secondary market could be substantial.
|
|
|
Contingent Coupon Barrier Notes
Royal Bank of Canada |
• |
The Initial Estimated Value of the Notes Is Less than the Price to the Public — The initial estimated value that is set forth on the cover page of this pricing
supplement does not represent a minimum price at which we, RBCCM or any of our affiliates would be willing to purchase the Notes in any secondary market (if any exists) at any time. If you attempt to sell the Notes prior to maturity,
their market value may be lower than the price you paid for them and the initial estimated value. This is due to, among other things, changes in the price of the Reference Stock, the borrowing rate we pay to issue securities of this
kind, and the inclusion in the price to the public of the underwriting discount and the estimated costs relating to our hedging of the Notes. These factors, together with various credit, market and economic factors over the term of the
Notes, are expected to reduce the price at which you may be able to sell the Notes in any secondary market and will affect the value of the Notes in complex and unpredictable ways. Assuming no change in market conditions or any other
relevant factors, the price, if any, at which you may be able to sell your Notes prior to maturity may be less than your original purchase price, as any such sale price would not be expected to include the underwriting discount and the
hedging costs relating to the Notes. In addition to bid-ask spreads, the value of the Notes determined by RBCCM for any secondary market price is expected to be based on the secondary rate rather than the internal funding rate used to
price the Notes and determine the initial estimated value. As a result, the secondary price will be less than if the internal funding rate was used. The Notes are not designed to be short-term trading instruments. Accordingly, you
should be able and willing to hold your Notes to maturity.
|
• |
The Initial Estimated Value of the Notes on the Cover Page of this Pricing Supplement Is an Estimate Only, Calculated as of the Time the Terms of the Notes Were Set — The
initial estimated value of the Notes is based on the value of our obligation to make the payments on the Notes, together with the mid-market value of the derivative embedded in the terms of the Notes. See “Structuring the Notes” below.
Our estimate is based on a variety of assumptions, including our credit spreads, expectations as to dividends, interest rates and volatility, and the expected term of the Notes. These assumptions are based on certain forecasts about
future events, which may prove to be incorrect. Other entities may value the Notes or similar securities at a price that is significantly different than we do.
|
• |
Our Business Activities May Create Conflicts of Interest — We and our affiliates expect to engage in trading activities related to the Reference Stock that are not for
the account of holders of the Notes or on their behalf. These trading activities may present a conflict between the holders’ interests in the Notes and the interests we and our affiliates will have in their proprietary accounts, in
facilitating transactions, including options and other derivatives transactions, for their customers and in accounts under their management. These trading activities, if they influence the share price of the Reference Stock, could be
adverse to the interests of the holders of the Notes. We and one or more of our affiliates may, at present or in the future, engage in business with the Reference Stock Issuer, including making loans to or providing advisory services.
These services could include investment banking and merger and acquisition advisory services. These activities may present a conflict between our or one or more of our affiliates’ obligations and your interests as a holder of the Notes.
Moreover, we and our affiliates may have published, and in the future expect to publish, research reports with respect to the Reference Stock. This research is modified from time to time without notice and may express opinions or
provide recommendations that are inconsistent with purchasing or holding the Notes. Any of these activities by us or one or more of our affiliates may affect the share price of the Reference Stock, and, therefore, the market value of
the Notes.
|
|
|
Contingent Coupon Barrier Notes
Royal Bank of Canada |
• |
Owning the Notes Is Not the Same as Owning the Reference Stock — The return on your Notes is unlikely to reflect the return you would realize if you actually owned
shares of the Reference Stock. For instance, you will not receive or be entitled to receive any dividend payments or other distributions on the Reference Stock during the term of your Notes. As an owner of the Notes, you will not have
voting rights or any other rights that holders of the Reference Stock may have. Furthermore, the Reference Stock may appreciate substantially during the term of the Notes, while your potential return will be limited to the applicable
Contingent Coupon payments.
|
• |
There Is No Affiliation Between the Reference Stock Issuer and RBCCM, and RBCCM Is Not Responsible for any Disclosure by the Reference Stock Issuer — We are not
affiliated with the Reference Stock Issuer. However, we and our affiliates may currently, or from time to time in the future, engage in business with the Reference Stock Issuer. Nevertheless, neither we nor our affiliates assume any
responsibilities for the accuracy or the completeness of any information that any other company prepares. You, as an investor in the Notes, should make your own investigation into the Reference Stock. The Reference Stock Issuer is not
involved in this offering and has no obligation of any sort with respect to your Notes. The Reference Stock Issuer has no obligation to take your interests into consideration for any reason, including when taking any corporate actions
that might affect the value of your Notes.
|
• |
The Payments on the Notes Are Subject to Market Disruption Events and Adjustments — The payment at maturity, each Observation Date and the Valuation Date are subject
to adjustment as described in the product prospectus supplement. For a description of what constitutes a market disruption event as well as the consequences of that market disruption event, see “General Terms of the Notes—Market
Disruption Events” in the product prospectus supplement.
|
|
|
Contingent Coupon Barrier Notes
Royal Bank of Canada |
|
|
Contingent Coupon Barrier Notes
Royal Bank of Canada |
|
|
Contingent Coupon Barrier Notes
Royal Bank of Canada |
|
|
Contingent Coupon Barrier Notes
Royal Bank of Canada |
|
|
Contingent Coupon Barrier Notes
Royal Bank of Canada |