Morgan Stanley plans contingent income autocallables linked to Apple

By Marisa Wong

Madison, Wis., Sept. 13 - Morgan Stanley plans to price contingent income autocallable securities due September 2016 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 downside threshold level, 75% of the initial share price, on a quarterly determination date, the notes will pay a contingent payment of 2.875% for that quarter. The amount is equivalent to 11.5% per year.

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 Apple 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.

The notes will price and settle in September.

The Cusip number is 61762P880.

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