New Issue: Morgan Stanley prices $6.65 million airbag return notes linked to SPDR S&P 500 fund

By Toni Weeks

San Luis Obispo, Calif., July 30 - Morgan Stanley priced $6.65 million of 0% airbag return optimization securities due July 29, 2016 linked to the SPDR S&P 500 exchange-traded fund trust, according to a 424B2 filing with the Securities and Exchange Commission.

The payout at maturity will be par plus 1.5 times any fund gain, up to a maximum return of 32.85%.

Investors will receive par if the share price falls by up to 15%.

Otherwise, the payout will be a number of shares equal to $1,000 divided by the conversion price. The conversion price is 85% of the initial share price.

Morgan Stanley & Co. LLC is the agent with UBS Financial Services Inc. as dealer.

Issuer:	Morgan Stanley
Issue:	Airbag return optimization securities
Underlying ETF:	SPDR S&P 500 ETF trust
Amount:	$6,653,000
Maturity:	July 29, 2016
Coupon:	0%
Price:	Par
Payout at maturity:	If fund return is positive, par plus 150% of return, capped at 32.85%; if fund return is negative but final share price is greater than or equal to conversion price, par; if final price is less than conversion price, 6.957 shares
Initial price:	$169.11
Conversion price:	143.75, 85% of initial price
Pricing date:	July 26
Settlement date:	July 31
Agent:	Morgan Stanley & Co., LLC with UBS Financial Services Inc. as dealer
Fees:	2.5%
Cusip:	61762P237

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