By Susanna Moon
Chicago, April 26 – HSBC USA Inc. priced $1.22 million of phoenix quarterly review notes with a memory coupon feature due May 8, 2019 linked to the common stock of Apple Inc., according to a 424B2 filing with the Securities and Exchange Commission.
The notes will pay a contingent quarterly coupon of 10% annualized if Apple shares close at or above the 78% coupon barrier on an observation date for that quarter.
If a coupon payment is missed because the stock closes below the barrier, it will be paid on the next coupon payment date on which the stock closes at or above the barrier.
The notes will be called at par plus the contingent coupon if the shares close at or above the initial price on any quarterly observation date.
The payout at maturity will be par plus the contingent coupon unless Apple shares finish below the 78% trigger price, in which case investors will be fully exposed to any losses.
HSBC Securities (USA) Inc. is the underwriter, and JPMorgan is the placement agent.
Issuer: | HSBC USA Inc.
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Issue: | Phoenix quarterly review notes
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Underlying stock: | Apple Inc. (Symbol: AAPL)
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Amount: | $1.22 million
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Maturity: | May 8, 2019
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Coupon: | 10% annualized, if stock closes at or above 78% coupon barrier on observation date for that quarter; if a coupon payment is missed because the stock closes below the barrier, it will be paid on the next coupon payment date on which the stock closes at or above the barrier
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Price: | Par
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Payout at maturity: | Par plus contingent coupon unless shares finish below trigger price, in which case 1% loss per 1% decline
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Call: | At par plus contingent coupon if shares close at or above initial price on any quarterly observation date
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Initial share price: | $165.72
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Trigger price: | $129.2616, 78% of initial share price
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Pricing date: | April 20
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Settlement date: | April 25
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Underwriter: | HSBC Securities (USA) Inc.
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Agents: | JPMorgan Chase Bank NA and J.P. Morgan Securities LLC
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Fees: | 1%
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Cusip: | 40435FWR4
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