By Toni Weeks
SanLuis Obispo, Calif., July 28 – HSBC USA Inc. priced $2.6 million of contingent income autocallable securities due July 29, 2016 linked to Biogen Idec Inc. shares, according to a 424B2 filing with the Securities and Exchange Commission.
The notes will pay a contingent quarterly coupon at an annual rate of 10.2% if the shares close at or above the 75% downside threshold level on the determination date for that quarter.
The notes will be called at par plus the contingent coupon if the stock closes at or above the initial price on any of the first three quarterly determination dates.
The payout at maturity will be par plus the final coupon unless the shares finish below the 75% downside threshold level, in which case investors will receive a number of Biogen shares equal to $10 divided by the initial price or, at the issuer’s option, the cash equivalent.
HSBC Securities (USA) Inc. is the agent with Morgan Stanley Wealth Management handling distribution.
| Issuer: | HSBC USA Inc.
|
| Issue: | Contingent income autocallable securities
|
| Underlying stock: | Biogen Idec Inc. (Nasdaq: BIIB)
|
| Amount: | $2,598,140
|
| Maturity: | July 29, 2016
|
| Coupon: | 10.2%, payable quarterly if stock closes at or above downside threshold level on determination date for that quarter
|
| Price: | Par of $10
|
| Payout at maturity: | Par plus contingent coupon if Biogen Idec shares finish at or above downside threshold level; otherwise, a number of Biogen shares equal to $10 divided by initial price or, at issuer’s option, cash equivalent
|
| Call: | Automatically at par plus contingent coupon if Biogen Idec shares close at or above initial price on any of first three determination dates
|
| Initial share price: | $300.03
|
| Downside threshold: | $225.02, 75% of initial price
|
| Pricing date: | July 24
|
| Settlement date: | July 29
|
| Agent: | HSBC Securities (USA) Inc.
|
| Dealer: | Morgan Stanley Wealth Management
|
| Fees: | 1.75%
|
| Cusip: | 40434E721
|
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