Morgan Stanley plans contingent income autocallables tied to Brazil ETF

By Angela McDaniels

Tacoma, Wash., Dec. 14 - Morgan Stanley plans to price contingent income autocallable securities due Dec. 24, 2012 linked to the iShares MSCI Brazil index fund, according to an FWP filing with the Securities and Exchange Commission.

Interest, if any, will be payable quarterly. If the exchange-traded fund's closing share price is greater than the downside threshold level - 80% of the initial share price - on a quarterly determination date, the notes will pay a contingent payment of 2% to 3%. Otherwise, no contingent payment will be made for that quarter.

If the ETF's closing share price is greater than the initial share price on any quarterly determination date, 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 the downside threshold level, the payout at maturity will be par plus the contingent payment. If the final share price is less than or equal to the downside threshold level, the payout will be par plus the fund return.

The notes (Cusip 61759G166) will price Dec. 27 and settle Dec. 30.

Morgan Stanley & Co. Inc. is the agent.

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