HSBC USA to price 20.4% upside down notes linked to homebuilding stocks

By Jennifer Chiou

New York, Aug. 8 - HSBC USA Inc. plans to price 20.4% upside down equity basket-linked notes due Feb. 28, 2008 linked to three homebuilding stocks, according to an FWP filing with the Securities and Exchange Commission.

The basket will include the common stocks of D.R. Horton, Inc., Lennar Corp. and Pulte Homes, Inc.

Interest will be payable monthly.

At maturity, investors will receive par if the final value of the best-performing stock is equal to or less than its initial value, or the official closing price of any stock remains equal to or less than its trigger level, 125% of its initial value, during the life of the notes.

If the final value of the best-performing stock is greater than its initial value and the closing price of any stock is greater than the trigger level on any trading day, investors will lose 1% for each 1% gain on the best-performing stock.

The notes will price on Aug. 24 and settle on Aug. 29.

HSBC Securities (USA) Inc. will be the agent.

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