New Issue: Morgan Stanley sells $485,000 more accrual notes on CMT, Libor, S&P 500

By Marisa Wong

Madison, Wis., June 10 - Morgan Stanley priced an additional $485,000 of accrual notes due June 10, 2026 linked to the 10-year Constant Maturity Treasury rate, Libor and the S&P 500 index, according to a 424B2 filing with the Securities and Exchange Commission.

This brings the total deal size to $2 million. The issuer priced an initial $1.52 million of the notes on June 7.

The coupon is 6% for the first year. After that, the rate will accrue at the greater of the 10-year CMT rate plus 25 basis points and Libor plus 300 bps for each day that the index closes at or above 950. Interest is payable quarterly and will not exceed 8% per year.

The payout at maturity will be par.

Morgan Stanley & Co. LLC is the agent.

Issuer:	Morgan Stanley
Issue:	Accrual notes
Underlyings:	10-year Constant Maturity Treasury rate, Libor, S&P 500 index
Amount:	$2 million (increased from $1,515,000)
Maturity:	June 10, 2026
Coupon:	Initially 6%; beginning June 10, 2012, the greater of the 10-year CMT rate plus 25 basis points and Libor plus 300 bps for each day that the index closes at or above 950; payable quarterly; cap of 8%
Price:	Par
Payout at maturity:	Par
Pricing date:	June 7 for $1,515,000; June 9 for $485,000
Settlement date:	June 10
Agent:	Morgan Stanley & Co. LLC
Fees:	3%
Cusip:	61745EU66

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