By Angela McDaniels
Tacoma, Wash., Jan. 29 - HSBC USA Inc. priced $1 million of reverse convertible notes due July 31, 2008 linked to the common stock of Apple Inc., according to a 424B2 filing with the Securities and Exchange Commission.
The six-month notes pay 7.25% for an annualized rate of 14.5%. Interest is payable monthly.
The payout at maturity will be par unless Apple shares fall by more than 40% during the life of the notes and the final share price is less than the initial share price, in which case the payout will be a number of Apple shares equal to $1,000 divided by the initial share price.
HSBC Securities (USA) Inc. is the agent.
| Issuer: | HSBC USA Inc.
|
| Issue: | Reverse convertible notes
|
| Underlying stock: | Apple Inc. (Symbol: AAPL)
|
| Amount: | $1 million
|
| Maturity: | July 31, 2008
|
| Coupon: | 14.5%, payable monthly
|
| Price: | Par
|
| Payout at maturity: | If Apple stock falls below the barrier price during the life of the notes and finishes below the initial share price, 7.6917 Apple shares; otherwise, par
|
| Initial share price: | $130.01
|
| Barrier price: | $78.006, 60% of initial share price
|
| Pricing date: | Jan. 25
|
| Settlement date: | Jan. 31
|
| Agent: | HSBC Securities (USA) Inc.
|
| Fees: | 1.6%
|
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