Published on 11/21/2006 in the Prospect News Structured Products Daily.
New Issue: HSBC USA prices $1 million 15.6% reverse convertibles linked to Frontline
By Laura Lutz
Des Moines, Nov. 21 - HSBC USA Inc. priced a $1 million issue of 15.6% reverse convertible notes due May 29, 2007 linked to Frontline Ltd. stock, according to a 424B2 filing with the Securities and Exchange Commission.
Payout at maturity will be par in cash unless Frontline stock falls below the barrier price of $29.36 during the life of the notes and finishes below its initial price on the valuation day, May 23, 2007, in which case payout will be a number of Frontline shares equal to $1,000 divided by the initial share price.
Issuer: | HSBC USA Inc.
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Issue: | Reverse convertible notes
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Underlying stock: | Frontline Ltd.
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Amount: | $1 million
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Maturity: | May 29, 2007
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Coupon: | 15.6%, paid monthly
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Price: | Par
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Payout at maturity: | If Frontline stock falls below $29.36 during the life of the notes and finishes below its initial price, shares of Frontline stock equal to $1,000 divided by the initial price; otherwise, par in cash
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Initial share price: | $39.15
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Barrier price: | $29.36, 75% of initial share price
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Pricing date: | Nov. 17
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Settlement date: | Nov. 29
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Agent: | HSBC Securities (USA) Inc.
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Agent fee: | 2.5%
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