HSBC plans 0% enhanced market participation notes linked to Berkshire Hathaway stock

By E. Janene Geiss

Philadelphia, Feb. 2 - HSBC USA Inc. plans to price 0% enhanced market participation notes due Feb. 25, 2011 linked to the class B common stock of Berkshire Hathaway Inc., according to an FWP filing with the Securities and Exchange Commission.

If the final stock price is at least the initial price, the payout will be par plus double any gain on the price, capped at between 125% and 130% of par. The exact cap will be set at pricing.

If the final stock price declines by 10% or less, the payout will be par. Investors will lose 1% for every 1% the price declines beyond 10%.

The notes are expected to price Feb. 20 and settle Feb. 25.

HSBC Securities (USA) Inc. is the underwriter.

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