New Issue: Morgan Stanley prices $5 million leveraged CMS curve, S&P 500 notes

By Susanna Moon

Chicago, May 15 - Morgan Stanley priced $5 million of fixed-to-floating leveraged CMS curve and S&P 500 index-linked notes due May 30, 2034, according to a 424B2 filing with the Securities and Exchange Commission.

The coupon will be fixed at 10% for the first three years. After that, it will accrue at 4 times the spread of the 30-year Constant Maturity Swap rate over the two-year CMS rate for each day that the index closes at or above the 50% barrier level, up to a maximum coupon of 10%. Interest will be payable monthly and cannot be less than zero.

If the index finishes at or above the 50% barrier level, the payout at maturity will be par.

Otherwise, investors will be fully exposed to any losses.

Morgan Stanley & Co. LLC is the agent.

Issuer:	Morgan Stanley
Issue:	Leveraged CMS curve and S&P 500-linked notes
Underlyings:	30-year CMS rate, two-year CMS rate, S&P 500 index
Amount:	$7 million
Maturity:	May 30, 2034
Coupon:	10% initially; beginning May 30, 2017, 4 times spread of 30-year CMS rate over two-year CMS rate for each day that index closes at or above barrier level, up to a cap of 10%; payable monthly
Price:	Variable
Payout at maturity:	If index finishes at or above barrier level, par; otherwise, full exposure to any losses
Initial level:	Closing level on May 27
Barrier level:	50% of initial index level
Pricing date:	May 13
Settlement date:	May 30
Agent:	Morgan Stanley & Co. LLC
Fees:	3.5%
Cusip:	61760QEG5

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