By Marisa Wong
Madison, Wis., Oct. 12 - HSBC USA Inc. priced $12.62 million of contingent income autocallable securities due Oct. 15, 2013 linked to the common stock of JPMorgan Chase & Co., according to a 424B2 filing with the Securities and Exchange Commission.
If JPMorgan stock closes at or above the 75% downside threshold level on a quarterly determination date, investors will receive a contingent payment of 2.2% that quarter. Otherwise, no payment will be made that quarter.
If the stock closes at or above the initial price on any of the first three quarterly determination dates, the notes will be called at par plus the contingent payment.
If the notes are not called, the payout at maturity will be par plus the contingent payment unless the final share price is less than the downside threshold level, in which case the payout will be a number of JPMorgan shares equal to $10.00 divided by the initial share price or, at the issuer's option, the cash equivalent.
HSBC Securities (USA) Inc. is the agent. Distribution will be through Morgan Stanley Smith Barney LLC.
| Issuer: | HSBC USA Inc.
|
| Issue: | Contingent income autocallable securities
|
| Underlying stock: | JPMorgan Chase & Co. (Symbol: JPM)
|
| Amount: | $12,618,010
|
| Maturity: | Oct. 15, 2013
|
| Coupon: | Contingent quarterly payment of 2.2% if stock closes at or above downside threshold level on a quarterly determination date; otherwise, no payment that quarter
|
| Price: | Par
|
| Payout at maturity: | Par plus contingent payment unless final share price is less than downside threshold level, in which case a number of JPMorgan shares equal to $10.00 divided by initial share price or, at the issuer's option, cash equivalent
|
| Call: | At par plus the contingent payment if stock closes at or above initial price on any of first three quarterly determination dates
|
| Initial price: | $41.77
|
| Downside threshold price: | $31.3275, 75% of initial price
|
| Pricing date: | Oct. 10
|
| Settlement date: | Oct. 15
|
| Agent: | HSBC Securities (USA) Inc. with distribution through Morgan Stanley Smith Barney LLC
|
| Fees: | 1.5%
|
| Cusip: | 40433T828
|
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