By Marisa Wong
Morgantown, W.Va., Nov. 20 – Morgan Stanley sold $44.87 million of 0% exchange-traded notes due March 21, 2031 linked to the Cushing MLP High Income index, according to a 424B2 filing with the Securities and Exchange Commission.
The $44,869,308.61 principal amount of notes have an aggregate market price of $18,526,564.98, based on $6.93 per note, which is the average of the high and low prices reported on NYSE Arca on Nov. 10.
The issuer had registered to issue up to $124,999,996.06 of the notes, the initial tranche of which priced in March 2011, as previously reported.
As of Nov. 16, $44,869,308.61 principal amount was held for sale by the agent, Morgan Stanley & Co. LLC. In an announcement on June 30, 2015, the issuer said it does not intend to issue any additional ETNs. However, the issuer may continue to sell any notes it currently holds or will acquire in the future.
The goal of the index is to track the performance of 30 master limited partnerships that hold energy infrastructure and related shipping assets in North America. The index was developed by Cushing MLP Asset Management, LP and is maintained and calculated by Standard & Poor's Financial Services LLC. The index includes securities from the 30 partnerships and uses a three-tiered weighting system based on current indicative yields.
The notes will pay a distribution on quarterly payment dates equal to the cash distributions a “reference holder” would have been entitled to receive during that period. On any determination date, a “reference holder” is a hypothetical holder of a number of units of each index MLP equal to (a) the published share weighting of that index MLP on that day divided by (b) 10 times the index divisor on that day.
The payout at maturity will be par plus the index return minus an 0.85% annualized fee factor on the final valuation date.
The notes are putable, subject to a minimum of 100,000 notes and a repurchase fee of 0.125%, and callable at any time.
The notes are listed on NYSE Arca under the symbol “MLPY.”
Morgan Stanley & Co. Inc. is the underwriter.
| Issuer: | Morgan Stanley
|
| Issue: | Exchange-traded notes
|
| Underlying index: | Cushing MLP High Income
|
| Amount: | $124,999,996.06
|
| Maturity: | March 21, 2031
|
| Coupon: | 0%, but there may be distributions on quarterly payment dates determined according to any cash distributions made by the MLPs in the index
|
| Price: | Variable
|
| Payout at maturity: | Par plus the index return minus an 0.85% annualized fee factor on the final valuation date
|
| Put option: | Minimum of 100,000 notes, subject to a repurchase fee of 0.125%
|
| Call option: | At any time
|
| Initial level: | 167.8372
|
| Pricing dates: | March 16, 2011 for initial $19,999,994.00; April 15, 2013 for $25,000,009.28; Nov. 17, 2014 for $79,999,992.78
|
| Settlement dates: | March 21, 2011 for initial tranche, April 18, 2013 for second tranche; Nov. 20, 2014 for latest add-on
|
| Listing: | NYSE Arca: MLPY
|
| Agent: | Morgan Stanley & Co. Inc.
|
| Fees: | None
|
| Cusip: | 61760E846
|
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