Morgan Stanley plans contingent income autocallables linked to Apple

By Susanna Moon

Chicago, April 27 - Morgan Stanley plans to price contingent income autocallable securities due May 2014 linked to the common stock of Apple Inc., according to an FWP filing with the Securities and Exchange Commission.

If Apple stock closes at or above the 80% downside threshold level on a quarterly determination date, investors will receive a contingent payment of $0.30 to $0.35 for each $10.00 note. The exact amount will be set at pricing.

If the stock closes at or above its initial share price on any of the first seven quarterly determination dates, the notes will be redeemed at par plus the contingent payment.

If the notes are not called and the payout at maturity will be par plus the contingent payment unless the stock finishes below the downside threshold level, in which case the payout will be a number of Apple shares equal to the principal amount of notes divided by the initial share price or, at Morgan Stanley's option, the cash equivalent.

Morgan Stanley & Co. LLC will be the agent, and Morgan Stanley Smith Barney LLC will handle distribution.

The notes will price in April and settle in May.

The Cusip number is 61755S149.

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