Morgan Stanley plans contingent income autocallables on Wells Fargo

By Susanna Moon

Chicago, Aug. 2 - Morgan Stanley plans to price contingent income autocallable securities due August 2013 linked to Wells Fargo & Co. shares, according to an FWP with the Securities and Exchange Commission.

If Wells Fargo stock closes at or above the 80% downside threshold level on a quarterly determination date, investors will receive a contingent payment of 2.125% to 2.875%. The exact percentage will be set at pricing.

If the stock closes at or above its initial share price on any determination date, the notes will be redeemed at par plus the contingent payment.

If the notes are not called and the payout at maturity will be par plus the contingent payment unless the stock finishes below the downside threshold level, in which case the payout will be a number of Wells Fargo shares equal to the principal amount of notes divided by the initial share price or, at Morgan Stanley's option, the cash equivalent.

Morgan Stanley & Co. LLC will be the agent, and Morgan Stanley Smith Barney LLC will handle distribution.

The notes will price and settle in August.

The Cusip number is 61755S479.

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