By Marisa Wong
Morgantown, W.Va., Jan. 3 – Morgan Stanley Finance LLC priced $4 million of additional fixed-to-floating leveraged CMS curve securities due Dec. 30, 2036 linked to the S&P 500 index and the Russell 2000 index, according to a 424B2 filing with the Securities and Exchange Commission.
The issuer priced an initial $3 million of the notes on Dec. 2.
The notes are guaranteed by Morgan Stanley.
The interest rate is fixed at 10% for the first two years. After that, it will accrue at 20 times the 30-year ICE swap rate minus the two-year ICE swap rate for each day that both indexes close at or above 70% of their initial levels, up to a maximum rate of 10% a year. Interest is payable monthly and cannot be less than zero.
The payout at maturity will be par unless either index finishes below its 50% barrier level, in which case investors will be fully exposed to the decline of the worse performing index.
Morgan Stanley & Co. LLC is the agent.
| Issuer: | Morgan Stanley Finance LLC
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| Guarantor: | Morgan Stanley
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| Issue: | Fixed-to-floating leveraged CMS curve securities
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| Amount: | $7 million (increased from $3 million)
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| Maturity: | Dec. 30, 2036
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| Coupon: | 10% for first two years; then 20 times 30-year ICE swap rate minus two-year ICE swap rate for each day both indexes close at or above reference levels, with a cap of 10% and floor of 0%; payable monthly
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| Price: | Variable
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| Payout at maturity: | Par unless either index finishes below its barrier level, in which case investors will be fully exposed to the decline of the worse performing index
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| Initial index levels: | 2,268.88 for S&P, 1,377.707 for Russell; Dec. 27 index closing levels
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| Reference levels: | 1,588.216 for S&P, 964.395 for Russell; 70% of initial levels
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| Barrier levels: | 1,134.44 for S&P, 688.854 for Russell; 50% of initial levels
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| Pricing date: | Dec. 2 for $3 million, Dec. 28 for $4 million
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| Settlement date: | Dec. 30
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| Agent: | Morgan Stanley & Co. LLC
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| Fee: | 5%
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| Cusip: | 61766YAY7
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