HSBC S&P/TSX60® Index-Linked Deposit Notes, Series 1

Secondary market price*:
Last updated:

If held to maturity, the Notes will pay 100% of the principal amount invested and a Variable Return, if any, linked to the increase, if any, in the value of the S&P/TSX60®Index. The change in value of the Index will be measured from its closing level on 26 May 2009 to the arithmetic average of the closing levels of the Index on specified preset quarterly Observation Dates (the 26th of each of May, August, November and February during the term). The performance of the Index (positive or negative) will then be multiplied by a Participation Rate of 90 per cent to determine the Variable Return, if any.

Key features

Issue date: 29 May 2009
Maturity date: 29 May 2015
Note term: 6 years
CUSIP #: CA40427HQQ97
Currency: USD
Participation: 90%
Selling agent fees: USD3.00 per Note (3.00% of the Principal Amount)

Highlights

  • Eligible for registered accounts
  • Principal protected at maturity
  • Return based on quarterly averaging

Underlying asset(s)

Index Ticker
S&P/TSX60® Index SPTSX60

Are the Notes right for you?

You may be suited to become a Noteholder if, among other benefits, you: (a) are looking for safety of principal if held to maturity; (b) want exposure to an investment that is linked to the performance of Canadian equities; and (c) you are prepared to hold the Notes until maturity.

The Notes do not provide investors with a return or income stream prior to maturity. The effective yield to maturity of the Notes may be less than that which would be payable on a conventional fixed-rate or floating-rate debt instrument. The Notes are generally more suitable for purchasing and holding up to maturity. Potential investors should consult with their own investment, legal and tax advisers to determine the suitability.

Early trading charges/Secondary market

HSBC Securities (Canada) Inc intends, in normal market conditions, to use reasonable efforts to provide a secondary price for the Notes as principal, but reserves the right not to do so in the future in its sole discretion, without providing prior notice to the Noteholders. Sale of Notes prior to maturity may be subject to an early trading charge as follows:

Time period Early trading charge
Issue date and including 27 November 2009 3.0%
30 November 2009 to and including 28 May 2010 2.0%
31 May 2010 to and including 29 November 2010 1.0%
30 November 2010 to and including the Maturity Date 0.0%

During the term of the Notes, you may inquire as to the net asset value of a Note or the level of the underlying Index and how it relates to the Variable Return that may be payable under the Notes, if any, by contacting HSBC at the number below.

Please see the Information Statement for further details or contact your investment adviser.

Risk factors

Noteholders should carefully review and consider all risks set forth in the Information Statement with their investment adviser, including:

  • Canadian equity market exposure
  • The volatility or degree to which the level of the underlying Index changes
  • Noteholders only participate in 90 per cent of the upside performance of the Index
  • The Notes will not constitute insured deposits under Canada Deposit Insurance Corporation Act (Canada)
  • The Principal Amount is protected only if Notes are held to maturity and there is no assurance the Notes will pay any variable return
  • To guaranteed secondary market
  • The historical or pro forma performance of the Index is not an indication of future performance
  • Special circumstances – HSBC may redeem the Notes prior to maturity under certain limited circumstances, including a change in the law, regulation, taxation regulations or taxation practice or other circumstances not within the control of the Bank
  • Conflicts of interest with the Calculation Agent and HSBC Securities (Canada) Inc
  • Currency risk

Additional information

Right of Cancellation – A subscriber may cancel an order to purchase a Note (or cancel the purchase of a Note if the Note has been issued) by providing written instructions to HSBC directly or through his or her investment adviser any time up to two days after the later of (i) the day on which the agreement to purchase the Note is entered into and (ii) deemed receipt of this Information Statement. Such notice should be directed to: Senior Vice President, HSBC Derivative Products Group, 70 York Street, 8th Floor, Toronto, ON M5J 1S9, Fax (416) 868-3088. This rescission right does not extend to Noteholders buying a Note in any secondary market.

Please see the Information Statement for further details. Please do not hesitate to call us at +1 866 511 4722 or send us an
e-mail for more information.

*The price is before the application of an early trade charge that may apply. The secondary market price for a Note, if available, represents the bid price of such Note as a percentage (%) of the original principal amount invested. The bid price stated is only as of the date indicated.

Important: Please read the disclaimer carefully.