Morgan Stanley to price contingent income autocallables linked to Ford

By Toni Weeks

San Luis Obispo, Calif., July 2 - Morgan Stanley plans to price contingent income autocallable securities due July 2016 linked to the common stock of Ford Motor Co., according to an FWP filing with the Securities and Exchange Commission.

If Ford 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 $0.22 to $0.27 per $10 note for that quarter. The payment is equivalent to 8.8% to 10.8% per year, and the exact amount will be set at pricing.

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 Ford 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 with Morgan Stanley Smith Barney LLC as dealer.

The notes will price and settle in July.

The Cusip number is 61762P161.

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