Published on 8/8/2008 in the Prospect News Structured Products Daily.
New Issue: HSBC USA prices $1.81 million 23.15% reverse convertibles linked to six stocks
By Susanna Moon
Chicago, Aug. 8 - HSBC USA Inc. priced $1.81 million of 23.15% reverse convertible notes due Feb. 11, 2009 linked to an equally weighted basket of stocks, according to a 424B2 filing with the Securities and Exchange Commission.
Underlying stocks are CF Industries Holdings, Inc., United States Steel Corp., Consol Energy Inc., IntercontinentalExchange, Inc., Research In Motion Ltd. and Transocean Inc.
Interest will be payable monthly.
Payout at maturity will be the sum of the payouts for each of the component stocks.
For each component stock, the payout at maturity will be $166.67 unless that stock falls below its barrier price - 70% of its initial share price - during the life of the notes and finishes below its initial share price, in which case the payout for that component stock will be a number of its shares equal to $166.67 divided by the initial share price or, at HSBC USA's option, the equivalent cash value.
The total payout at maturity will be equal to the sum of the payouts for the six components.
HSBC Securities (USA) Inc. is the agent.
| Issuer: | HSBC USA Inc.
|
| Issue: | Reverse convertible notes
|
| Amount: | $1,811,000
|
| Underlying shares: | CF Industries Holdings, Inc. (Symbol: CF), United States Steel Corp. (Symbol: X), Consol Energy Inc. (Symbol: CNX), IntercontinentalExchange, Inc. (Symbol: ICE), Research In Motion Ltd. (Symbol: RIMM) and Transocean Inc. (Symbol: RIG)
|
| Maturity: | Feb. 11, 2009
|
| Coupon: | 23.15%, payable monthly
|
| Price: | Par
|
| Payout at maturity: | Sum of component payouts; for each component stock that stays at or above protection level during life of notes or finishes at or above initial level, one-sixth of par; for each stock that falls below protection level during life of notes and finishes below its initial level, number of shares equal to one-sixth of par divided by that stock's initial level
|
| Initial level: | $140.79 for CF Industries Holdings, $144.34 for United States Steel, $65.81 for Consol Energy, $84.60 for IntercontinentalExchange, $127.30 for Research In Motion and $132.20 for Transocean.
|
| Protection level: | $98.553 for CF Industries Holdings, $101.038 for United States Steel, $46.067 for Consol Energy Inc., $59.22 for IntercontinentalExchange, $89.11 for Research In Motion, $92.54 for Transocean; or 70% of initial levels
|
| Pricing date: | Aug. 6
|
| Settlement date: | Aug. 11
|
| Agent: | HSBC Securities (USA) Inc.
|
| Fees: | 2.625%
|
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