By Susanna Moon
Chicago, June 21 - Morgan Stanley priced $910,000 of 0% knock-out notes due July 5, 2012 linked to Merck & Co., Inc. shares, according to a 424B2 filing with the Securities and Exchange Commission.
A knock-out event occurs if Merck stock ever falls by more than 25% during the life of the notes.
If a knock-out event does not occur, the payout at maturity will be par plus the greater of the stock return and a contingent minimum return of 5.5%. Otherwise, investors will receive par plus the stock return, with exposure to losses.
In either case, the maximum payment at maturity is $1,200 per $1,000 principal amount.
J.P. Morgan Securities LLC is the dealer, and Morgan Stanley & Co. LLC is the agent.
| Issuer: | Morgan Stanley
|
| Issue: | Knock-out notes
|
| Underlying stock: | Merck & Co., Inc. (NYSE: MRK)
|
| Amount: | $910,000
|
| Maturity: | July 5, 2012
|
| Coupon: | 0%
|
| Price: | Par
|
| Payout at maturity: | If stock never falls by more than 25%, par plus greater of stock return and 5.5%; otherwise, par plus stock return with exposure to losses; in either case, gains capped at 20%
|
| Initial share price: | $35.39
|
| Pricing date: | June 17
|
| Settlement date: | June 24
|
| Agents: | J.P. Morgan Securities LLC (dealer), Morgan Stanley & Co. LLC (agent)
|
| Fees: | 1%
|
| Cusip: | 617482VD3
|
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