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Published on 8/30/2012 in the Prospect News Structured Products Daily.

New Issue: HSBC prices $127,000 head start annual income opportunity notes linked to stocks

By Toni Weeks

San Diego, Aug. 30 - HSBC USA, Inc. priced $127,000 of annual income opportunity notes due Aug. 31, 2018 linked to a basket of common stocks, according to a 424B2 filing with the Securities and Exchange Commission.

The basket includes Barrick Gold Corp., Bristol-Myers Squibb Co., ConAgra Foods, Inc., FirstEnergy Corp., Halliburton Co., Intel Corp., PNC Financial Services Group, Inc., Tiffany & Co., Unitedhealth Group Inc. and Verizon Communications Inc.

Interest is payable annually and will equal the average of the performances of the basket stocks, subject to a minimum interest rate of 0.25% per year.

A stock's performance will be equal to the 7% auto cap rate if its return is greater than or equal to negative 10%. If a stock's return is less than negative 10%, its performance will be the greater of its return and negative 25%.

The payout at maturity will be par plus the last coupon payment.

HSBC Securities (USA) Inc. is the agent.

Issuer:HSBC USA Inc.
Issue:Head start annual income opportunity notes with auto cap
Underlying stocks:Barrick Gold Corp., Bristol-Myers Squibb Co., ConAgra Foods, Inc., FirstEnergy Corp., Halliburton Co., Intel Corp., PNC Financial Services Group, Inc., Tiffany & Co., Unitedhealth Group Inc. and Verizon Communications Inc.
Amount:$127,000
Maturity:Aug. 31, 2018
Coupon:Average of performances of the basket stocks, subject to a minimum interest rate of 0.25%; payable annually
Stock performance:If stock's return is negative 10% or greater, 7%; otherwise, greater of stock return and negative 25%
Price:Par
Payout at maturity:Par
Initial prices:$37.73 for Barrick Gold Corp., $32.96 for Bristol-Myers Squibb Co., $25.22 for ConAgra Foods, Inc., $44.36 for FirstEnergy Corp., $34.08 for Halliburton Co., $25.00 for Intel Corp., $61.97 for PNC Financial Services Group, Inc., $62.50 for Tiffany & Co., $54.33 for Unitedhealth Group Inc. and $42.67 for Verizon Communications Inc.
Pricing date:Aug. 28
Settlement date:Aug. 31
Agent:HSBC Securities (USA) Inc.
Fees:3.6%
Cusip:4042K13F8

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