By Angela McDaniels
Tacoma, Wash., May 29 - HSBC USA Inc. priced $13.28 million of 8.5% STEP Income Securities due June 7, 2013 linked to the common stock of Schlumberger Ltd. via Bank of America Merrill Lynch, according to a 424B2 filing with the Securities and Exchange Commission.
Interest is payable quarterly.
If the final price of Schlumberger stock is greater than or equal to the step level, the payout at maturity will be par of $10 plus 11.5%. The step level is 108.5% of the initial share price.
If the final share price is greater than or equal to the initial share price but is less than the step level, the payout will be par.
Investors will lose 1% for every 1% that the final price declines.
| Issuer: | HSBC USA Inc.
|
| Issue: | STEP Income Securities
|
| Underlying stock: | Schlumberger Ltd. (NYSE: SLB)
|
| Amount: | $13,277,600
|
| Maturity: | June 7, 2013
|
| Coupon: | 8.5%, payable quarterly
|
| Price: | Par of $10.00
|
| Payout at maturity: | If final price of Schlumberger stock is greater than or equal to step level, par plus 11.5%; if final share price is greater than or equal to initial share price but is less than step level, par; full exposure to any share price decline
|
| Initial share price: | $65.89, equal to volume-weighted average price on pricing date
|
| Step level: | $71.49, 108.5% of initial share price
|
| Pricing date: | May 24
|
| Settlement date: | June 1
|
| Agent: | Bank of America Merrill Lynch
|
| Fees: | 1.75%
|
| Cusip: | 40433M823
|
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