Morgan Stanley plans contingent income autocallables tied to CBS

By Toni Weeks

San Diego, April 12 - Morgan Stanley plans to price contingent income autocallable securities due April 2014 linked to the common stock of CBS Corp., according to an FWP filing with the Securities and Exchange Commission.

If CBS stock closes above the downside threshold level - 75% of the initial share price - on a quarterly determination date, investors will receive a contingent payment of $0.215 to $0.265 for each $10.00 note. Otherwise, no contingent payment will be made for that period.

If the closing share price is greater than the initial share price on any quarterly determination date, 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, the payout will be a number of CBS shares equal to the principal amount of notes divided by the initial share price or, at Morgan Stanley's option, the cash value of those shares.

The exact contingent payment will be set at pricing.

The notes (Cusip: 61760E598) will price and settle in April.

Morgan Stanley & Co. Inc. is the agent.

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