Morgan Stanley plans contingent coupon buffered notes tied to S&P 500

By Marisa Wong

Madison, Wis., July 3 - Morgan Stanley plans to price buffered autocallable securities with contingent coupon due July 29, 2022 linked to the S&P 500 index, according to a 424B2 filing with the Securities and Exchange Commission.

The interest rate is 9% per year, payable monthly. Interest will only be paid if the index closes at or above the index reference level, which is 70% of the initial level, on the observation date for that month. Otherwise, no coupon will be paid that month.

If the index closes at or above its initial level on any quarterly determination date beginning in July 2017, the notes will be automatically called at par plus the contingent coupon.

If the notes are not redeemed early and the final index level is greater than or equal to the index reference level, the payout at maturity will be par. Investors will lose 1% for every 1% decline beyond the 30% buffer.

The notes (Cusip: 617482U69) are expected to price July 26 and settle July 31.

Morgan Stanley & Co. LLC is the agent.

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