By Marisa Wong
Morgantown, W.Va., Aug. 12 – HSBC USA Inc. priced $2.23 million of phoenix quarterly review notes due Aug. 24, 2016 linked to Valeant Pharmaceuticals International, Inc. shares, according to a 424B2 filing with the Securities and Exchange Commission.
If Valeant stock closes at or above the 70% trigger level on a quarterly observation date, the notes will pay a contingent coupon at an annual rate of 14.2% for that quarter.
If the shares close at or above the initial price on any quarterly observation date, the notes will be called at par of $10 plus the contingent coupon.
If the notes are not called and Valeant shares finish at or above the trigger level, the payout at maturity will be par plus the contingent coupon.
Otherwise, investors will be fully exposed to any losses.
HSBC Securities (USA) Inc. is the underwriter, and J.P. Morgan Securities LLC is the placement agent.
| Issuer: | HSBC USA Inc.
|
| Issue: | Phoenix quarterly review notes
|
| Underlying stock: | Valeant Pharmaceuticals International, Inc. (Symbol: VRX)
|
| Amount: | $2,225,000
|
| Maturity: | Aug. 24, 2016
|
| Coupon: | 14.2% annualized if Valeant shares close at or above barrier level on quarterly observation date
|
| Price: | Par
|
| Payout at maturity: | Par plus contingent coupon if Valeant shares finish at or above barrier level; otherwise, full exposure to any losses
|
| Call: | At par plus contingent coupon if Valeant shares close at or above initial share price on any quarterly observation date
|
| Initial share price: | $247.79
|
| Trigger price: | $173.45, 70% of initial share price
|
| Pricing date: | Aug. 7
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| Settlement date: | Aug. 12
|
| Underwriter: | HSBC Securities (USA) Inc.
|
| Agent: | J.P. Morgan Securities LLC
|
| Fees: | 1%
|
| Cusip: | 40433B5Z7
|
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