New Issue: Morgan Stanley prices $1 million range accrual step up notes tied to S&P 500

By Marisa Wong

Madison, Wis., Oct. 5 - Morgan Stanley priced $1 million of range accrual step up notes due Oct. 29, 2030 linked to the S&P 500 index, according to a 424B2 filing with the Securities and Exchange Commission.

The coupon will be 7% for years one through four. After that, interest will accrue at the reference rate for each day that the S&P 500 closes at or above 900. The reference rate will be 8% per year from Oct. 29, 2014 to Oct. 29, 2018; 9% per year from Oct. 29, 2018 to Oct. 29, 2022; 10% per year from Oct. 29, 2022 to Oct. 29, 2026; and 12% thereafter. Interest is payable monthly.

The payout at maturity will be par.

The notes will be callable at par on any quarterly redemption date beginning Oct. 29, 2014.

Morgan Stanley & Co. Inc. is the agent.

Issuer:	Morgan Stanley
Issue:	Range accrual step up notes
Underlying index:	S&P 500
Amount:	$1 million
Maturity:	Oct. 29, 2030
Coupon:	7% for four years; then reference rate multiplied by proportion of days on which S&P 500 closes at or above 900; reference rate is 8% from Oct. 29, 2014 to Oct. 29, 2018, 9% from Oct. 29, 2018 to Oct. 29, 2022, 10% from Oct. 29, 2022 to Oct. 29, 2026 and 12% thereafter; payable monthly
Price:	Par
Payout at maturity:	Par
Call option:	At par on any quarterly redemption date beginning Oct. 29, 2014
Pricing date:	Oct. 1
Settlement date:	Oct. 29
Agent:	Morgan Stanley & Co. Inc.
Fees:	3.5%
Cusip:	61745EM73

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