Published on 1/30/2014 in the Prospect News Structured Products Daily.
New Issue: Morgan Stanley prices $5.85 million contingent income notes tied to Russell, S&P 500
By Toni Weeks
San Luis Obispo, Calif., Jan. 30 - Morgan Stanley priced $5.85 million of contingent income participation securities due Jan. 31, 2029 linked to the worst-performing of the Russell 2000 index and the S&P 500 index, according to a 424B2 filing with the Securities and Exchange Commission.
The notes will pay a fixed coupon of 6.5% per year for the first five years. After that, they will pay a contingent coupon of 6.5% per year if the closing level of each index is at or above its respective coupon barrier level, 50% of its initial level, on the related observation date for that month. Otherwise, no coupon will be paid that month.
If the final level of each index is greater than or equal to its 50% barrier level, the payout will be par plus the final monthly coupon.
Otherwise, investors will be fully exposed to the decline of the worst-performing index from its initial level.
Morgan Stanley & Co. LLC is the agent.
Issuer: | Morgan Stanley
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Issue: | Contingent income participation securities
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Underlying indexes: | Russell 2000, S&P 500
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Amount: | $5,849,000
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Maturity: | Jan. 31, 2029
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Coupon: | 6.5% per year for first five years; after that, contingent coupon of 6.5% per year if closing level of each index is at or above barrier level on related observation date for that month; otherwise, no coupon will be paid that month
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Price: | Par
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Payout at maturity: | If final level of each index is greater than or equal to its barrier level, par plus final monthly coupon; otherwise, full exposure to decline of worst-performing index from its initial level
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Initial index levels: | 1,138.24 for Russell, 1,792.5 for S&P 500
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Barrier levels: | 569.12 for Russell, 896.25 for S&P 500, 50% of initial levels
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Pricing date: | Jan. 28
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Settlement date: | Jan. 31
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Agent: | Morgan Stanley & Co. LLC
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Fees: | 3.5%
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Cusip: | 61761JNP0
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