By Jennifer Chiou
New York, Oct. 31 - HSBC USA Inc. priced $10.18 million of 10% STEP Income Securities due Nov. 9, 2012 linked to Freeport-McMoRan Copper & Gold Inc. shares, according to a 424B2 filing with the Securities and Exchange Commission.
Interest is payable quarterly.
If the price of Freeport-McMoRan shares finishes at or above the STEP level - 110% of the initial price - the payout at maturity will be par of $10 plus 4.35%.
If the stock finishes at or above 90% of the initial value but below the STEP level, the payout will be par.
Investors will be exposed to losses beyond the 10% buffer.
Bank of America Merrill Lynch is the agent.
| Issuer: | HSBC USA Inc.
|
| Issue: | STEP Income Securities
|
| Underlying stock: | Freeport-McMoRan Copper & Gold Inc. (NYSE: FCX)
|
| Amount: | $10,181,270
|
| Maturity: | Nov. 9, 2012
|
| Coupon: | 10%, payable quarterly
|
| Price: | Par of $10
|
| Payout at maturity: | If Freeport-McMoRan shares finish at or above STEP level, par plus 4.35% per note; par if shares finish at or above threshold value but below STEP level; exposure to losses beyond 10% buffer
|
| Initial price: | $42.54
|
| STEP level: | $46.79, 110% of initial value
|
| Threshold value: | $38.29, 90% of initial value
|
| Pricing date: | Oct. 27
|
| Settlement date: | Nov. 4
|
| Agent: | Bank of America Merrill Lynch
|
| Fees: | 1.75%
|
| Cusip: | 40433C270
|
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