By Angela McDaniels
Tacoma, Wash., July 20 - Morgan Stanley priced $40 million of callable notes with contingent coupon due July 21, 2018 linked to the S&P 500 index, according to an FWP filing with the Securities and Exchange Commission.
Interest is payable semiannually and is fixed at 6% for the first year. After that time, the notes will pay a coupon only if the index is above 67% of the initial index level. The contingent coupon is 6% in year two, 7% in years three and four, 7.5% in years five and six and 8% in years seven and eight.
If the index is at or below the barrier level on an observation date, no interest will be paid for that interest period.
The payout at maturity will be par.
Beginning July 21, 2011, the notes are callable at par on any annual redemption date.
Morgan Stanley & Co. Inc. is the agent.
| Issuer: | Morgan Stanley
|
| Issue: | Callable notes with contingent coupon
|
| Underlying index: | S&P 500
|
| Amount: | $40 million
|
| Maturity: | July 21, 2018
|
| Coupon: | 6% for first year; after that time, coupon will be paid only if index is above barrier level; contingent coupon is 6% in year two, 7% in years three and four, 7.5% in years five and six and 8% in years seven and eight; payable semiannually
|
| Price: | Par of $10
|
| Payout at maturity: | Par
|
| Call option: | At par on annual redemption dates beginning July 21, 2011
|
| Initial index level: | 1,064.88
|
| Barrier level: | 713.4696, 67% of initial level
|
| Pricing date: | July 16
|
| Settlement date: | July 22
|
| Agent: | Morgan Stanley & Co. Inc.
|
| Fees: | 2.25%
|
| Cusip: | 61759G570
|
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