By Marisa Wong
Madison, Wis., Oct. 28 – HSBC USA Inc. priced $5 million of contingent income autocallable securities due Oct. 29, 2015 linked to the common stock of Facebook, Inc., according to a 424B2 filing with the Securities and Exchange Commission.
If Facebook shares close at or above the downside threshold level, 70% of the initial share price, on a quarterly determination date, the notes will pay a contingent payment that quarter at an annualized rate of 10.45%.
The notes will be called at par of $10 plus the contingent coupon if Facebook shares close at or above the initial share price on any of the first three quarterly determination dates.
If the final share price is greater than or equal to the downside threshold level, the payout at maturity will be par plus the final contingent coupon. Otherwise, investors will receive a number of Facebook 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.
HSBC Securities (USA) Inc. is the agent. Morgan Stanley Smith Barney LLC is handling distribution.
| Issuer: | HSBC USA Inc.
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| Issue: | Contingent income autocallable securities
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| Underlying stock: | Facebook, Inc. (Symbol: FB)
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| Amount: | $5 million
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| Maturity: | Oct. 29, 2015
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| Coupon: | 10.45% per year, payable quarterly if Facebook shares close at or above downside threshold level on determination date for that quarter
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| Price: | Par of $10.00
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| Payout at maturity: | If final share price is greater than or equal to downside threshold level, par plus final contingent coupon; otherwise, number of Facebook shares equal to $10 divided by initial share price or, at issuer’s option, equivalent amount in cash
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| Call: | At par plus contingent coupon if Facebook shares close at or above initial share price on any of first three quarterly determination dates
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| Initial share price: | $80.67
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| Downside threshold: | $56.47, 70% of initial share price
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| Pricing date: | Oct. 24
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| Settlement date: | Oct. 29
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| Agent: | HSBC Securities (USA) Inc.
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| Distribution: | Morgan Stanley Smith Barney LLC
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| Fees: | 1.75%
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| Cusip: | 40434D350
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