By Susanna Moon
Chicago, Feb. 4 - HSBC USA Inc. priced $4.7 million of 0% capped knock-out buffer notes due Feb. 14, 2012 linked to Ford Motor Co. shares, according to a 424B2 filing with the Securities and Exchange Commission.
A knock-out event occurs if the price of Ford stock falls by more than 25% on any day during the life of the notes.
If a knock-out event occurs, the payout at maturity will be par plus the share return. Investors will be exposed to any losses.
If a knock-out event does not occur, the payout will be par plus the share return, with a contingent minimum return of 10.6%.
In either case, the payout is subject to a maximum return of 25%.
J.P. Morgan Securities LLC is the agent.
Issuer: | HSBC USA Inc.
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Issue: | Capped knock-out buffer notes
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Underlying shares: | Ford Motor Co. (Symbol: F)
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Amount: | $4.7 million
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Maturity: | Feb. 14, 2012
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Coupon: | 0%
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Price: | Par
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Payout at maturity: | If share price falls by more than 25%, par plus share return with exposure to losses; otherwise, par plus any stock gain, floor of 10.6%; in both cases, payout capped at 25%
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Initial price: | $15.40
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Pricing date: | Feb. 2
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Settlement date: | Feb. 7
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Agent: | J.P. Morgan Securities LLC
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Fees: | 1%
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Cusip: | 4042K1DQ3
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