Morgan Stanley plans contingent income autocallables tied to Broadcom

By Toni Weeks

San Luis Obispo, Calif., Aug. 6 - Morgan Stanley plans to price contingent income autocallable securities due August 2016 linked to Broadcom Corp. shares, according to an FWP filing with the Securities and Exchange Commission.

If Broadcom stock closes at or above 70% the barrier level on a quarterly review date, the notes will pay a contingent payment at an annualized rate of 8.95% to 10.95% for that quarter. The exact contingent quarterly coupon will be set at pricing.

If the shares close at or above initial level on any of the first 11 quarterly determination dates, the notes will be redeemed at par of $10 plus the contingent payment.

If the notes are not called, the payout at maturity will be par plus the contingent payment unless the stock closes below the 70% trigger level, in which case the payout will be a number of Broadcom shares equal to $10 divided by the initial share price or, at the issuer's option, the cash equivalent.

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

The notes (Cusip: 61762P393) will price and settle in August.

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