Morgan Stanley plans contingent income autocallable notes on Facebook

By Toni Weeks

San Luis Obispo, Calif., Sept. 5 – Morgan Stanley plans to price contingent income autocallable securities due September 2015 linked to the common stock of Facebook, Inc., according to an FWP filing with the Securities and Exchange Commission.

If Facebook stock closes at or above the downside threshold level, 75% of the initial share price, on any quarterly determination date, the notes will pay a contingent coupon at an annual rate of 10.2% for that quarter.

If the closing share price is greater than or equal to the initial share price on any of the first three quarterly determination dates, the notes will be automatically redeemed at par 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. If the final share price is less than the downside threshold level, investors will receive a number of shares equal to $10 divided by the initial share price or, at the issuer’s option, the cash value of those shares.

Morgan Stanley & Co. LLC is the agent with Morgan Stanley Wealth Management as dealer.

The notes (Cusip: 61758S740) will price and settle in September.

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