Morgan Stanley to price leveraged callable CMS curve-linked notes

By Susanna Moon

Chicago, April 30 - Morgan Stanley plans to price leveraged callable CMS curve-linked notes due May 19, 2023, according to an FWP filing with the Securities and Exchange Commission.

Interest will be payable quarterly.

The notes will bear interest at 10.5% per year until May 19, 2010. Thereafter, interest will equal 50 times any positive spread between the 30-year Constant Maturity Swap (CMS) rate and the 10-year CMS rate. Interest will be determined and reset quarterly. Interest will not accrue in any quarter in which the 30-year CMS rate is less than or equal to the 10-year CMS rate.

The notes are callable at par on any interest payment date beginning May 19, 2010.

If the notes are not called early, the payout at maturity will be par.

The notes are expected to price in May and settle on May 19.

Morgan Stanley & Co. Inc. is the agent.

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