Morgan Stanley plans contingent income notes on Russell 2000, S&P 500

By Marisa Wong

Morgantown, W.Va., May 16 – Morgan Stanley Finance LLC plans to price contingent income securities due May 30, 2031 linked to the worse performing of the Russell 2000 index and the S&P 500 index, according to a 424B2 filing with the Securities and Exchange Commission.

The notes are guaranteed by Morgan Stanley.

In the first five years, the notes pay a monthly coupon at a rate of 7% per year. After that, the notes will pay a contingent monthly coupon at a rate of 7% per year if each index closes at or above its coupon barrier level, 60% of the initial level, on a monthly determination date.

If each index finishes at or above its downside threshold level, 50% of its initial index level, the payout at maturity will be par plus the final contingent coupon, if any.

Otherwise, investors will be fully exposed to the decline of the worse performing index.

Morgan Stanley & Co. LLC is the agent.

The notes will price on May 25 and settle on May 31.

The Cusip number is 61766BAQ4.

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