By Toni Weeks
San Luis Obispo, Calif., May 2 - Morgan Stanley priced $13.5 million of contingent income autocallable securities due May 3, 2016 linked to Starbucks Corp. shares, according to a 424B2 with the Securities and Exchange Commission.
The notes will pay a contingent quarterly coupon of 2.15% if Starbucks stock closes at or above the 80% barrier 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 level is 105% of the initial share price for the first four redemption dates, 110% of the initial share price for the next four redemption dates and 115% of the initial share price after that.
If Starbucks stock finishes at or above the 80% trigger level, the payout at maturity will be par plus the contingent payment.
Otherwise, investors will receive a number of shares of Starbucks stock equal to $10 divided by the initial share price or, at the issuer's option, the cash value of those shares.
Morgan Stanley & Co. LLC is the agent with Morgan Stanley Smith Barney LLC as dealer.
| Issuer: | Morgan Stanley
|
| Issue: | Contingent income autocallable securities
|
| Underlying stock: | Starbucks Corp (Symbol: SBUX)
|
| Amount: | $13,498,310
|
| Maturity: | May 3, 2016
|
| Contingent coupon: | 2.15% (8.6% per year), payable quarterly if Starbucks stock closes at or above downside threshold level on determination date for that quarter
|
| Price: | Par of $10.00
|
| Payout at maturity: | If final share price is greater than or equal to downside threshold level, par plus contingent payment; otherwise, 0.16437 Starbucks shares or, at issuer's option, cash amount equal to value of those shares
|
| Call: | At par plus contingent payment if closing share price is greater than or equal to redemption threshold level on any of first 11 quarterly determination dates; redemption level is 105% of the initial share price for first four redemption dates, 110% of the initial share price for next four redemption dates and 115% of the initial share price after that
|
| Initial share price: | $60.84
|
| Barrier/ downside threshold: | $48.672, 80% of initial share price
|
| Pricing date: | April 30
|
| Settlement date: | May 3
|
| Agent: | Morgan Stanley & Co. LLC with Morgan Stanley Smith Barney LLC as dealer
|
| Fees: | 2.25%
|
| Cusip: | 61762E208
|
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