The issuer has filed a registration
statement (including a prospectus) with the SEC for the offering to
which this communication relates. Before you invest, you should
read the prospectus in that registration statement and other
documents the issuer has filed with the SEC for more complete
information about the issuer and this offering. You may get these
documents for free by visiting EDGAR on the SEC Web site at
www.sec.gov. Alternatively, the issuer, any underwriter or any
dealer participating in the offering will arrange to send you the
prospectus if you request it by calling toll-free
For more information about the underlying
indices, including historical performance information, see the
accompanying preliminary terms.
The risks set forth below are discussed in
more detail in the “Risk Factors” section in the accompanying
preliminary terms. Please review those risk factors carefully prior
to making an investment decision.
Risks Relating to an
Investment in the Buffered PLUS
Buffered PLUS do not pay interest and provide a minimum payment at
maturity of only 15% of the stated principal
appreciation potential of the Buffered PLUS is limited by the
maximum payment at maturity.
market price of the Buffered PLUS will be influenced by many
Buffered PLUS are subject to our credit risk, and any actual or
anticipated changes to our credit ratings or credit spreads may
adversely affect the market value of the Buffered
a finance subsidiary, MSFL has no independent operations and will
have no independent assets.
amount payable on the Buffered PLUS is not linked to the values of
the underlying indices at any time other than the valuation
in the Buffered PLUS is not equivalent to investing in any
rate we are willing to pay for securities of this type, maturity
and issuance size is likely to be lower than the rate implied by
our secondary market credit spreads and advantageous to us. Both
the lower rate and the inclusion of costs associated with issuing,
selling, structuring and hedging the Buffered PLUS in the original
issue price reduce the economic terms of the Buffered PLUS, cause
the estimated value of the Buffered PLUS to be less than the
original issue price and will adversely affect secondary market
estimated value of the Buffered PLUS is $964.90 per Buffered PLUS,
or within $35.00 of that estimate, and is determined by reference
to our pricing and valuation models, which may differ from those of
other dealers and is not a maximum or minimum secondary market
Buffered PLUS will not be listed on any securities exchange and
secondary trading may be limited.
and trading activity by our affiliates could potentially adversely
affect the value of the Buffered PLUS.
calculation agent, which is a subsidiary of Morgan Stanley and an
affiliate of MSFL, will make determinations with respect to the
U.S. federal income tax consequences of an investment in the
Buffered PLUS are uncertain.
Risks Relating to the
are exposed to the price risk of each underlying
the Buffered PLUS are linked to the performance of the worst
performing underlying index, you are exposed to greater risk of
sustaining a loss on your investment than if the Buffered PLUS were
linked to just one underlying index.
Buffered PLUS are linked to the Russell
Index and are subject to risks associated
with small-capitalization companies.
to the underlying indices could adversely affect the value of the
You should review carefully the discussion
in the accompanying preliminary terms under the caption “Additional
Information About the Buffered PLUS–Tax considerations” concerning
the U.S. federal income tax consequences of an investment in the
Buffered PLUS, and you should consult your tax