By Marisa Wong
Madison, Wis., Oct. 28 - HSBC USA Inc. priced $2 million of 0% knock-out buffer notes due May 2, 2012 linked to the American Depositary Shares of Petroleo Brasileiro SA - Petrobras, according to a 424B2 filing with the Securities and Exchange Commission.
A knock-out event occurs if the price of Petrobras stock falls by more than 30% on any day during the life of the notes.
If a knock-out event occurs, the payout at maturity will be par plus the share return. Investors will be exposed to any losses.
If a knock-out event does not occur, the payout will be par plus the share return, subject to a contingent minimum return of 8%.
In either case, the payout is subject to a maximum return of 50%.
J.P. Morgan Securities LLC is the agent.
| Issuer: | HSBC USA Inc.
|
| Issue: | Knock-out buffer notes
|
| Underlying ADSs: | Petroleo Brasileiro SA - Petrobras (Symbol: PBR)
|
| Amount: | $2 million
|
| Maturity: | May 2, 2012
|
| Coupon: | 0%
|
| Price: | Par
|
| Payout at maturity: | If share price falls by more than 30% during life of notes, par plus share return with exposure to losses; otherwise, par plus share return, floor of 8%; in both cases, payout capped at 50%
|
| Initial price: | $33.66
|
| Pricing date: | Oct. 26
|
| Settlement date: | Nov. 2
|
| Agent: | J.P. Morgan Securities LLC
|
| Fees: | 1.25%
|
| Cusip: | 4042K06V2
|
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