Calculation
of Registration Fee
Title of Each Class of
Securities Offered
|
|
Maximum Aggregate
Offering Price
|
|
Amount of
Registration Fee
(1)
|
|
|
|
|
|
Debt Securities
|
|
$1,372,000
|
|
$187.15
|
(1)
Calculated in accordance with Rule 457 (r) of
the Securities Act of 1933, as amended.
Filed Pursuant
to Rule 424(b)(2)
Registration
No. 333-180289
PRICING
SUPPLEMENT
Dated May
30, 2013
(To Prospectus
dated March 22, 2012,
Prospectus
Supplement dated March 22, 2012 and
ETF Underlying
Supplement dated March 22, 2012)
HSBC USA Inc.
Leveraged Buffered Uncapped Market
Participation Securities Linked to the
iShares
®
MSCI
Emerging Markets Index Fund
|
}
|
$1,372,000 Leveraged Buffered Uncapped Market Participation Securities linked to the iShares
®
MSCI Emerging Markets
Index Fund
|
|
}
|
1.20x uncapped exposure to any positive return of the reference asset
|
|
}
|
Protection from the first 25% of any losses of the reference asset, with 1.3333% exposure to each 1% loss of the reference
asset beyond -25%
|
|
}
|
All
payments on the securities are subject to the credit risk of HSBC USA Inc.
|
The Leveraged Buffered Uncapped Market Participation Securities (each a “security” and collectively
the “securities") offered hereunder will not be listed on any U.S. securities exchange or automated quotation system.
The securities will not bear interest.
Neither the U.S. Securities
and Exchange Commission (the “SEC”) nor any state securities commission has approved or disapproved of the securities
or passed upon the accuracy or the adequacy of this document, the accompanying ETF Underlying Supplement, prospectus or prospectus
supplement. Any representation to the contrary is a criminal offense. We have appointed HSBC Securities (USA) Inc., an affiliate
of ours, as the agent for the sale of the securities. HSBC Securities (USA) Inc. will purchase the securities from us for distribution
to other registered broker-dealers or will offer the securities directly to investors. In addition, HSBC Securities (USA) Inc.
or another of its affiliates or agents may use this pricing supplement in market-making transactions in any securities after their
initial sale. Unless we or our agent informs you otherwise in the confirmation of sale, this pricing supplement is being used in
a market-making transaction. See “Supplemental Plan of Distribution (Conflicts of Interest)” on page PS-11 of this
pricing supplement.
Investment in the securities
involves certain risks. You should refer to “Risk Factors” beginning on page PS-5 of this document, page S-3 of the
accompanying prospectus supplement, and page S-2 of the accompanying ETF Underlying Supplement.
|
Price to Public
|
Underwriting Discount
1
|
Proceeds to Issuer
|
Per security
|
$1,000
|
$0
|
$1,000
|
Total
|
$1,372,000
|
$1,000
|
$1,372,000
|
1
See “Supplemental
Plan of Distribution (Conflicts of Interest)” on page PS-11 of this pricing supplement.
The
securities:
Are Not FDIC Insured
|
Are Not Bank Guaranteed
|
May Lose Value
|
HSBC USA
Inc.
Leveraged
Buffered Uncapped Market Participation Securities
|
|
Linked to the
iShares
®
MSCI Emerging Markets Index Fund
|
|
The securities have the
terms described in this pricing supplement and the accompanying ETF Underlying Supplement, prospectus supplement and prospectus.
If the terms of the securities offered hereby are inconsistent with those described in the accompanying ETF Underlying Supplement,
prospectus supplement or prospectus, the terms described in this pricing supplement shall control.
You should be willing to forgo interest and dividend payments during the term of the securities.
This pricing supplement
relates to an offering of securities linked to the performance of the iShares
®
MSCI Emerging Markets Index Fund
(the “Reference Asset”). The purchaser of a security will acquire a senior unsecured debt security of HSBC USA Inc.
linked to the Reference Asset as described below. The following key terms relate to the offering of securities:
Issuer:
|
HSBC USA Inc.
|
|
|
Principal Amount:
|
$1,000 per security
|
|
|
Reference Asset:
|
The iShares
®
MSCI Emerging Markets Index Fund (Ticker: EEM)
|
|
|
Trade Date:
|
May 30, 2013
|
|
|
Pricing Date:
|
May 30, 2013
|
|
|
Original Issue Date:
|
June 4, 2013
|
|
|
Final Valuation Date:
|
May
30, 2019.
The Final Valuation Date is subject to adjustment as described under “Additional Terms of the Notes—Valuation Dates” in the accompanying ETF Underlying Supplement.
|
|
|
Maturity Date:
|
June 4, 2019.
The Maturity Date is subject to adjustment as described under “Additional Terms of the Notes—Coupon Payment Dates, Call Payment Dates and Maturity Date” in the accompanying ETF Underlying Supplement.
|
|
|
Upside Participation Rate:
|
120%
|
|
|
Payment at Maturity:
|
On the Maturity Date, for each security, we will pay you the Final Settlement Value.
|
|
|
Final Settlement Value:
|
If the Reference Return is greater than zero,
you
will receive a cash payment on the Maturity Date, per $1,000 Principal Amount, calculated as follows:
$1,000 + ($1,000 × Reference Return × Upside Participation
Rate).
If the Reference Return is less than or equal to zero
but greater than or equal to the Buffer Price,
you will receive a cash payment on the Maturity Date of $1,000 per $1,000
Principal Amount (zero return).
If the Reference Return is less than the Buffer Price,
you will receive a cash payment on the Maturity Date, per $1,000 Principal Amount, calculated as follows:
$1,000 + [$1,000 × (Reference Return + 25%) x Downside
Leverage Factor].
Under these circumstances, you will lose 1.3333% of the Principal
Amount of your securities for each percentage point that the Reference Return is below the Buffer Price. For example, if the Reference
Return is -26%, you will suffer a 1.3333% loss and receive 98.6667% of the Principal Amount.
If the Reference Return is less
than the Buffer Price, you will lose up to 100% of your investment.
|
|
|
Reference Return:
|
The quotient, expressed as a percentage, calculated as follows:
|
|
|
|
Final Price – Initial Price
Initial Price
|
Buffer Price:
|
-25%
|
|
|
Downside Leverage
Factor:
|
1.3333
|
Initial Price:
|
$41.96, which was the Official Closing Price of the Reference Asset on the Pricing Date.
|
|
|
Final Price:
|
The Official Closing Price of the Reference Asset on the Final Valuation Date.
|
|
|
Official Closing Price:
|
The closing price of the Reference Asset on any scheduled trading day as determined by the calculation agent based upon the price displayed on Bloomberg Professional
®
service page “EEM <EQUITY>”, or on any successor page on the Bloomberg Professional
®
service or any successor service, as applicable. The Official Closing Price is subject to adjustment as set forth under “Additional Terms of the Notes” in the accompanying ETF Underlying Supplement.
|
|
|
Form of Securities:
|
Book-Entry
|
|
|
Listing:
|
The securities will not be listed on any U.S. securities exchange or quotation system.
|
|
|
CUSIP/ISIN:
|
40432XFU0/US40432XFU00
|
GENERAL
This pricing supplement relates to an offering of securities
linked to the Reference Asset. The purchaser of a security will acquire a senior unsecured debt security of HSBC USA Inc. Although
the offering of securities relates to the Reference Asset, you should not construe that fact as a recommendation as to the merits
of acquiring an investment linked to the Reference Asset or any component security included in the Reference Asset or as to the
suitability of an investment in the securities.
You should read this document together
with the prospectus dated March 22, 2012, the prospectus supplement dated March 22, 2012 and the ETF Underlying Supplement dated
March 22, 2012. If the terms of the securities offered hereby are inconsistent with those described in the accompanying ETF Underlying
Supplement, prospectus supplement or prospectus, the terms described in this pricing supplement shall control. You should carefully
consider, among other things, the matters set forth in “Risk Factors” beginning on page PS-5 of this pricing supplement,
page S-3 of the prospectus supplement and page S-2 of the ETF Underlying Supplement, as the securities involve risks not associated
with conventional debt securities. We urge you to consult your investment, legal, tax, accounting and other advisors before you
invest in the securities. As used herein, references to the “Issuer”, “HSBC”, “we”, “us”
and “our” are to HSBC USA Inc.
HSBC has filed a registration statement
(including a prospectus, prospectus supplement and ETF Underlying Supplement) with the SEC for the offering to which this pricing
supplement relates. Before you invest, you should read the prospectus, prospectus supplement and ETF Underlying Supplement in that
registration statement and other documents HSBC has filed with the SEC for more complete information about HSBC and this offering.
You may get these documents for free by visiting EDGAR on the SEC’s web site at www.sec.gov. Alternatively, HSBC Securities
(USA) Inc. or any dealer participating in this offering will arrange to send you the prospectus, prospectus supplement and ETF
Underlying Supplement if you request them by calling toll-free 1-866-811-8049.
You may also obtain:
PAYMENT
AT MATURITY
On the Maturity Date, for each security
you hold, we will pay you the Final Settlement Value, which is an amount in cash, as described below:
If the Reference Return is greater than
zero
, you will receive a cash payment on the Maturity Date, per $1,000 Principal Amount, calculated as follows:
$1,000 + ($1,000 ×
Reference Return × Upside Participation Rate).
If the Reference Return is less than
or equal to zero but greater than or equal to the Buffer Price,
you will receive a cash payment on the Maturity Date of $1,000
per $1,000 Principal Amount (zero return).
If the Reference Return is less than
the Buffer Price,
you will receive a cash payment on the Maturity Date, per $1,000 Principal Amount, calculated as follows:
$1,000 + [$1,000 ×
(Reference Return + 25%) x Downside Leverage Factor].
Under these circumstances, you will lose
1.3333% of the Principal Amount of your securities for each percentage point that the Reference Return is below the Buffer Price.
For example, if the Reference Return is -26%, you will suffer a 1.3333% loss and receive 98.6667% of the Principal Amount.
You
should be aware that if the Reference Return is less than the Buffer Price, you will lose up to 100% of your investment, subject
to the credit risk of HSBC.
Interest
The securities will not pay interest.
Business Day
A “business day”
means any day, other than a Saturday or Sunday, that is neither a legal holiday nor a day on which banking institutions are authorized
or required by law or regulation to close in the City of New York.
Payment When Offices or Settlement
Systems Are Closed
If
any payment is due on the securities on a day that would otherwise be a “business day” but is a day on which the office
of a paying agent or a settlement system is closed, we will make the payment on the next business day when that paying agent or
system is open. Any such payment will be deemed to have been made on the original due date, and no additional payment will be made
on account of the delay.
Calculation
Agent
We or one of our affiliates will act as
calculation agent with respect to the securities.
Reference
Issuer
iShares, Inc. is the reference issuer.
INVESTOR
SUITABILITY
The securities may be suitable for you if:
|
|
The securities may not be suitable for you if:
|
|
|
|
}
You
seek an investment with an enhanced return linked to the potential positive performance of the Reference Asset and you believe
the price of the Reference Asset will increase over the term of the securities.
}
You
are willing to make an investment that is exposed to the negative Reference Return on a 1.3333-to-1 basis for each percentage point
that the Reference Return is less than the Buffer Price of -25%.
}
You
are willing to forgo dividends or other distributions paid to holders of the stocks comprising the Reference Asset.
}
You
are willing to accept the risk and return profile of the securities versus a conventional debt security with a comparable maturity
issued by HSBC or another issuer with a similar credit rating.
}
You
do not seek current income from your investment.
}
You
do not seek an investment for which there is an active secondary market.
}
You
are willing to hold the securities to maturity.
}
You
are comfortable with the creditworthiness of HSBC, as Issuer of the securities.
|
|
}
You
believe the Reference Return will be negative or that the Reference Return will not be sufficiently positive to provide you with
your desired return.
}
You
are unwilling to make an investment that is exposed to the negative Reference Return on a 1.3333-to-1 basis for each percentage
point that the Reference Return is less than the Buffer Price of -25%.
}
You
seek an investment that provides full return of principal.
}
You
prefer the lower risk, and therefore accept the potentially lower returns, of conventional debt securities with comparable maturities
issued by HSBC or another issuer with a similar credit rating.
}
You
prefer to receive the dividends or other distributions paid on the stocks comprising the Reference Asset.
}
You
seek current income from your investment.
}
You
seek an investment for which there will be an active secondary market.
}
You
are unable or unwilling to hold the securities to maturity.
}
You
are not willing or are unable to assume the credit risk associated with HSBC, as Issuer of the securities.
|
RISK
FACTORS
We urge you to read the section “Risk
Factors” beginning on page S-3 in the accompanying prospectus supplement and on page S-2 of the accompanying ETF Underlying
Supplement. Investing in the securities is not equivalent to investing directly in any of the stocks comprising the Reference Asset.
You should understand the risks of investing in the securities and should reach an investment decision only after careful consideration,
with your advisors, of the suitability of the securities in light of your particular financial circumstances and the information
set forth in this pricing supplement and the accompanying ETF Underlying Supplement, prospectus supplement and prospectus.
In addition to the risks discussed below,
you should review “Risk Factors” in the accompanying prospectus supplement and ETF Underlying Supplement including
the explanation of risks relating to the securities described in the following sections:
|
}
|
“— Risks Relating to All Note Issuances” in the prospectus supplement;
|
|
}
|
“— General Risks Related to Index Funds” in the ETF Underlying Supplement;
|
|
}
|
“— Securities Prices Generally Are Subject to Political, Economic, Financial, and Social
Factors that Apply to the Markets in which They Trade and, to a Lesser Extent, Foreign Markets” in the ETF Underlying Supplement;
and
|
|
}
|
“— Time Differences Between the Domestic and Foreign Markets and New York City May
Create Discrepancies in the Trading Level or Price of the Notes” in the ETF Underlying Supplement.
|
You will be subject to
significant risks not associated with conventional fixed-rate or floating-rate debt securities.
Your investment in the securities
may result in a loss.
You will be exposed on a leveraged basis
to the decline in the Final Price from the Initial Price beyond the Buffer Price of -25%. Accordingly, if the Reference Return
is less than -25%, your Payment at Maturity will be less than the Principal Amount of your securities. You will lose up to 100%
of your investment at maturity if the Reference Return is less than the Buffer Price.
Credit risk of HSBC USA Inc.
The securities are senior unsecured debt
obligations of the Issuer, HSBC, and are not, either directly or indirectly, an obligation of any third party. As further described
in the accompanying prospectus supplement and prospectus, the securities will rank on par with all of the other unsecured and unsubordinated
debt obligations of HSBC, except such obligations as may be preferred by operation of law. Any payment to be made on the securities,
including any return of principal at maturity, depends on the ability of HSBC to satisfy its obligations as they come due. As a
result, the actual and perceived creditworthiness of HSBC may affect the market value of the securities and, in the event HSBC
were to default on its obligations, you may not receive the amounts owed to you under the terms of the securities.
The amount payable on the securities is not linked to the
price of the Reference Asset at any time other than on the Final Valuation Date.
The Final Price will be based on the Official
Closing Price of the Reference Asset on the Final Valuation Date, subject to postponement for non-trading days and certain market
disruption events. Even if the price of the Reference Asset appreciates prior to the Final Valuation Date but then decreases on
the Final Valuation Date to a price that is equal to or less than the Initial Price, the Payment at Maturity will be less, and
may be significantly less, than it would have been had the Payment at Maturity been linked to the price of the Reference Asset
prior to such decrease. Although the actual price of the Reference Asset on the Maturity Date or at other times during the term
of the securities may be higher than the Final Price, the Payment at Maturity will be based solely on the Official Closing Price
of the Reference Asset on the Final Valuation Date.
The securities will not bear interest.
As a holder of the securities, you will
not receive interest payments.
Risks associated with non-U.S. companies.
The values of the EEM depends upon the stocks of non-U.S. companies, and thus involve risks associated
with the home countries of those non-U.S. companies. The prices of these non-U.S. stocks may be affected by political, economic,
financial and social factors in the home country of each applicable company, including changes in that country’s government,
economic and fiscal policies, currency exchange laws or other laws or restrictions, which could affect the value of the securities.
These foreign securities may have less liquidity and could be more volatile than many of the securities traded in U.S. or other
securities markets. Direct or indirect government intervention to stabilize the relevant foreign securities markets, as well as
cross shareholdings in foreign companies, may affect trading levels or prices and volumes in those markets. The other special risks
associated with foreign securities may include, but are not limited to: less liquidity and smaller market capitalizations; less
rigorous regulation of securities markets; different accounting and disclosure
standards; governmental interference; currency
fluctuations; higher inflation; and social, economic and political uncertainties. These factors may adversely affect the performance
of the EEM and, as a result, the value of the securities.
Risks associated with emerging markets.
An investment in the securities linked to
the EEM will involve risks not generally associated with investments which have no emerging market component. In particular, many
emerging nations are undergoing rapid change, involving the restructuring of economic, political, financial and legal systems.
Regulatory and tax environments may be subject to change without review or appeal. Many emerging markets suffer from underdevelopment
of capital markets and tax regulation. The risk of expropriation and nationalization remains a threat. Guarding against such risks
is made more difficult by low levels of corporate disclosure and unreliability of economic and financial data
.
The securities will not be adjusted for
changes in exchange rates.
Although the equity securities held by the
EEM are traded in currencies other than U.S. dollars, and your securities are denominated in U.S. dollars, the amount payable on
your securities at maturity, if any, will not be adjusted for changes in the exchange rates between the U.S. dollar and the currencies
in which these non-U.S. equity securities are denominated. Changes in exchange rates, however, may also reflect changes in the
applicable non-U.S. economies that in turn may affect the value of the EEM, and therefore your securities. The amount we pay in
respect of your securities on the maturity date, if any, will be determined solely in accordance with the procedures described
in this pricing supplement.
Changes that affect the Reference Asset
will affect the market value of the securities and the amount you will receive at maturity.
The policies of the reference sponsor concerning
additions, deletions and substitutions of the constituents comprising the Reference Asset and the manner in which the reference
sponsor takes account of certain changes affecting those constituents may affect the price of the Reference Asset. The policies
of the reference sponsor with respect to the calculation of the Reference Asset could also affect the price of the Reference Asset.
The reference sponsor may discontinue or suspend calculation or dissemination of the Reference Asset. Any such actions could affect
the value of the securities and the return on the securities.
The securities are not insured or
guaranteed by any governmental agency of the United States or any other jurisdiction.
The securities are not deposit liabilities
or other obligations of a bank and are not insured or guaranteed by the Federal Deposit Insurance Corporation or any other governmental
agency or program of the United States or any other jurisdiction. An investment in the securities is subject to the credit risk
of HSBC, and in the event that HSBC is unable to pay its obligations as they become due, you may not receive the full Payment at
Maturity of the securities.
Certain built-in costs are likely
to adversely affect the value of the securities prior to maturity.
While the Payment at Maturity described
in this pricing supplement is based on the full Principal Amount of your securities, the original issue price of the securities
includes the agent’s commission and the estimated cost of HSBC hedging its obligations under the securities. As a result,
the price, if any, at which HSBC Securities (USA) Inc. will be willing to purchase securities from you in secondary market transactions,
if at all, will likely be lower than the original issue price, and any sale prior to the Maturity Date could result in a substantial
loss to you. The securities are not designed to be short-term trading instruments. Accordingly, you should be able and willing
to hold your securities to maturity.
The securities lack liquidity.
The securities will not be listed on any
securities exchange. HSBC Securities (USA) Inc. is not required to offer to purchase the securities in the secondary market, if
any exists. Even if there is a secondary market, it may not provide enough liquidity to allow you to trade or sell the securities
easily. Because other dealers are not likely to make a secondary market for the securities, the price at which you may be able
to trade your securities is likely to depend on the price, if any, at which HSBC Securities (USA) Inc. is willing to buy the securities.
Potential conflicts of interest may
exist.
HSBC and its affiliates play a variety
of roles in connection with the issuance of the securities, including acting as calculation agent and hedging our obligations under
the securities. In performing these duties, the economic interests of the calculation agent and other affiliates of ours are potentially
adverse to your interests as an investor in the securities. We will not have any obligation to consider your interests as a holder
of the securities in taking any action that might affect the value of your securities.
Uncertain tax treatment.
For a discussion of the U.S. federal income
tax consequences of your investment in a security, please see the discussion under “U.S. Federal Income Tax Considerations”
herein and the discussion under “U.S. Federal Income Tax Considerations” in the accompanying prospectus supplement.
ILLUSTRATIVE
EXAMPLES
The following table and examples are provided
for illustrative purposes only and are hypothetical. They do not purport to be representative of every possible scenario concerning
increases or decreases in the price of the Reference Asset relative to its Initial Price. We cannot predict the actual Final Price.
The assumptions we have made in connection with the illustrations set forth below may not reflect actual events. You should not
take this illustration or these examples as an indication or assurance of the expected performance of the Reference Asset or the
return on your securities
.
The Final Settlement Value may be less than the amount that you would have received from a conventional
debt security with the same stated maturity, including such a security issued by HSBC. The numbers appearing in the table below
and following examples have been rounded for ease of analysis.
The table below illustrates the Final Settlement
Value on a $1,000 investment in securities for a hypothetical range of Reference Returns from -100% to +100%. The following results
are based solely on the assumptions outlined below. The “Hypothetical Return on the Securities” as used below is the
number, expressed as a percentage, that results from comparing the Final Settlement Value per $1,000 Principal Amount of securities
to $1,000. The potential returns described here assume that your securities are held to maturity. You should consider carefully
whether the securities are suitable to your investment goals. The following table and examples are based on the following terms:
}
|
Principal Amount:
|
$1,000
|
|
|
|
}
|
Initial Price:
|
$41.96
|
|
|
|
}
|
Upside Participation Rate:
|
120%
|
|
|
|
}
|
Downside Leverage Factor:
|
1.3333
|
|
|
|
}
|
Buffer Price:
|
-25%
|
Hypothetical
Final Price
|
Hypothetical
Reference Return
|
Hypothetical
Final Settlement Value
|
Hypothetical
Return on the
Securities
|
$83.92
|
100.00%
|
$2,200.00
|
120.00%
|
$75.53
|
80.00%
|
$1,960.00
|
96.00%
|
$67.14
|
60.00%
|
$1,720.00
|
72.00%
|
$58.74
|
40.00%
|
$1,480.00
|
48.00%
|
$54.55
|
30.00%
|
$1,360.00
|
36.00%
|
$50.35
|
20.00%
|
$1,240.00
|
24.00%
|
$48.25
|
15.00%
|
$1,180.00
|
18.00%
|
$46.16
|
10.00%
|
$1,120.00
|
12.00%
|
$44.06
|
5.00%
|
$1,060.00
|
6.00%
|
$42.80
|
2.00%
|
$1,024.00
|
2.40%
|
$42.38
|
1.00%
|
$1,012.00
|
1.20%
|
$41.96
|
0.00%
|
$1,000.00
|
0.00%
|
$41.12
|
-2.00%
|
$1,000.00
|
0.00%
|
$39.86
|
-5.00%
|
$1,000.00
|
0.00%
|
$37.76
|
-10.00%
|
$1,000.00
|
0.00%
|
$35.67
|
-15.00%
|
$1,000.00
|
0.00%
|
$31.47
|
-25.00%
|
$1,000.00
|
0.00%
|
$29.37
|
-30.00%
|
$933.33
|
-6.67%
|
$25.18
|
-40.00%
|
$800.00
|
-20.00%
|
$16.78
|
-60.00%
|
$533.33
|
-46.67%
|
$8.39
|
-80.00%
|
$266.67
|
-73.33%
|
$0.00
|
-100.00%
|
$0.00
|
-100.00%
|
The following examples indicate how the
Final Settlement Value would be calculated with respect to a hypothetical $1,000 investment in the securities.
Example 1: The price of the Reference
Asset increases from the Initial Price of $41.96 to a Final Price of $58.74.
|
|
Reference Return:
|
40%
|
Final Settlement Value:
|
$1,480
|
Because the Reference Return is positive,
the Final Settlement Value would be $1,480 per $1,000 Principal Amount, calculated as follows:
$1,000 + ($1,000 × Reference
Return × Upside Participation Rate)
= $1,000 + ($1,000 × 40% ×
120%)
= $1,480
Example 1 shows that you will receive the
return of your principal investment plus a return equal to the Reference Return multiplied by the hypothetical Upside Participation
Rate when such Reference Return is positive.
Example 2: The price of the Reference
Asset decreases from the Initial Price of $41.96 to a Final Price of $39.86.
|
|
Reference Return:
|
-5.00%
|
Final Settlement Value:
|
$1,000
|
Because the Reference Return is less than
zero but greater than the Buffer Price of -25%, the Final Settlement Value would be $1,000 per $1,000 Principal Amount (a zero
return).
Example 3: The price of the Reference
Asset decreases from the Initial Price of $41.96 to a Final Price of $25.18.
|
|
Reference Return:
|
-40%
|
Final Settlement Value:
|
$800
|
Because the Reference
Return is less than the Buffer Price of -25%, the Final Settlement Value would be $800 per $1,000 Principal Amount, calculated
as follows:
$1,000 + [$1,000 ×
(Reference Return + 25%) x Downside Leverage Factor]
= $1,000 + [$1,000
× (-40.00% + 25%) x 1.3333]
= $800
Example 3 shows that you
are exposed on a 1.3333-to-1 basis to declines in the price of the Reference Asset beyond the Buffer Price of -25%. YOU MAY LOSE
UP TO 100% OF THE PRINCIPAL AMOUNT OF YOUR SECURITIES.
THE ISHARES
®
EMERGING MARKETS INDEX FUND (“EEM”)
Description of the EEM
The EEM seeks investment results
that correspond generally to the price and yield performance, before fees and expenses, of the MSCI Emerging Markets Index. The
MSCI Emerging Markets Index is intended to measure the performance of equity markets in the global emerging markets. As of March
29, 2013, the MSCI Emerging Markets Index consisted of the following 21 component country indices: Brazil, Chile, China, Colombia,
Czech Republic, Egypt, Hungary, India, Indonesia, Korea, Malaysia, Mexico, Morocco, Peru, Philippines, Poland, Russia, South Africa,
Taiwan, Thailand, and Turkey.
For
more information about the EEM, see “The iShares
Ò
MSCI Emerging Markets Index Fund” beginning on page S-21 of the accompanying ETF Underlying Supplement.
|
|
Historical Performance of the EEM
The following graph sets forth
the historical performance of the EEM based on the daily historical closing prices from May 30, 2008 through May 30, 2013. The
closing price for the EEM on May 30, 2013 was $41.96. We obtained the closing prices below from the Bloomberg Professional
®
service. We have not undertaken any independent review of, or made any due diligence inquiry with respect to, the information
obtained from the Bloomberg Professional
®
service.
|
The historical prices of the EEM should not be taken as an indication of future performance, and no assurance
can be given
as to the Official Closing Price of the EEM on
the Final Valuation Date.
Quarter Begin
|
Quarter End
|
Quarterly High
|
Quarterly Low
|
Quarterly Close
|
1/2/2008
|
3/31/2008
|
$50.69
|
$40.63
|
$44.74
|
4/1/2008
|
6/30/2008
|
$52.42
|
$44.38
|
$45.14
|
7/1/2008
|
9/30/2008
|
$44.71
|
$30.84
|
$34.49
|
10/1/2008
|
12/31/2008
|
$34.25
|
$18.20
|
$24.94
|
1/2/2009
|
3/31/2009
|
$27.25
|
$19.85
|
$24.78
|
4/1/2009
|
6/30/2009
|
$34.84
|
$24.69
|
$32.19
|
7/1/2009
|
9/30/2009
|
$39.46
|
$30.21
|
$38.86
|
10/1/2009
|
12/31/2009
|
$42.47
|
$37.26
|
$41.46
|
1/4/2010
|
3/31/2010
|
$43.43
|
$34.98
|
$42.08
|
4/1/2010
|
6/30/2010
|
$43.98
|
$35.18
|
$37.29
|
7/1/2010
|
9/30/2010
|
$44.95
|
$36.73
|
$44.73
|
10/1/2010
|
12/31/2010
|
$48.58
|
$44.47
|
$47.60
|
1/3/2011
|
3/31/2011
|
$48.73
|
$44.24
|
$48.67
|
4/1/2011
|
6/30/2011
|
$50.41
|
$44.76
|
$47.58
|
7/1/2011
|
9/30/2011
|
$48.61
|
$34.69
|
$35.06
|
10/3/2011
|
12/30/2011
|
$43.20
|
$33.42
|
$37.93
|
1/3/2012
|
3/30/2012
|
$44.89
|
$38.20
|
$42.93
|
4/2/2012
|
6/29/2012
|
$43.74
|
$36.56
|
$39.18
|
7/2/2012
|
9/28/2012
|
$42.82
|
$37.14
|
$41.31
|
10/1/2012
|
12/31/2012
|
$44.42
|
$39.92
|
$44.35
|
1/2/2013
|
3/29/2013
|
$45.28
|
$41.72
|
$42.78
|
4/1/2013*
|
5/30/2013*
|
$44.26
|
$40.76
|
$41.96
|
* This pricing supplement includes information for the second calendar quarter of 2013 for the period from
April 1, 2013 through May 30, 2013. Accordingly, the “Quarterly High,” “Quarterly Low” and “Quarterly
Close” data indicated are for this shortened period only and do not reflect complete data for the second calendar quarter
of 2013.
SUPPLEMENTAL
PLAN OF DISTRIBUTION (CONFLICTS OF INTEREST)
We have appointed HSBC Securities (USA)
Inc., an affiliate of HSBC, as the agent for the sale of the securities. Pursuant to the terms of a distribution agreement, HSBC
Securities (USA) Inc. will purchase the securities from HSBC at the price to public less the underwriting discount set forth on
the cover page of this pricing supplement for distribution to other registered broker-dealers or will offer the securities directly
to investors. HSBC Securities (USA) Inc. will offer the securities at the price to public set forth on the cover page of this pricing
supplement. Neither HSBC USA Inc. nor any of its affiliates will pay any underwriting discounts.
In addition, HSBC Securities (USA) Inc. or
another of its affiliates or agents may use this pricing supplement in market-making transactions after the initial sale of the
securities, but is under no obligation to make a market in the securities and may discontinue any market-making activities at any
time without notice.
See “Supplemental Plan of Distribution
(Conflicts of Interest)” on page S-49 in the prospectus supplement.
U.S.
FEDERAL INCOME TAX CONSIDERATIONS
There is no direct legal authority as to
the proper tax treatment of the securities, and therefore significant aspects of the tax treatment of the securities are uncertain
as to both the timing and character of any inclusion in income in respect of the securities. Under one approach, a security should
be treated as a pre-paid executory contract with respect to the Reference Asset. We intend to treat the securities consistent with
this approach. Pursuant to the terms of the securities, you agree to treat the securities under this approach for all U.S. federal
income tax purposes. Subject to the limitations described therein, and based on certain factual representations received from us,
in the opinion of our special U.S. tax counsel, Morrison & Foerster LLP, it is reasonable to treat a security as a pre-paid
executory contract with respect to the Reference Asset. Pursuant to this approach and subject to the discussion below regarding
“constructive ownership transactions,” we do not intend to report any income or gain with respect to the securities
prior to their maturity or an earlier sale or exchange and we intend to treat any gain or loss upon maturity or an earlier sale
or exchange as long-term capital gain or loss, provided that you have held the security for more than one year at such time for
U.S. federal income tax purposes.
Despite the foregoing, U.S. holders (as
defined under “U.S. Federal Income Tax Considerations” in the accompanying prospectus supplement) should be aware that
the Internal Revenue Code of 1986, as amended (the “Code”), contains a provision, Section 1260 of the Code, which sets
forth rules which are applicable to what it refers to as “constructive ownership transactions.” Due to the manner in
which it is drafted, the precise applicability of Section 1260 of the Code to any particular transaction is often uncertain. In
general, a “constructive ownership transaction” includes a contract under which an investor will receive payment equal
to or credit for the future value of any equity interest in a regulated investment company (such as shares of the EEM (the “Underlying
Shares”)). Under the “constructive ownership” rules, if an investment in the securities is treated as a “constructive
ownership transaction,” any long-term capital gain recognized by a U.S. holder in respect of a security will be recharacterized
as ordinary income to the extent such gain exceeds the amount of “net underlying long-term capital gain” (as defined
in Section 1260 of the Code) of the U.S. holder determined as if the U.S. holder had acquired the Underlying Shares on the original
issue date of the security at fair market value and sold them at fair market value on the Maturity Date (if the security was held
until the Maturity Date) or on the date of sale or exchange of the security (if the security was sold or exchanged prior to the
Maturity Date) (the “Excess Gain”). In addition, an interest charge will also apply to any deemed underpayment of tax
in respect of any Excess Gain to the extent such gain would have resulted in gross income inclusion for the U.S. holder in taxable
years prior to the taxable year of the sale, exchange or maturity of the security (assuming such income accrued at a constant rate
equal to the applicable federal rate as of the date of sale, exchange or maturity of the security).
Although the matter is not clear, there
exists a risk that an investment in the securities will be treated as a “constructive ownership transaction.” If such
treatment applies, it is not entirely clear to what extent any long-term capital gain recognized by a U.S. holder in respect of
the securities will be recharacterized as ordinary income. It is possible, for example, that the amount of the Excess Gain (if
any) that would be recharacterized as ordinary income in respect of each security linked to the EEM will equal the excess of (i)
any long-term capital gain recognized by the U.S. holder in respect of such a security over (ii) the “net underlying long-term
capital gain” such U.S. holder would have had if such U.S. holder had acquired a number of the Underlying Shares at fair
market value on the original issue date of such security for an amount equal to the “issue price” of the security and,
upon the date of sale, exchange or maturity of the security, sold such Underlying Shares at fair market value (which would reflect
the percentage increase in the value of the Underlying Shares over the term of the security). Accordingly, U.S. holders should
consult their tax advisors regarding the potential application of the “constructive ownership” rules.
We will not attempt to ascertain whether
any of the entities whose stock is included in, or owned by, the Reference Asset, as the case may be, would be treated as a passive
foreign investment company (“PFIC”) or United States real property holding corporation (“USRPHC”), both
as defined for U.S. federal income tax purposes. If one or more of the entities whose stock is included in, or owned by, the Reference
Asset, as the case may be, were so treated, certain adverse U.S. federal income tax consequences might apply. You should refer
to information filed with the SEC and other authorities by the entities whose stock is included in, or owned by, the Reference
Asset, as the case may be, and consult your tax advisor regarding the possible consequences to you if one or more of the entities
whose stock is included in, or owned by, the Reference Asset, as the case may be, is or becomes a PFIC or a USRPHC.
Withholding and reporting requirements
under the legislation enacted on March 18, 2010 (as discussed beginning on page S-48 of the prospectus supplement) will generally
apply to payments made after December 31, 2013. However, this withholding tax will not be imposed on payments pursuant to obligations
outstanding on January 1, 2014. Additionally, withholding due to any payment being treated as a “dividend equivalent”
(as discussed beginning on page S-47 of the prospectus supplement) will begin no earlier than January 1, 2014. Holders are urged
to consult with their own tax advisors regarding the possible implications of this recently enacted legislation on their investment
in the securities.
For a discussion of the U.S. federal income
tax consequences of your investment in a security, please see the discussion under “U.S. Federal Income Tax Considerations”
in the accompanying prospectus supplement.
VALIDITY OF THE SECURITIES
In the opinion of Morrison & Foerster
LLP, as counsel to the Issuer, when the securities offered by this pricing supplement have been executed and delivered by the
Issuer and authenticated by the trustee pursuant to the Senior Indenture referred to in the prospectus supplement dated March
22, 2012, and issued and paid for as contemplated herein, such securities will be valid, binding and enforceable obligations of
the Issuer, entitled to the benefits of the Senior Indenture, subject to applicable bankruptcy, insolvency and similar laws affecting
creditors’ rights generally, concepts of reasonableness and equitable principles of general applicability (including, without
limitation, concepts of good faith, fair dealing and the lack of bad faith). This opinion is given as of the date hereof and is
limited to the laws of the State of New York, the Maryland General Corporation Law (including the statutory provisions, all applicable
provisions of the Maryland Constitution and the reported judicial decisions interpreting the foregoing) and the federal laws of
the United States of America. This opinion is subject to customary assumptions about the trustee’s authorization, execution
and delivery of the Senior Indenture and the genuineness of signatures and to such counsel’s reliance on the Issuer and
other sources as to certain factual matters, all as stated in the legal opinion dated July 27, 2012, which has been filed as Exhibit
5.1 to the Issuer’s Current Report on Form 8-K dated July 27, 2012.
TABLE OF CONTENTS
|
|
|
You should only rely on the
information contained in this pricing supplement, the accompanying ETF Underlying Supplement, prospectus supplement and prospectus.
We have not authorized anyone to provide you with information or to make any representation to you that is not contained in this
pricing supplement, the accompanying ETF Underlying Supplement, prospectus supplement and prospectus. If anyone provides you with
different or inconsistent information, you should not rely on it. This pricing supplement, the accompanying ETF Underlying Supplement,
prospectus supplement and prospectus are not an offer to sell these securities, and these documents are not soliciting an offer
to buy these securities, in any jurisdiction where the offer or sale is not permitted. You should not, under any circumstances,
assume that the information in this pricing supplement, the accompanying ETF Underlying Supplement, prospectus supplement and prospectus
is correct on any date after their respective dates.
HSBC USA Inc.
$1,372,000
Leveraged Buffered
Uncapped Market Participation
Securities Linked to the
iShares
®
MSCI Emerging Markets
Index Fund
May
30, 2013
PRICING
SUPPLEMENT
|
|
|
|
Pricing Supplement
|
|
|
General
|
PS-3
|
|
Payment at Maturity
|
PS-3
|
|
Investor Suitability
|
PS-4
|
|
Risk Factors
|
PS-5
|
|
Illustrative Examples
|
PS-8
|
|
The iShares
®
MSCI Emerging Markets Index Fund (“EEM”)
|
PS-10
|
|
Supplemental Plan of Distribution (Conflicts of Interest)
|
PS-11
|
|
U.S. Federal Income Tax Considerations
|
PS-11
|
|
Validity of the Securities
|
PS-12
|
|
|
|
|
ETF Underlying Supplement
|
|
|
Risk Factors
|
S-2
|
|
Reference Sponsors
|
S-8
|
|
The SPDR
®
Dow Jones Industrial AverageSM ETF Trust
|
S-8
|
|
The POWERSHARES QQQ TRUSTSM, SERIES 1
|
S-11
|
|
The iShares
®
MSCI Mexico Investable Market Index Fund
|
S-15
|
|
The iShares
®
MSCI Brazil Index Fund
|
S-18
|
|
The iShares
®
MSCI Emerging Markets Index Fund
|
S-21
|
|
The iShares
®
MSCI EAFE Index Fund
|
S-24
|
|
The SPDR S&P 500 ETF Trust
|
S-26
|
|
The Market Vectors Gold Miners ETF
|
S-30
|
|
The iShares
®
Dow Jones U.S. Real Estate Index Fund
|
S-33
|
|
The iShares
®
FTSE China 25 Index Fund
|
S-36
|
|
The iShares
®
S&P Latin America 40 Index Fund
|
S-39
|
|
The Financial Select Sector SPDR
®
Fund
|
S-42
|
|
The iShares
®
Dow Jones Transportation Average Index Fund
|
S-45
|
|
The Energy Select SPDR
®
Fund
|
S-47
|
|
The Health Care Select SPDR
®
Fund
|
S-50
|
|
Other Components
|
S-52
|
|
Additional Terms of the Notes
|
S-52
|
|
|
|
|
Prospectus Supplement
|
|
|
Risk Factors
|
S-3
|
|
Risks Relating to Our Business
|
S-3
|
|
Risks Relating to All Note Issuances
|
S-3
|
|
Pricing Supplement
|
S-7
|
|
Description of Notes
|
S-8
|
|
Use of Proceeds and Hedging
|
S-30
|
|
Certain ERISA Considerations
|
S-30
|
|
U.S. Federal Income Tax Considerations
|
S-32
|
|
Supplemental Plan of Distribution (Conflicts of Interest)
|
S-49
|
|
|
|
|
Prospectus
|
|
|
About this Prospectus
|
1
|
|
Risk Factors
|
1
|
|
Where You Can Find More Information
|
1
|
|
Special Note Regarding Forward-Looking Statements
|
2
|
|
HSBC USA Inc.
|
3
|
|
Use of Proceeds
|
3
|
|
Description of Debt Securities
|
3
|
|
Description of Preferred Stock
|
15
|
|
Description of Warrants
|
21
|
|
Description of Purchase Contracts
|
25
|
|
Description of Units
|
28
|
|
Book-Entry Procedures
|
30
|
|
Limitations on Issuances in Bearer Form
|
35
|
|
U.S. Federal Income Tax Considerations Relating to Debt Securities
|
35
|
|
Plan of Distribution (Conflicts of Interest)
|
51
|
|
Notice to Canadian Investors
|
53
|
|
Notice to EEA Investors
|
58
|
|
Certain ERISA Matters
|
59
|
|
Legal Opinions
|
60
|
|
Experts
|
60
|
|
Lehman Abs Mbna Capa (NYSE:CCG)
Historical Stock Chart
From May 2024 to Jun 2024
Lehman Abs Mbna Capa (NYSE:CCG)
Historical Stock Chart
From Jun 2023 to Jun 2024