HSBC plans annual income opportunity notes linked to 10 stocks

By Marisa Wong

Madison, Wis., July 24 - HSBC USA Inc. plans to price annual income opportunity notes with auto cap due Aug. 30, 2019 linked to a basket of 10 common stocks, according to an FWP filing with the Securities and Exchange Commission.

The basket includes American Electric Power Co., Inc., Polo Ralph Lauren Corp., Biogen Idec Inc., Kimberly-Clark Corp., AT&T Inc., Lockheed Martin Corp., Mosaic Co., Maxim Integrated Products, Inc., Pfizer Inc. and Silver Wheaton Corp.

Interest is payable annually and will equal the average of the performances of the basket stocks, subject to a minimum coupon of 0.5%.

A stock's performance will be equal to the auto cap rate if its return is greater than or equal to zero. The auto cap rate is expected to be at least 8% and will be set at pricing. If a stock's return is less than zero, its performance will be the greater of its return and negative 30%.

The payout at maturity will be par.

The notes will price Aug. 27 and settle Aug. 30.

HSBC Securities (USA) Inc. is the agent.

The Cusip number is 4042K1Z55.

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