Contingent
Income Auto-Callable
Securities due January 3, 2025
All Payments on the Securities
Based on the Worst Performing of the Russell
2000®
Index, the Dow Jones
Industrial AverageSM
and the Technology Select
Sector SPDR®
Fund
Fully and Unconditionally
Guaranteed by Morgan Stanley
Principal at Risk
Securities
The securities offered are unsecured
obligations of Morgan Stanley Finance LLC (“MSFL”) and are fully
and unconditionally guaranteed by Morgan Stanley. The
securities
have the terms described in
the accompanying product supplement, index supplement and
prospectus, as supplemented or modified by this document. The
securities do not guarantee the repayment of principal and do not
provide for the regular payment of interest. Instead, the
securities will pay a contingent quarterly coupon
but only if
the closing level
of
each
of the Russell
2000®
Index, the
Dow Jones Industrial
AverageSM
and
the Technology Select Sector
SPDR®
Fund
is
at or above
70% of its respective initial
level, which we refer to as the respective
coupon threshold
level,
on the related observation
date. However, if the closing level of
any
underlying is
less than
its
coupon threshold
level
on any observation date, we
will pay no interest for the related quarterly period. In addition,
the securities will be automatically redeemed if the closing level
of
each
underlying is
greater than or equal
to
its respective
initial level
on any quarterly redemption
determination date, for the early redemption payment equal to the
sum of the stated principal amount
plus
the related contingent
quarterly coupon. No further payments will be made on the
securities once they have been redeemed. At maturity,
if the securities have not previously been
redeemed and the final level of
each
underlying is
greater than or equal
to 70% of its respective initial level, which
we refer to as the respective downside threshold level, the payment
at maturity will be the stated principal amount and the related
contingent quarterly coupon. If, however, the final level
of
any underlying is
less than
its respective downside threshold level,
investors will be fully exposed to the decline in the worst
performing underlying on a 1-to-1 basis and will receive a payment
at maturity that is
less than
70% of the stated principal amount of the
securities and could be zero.
Accordingly,
investors in the securities
must be willing to accept the risk of losing their entire initial
investment and also the risk of not receiving any contingent
quarterly coupons throughout the 1.5-year term of the
securities. Because all payments on the securities are
based on the worst performing of the underlyings, a decline beyond
the respective coupon threshold level or respective downside
threshold level, as applicable, of any underlying will result in
few or no contingent coupon payments or a significant loss of your
investment, even if one or both of the other underlyings have
appreciated or have not declined as much. The securities are for
investors who are willing to risk their principal based on the
worst performing of three underlyings and who seek an opportunity
to earn interest at a potentially above-market rate in exchange for
the risk of receiving no quarterly coupons over the entire 1.5-year
term. Investors will not participate in any appreciation of any
underlying.
The securities are notes
issued as part of MSFL’s Series A Global Medium-Term Notes
program.
All payments are subject to
our credit risk. If we default on our obligations, you could lose
some or all of your investment. These securities are not secured
obligations and you will not have any security interest in, or
otherwise have any access to, any underlying reference asset or
assets.
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SUMMARY
TERMS
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Issuer:
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Morgan Stanley Finance
LLC
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Guarantor:
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Morgan Stanley
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Underlyings:
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Russell 2000®
Index (the “RTY Index”), Dow Jones
Industrial AverageSM
(the “INDU Index”) and Technology Select
Sector SPDR®
Fund (the “XLK Shares”)
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Aggregate principal
amount:
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$
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Stated principal
amount:
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$1,000 per security
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Issue price:
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$1,000 per security (see “Commissions and
issue price” below)
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Pricing
date:
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June 30, 2023
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Original issue
date:
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July 6, 2023 (3 business days after the
pricing date)
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Maturity
date:
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January 3, 2025
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Contingent quarterly
coupon:
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A
contingent
coupon will be paid on the securities on
each coupon payment date
but only if
the closing level of
each
underlying is at or above its respective
coupon
threshold level
on the related observation date. If
payable, the contingent quarterly coupon will be an amount in cash
per stated principal amount corresponding to a return of 10.75% to
12.75%
per annum
(corresponding to approximately $26.875 to
$31.875 per quarter per security, to be determined on the pricing
date) for each interest payment period for each applicable
observation date.
If, on any observation date,
the closing level of any underlying is less than its respective
coupon threshold level, we will pay no coupon for the applicable
quarterly period. It is possible that any underlying
will remain below its respective coupon threshold level for
extended periods of time or even throughout the entire 1.5-year
term of the securities so that you will receive few or no
contingent quarterly coupons.
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Payment at
maturity:
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If the securities have not been
automatically redeemed prior to maturity, the payment at maturity
will be determined as follows:
If the final level of
each
underlying is
greater than or equal
to its respective downside threshold level,
investors will receive the stated principal amount and the
contingent quarterly coupon with respect to the final observation
date.
If the final level of
any underlying is
less than
its respective downside threshold level,
investors will receive (i) the stated principal
amount
multiplied by
(ii) the performance factor of the worst
performing underlying. Under these circumstances, the payment at
maturity will be less than 70% of the stated principal amount of
the securities and could be zero.
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Terms continued on the
following page
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Agent:
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Morgan Stanley & Co. LLC (“MS &
Co.”), an affiliate of MSFL and a wholly owned subsidiary of Morgan
Stanley. See “Supplemental information regarding plan of
distribution; conflicts of interest.”
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Estimated value on the pricing
date:
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Approximately $964.10 per security, or
within $35.00 of that estimate. See “Investment Summary” beginning
on page 3.
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Commissions and issue
price:
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Price to
public(1)
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Agent’s commissions and
fees(2)
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Proceeds to
us(3)
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Per security
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$1,000
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$
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$
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Total
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$
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$
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$
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(1)The
securities will be sold only to investors purchasing the securities
in fee-based advisory accounts.
(2)MS
& Co. expects to sell all of the securities that it purchases
from us to an unaffiliated dealer at a price of $ per security, for
further sale to certain fee-based advisory accounts at the price to
public of $1,000 per security. MS & Co. will not receive a
sales commission with respect to the securities. See “Supplemental
information regarding plan of distribution; conflicts of interest.”
For additional information, see “Plan of Distribution (Conflicts of
Interest)” in the accompanying product
supplement.
(3)See
“Use of proceeds and hedging” on page 32.
The securities involve risks
not associated with an investment in ordinary debt securities. See
“Risk Factors” beginning on page 12.
The Securities and Exchange
Commission and state securities regulators have not approved or
disapproved these securities, or determined if this document or the
accompanying product supplement, index supplement and prospectus is
truthful or complete. Any representation to the contrary is a
criminal offense.
The securities are not
deposits or savings accounts and are not insured by the Federal
Deposit Insurance Corporation or any other governmental agency or
instrumentality, nor are they obligations of, or guaranteed by, a
bank.
You should read this document
together with the related product supplement, index supplement and
prospectus, each of which can be accessed via the hyperlinks below.
Please also see “Additional Terms of the Securities” and
“Additional Information About the Securities” at the end of this
document.
As used in this document,
“we,” “us” and “our” refer to Morgan Stanley or MSFL, or Morgan
Stanley and MSFL collectively, as the context
requires.
Product Supplement for
Auto-Callable Securities dated November 16,
2020 Index
Supplement dated November 16, 2020
Prospectus dated November
16, 2020