New Issue: Morgan Stanley prices $55,000 14.5% RevCons tied to Sears stock

By Marisa Wong

Madison, Wis., Feb. 24 - Morgan Stanley priced $55,000 of 14.5% reverse convertible securities due Aug. 25, 2011 linked to Sears Holding Co. shares, according to a 424B2 filing with the Securities and Exchange Commission.

Interest will be payable monthly.

The payout at maturity will be par unless Sears stock falls by 25% or more during the life of the notes and finishes below the initial share price, in which case the payout will be a number of Sears shares equal to par divided by the initial share price or, at the issuer's option, the value of those shares in cash.

Morgan Stanley & Co. Inc. is the agent.

Issuer:	Morgan Stanley
Issue:	Reverse convertible securities
Underlying stock:	Sears Holding Co. (Symbol: SHLD)
Amount:	$55,000
Maturity:	Aug. 25, 2011
Coupon:	14.5%, payable monthly
Price:	Par
Payout at maturity:	Par unless Sears stock falls by 25% or more during the life of the notes and finishes below the initial share price, in which case the payout will be a number of Sears shares equal to par divided by the initial share price or, at the issuer's option, the value of those shares in cash
Initial share price:	$90.16
Trigger price:	$67.62, 75% of initial price
Exchange ratio:	11.09139
Pricing date:	Feb. 22
Settlement date:	Feb. 25
Agent:	Morgan Stanley & Co. Inc.
Fees:	2%
Cusip:	617482RE6

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