HSBC to price autocallable optimization notes tied to Energy Select Sector SPDR via UBS

By Angela McDaniels

Tacoma, Wash., May 7 - HSBC USA Inc. plans to price 0% autocallable optimization securities with contingent protection due June 2, 2010 linked to the Energy Select Sector SPDR fund, according to an FWP filing with the Securities and Exchange Commission.

UBS Financial Services Inc. and HSBC USA Inc. are the agents.

If the fund closes above its initial share price on any of 12 monthly observation dates, the notes will be called and investors will receive par of $10 plus an annualized return of 18% to 25%. The exact percentage will be determined at pricing.

If the notes are not called, the payout at maturity will be par if the final share price is at least 70% of the initial price. Otherwise, investors will receive par plus the share price return.

The notes are expected to price May 26 and settle May 29.

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