By Toni Weeks
San Luis Obispo, Calif., May 6 - HSBC USA Inc. priced $3.47 million of contingent income autocallable securities due May 8, 2017 linked to Baidu, Inc. American Depositary Shares, according to a 424B2 filing with the Securities and Exchange Commission.
The notes will pay a contingent quarterly payment at an annual rate of 12% if Baidu shares close at or above the 70% barrier level on a determination date for that quarter.
The notes will be redeemed at par of $10 plus the contingent payment if the shares close at or above the initial share price on any of the first 11 quarterly determination dates.
If the notes are not called and the final share price is greater than or equal to the 70% downside threshold level, the payout at maturity will be par plus the contingent payment.
Otherwise, the payout will be a number of Baidu shares equal to $10 divided by the initial share price or, at the issuer's option, a cash equivalent.
HSBC Securities (USA) Inc. is the agent with Morgan Stanley Wealth Management as dealer.
| Issuer: | HSBC USA Inc.
|
| Issue: | Contingent income autocallable securities
|
| Underlying stock: | Baidu, Inc. (Nasdaq: BIDU)
|
| Amount: | $3,472,190
|
| Maturity: | May 8, 2017
|
| Coupon: | 12% per year, payable quarterly if Baidu ADSs close at or above downside threshold level on review date for that quarter
|
| Price: | Par of $10
|
| Payout at maturity: | If final ADS price is greater than or equal to downside threshold level, par plus contingent payment; otherwise, Baidu shares equal to $10 divided by the initial share price
|
| Call: | At par plus contingent payment if shares close at or above initial price on any of first 11 quarterly determination dates
|
| Initial share price: | $159.91
|
| Downside threshold: | $111.94, 70% of initial share price
|
| Pricing date: | May 2
|
| Settlement date: | May 7
|
| Agent: | HSBC Securities (USA) Inc. with Morgan Stanley Wealth Management as dealer
|
| Fees: | 2.25%
|
| Cusip: | 40434C634
|
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