Morgan Stanley to price contingent income autocallables on lululemon

By Jennifer Chiou

New York, May 13 - Morgan Stanley plans to price contingent income autocallable securities due May 2015 linked to the common stock of lululemon athletica inc., according to an FWP with the Securities and Exchange Commission.

If lululemon stock closes at or above the downside threshold level, 75% of the initial share price, on any quarterly determination date, the notes will pay a contingent coupon at an annual rate of 14% for that quarter. The exact contingent payment will be set at pricing.

If the closing share price is greater than or equal to the initial price on any of the first three quarterly determination dates, the notes will be automatically redeemed at par 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. If the final share price is less than the downside threshold level, investors will receive a number of shares equal to $10 divided by the initial share price or, at the issuer's option, the cash value of those shares.

The notes (Cusip: 61761S182) will price and settle in May.

Morgan Stanley & Co. LLC is the agent with Morgan Stanley Wealth Management as dealer.

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