By Jennifer Chiou
New York, Oct. 18 - HSBC USA Inc. priced $6.39 million of trigger phoenix autocallable optimization securities due Oct. 19, 2012 linked to the iShares Russell 2000 index fund, according to a 424B2 filing with the Securities and Exchange Commission.
If the fund closes at or above the trigger price - 65% of the initial price - on any quarterly observation dates, the issuer will pay a contingent coupon of 14%.
If the fund closes at or above the initial price on any of the observation dates, the notes will be called at par of $10 plus the contingent coupon.
If the notes are not called and the fund finishes at or above the trigger price, the payout at maturity will be par plus the contingent coupon.
Otherwise, investors will be exposed to any losses.
HSBC Securities (USA) Inc. is the underwriter with UBS Financial Services Inc. as dealer.
| Issuer: | HSBC USA Inc.
|
| Issue: | Trigger phoenix autocallable optimization securities
|
| Underlying fund: | iShares Russell 2000 index fund
|
| Amount: | $6,391,800
|
| Maturity: | Oct. 19, 2012
|
| Coupon: | 14% if stock closes at or above trigger price on observation date for that interest period; payable quarterly
|
| Price: | Par of $10
|
| Payout at maturity: | Par plus contingent coupon if shares finish at or above trigger price; otherwise, par plus return with exposure to losses
|
| Call: | At par plus contingent coupon if shares close at or above initial price on a quarterly observation date
|
| Initial share price: | $71.14
|
| Trigger price: | $46.24, 65% of initial price
|
| Pricing date: | Oct. 14
|
| Settlement date: | Oct. 19
|
| Underwriters: | UBS Financial Services Inc. and HSBC Securities (USA) Inc.
|
| Fees: | 1.5%
|
| Cusip: | 40433C346
|
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