SPARQSSM

Stock Participating Accreting Redemption Quarterly-Pay Securities

A callable bond that pays coupons in cash, but, upon maturity, is redeemed for a certain number of shares in the company issuing the bond. If it is called, the issuer must pay all interest that would have been paid had the SPARQS been held until maturity; companies call these bonds after their stock has risen quickly since they do not wish to distribute them for free. SPARQS exist to provide the low risk of a bond while also exposing the investor to the stock market. Morgan Stanley underwrites SPARQS.

SPARQSSM