New Issue: Morgan Stanley sells $456,000 9.8% RevCons linked to Schlumberger

By Laura Lutz

Washington, Feb. 21 - Morgan Stanley priced $456,000 of 9.8% reverse convertible securities (RevCons) due Feb. 22, 2008 linked to Schlumberger Ltd. stock, according to an FWP filing with the Securities and Exchange Commission.

The payout at maturity will be par in cash if Schlumberger stock stays at or above the protection price, 80% of the initial share price of $63.33, during the life of the securities and finishes at or above the initial share price. Otherwise, the payout will be in Schlumberger stock, with the number of shares equal to $1,000 divided by the initial share price.

Issuer:	Morgan Stanley
Issue:	Reverse convertible securities (RevCons)
Underlying stock:	Schlumberger Ltd.
Amount:	$456,000
Maturity:	Feb. 22, 2008
Coupon:	9.8%, payable monthly
Price:	Par
Payout at maturity:	Par in cash if Schlumberger stock stays at or above the protection price of $50.664 and finishes at or above the initial share price; otherwise 15.79030 shares of Schlumberger stock
Initial share price:	$63.33
Protection price:	$50.664, 80% of $63.33
Exchange ratio:	15.79030, $1,000 divided by $63.33
Pricing date:	Feb. 16
Settlement date:	Feb. 22
Agent:	Morgan Stanley & Co. Inc.
Agent fees:	2.75%

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