By Marisa Wong
Morgantown, W.Va., Feb. 2 – HSBC USA Inc. priced $1.02 million of phoenix quarterly review notes with memory coupon due Feb. 14, 2018 linked to the SPDR S&P Oil & Gas Exploration & Production exchange-traded fund, according to a 424B2 filing with the Securities and Exchange Commission.
If the fund closes at or above the 75% coupon barrier on a quarterly observation date, the notes will pay a contingent coupon that quarter at a rate of 12.35% per year. If a contingent coupon is not paid on a particular quarter because the fund closed below the coupon barrier on that quarter’s observation date, that contingent coupon will be paid on a later quarter if the fund closes at or above the coupon barrier on the observation date for that later quarter.
The notes will be called at par plus the contingent coupon if the fund closes at or above the initial price on any quarterly observation date.
The payout at maturity will be par plus the contingent coupon unless the fund finishes below the 75% trigger level, in which case investors will be fully exposed to any losses.
HSBC Securities (USA) Inc. is the underwriter, and J.P. Morgan Securities LLC and JPMorgan Chase Bank NA are placement agents.
| Issuer: | HSBC USA Inc.
|
| Issue: | Phoenix quarterly review notes with memory coupon
|
| Underlying ETF: | SPDR S&P Oil & Gas Exploration & Production ETF
|
| Amount: | $1,015,000
|
| Maturity: | Feb. 14, 2018
|
| Coupon: | 12.35% per year, payable on a quarter if fund closes at or above coupon barrier on observation date for that quarter; if a contingent coupon is not paid on a particular quarter, that contingent coupon will be paid on a later quarter if fund closes at or above coupon barrier on observation date for that later quarter
|
| Price: | Par
|
| Payout at maturity: | Par plus contingent coupon unless fund finishes below trigger price, in which case investors will be fully exposed to any losses
|
| Call: | At par plus contingent coupon if fund closes at or above initial price on any quarterly observation date
|
| Initial price: | $41.30
|
| Coupon barrier: | $30.975, 75% of initial price
|
| Trigger price: | $30.975, 75% of initial price
|
| Pricing date: | Jan. 27
|
| Settlement date: | Feb. 1
|
| Underwriter: | HSBC Securities (USA) Inc. with J.P. Morgan Securities LLC and JPMorgan Chase Bank NA as placement agents
|
| Fees: | 1%
|
| Cusip: | 40433UM45
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