Morgan Stanley plans contingent income autocallables tied to Tesla

By Devika Patel

Knoxville, Tenn., June 9 – Morgan Stanley Finance LLC plans to price contingent income autocallable securities due June 19, 2020 linked to the common stock of Tesla, Inc., according to an FWP filing with the Securities and Exchange Commission.

The notes will be guaranteed by Morgan Stanley.

If Tesla shares close at or above the downside threshold level, 65% of the initial share price, on a quarterly determination date, the notes will pay a contingent payment that quarter at an annualized rate of 13.5%.

Beginning on Sept. 18, 2017, the notes will be called at par of $10 plus the contingent coupon if Tesla shares close at or above the initial share price on any of the first 11 determination dates.

If the final share price is greater than or equal to the downside threshold level, the payout at maturity will be par plus the final contingent coupon. Otherwise, investors will lose 1% for every 1% that the final share price is less than the initial share price.

Morgan Stanley & Co. LLC is the agent, with Morgan Stanley Wealth Management handling distribution.

The notes (Cusip: 61766W857) will price on June 16 and settle on June 21.

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