Bond Morgan Stanleigh 7% ( US61761JDW62 ) in USD

Morgan Stanleigh

111.255 % ⇌

United States

US61761JDW62 ( in USD )

7% per year ( payment 2 times a year)

28/03/2033

Prospectus brochure of the bond Morgan Stanley US61761JDW62 en USD 7%, maturity 28/03/2033

1 000 USD

872 000 USD

61761JDW6

N/A

28/09/2025 ( In 84 days )

Morgan Stanley is a leading global financial services firm offering investment banking, wealth management, investment management, and securities services to individuals, corporations, and governments worldwide.

The Bond issued by Morgan Stanleigh ( United States ) , in USD, with the ISIN code US61761JDW62, pays a coupon of 7% per year.
The coupons are paid 2 times per year and the Bond maturity is 28/03/2033

The Bond issued by Morgan Stanleigh ( United States ) , in USD, with the ISIN code US61761JDW62, was rated NR by Moody's credit rating agency.

http://www.sec.gov/Archives/edgar/data/895421/000095010313001992/...
424B2 1 dp37218_424b2-ps638.htm FORM 424B2
CALCULATION OF REGISTRATION FEE

Maximum Aggregate

Amount of Registration
Title of Each Class of Securities Offered

Offering Price

Fee
Contingent Coupon Notes due 2033

$872,000

$118.94

March 2013

Pricing Supplement No. 638
Registration Statement No. 333-178081
Dated March 25, 2013
Filed pursuant to Rule 424(b)(2)
S T R U C T U R E D I N V E S T M E N T S
Opportunities in U.S. Equities
Contingent Coupon Notes due March 28, 2033
With Payment of Contingent Monthly Coupons Based on the Worst Performing of the Russell 2000® Index and the S&P 500® Index
The notes are senior unsecured obligations of Morgan Stanley and have the terms described in the accompanying prospectus supplement, index
supplement and prospectus, as supplemented or modified by this document. Unlike ordinary debt securities, the notes do not provide for the regular
payment of interest and instead wil pay a contingent monthly coupon but only if the index closing value of each of the Russell 2000® Index and the S&P
500® Index on the related observation date is at or above 80% of its respective initial index value, which we refer to as the barrier level. If the index
closing value of either underlying index is less than the barrier level for such index on any observation date, we wil pay no interest for the related interes
period. At maturity, you wil receive an amount equal to the stated principal amount for each note you hold plus the contingent monthly coupon with respect
to the final observation date, if any. Investors will not participate in any appreciation of either underlying index and should be willing to hold their
notes for the entire 20-year term. These long-dated notes are for investors who seek an opportunity to earn interest at a potential y above-market rate
in exchange for the risk of receiving no monthly interest over the 20-year term if either underlying index closes below the barrier level for such index on
the observation dates. Because the payment of contingent monthly coupons is based on the worst performing of the underlying indices, the fact that the
notes are linked to two underlying indices does not provide any asset diversification benefits and instead means that a decline of either underlying index
beyond the relevant barrier level wil result in no contingent monthly coupons, even if the other underlying index closes at or above its barrier level. The
issuer will not pay a contingent monthly coupon on any contingent coupon payment date if the closing value of either underlying index is below
the barrier level for such index on the related observation date. The notes are senior notes issued as part of Morgan Stanley's Series F Global
Medium-Term Notes program. Al payments on the notes, including the repayment of principal, are subject to the credit risk of Morgan Stanley.
FINAL TERMS
Issuer:
Morgan Stanley
Underlying indices:
Russel 2000® Index (the "RTY Index") and S&P 500® Index (the "SPX Index")
Aggregate principal amount:
$872,000
Stated principal amount:
$1,000 per note
Issue price:
$1,000 per note (See "Commissions and Issue Price" below)
Pricing date:
March 25, 2013
Original issue date:
March 28, 2013 (3 business days after the pricing date)
Maturity date:
March 28, 2033
Contingent monthly coupon:
A contingent coupon at a rate of 7.00% per annum is paid monthly only if the closing value of each underlying
index is at or above its respective barrier level on the related observation date.
If, on any observation date, the closing value of either underlying index is less than the barrier level for
such index, we will pay no coupon for the applicable interest period. It is possible that one or both
underlying indices will remain below the respective barrier level(s) for extended periods of time or even
throughout the entire 20-year term of the notes so that you will receive few or no contingent monthly
coupons.
With respect to the RTY Index: 756.68, which is 80% of the initial index value for such index
Barrier level:
With respect to the SPX Index: 1,241.35, which is approximately 80% of the initial index value for such index
Initial index value:
With respect to the RTY Index: 945.85, which is the index closing value of such index on the pricing date
With respect to the SPX Index: 1,551.69, which is the index closing value of such index on the pricing date
Contingent coupon payment dates:
The 28th day of each month, beginning April 28, 2013; provided that if any such day is not a business day, that
contingent monthly coupon, if any, wil be made on the next succeeding business day and no adjustment wil be
made to any coupon payment made on that succeeding business day; provided further that the contingent
coupon, if any, with respect to the final observation date shal be paid on the maturity date.
Observation dates:
The third scheduled business day preceding each scheduled contingent coupon payment date, beginning with the
April 28, 2013 contingent coupon payment date, subject to postponement for non-index business days and
certain market disruption events.
Payment at maturity:
At maturity, you wil receive an amount equal to the stated principal amount for each note you hold plus the
contingent monthly coupon with respect to the final observation date, if any.
CUSIP:
61761JDW6
ISIN:
US61761JDW62
Listing:
The notes wil not be listed on any securities exchange.
Agent:
Morgan Stanley & Co. LLC ("MS & Co."), a whol y-owned subsidiary of Morgan Stanley. See "Supplemental
information regarding plan of distribution; conflicts of interest."
Commissions and Issue Price:
Price to Public(1)
Agent's Commissions(2)
Proceeds to Issuer
Per note
$1,000
$35
$965
Total
$872,000
$30,520
$841,480
(1) The price to public for investors purchasing the notes in fee-based advisory accounts will be $970 per note.
(2) Selected dealers and their financial advisors will collectively receive from the Agent, MS & Co., a fixed sales commission of $35 for each note they sell; provided that dealers selling to
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investors purchasing the notes in fee-based advisory accounts will receive a sales commission of $5 per note. See "Supplemental information regarding plan of distribution; conflicts of
interest." For additional information, see "Plan of Distribution (Conflicts of Interest)" in the accompanying prospectus supplement.

The notes involve risks not associated with an investment in ordinary debt securities. See "Risk Factors" beginning on page 6.

The Securities and Exchange Commission and state securities regulators have not approved or disapproved these notes, or determined if this document or the accompanying
prospectus supplement, index supplement and prospectus is truthful or complete. Any representation to the contrary is a criminal offense.

The notes are not bank deposits and are not insured by the Federal Deposit Insurance Corporation or any other governmental agency, nor are they obligations of, or guaranteed
by, a bank.

You should read this document together with the related prospectus supplement, index supplement and prospectus, each of which can be accessed via the hyperlinks
below. Please also see "Additional Information About the Notes" at the end of this document.

Prospectus Supplement dated November 21, 2011
Index Supplement dated November 21, 2011 Prospectus dated November 21, 2011

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Contingent Coupon Notes due March 28, 2033
With Payment of Contingent Monthly Coupons Based on the Worst Performing of the Russell 2000® Index and the S&P 500® Index

Investment Overview

Contingent Coupon Notes due March 28, 2033 With Payment of Contingent Monthly Coupons Based on the Worst Performing of the Russell 2000® Index
and the S&P 500® Index (the "notes") do not provide for the regular payment of interest. Instead, the notes wil pay a contingent monthly coupon but only
if the index closing value of each of the Russell 2000® Index and the S&P 500® Index (which we refer to together as the "underlying indices") is at or
above 80% of its respective initial index value, which we refer to as the barrier level, on the related observation date. If the index closing value of either
underlying index is less than the barrier level for such index on any observation date, we wil pay no coupon for the related monthly period. It is possible
that the index closing value of one or both underlying indices wil remain below the respective barrier level(s) for extended periods of time or even
throughout the entire 20-year term of the notes so that you wil receive few or no contingent monthly coupons. We refer to the coupon on the notes as
contingent, because there is no guarantee that you wil receive a coupon payment on any contingent coupon payment date. Even if an underlying index
were to be at or above the barrier level for such index on some monthly observation dates, it may fluctuate below the barrier level on others. In addition,
even if one underlying index were to be at or above the barrier level for such index on al monthly observation dates, you wil receive a contingent monthly
coupon only with respect to the observation dates on which the other underlying index is also at or above the barrier level for such index, if any. At
maturity, you wil receive an amount equal to the stated principal amount for each note you hold plus the contingent monthly coupon with respect to the
final observation date, if any.

Maturity:
20 years

Contingent monthly
A contingent coupon at a rate of 7.00% per annum wil be paid on the notes but only if the closing value
coupon:
of each underlying index is at or above its respective barrier level on the related observation date.

If, on any observation date, the closing value of either underlying index is less than the barrier
level for such index, we will pay no coupon for the applicable monthly period. It is possible that
one or both underlying indices will remain below the respective barrier level(s) for extended
periods of time or even throughout the entire 20-year term of the notes so that you will receive
few or no contingent monthly coupons.

Morgan Stanley clients may contact their local Morgan Stanley branch office or our principal executive offices at 1585 Broadway, New York, New York
10036 (telephone number (866) 477-4776). Al other clients may contact their local brokerage representative. Third-party distributors may contact
Morgan Stanley Structured Investment Sales at (800) 233-1087.

Key Investment Rationale

The notes do not provide for the regular payment of interest and instead wil pay a contingent monthly coupon but only if the index closing value of each
underlying index is at or above 80% of its initial index value, which we refer to as the barrier level, on the related observation date. The notes have
been designed for investors who are wil ing to forgo market floating interest rates and accept the risk of no interest payments during the entire 20-year
term of the notes in exchange for an opportunity to earn interest at a potential y above market rate if each underlying index closes at or above its
respective barrier level on each monthly observation date. The fol owing scenarios are for il ustration purposes only to demonstrate how the coupon is
calculated, and do not attempt to demonstrate every situation that may occur. Accordingly, the contingent coupon may be payable with respect to none
of, or some but not al of, the monthly periods during the 20-year term of the notes.

Scenario 1: A contingent monthly
This scenario assumes that each underlying index closes at or above its respective barrier level on every
coupon is paid for al interest periods,
monthly observation date. Investors receive the 7.00% per annum contingent monthly coupon for each
which is the best case scenario.
interest period during the term of the notes.
Scenario 2: A contingent monthly
This scenario assumes that each underlying index closes at or above its respective barrier level on some
coupon is paid for some, but not al ,
monthly observation dates, but one or both underlying indices close below the respective barrier level(s) for
interest periods
such index on the others. Investors receive the contingent monthly coupon for the monthly interest periods
that the index closing value of each underlying index is at or above its respective barrier level on the related
observation date, but not for the interest periods that one or both underlying indices close below the
respective barrier level(s) on the related observation date.

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Contingent Coupon Notes due March 28, 2033
With Payment of Contingent Monthly Coupons Based on the Worst Performing of the Russell 2000® Index and the S&P 500® Index

Scenario 3 : No contingent monthly
This scenario assumes that one or both underlying indices close below the respective barrier level(s) on every
coupon is paid for any interest period
monthly observation date. Since one or both underlying indices close below the respective barrier level(s) on
and investors receive zero return over
every monthly observation date, investors do not receive any contingent monthly coupon during the entire
the 20-year term of the notes.
20-year term of the notes.

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Contingent Coupon Notes due March 28, 2033
With Payment of Contingent Monthly Coupons Based on the Worst Performing of the Russell 2000® Index and the S&P 500® Index

Underlying Indices Summary

Russel 2000® Index

The Russel 2000® Index is an index calculated, maintained and published by Russel Investments, a subsidiary of Russel Investment Group. The Russel
2000® Index measures the composite price performance of stocks of 2,000 companies (the "Russel 2000® Component Stocks") incorporated in the U.S.
and its territories. Al 2,000 stocks are traded on a major U.S. exchange and are the 2,000 smal est securities that form the Russel 3000® Index. The
Russel 3000® Index is composed of the 3,000 largest U.S. companies as determined by market capitalization and represents approximately 98% of the
U.S. equity market. The Russel 2000® Index consists of the smal est 2,000 companies included in the Russel 3000® Index and represents a smal portion
of the total market capitalization of the Russel 3000® Index. The Russell 2000® Index is designed to track the performance of the smal capitalization
segment of the U.S. equity market.

Information as of market close on March 25, 2013:

Bloomberg Ticker Symbol:
RTY
Current Index Value:
945.85
52 Weeks Ago:
830.03
52 Week High (on 3/14/2013):
953.07
52 Week Low (on 6/4/2012):
737.24

For additional information about the Russel 2000® Index, see the information set forth under "Russel 2000® Index" in the accompanying index
supplement. Furthermore, for additional historical information, see "Russel 2000® Index Overview" below.

S&P 500® Index

The S&P 500® Index, which is calculated, maintained and published by S&P, consists of 500 component stocks selected to provide a performance
benchmark for the U.S. equity markets. The calculation of the S&P 500® Index is based on the relative value of the float adjusted aggregate market
capitalization of the 500 component companies as of a particular time as compared to the aggregate average market capitalization of 500 similar
companies during the base period of the years 1941 through 1943.

Information as of market close on March 25, 2013:

Bloomberg Ticker Symbol:
SPX
Current Index Value:
1,551.69
52 Weeks Ago:
1,397.11
52 Week High (on 3/14/2013):
1,563.23
52 Week Low (on 6/1/2012):
1,278.04

For additional information about the S&P 500® Index, see the information set forth under "S&P 500® Index" in the accompanying index
supplement. Furthermore, for additional historical information, see "S&P 500® Index Overview" below.

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Contingent Coupon Notes due March 28, 2033
With Payment of Contingent Monthly Coupons Based on the Worst Performing of the Russell 2000® Index and the S&P 500® Index

Hypothetical Examples

The fol owing hypothetical examples il ustrate how to determine whether a contingent monthly coupon is paid with respect to an observation date. The
fol owing examples are for il ustrative purposes only. Whether you receive a contingent monthly coupon wil be determined on each monthly observation
date. The actual initial index value and barrier level for each underlying index are set forth on the cover page of this document. Al payments on the notes,
including the repayment of principal, are subject to the credit risk of Morgan Stanley. The below examples are based on the following terms:

Contingent Monthly Coupon:
7.00% per annum (corresponding to approximately $5.8333 per month)

With respect to each contingent coupon payment date, a contingent monthly coupon is paid but only if
the closing value of each underlying index is at or above its respective barrier level on the related
observation date.
Hypothetical Initial Index Value:
With respect to the RTY Index: 900

With respect to the SPX Index: 1,500
Hypothetical Barrier Level:
With respect to the RTY Index: 720, which is 80% of the hypothetical initial index value for such index

With respect to the SPX Index: 1,200, which is 80% of the hypothetical initial index value for such index

Index Closing Value
Contingent Monthly Coupon

RTY Index
SPX Index

Hypothetical Observation
950 (at or above barrier level)
1,400 (at or above barrier level)
Approximately $5.8333
Date 1
Hypothetical Observation
700 (below barrier level)
1,450 (at or above barrier level)
$0
Date 2
Hypothetical Observation
920 (at or above barrier level)
1,100 (below barrier level)
$0
Date 3
Hypothetical Observation
650 (below barrier level)
1,000 (below barrier level)
$0
Date 4

On hypothetical observation date 1, both the RTY Index and SPX Index close at or above their respective barrier levels. Therefore a contingent monthly
coupon of approximately $5.8333 is paid on the relevant contingent coupon payment date.

On each of the hypothetical observation dates 2 and 3, one underlying index closes at or above its barrier level but the other underlying index closes below
its barrier level. Therefore no contingent monthly coupon is paid on the relevant contingent coupon payment date.

On hypothetical observation date 4, both underlying indices close below their respective barrier levels and accordingly no contingent monthly coupon is
paid on the relevant contingent coupon payment date.

You will not receive a contingent monthly coupon on any contingent coupon payment date if the closing value of either underlying index is
below its respective barrier level on the related observation date.

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Contingent Coupon Notes due March 28, 2033
With Payment of Contingent Monthly Coupons Based on the Worst Performing of the Russell 2000® Index and the S&P 500® Index

Risk Factors

The following is a non-exhaustive list of certain key risk factors for investors in the notes. For further discussion of these and other risks, you should
read the section entitled "Risk Factors" in the accompanying prospectus supplement, index supplement and prospectus. We also urge you to consult
with your investment, legal, tax, accounting and other advisers before you invest in the notes.

§
The notes do not provide for regular interest payments. The terms of the notes differ from those of ordinary debt securities in that they do not
provide for the regular payment of interest and instead wil pay a contingent monthly coupon but only if the index closing value of each underlying index
is at or above 80% of its respective initial index value, which we refer to as the barrier level, on the related observation date. If, on the other hand, the
index closing value of either underlying index is lower than the barrier level for such index on the relevant observation date for any interest period, we
wil pay no coupon on the applicable contingent coupon payment date. It is possible that the index closing value of one or both underlying indices will
remain below the respective barrier level(s) for extended periods of time or even throughout the entire 20-year term of the notes so that you wil
receive few or no contingent monthly coupons. If you do not earn sufficient contingent coupons over the term of the notes, the overall return on the
notes may be less than the amount that would be paid on a conventional debt security of the issuer of comparable maturity.

§
You are exposed to the price risk of both underlying indices. Your return on the notes is not linked to a basket consisting of both underlying
indices. Rather, it wil be contingent upon the independent performance of each of the underlying indices. Unlike an instrument with a return linked to
a basket of underlying assets in which risk is mitigated and diversified among all the components of the basket, you wil be exposed to the risks
related to both underlying indices. Poor performance by either of the underlying indices over the term of the notes may negatively affect your return
and wil not be offset or mitigated by a positive performance by the other underlying index. To receive any contingent monthly coupons, each
underlying index must close at or above its respective barrier level on the applicable observation date. Accordingly, your investment is subject to the
price risk of both underlying indices.

§
Because the notes are linked to the performance of the worst performing of the underlying indices, you are exposed to a greater risk of no
contingent monthly coupons than if the notes were linked to just the RTY Index or just the SPX Index. The risk that you wil not receive any
contingent monthly coupons is greater if you invest in the notes as opposed to substantial y similar securities that are linked to just the performance of
the RTY Index or just the SPX Index. With two underlying indices, it is more likely that either underlying index wil close below the barrier level for such
index on the observation dates than if the notes were linked to only one of the underlying indices, and therefore it is more likely that you wil not receive
any contingent monthly coupons.

§
The contingent monthly coupon, if any, is based only on the value of each underlying index on the related monthly observation date at the
end of the related interest period. Whether the contingent monthly coupon wil be paid on any contingent coupon payment date wil be determined at
the end of the relevant interest period, based on the closing value of each underlying index on the relevant monthly observation date. As a result, you
wil not know whether you wil receive the contingent monthly coupon on any contingent coupon payment date until near the end of the relevant interest
period. Moreover, because the contingent monthly coupon is based solely on the value of each underlying index on monthly observation dates, if the
closing value of either underlying index on any observation date is below the barrier level for such index, you wil receive no coupon for the related
interest period even if the level of such underlying index was at or above its respective barrier level on other days during that interest period and even
if the closing value of the other underlying index is at or above the barrier level for such index.

§
Investors will not participate in any appreciation in either underlying index. Investors wil not participate in any appreciation in either underlying
index from the initial index value for such index, and the return on the notes wil be limited to the contingent monthly coupon, if any, that is paid with
respect to each observation date on which the index closing value of each underlying index is greater than or equal to its respective barrier level.

§
The notes are linked to the Russell 2000® Index and are subject to risks associated with small-capitalization companies. The Russel 2000®
Index, one of the underlying indices, consists of stocks issued by companies with relatively smal market capitalization. These companies often have
greater stock price volatility, lower trading volume and less liquidity than large-capitalization companies and therefore the RTY Index may be more
volatile than that of indices that

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With Payment of Contingent Monthly Coupons Based on the Worst Performing of the Russell 2000® Index and the S&P 500® Index

consist of stocks issued by large-capitalization companies. Stock prices of small-capitalization companies are also more vulnerable than those of
large-capitalization companies to adverse business and economic developments, and the stocks of small-capitalization companies may be thinly
traded. In addition, small capitalization companies are typically less well-established and less stable financially than large-capitalization companies
and may depend on a small number of key personnel, making them more vulnerable to loss of personnel. Such companies tend to have smal er
revenues, less diverse product lines, smal er shares of their product or service markets, fewer financial resources and less competitive strengths than
large-capitalization companies and are more susceptible to adverse developments related to their products.

§
The market price will be influenced by many unpredictable factors. Several factors, many of which are beyond our control, wil influence the
value of the notes in the secondary market and the price at which MS & Co. may be wil ing to purchase or sel the notes in the secondary market. We
expect that generally the level of interest rates available in the market and the value of each underlying index on any day, including in relation to its
respective barrier level, wil affect the value of the notes more than any other factors. Other factors that may influence the value of the notes include:

o
the volatility (frequency and magnitude of changes in value) of the underlying indices,

o
whether the index closing value of either underlying index has been below its respective barrier level on any observation date,

o
geopolitical conditions and economic, financial, political, regulatory or judicial events that affect the component stocks of the underlying
indices or securities markets generally and which may affect the value of each underlying index,

o
dividend rates on the securities underlying the underlying indices,

o
the time remaining until the notes mature,

o
interest and yield rates in the market,

o
the availability of comparable instruments,

o
the composition of the underlying indices and changes in the constituent stocks of such indices, and

o
any actual or anticipated changes in our credit ratings or credit spreads.

Some or al of these factors wil influence the price that you wil receive if you sel your notes prior to maturity. General y, the longer the time remaining
to maturity, the more the market price of the notes wil be affected by the other factors described above. In particular, if either underlying index has
closed near or below the barrier level for such index, the market value of the notes is expected to decrease substantial y and you may have to sel
your notes at a substantial discount from the stated principal amount of $1,000 per note.

You cannot predict the future performance of either underlying index based on its historical performance. The value of either underlying index may
decrease and be below the barrier level for such index on each observation date so that you wil receive no return on your investment throughout the
entire 20-year term of the notes. There can be no assurance that the closing value of each underlying index wil be at or above the respective barrier
level on any observation date so that you wil receive a coupon payment on the notes for the applicable interest period. See "Russell 2000® Index
Overview" and "S&P 500® Index Overview" below.

§
The notes are subject to the credit risk of Morgan Stanley, and any actual or anticipated changes to its credit ratings or credit spreads
may adversely affect the market value of the notes. Under the terms of the notes, Morgan Stanley is obligated to return to you the stated
principal amount at maturity. However, as with an ordinary debt security, you are dependent on Morgan Stanley's ability to pay all amounts due on the
notes at maturity or on any contingent coupon payment date, and therefore you are subject to the credit risk of Morgan Stanley. The notes are not
guaranteed by any other entity. If Morgan Stanley defaults on its obligations under the notes, your investment would be at risk and you could lose
some or al of your investment. As a result, the market value of the notes prior to maturity wil be affected by changes in the market's view of Morgan
Stanley's creditworthiness. Any actual or anticipated decline in Morgan Stanley's credit ratings or increase in the credit spreads charged by the
market for taking Morgan Stanley credit risk is likely to adversely affect the market value of the notes.

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With Payment of Contingent Monthly Coupons Based on the Worst Performing of the Russell 2000® Index and the S&P 500® Index

§
Not equivalent to investing in the underlying indices. Investing in the notes is not equivalent to investing in either underlying index or the
component stocks of either underlying index. Investors in the notes wil not participate in any positive performance of either underlying index, and wil
not have voting rights or rights to receive dividends or other distributions or any other rights with respect to stocks that constitute either underlying
index.

§
The notes will not be listed on any securities exchange and secondary trading may be limited. The notes wil not be listed on any securities
exchange. Therefore, there may be little or no secondary market for the notes. MS & Co. may, but is not obligated to, make a market in the
notes. Even if there is a secondary market, it may not provide enough liquidity to al ow you to trade or sel the notes easily. Because we do not
expect that other broker-dealers wil participate significantly in the secondary market for the notes, the price at which you may be able to trade your
notes is likely to depend on the price, if any, at which MS & Co. is wil ing to transact. If, at any time, MS & Co. were not to make a market in the
notes, it is likely that there would be no secondary market for the notes. Accordingly, you should be wil ing to hold your notes to maturity.

§
The inclusion of commissions and projected profit from hedging in the original issue price is likely to adversely affect secondary market
prices. Assuming no change in market conditions or any other relevant factors, the price, if any, at which MS & Co. is wil ing to purchase the notes at
any time in secondary market transactions wil likely be significantly lower than the original issue price, since secondary market prices are likely to
exclude commissions paid with respect to the notes and the cost of hedging our obligations under the notes that are included in the original issue
price. The cost of hedging includes the projected profit that our subsidiaries may realize in consideration for assuming the risks inherent in managing
the hedging transactions. These secondary market prices are also likely to be reduced by the costs of unwinding the related hedging
transactions. Our subsidiaries may realize a profit from the expected hedging activity even if investors do not receive a favorable investment return
under the terms of the notes or in any secondary market transaction. In addition, any secondary market prices may differ from values determined by
pricing models used by MS & Co., as a result of dealer discounts, mark-ups or other transaction costs.

§
Hedging and trading activity by our subsidiaries could potentially affect the value of the notes. One or more of our subsidiaries have carried
out, and wil continue to carry out, hedging activities related to the notes, including trading in the stocks that constitute the underlying indices as wel as
in other instruments related to the underlying indices. Some of our subsidiaries also trade the stocks that constitute the underlying indices and other
financial instruments related to the underlying indices on a regular basis as part of their general broker-dealer and other businesses. Any of these
hedging or trading activities on or prior to the pricing date could have increased the initial index value of an underlying index and, therefore, could have
increased the barrier level for such underlying index, which is the value at which such underlying index must close on the observation dates in order for
you to earn a contingent monthly coupon (depending also on the performance of the other underlying index). Additional y, such hedging or trading
activities during the term of the notes could affect whether an underlying index closes at or above the barrier level for such index on the observation
dates and, accordingly, whether we pay a contingent monthly coupon on the notes (depending also on the performance of the other underlying index).

§
The calculation agent, which is a subsidiary of the issuer, will make determinations with respect to the notes. As calculation agent, MS &
Co. has determined the initial index value and barrier level for each underlying index and wil determine whether you receive a contingent monthly
coupon on each contingent coupon payment date and at maturity. Any of these determinations made by MS & Co. in its capacity as calculation agent,
including with respect to the occurrence or non-occurrence of market disruption events and the selection of a successor index or calculation of the
index closing value in the event of a market disruption event or discontinuance of an underlying index, may adversely affect the payout to you at
maturity.

§
Adjustments to the underlying indices could adversely affect the value of the notes. The publisher of each underlying index may add, delete or
substitute the component stocks of such underlying index or make other methodological changes that could change the value of such underlying
index. Any of these actions could adversely affect the value of the notes. The publisher of each underlying index may also discontinue or suspend
calculation or publication of such underlying index at any time. In these circumstances, MS & Co., as the calculation agent, will have the sole
discretion to substitute a successor index that is comparable to the discontinued index. MS & Co. could have an economic interest that is different
than that of investors in the notes insofar as, for example, MS & Co. is permitted to consider indices that are calculated and published by MS & Co. or
any of its affiliates. If MS & Co. determines that there is no appropriate successor index on any observation date, the determination of whether a
contingent monthly coupon wil be payable on the notes on the applicable contingent coupon payment date wil be based on whether the value of such
underlying index, based on the closing prices

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http://www.sec.gov/Archives/edgar/data/895421/000095010313001992/...

Contingent Coupon Notes due March 28, 2033
With Payment of Contingent Monthly Coupons Based on the Worst Performing of the Russell 2000® Index and the S&P 500® Index

of the stocks constituting such underlying index at the time of such discontinuance, without rebalancing or substitution, computed by MS & Co. as
calculation agent in accordance with the formula for calculating such underlying index last in effect prior to such discontinuance, is less than the barrier
level for such index (depending also on the performance of the other underlying index).

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