By Jennifer Chiou
New York, March 6 - HSBC USA Inc. priced $6,012,000 of knock-out buffer notes due March 20, 2013 linked to the S&P 500 index, according to a 424B2 filing with the Securities and Exchange Commission.
A knock-out event occurs if the S&P 500 falls by more than 20% on any day during the life of the notes.
If a knock-out event occurs, the payout at maturity will be par plus the index return. Investors will be exposed to any losses.
Otherwise, the payout will be par plus the greater of the index return and the contingent minimum return of 4.75%.
The return will be capped at 20% in either case.
HSBC Securities (USA) Inc. is the underwriter, and J.P. Morgan Securities LLC is the agent.
Issuer: | HSBC USA Inc.
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Issue: | Knock-out buffer notes
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Underlying index: | S&P 500
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Amount: | $6,012,000
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Maturity date: | March 20, 2013
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Coupon: | 0%
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Price: | Par
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Payout at maturity: | If index falls by more than 20% during the life of the notes, par plus index return, with full exposure to losses; otherwise par plus greater of the index return and the contingent minimum return of 4.75%; cap of 20% in either case
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Initial level: | 1,369.63
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Knock-out buffer: | 20% of initial level
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Pricing date: | March 2
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Settlement date: | March 7
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Underwriter: | HSBC Securities (USA) Inc. (underwriter) and J.P. Morgan Securities LLC (agent)
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Fees: | 1%
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Cusip: | 4042K1YL3
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