By Wendy Van Sickle
Columbus, Ohio, June 3 – HSBC USA Inc. priced $1.17 million of phoenix quarterly review notes with memory coupon feature due June 3, 2024 linked to Caterpillar Inc. stock, according to a 424B2 filing with the Securities and Exchange Commission.
The notes will pay a contingent quarterly coupon at an annualized rate of 15.7% if the stock closes at or above its 80% coupon barrier on the 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 that 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 the shares finish below the 80% trigger level, in which case investors will be fully exposed to any losses.
HSBC Securities (USA) Inc. is the underwriter, and JPMorgan Chase Bank, NA and J.P. Morgan Securities LLC are the placement agents.
| Issuer: | HSBC USA Inc.
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| Issue: | Phoenix quarterly review notes with memory coupon feature
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| Underlying stock: | Caterpillar Inc.
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| Amount: | $1,172,000
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| Maturity: | June 3, 2024
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| Coupon: | 15.7% annual rate, payable quarterly if each stock closes at or above coupon barrier on observation date for that quarter; previously unpaid coupons will also be paid
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| Price: | Par
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| Payout at maturity: | Par unless any stock finishes below trigger level, in which case 1% loss per 1% decline of worst performing stock from initial level
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| Call: | At par if each stock closes at or above initial level on any quarterly determination date
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| Initial level: | $217.14
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| Coupon barrier level: | $173.712, 80% of initial level
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| Trigger level: | $173.712, 80% of initial level
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| Pricing date: | May 27
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| Settlement date: | June 2
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| Agent: | HSBC Securities (USA) Inc.
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| Placement agents: | JPMorgan Chase Bank, NA and J.P. Morgan Securities LLC
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| Fees: | 1.5%
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| Cusip: | 40439J6B6
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