By Wendy Van Sickle
Columbus, Ohio, May 9 – HSBC USA Inc. priced $11 million of phoenix quarterly review notes with a memory coupon feature due May 19, 2023 linked to the common shares of Shopify Inc., according to a 424B2 filing with the Securities and Exchange Commission.
The notes will pay a contingent quarterly coupon at an annualized rate of 18.5% if the shares close at or above their 50% coupon barrier on the observation date for that quarter. If a coupon payment is missed because the stock closes below the barrier, it will be paid on the next coupon payment date that the stock closes at or above the barrier.
The notes will be called at par plus the contingent coupon if the shares close at or above the initial price on any quarterly observation date.
The payout at maturity will be par plus the contingent coupon unless the shares finish below the 50% trigger level, in which case investors will lose 2% for every 1% stock decline beyond 50%.
HSBC Securities (USA) Inc. is the underwriter, and JPMorgan Chase Bank, NA and J.P. Morgan Securities LLC are the placement agents.
| Issuer: | HSBC USA Inc.
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| Issue: | Phoenix quarterly review notes with memory coupon
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| Underlying stock: | Shopify Inc.
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| Amount: | $11 million
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| Maturity: | May 19, 2023
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| Coupon: | 18.5% annual rate, payable quarterly if stock closes at or above 50% coupon barrier on observation date for that quarter; coupon payments will include any previously unpaid coupons
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| Price: | Par
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| Payout at maturity: | Par plus final coupon unless stock finishes below trigger level, in which case 2% loss per 1% decline beyond 50%
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| Call: | Automatically at par plus coupon if stock closes at or above initial level on any determination date
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| Initial level: | $452.98
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| Trigger level: | $226.49; 50% of initial level
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| Pricing date: | May 2
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| Settlement date: | May 6
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| Agent: | HSBC Securities (USA) Inc.
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| Placement agents: | JPMorgan Chase Bank, NA and J.P. Morgan Securities LLC
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| Fees: | 2%
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| Cusip: | 40439J4C6
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