Morgan Stanley to price leveraged CMS curve, S&P 500-linked notes

By Toni Weeks

San Diego, March 1 - Morgan Stanley plans to price leveraged CMS curve and S&P 500 index-linked notes due March 30, 2032, according to an FWP filing with the Securities and Exchange Commission.

The coupon will be 10% for the first three years. After that, it will accrue at the applicable leverage factor times the spread of the 30-year Constant Maturity Swap rate over the two-year CMS rate for each day that the index closes at or above 950, up to a maximum rate of 10% in any interest payment period. The leverage factor is five beginning March 30, 2015, six beginning March 30, 2017, eight beginning March 30, 2022 and 10 beginning March 30, 2027.

Interest is payable quarterly and cannot be less than zero.

The payout at maturity will be par.

The notes (Cusip: 61760QAK0) will settle March 30.

Morgan Stanley & Co. LLC is the agent, and Morgan Stanley Smith Barney LLC will handle distribution.

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