By Toni Weeks
San Luis Obispo, Calif., March 26 - HSBC USA Inc. priced $2.68 million of contingent income autocallable securities with step-down redemption threshold due March 28, 2016 linked to Las Vegas Sands Corp. shares, according to a 424B2 filing with the Securities and Exchange Commission.
The notes will pay a contingent quarterly coupon of 2.25% if Las Vegas Sands stock closes at or above the 70% downside threshold level on the determination date for that quarter.
If the shares close at or above the redemption threshold level on any of the first 11 quarterly determination dates, the notes will be called at par plus the contingent coupon. The redemption threshold will be 95% of the initial share price for the first four determination dates, 90% of the initial share price for the next four determination dates and 85% of the initial share price for the remaining determination dates.
If Las Vegas Sands stock finishes at or above the downside threshold level, the payout at maturity will be par plus the contingent payment. Otherwise, investors will receive a number of shares equal to $10 divided by the initial share price or, at the issuer's option, the cash equivalent of those shares.
HSBC Securities (USA) Inc. is the agent. Morgan Stanley Smith Barney LLC will handle distribution.
| Issuer: | HSBC USA Inc.
|
| Issue: | Contingent income autocallable securities with step-down redemption threshold
|
| Underlying stock: | Las Vegas Sands Corp. (Symbol: LVS)
|
| Amount: | $2,678,000
|
| Maturity: | March 28, 2016
|
| Coupon: | 2.25% if closing price is at least 70% of initial price on quarterly determination date; otherwise, none
|
| Price: | Par of $10
|
| Payout at maturity: | If final share price is at least 70% of initial price, par plus contingent quarterly payment; otherwise, number of Las Vegas Sands shares equal to $10.00 divided by initial share price, or, at HSBC's option, equivalent cash amount of those shares
|
| Initial price: | $53.84
|
| Downside threshold level: | $37.69, 70% of initial share price
|
| Call: | Par plus contingent payment if closing share price greater than or equal to redemption threshold level on any of first 11 quarterly determination dates; redemption threshold will be 95% of initial share price for first four determination dates, 90% of initial share price for next four determination dates and 85% of initial share price for remaining determination dates
|
| Pricing date: | March 22
|
| Settlement date: | March 27
|
| Agent: | HSBC Securities (USA) Inc.
|
| Dealer: | Morgan Stanley Smith Barney LLC
|
| Fees: | 2.25%, used for selling concessions
|
| Cusip: | 40433X209
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