Morgan Stanley SEC Filings

The prospectus supplement describes Trigger PLUS securities issued by Morgan Stanley Finance LLC and guaranteed by Morgan Stanley that pay no interest and do not guarantee principal. Payout at maturity is determined solely by the worst performing underlier among the S&P 500, Nasdaq-100 and Dow Jones Industrial Average. If the worst performing underlier finishes above its initial level, investors receive principal plus 138% of that underlier's appreciation. If the worst performing underlier finishes at or above a downside threshold but not above the initial level, investors receive only principal. If the worst performing underlier finishes below the downside threshold, investors lose 1% of principal for each 1% decline in that underlier; there is no minimum payment. The securities are unsecured, subject to issuer credit risk, not exchange listed, may be illiquid, have uncertain U.S. federal tax treatment, and rely on Morgan Stanley affiliate MS&Co. as calculation agent.

Morgan Stanley Finance LLC (MSFL) is offering $510,000 aggregate principal amount of Fixed-Income Auto-Callable Securities due July 13, 2028, linked to the worst performer of KKR & Co. Inc. (KKR) and Dow Inc. (DOW) common stock. The notes are unsecured obligations of MSFL and are fully and unconditionally guaranteed by Morgan Stanley; repayment therefore depends on Morgan Stanley’s creditworthiness.

Key economic terms

• Issue price: $1,000 per note; CUSIP 61778NGW5; ISIN US61778NGW56
• Estimated value at pricing: $952.70 (4.7 % below issue price, reflecting fees and internal funding rate)
• Coupon: 11.10 % fixed annual rate, paid monthly, regardless of underlier performance until redemption/maturity
• Automatic early redemption: possible on ten quarterly determination dates beginning Jan 8 2026 if each underlier closes ≥ its call threshold (100 % of initial level). Early redemption pays principal plus accrued coupon; no further payments thereafter.
• Downside protection: none below 50 % of initial level. If not called and the final level of either underlier is < 50 % of its initial level, principal is reduced 1 % for every 1 % decline of the worst performer, down to zero.
• Initial levels: KKR $143.05; DOW $30.23. Thus downside thresholds are $71.525 and $15.115 respectively; call thresholds equal the initial levels.
• Liquidity: not listed; MS & Co. may make a secondary market but is not obliged to do so.

Risk / return profile

• Investors receive high fixed coupons and potential early return of capital if both stocks stay at or above current levels.
• Investors forfeit upside in either stock and face full downside exposure below the 50 % barrier; the final payoff depends solely on the worst-performing stock.
• The notes’ value will be sensitive to equity volatility, correlation, interest-rate moves, dividends, and Morgan Stanley credit spreads.
• Because the estimated value is below issue price and the notes embed dealer compensation of $25 per note, secondary prices are expected to trade below par, absent favorable market moves.

Structural considerations

• First possible call occurs roughly six months after issuance; investors are locked in until then.
• Principal is at risk; there is no minimum repayment.
• Tax treatment is uncertain; counsel believes the securities should be treated as a combination of a deposit and a written put option, but the IRS could disagree.
• Aggregate size is modest for Morgan Stanley (<$1 million including fees), suggesting limited impact on the issuer’s financials.

Overall, the product targets yield-seeking investors willing to trade equity upside and principal protection for a double-trigger high coupon, accepting issuer credit risk and potentially severe capital loss if either KKR or DOW falls more than 50 % by July 2028.

Offering overview: Morgan Stanley Finance LLC is issuing $250,000 of Jump Securities with an auto-callable feature maturing 13 July 2028. Each $1,000 note is fully and unconditionally guaranteed by Morgan Stanley, but is principal-at-risk and pays no periodic interest.

Underlying assets: Apple (AAPL), Alphabet Class A (GOOGL), UnitedHealth Group (UNH) and the SPDR S&P Biotech ETF (XBI). Performance is assessed on a worst-of basis; therefore a sharp decline in any single underlier drives the entire payoff.

Key strike data (10 July 2025): Initial levels AAPL $211.14, GOOGL $176.62, UNH $302.91, XBI $87.87. Call thresholds are set at 100 % of these levels; downside thresholds are 90 %.

Early redemption schedule: 24 monthly determination dates starting 14 July 2026. If every underlier closes at or above its call threshold on a determination date, the note is automatically redeemed for the corresponding cash amount that equates to an approx. 47.40 % simple annual return (e.g., $1,474 on the first date, rising to $2,382.50 by the 24th).

Maturity payment (if not previously called): • $2,422 (142.2 % of par) if all underliers ≥ call thresholds. • Par ($1,000) if any underlier < call threshold but all ≥ downside thresholds. • $1,000 × worst-performing underlier’s performance factor if any underlier < downside threshold – exposing investors to losses of up to 100 % of principal.

Pricing economics: Issue price $1,000; estimated value on pricing date $958.70, reflecting issuer funding spreads and embedded distribution costs. Agent commissions total $2.50 per note (0.25 %). Notes will not be listed; liquidity will rely on Morgan Stanley & Co. making a secondary market.

Risk highlights: 1) No principal protection; downside begins if any underlier falls >10 %. 2) Investors forgo all upside beyond the fixed early-redemption or maturity payment. 3) Credit exposure to Morgan Stanley and MSFL. 4) Biotech sector concentration via XBI raises volatility. 5) Complex tax treatment; potential Section 1260 constructive-ownership implications. 6) Secondary market prices likely to be below issue price due to bid/ask and credit spread effects.

Investor profile: Suitable only for fee-based advisory accounts willing to trade higher credit and market risk for the possibility of double-digit fixed returns, and who can analyze multi-asset worst-of structures.

Morgan Stanley Finance LLC is offering Contingent Income Memory Buffered Auto-Callable Securities due August 1 2030 linked to the S&P® U.S. Equity Momentum 40% VT 4% Decrement Index (ticker: SPUMP40). The $1,000-denominated notes are principal-at-risk, unsecured and unlisted obligations of MSFL, fully and unconditionally guaranteed by Morgan Stanley.

Key economic terms

• Contingent coupon: at least 8.28% p.a. (actual rate set on July 29 2025) paid quarterly only if the index closes ≥ 70 % of the initial level (coupon barrier). Missed coupons “memory” and may be paid later if the barrier is met.
• Automatic early redemption: from July 29 2026 and monthly thereafter; triggered if the index closes ≥ 85 % of the initial level (call threshold). Early redemption pays par plus the current and any unpaid coupons.
• Buffer: 15 %. If held to maturity and the final index level is < 85 % of the initial level, investors lose 1 % of principal for every 1 % decline beyond the buffer, subject to a minimum payment of 15 % of par.
• Estimated value: ≈ $905.70 on the pricing date, reflecting dealer margins and an internal funding rate that is “advantageous to the issuer.”
• Issue/strike date: July 29 2025  |  Maturity: August 1 2030  |  CUSIP: 61778NLY5  |  Not exchange-listed.

Investor profile The notes suit investors seeking enhanced income and limited downside protection who can tolerate: (1) full exposure to index losses below the 15 % buffer; (2) the possibility of receiving no coupons for the entire 5-year term; (3) credit risk of Morgan Stanley; and (4) limited secondary market liquidity.

Risk highlights

• No regular interest; contingent on index level at discrete dates.
• Principal at risk below the buffer; payment at maturity may be as low as $150 per $1,000.
• Secondary market value expected to be below issue price given the $94-premium to estimated value and bid-offer spreads.
• Underlying index launched March 14 2022; limited live history and incorporates a 4 % annual decrement and 40 % volatility target, adding complexity and drag on performance.
• Tax treatment uncertain; coupons expected to be ordinary income and may be subject to 30 % withholding for non-U.S. holders.

Structural mechanics A quarterly observation calendar begins August 29 2025 and runs through July 29 2030. If the notes are not called, investors receive the contingent coupon for the final period plus principal adjusted for index performance and buffer.

Credit & distribution MS&Co. acts as agent and calculation agent, will receive a fixed selling concession (amount TBD) and may hedge positions in the underlying futures, potentially affecting secondary prices. Client accounts over which Morgan Stanley has discretion cannot purchase the notes.

Overall, the product offers the potential for above-market coupons and a 15 % loss-buffer, balanced against meaningful tail risk, dependence on a new index, and the structural discount embedded in the issue price.