By Marisa Wong
Madison, Wis., Feb. 19 - Morgan Stanley priced $13 million of contingent income autocallable securities due Feb. 21 2017 linked to the common stock of Valero Energy Corp., according to an FWP filing with the Securities and Exchange Commission.
If Valero Energy stock closes at or above the downside threshold level, 75% of the initial share price, on a quarterly determination date, the notes will pay a contingent payment of $0.3375 per $10 note for that quarter. The payment is equivalent to 13.5% per year, and the exact amount will be set at pricing.
If the closing share price is greater than or equal to the initial share price on any of the first 11 quarterly determination dates, the notes will be automatically redeemed at par of $10 plus the contingent payment.
If the notes are not called and the final share price is greater than or equal to the downside threshold level, the payout at maturity will be par plus the contingent payment. Otherwise, the payout will be a number of Valero Energy shares equal to $10 divided by the initial share price or, at the issuer's option, a cash amount equal to the value of those shares.
Morgan Stanley & Co. LLC is the agent.
| Issuer: | Morgan Stanley
|
| Issue: | Contingent income autocallable securities
|
| Underlying stock: | Valero Energy Corp. (Symbol: VLO)
|
| Amount: | $13 million
|
| Maturity: | Feb. 21, 2017
|
| Coupon: | 13.5% annualized for each quarter that shares close at or above downside threshold level on quarterly determination date
|
| Price: | Par of $10
|
| Payout at maturity: | Par plus any contingent coupon unless stock finishes below downside threshold level, in which case 0.20056 Valero shares
|
| Call: | At par plus contingent coupon if stock closes at or above initial price on any of first 11 review dates
|
| Initial price: | $49.86
|
| Downside threshold: | $37.395, 75% of initial price
|
| Pricing date: | Feb. 14
|
| Settlement date: | Feb. 20
|
| Agent: | Morgan Stanley & Co. LLC
|
| Fees: | 2.25%
|
| Cusip: | 61760S340
|
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