Published on 12/31/2008 in the Prospect News Structured Products Daily.
New Issue: HSBC prices $907,000 17.5% reverse convertibles linked to Peabody
By Susanna Moon
Chicago, Dec. 26 - HSBC USA Inc. priced $907,000 of 17.5% annualized reverse convertible notes due June 25, 2008 linked to the stock of Peabody Energy Corp., according to a 424B2 filing with the Securities and Exchange Commission.
Interest is payable monthly.
At maturity, investors will receive par unless the stock falls below the barrier price - 75% of the initial share price - during the life of the notes and finishes below the initial share price, in which case the payout will be a number of Peabody shares equal to $1,000 divided by the initial share price.
HSBC Securities (USA) Inc. is the agent.
Issuer: | HSBC USA Inc.
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Issue: | Reverse convertible notes
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Underlying stock: | Peabody Energy Corp. (NYSE: BTU)
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Amount: | $907,000
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Maturity: | June 25, 2008
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Coupon: | 17.5%, payable monthly
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Price: | Par
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Payout at maturity: | Par in cash unless the stock falls below the barrier price during the life of the notes and finishes below its initial price, in which case 16.559 Peabody shares
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Initial share price: | $60.39
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Barrier price: | $45.2925, 75% of initial share price
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Pricing date: | Dec. 21
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Settlement date: | Dec. 31
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Agent: | HSBC Securities (USA) Inc.
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Fees: | 2.25%
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