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BANK DEPOSIT PROGRAM DISCLOSURE STATEMENTinvestment in the Fund is not insured or guaranteedby the Federal Deposit Insurance Corporation orany other government agency. The Fund’s sponsorhas no legal obligation to provide financial supportto the Fund, and you should not expect that thesponsor will provide financial support to the Fundat any time. You may also obtain a prospectusfrom us or from Morgan Stanley InvestmentManagement at www.morganstanley.com/funds/MGPXX. Please read the prospectus carefullybefore investing or sending money.You may contact us to block deposits toMorgan Stanley Bank or Morgan Stanley PrivateBank, or to the Sweep Fund. If you do block depositsto either Morgan Stanley Bank or Morgan StanleyPrivate Bank, the total deposit amount at theremaining Sweep Bank will be the Deposit Maximum.If you block deposits to the Sweep Fund, then yourfree credit balance will sweep to the Sweep Bankspursuant to the deposit procedures for the SweepBanks as outlined above, and the Deposit Maximumwill not apply.Withdrawal ProceduresGenerally, all withdrawals necessary to satisfy debitsin your Account will be made from your DepositsAccounts at a Sweep Bank by Morgan Stanley, asyour agent. A debit in your Account could arise if,for example, you make a securities purchase or, if youwithdraw funds, or if applicable, you write a check,or use your debit card to make purchases or makepayments pursuant to bill payment services.Funds from your Deposit Accounts will bewithdrawn on a “last in, first out” basis, which meansthat funds will be withdrawn from the Sweep Banks inthe reverse order from which the funds were deposited.For accounts with a Sweep Fund, all withdrawalsnecessary to satisfy debits from your Account will bemade by Morgan Stanley, as your agent, first from4MORGAN STANLEYyour Sweep Fund. If there are not enough funds inyour Sweep Fund to satisfy debits or charges in yourAccount, Morgan Stanley, as your agent, will thenmake the necessary withdrawals from your DDA at aSweep Bank as described above.Interest on the Deposit AccountsGENERAL INFORMATIONInterest rates on the Deposit Accounts are variable.Morgan Stanley and the Sweep Banks reserve the rightto change the interest rates or the methodology usedto determine the interest rates on Deposit Accounts intheir sole discretion and without prior notice to you.Interest rates are set on a weekly basis but may be setmore or less frequently. The interest rate is generallybased on a variety of factors, including, but not limitedto, current market conditions and competitive interestrates. Morgan Stanley’s ability to influence the interestrate on your Deposit Accounts presents a conflictof interest. Please refer to the “Conflicts of Interest”section below for more information.Funds deposited into Deposit Accounts at a SweepBank will begin to accrue interest on the business dayof receipt by the Sweep Bank up to, but not including,the day of withdrawal. Morgan Stanley as your agentwill generally deposit cash in your Deposit Accounts ata Sweep Bank on the first business day after the cash isreceived in your Account.Interest will be compounded daily and creditedmonthly to your Deposit Accounts at a Sweep Bank.Interest will be credited on the last business day ofthe month (and if the last business day is not the lastcalendar day, interest is calculated through the lastcalendar day of the month). The Sweep Banks use thedaily balance method to calculate interest on yourDeposit Accounts. This method applies a daily periodicrate to the principal in the Deposit Accounts each day.The interest rates applicable to your DepositAccounts at the Sweep Banks may be higher or lower

BANK DEPOSIT PROGRAM DISCLOSURE STATEMENTthan the interest rates available on other depositaccounts offered by a Sweep Bank or on depositaccounts offered by other depository institutions. Youshould compare the terms, interest rates, requiredminimum amounts and other features of the DepositAccounts with other deposit accounts and alternativecash investments. You may obtain informationregarding the current interest rates and interest ratetiers, as well as money fund yields, by contacting us,or by accessing Morgan Stanley’s public website es/ratemonitor.html.INTEREST RATES AND TIERSFor eligible Accounts, the interest rates on DepositAccounts will be tiered (“Tiered Rates”) based uponthe value of Total Deposit Balances in your BDPPricing Group. Total Deposit Balances is the value ofall deposits (including deposits in the Bank DepositProgram and in the Morgan Stanley Savings Program)across all Accounts in your BDP Pricing Group(as defined below). Currently, there are six interestrate tiers: 2,000,000 or greater 1,000,000 to 1,999,999.99 500,000 to 999,999.99 250,000 to 499,999.99 100,000 to 249,999.99 Less than 100,000.00The current yield paid by the Sweep Fund willbe among the factors used to determine the interestrate for the highest interest rate tier. Morgan Stanleyand the Sweep Banks reserve the right to change theinterest rates and interest rate tiers. There may beno difference in the interest rates on different tierson any given day. The interest rates set by the SweepBanks and the Sweep Fund yield may differ fromtime to time. Morgan Stanley and its affiliates do notguarantee that the interest rates and yield willbe identical.In general, the greater the value of your TotalDeposit Balances, the higher the interest rate on yourDeposit Accounts.We will determine the value of Total DepositBalances each week (the “Valuation Date”) and ourvaluation will be final. If a change in the value ofyour Total Deposit Balances causes you to move fromone interest rate tier to another interest rate tier, yourDeposit Accounts will earn interest at the rate in yournew tier beginning no later than the first business dayfollowing the subsequent Valuation Date.The interest rate tier for your Deposit Accounts willbe determined by aggregating Total Deposit Balancesin all applicable accounts in your BDP Pricing Group.A BDP Pricing Group is a group of Accounts withina household that have the same address. Accountsutilizing the same Social Security number or taxidentification number in a household may also beincluded in a BDP Pricing Group even if the Accountaddress is different from other Accounts.Certain Accounts can be included in a householdif the Account owner lives with the head of householdand/or qualifies based on his/her familial relationshipto the head of household.Eligible family relationships include spouse (ordomestic partner), children, parents and grandparentsof the head of household.There are restrictions on what Account types can andcannot be grouped together in a BDP Pricing Group.These include, but are not limited to, employee benefitplan accounts, irrevocable trusts, IRAs and businessAccounts. There are also Account types where consentmay be required to include an account in a BDP PricingGroup including, for example, non-ERISA retirementaccounts (i.e., retirement plans that cover only ownerand/or spouse) and family/solely owned entity accounts.MORGAN STANLEY5

BANK DEPOSIT PROGRAM DISCLOSURE STATEMENTYou may consult with us to determine whetherall eligible Accounts have been included in yourhousehold and/or BDP Pricing Group. It is yourresponsibility to ensure that all eligible Accountsare included in your household and/or BDPPricing Group.We reserve the right to modify our eligibilityrequirements and method of calculating a BDP PricingGroup at any time, including the right to modify thedefinition of Total Deposit Balances without notice.Credited Interest Rebalancing at the Sweep BanksIf, on the last day of any month, the interest creditedto your Deposit Accounts at a Sweep Bank hascaused your deposits to exceed the Deposit Limit,Morgan Stanley, as your agent, may withdraw theexcess from that Sweep Bank and deposit it into theother Sweep Bank. For example, with respect to anAccount owned by an individual, if, at the end of amonth, you maintain deposit balances of 245,000 inyour Deposit Accounts at Morgan Stanley Bank and 15,000 in your Deposit Accounts at Morgan StanleyPrivate Bank, the amount of any interest credited toyour Deposit Accounts at Morgan Stanley Bank forthe month would be transferred by Morgan Stanley,as your agent, to your Deposit Accounts atMorgan Stanley Private Bank. When the DepositLimit at Morgan Stanley Private Bank is reached,the amount of any interest credited to your DepositAccounts at Morgan Stanley Private Bank for themonth would be transferred by Morgan Stanley,as your agent, to your Deposit Accounts atMorgan Stanley Bank so that no more than theDeposit Limit is on deposit at Morgan Stanley PrivateBank. In this example, Morgan Stanley would not,however, transfer to Morgan Stanley Private Bankthe amount of any interest credited to your Deposit6MORGAN STANLEYAccounts at Morgan Stanley Bank, due to the factthat, for individual Accounts, no more than theDeposit Limit can be deposited at Morgan StanleyPrivate Bank. Please refer to the “Deposit Procedures”section above for more information.Fee to Morgan StanleyThe Sweep Banks will pay Morgan Stanley an annualaccount-based flat fee for the services performedby Morgan Stanley with respect to the Program.Morgan Stanley and the Sweep Banks will reviewthe fee annually and, if applicable, mutually agreeupon any changes to the fee. The fee received byMorgan Stanley may affect the interest rate paid bythe Sweep Banks on your Deposit Accounts. YourFinancial Advisor or Private Wealth Advisor mayreceive credit of up to 0.10% of the average dailydeposit balance in your Deposit Accounts if you meetcertain criteria. Your Financial Advisor will not receivethe foregoing fees or credits for Managed Accounts.The asset-based fee charged on Managed Accountassets, includes cash held in the Program. Affiliates ofMorgan Stanley may also receive a financial benefitin the form of credit allocations made for financialreporting purposes.No other charges, fees or commissions will beimposed on your Account as a result of, or otherwise inconnection with, the Program.Our affiliate, Morgan Stanley InvestmentManagement (“MSIM”), serves as the investmentadviser to the Sweep Fund. Morgan Stanley receivesrevenue-sharing compensation from MSIM based onthe amount of Sweep Fund assets held by clients inBrokerage Accounts of up to 0.25% per year ( 25 per 10,000 of assets). This fee is not assessed on positionsheld by clients in Managed Accounts.

BANK DEPOSIT PROGRAM DISCLOSURE STATEMENTConflicts of Interest and Benefits toInformation about YourMorgan Stanley, the Sweep Banks and Deposit AccountsTheir AffiliatesYour account statement from Morgan Stanley willMorgan Stanley, the Sweep Banks and their affiliatesmay receive other financial benefits in connection withthe Program.Through the Program, each Sweep Bank will receivea stable, cost-effective source of funding. Each SweepBank intends to use deposits in the Deposit Accountsit holds to fund current and new businesses, includinglending activities and investments. The profitability ofsuch loans and investments is generally measured bythe difference, or “spread,” between the interest ratepaid on the Deposit Accounts at the Sweep Bank andother costs of maintaining the Deposit Accounts, andthe interest rate and other income earned by the SweepBank on those loans and investments made with thefunds in the Deposit Accounts. The income that aSweep Bank earns through its lending and investingactivities may be greater than the fees earned byMorgan Stanley and its affiliates from managing anddistributing the Sweep Fund or other money marketmutual funds available to you as a sweep investment.MarginFunds in the Deposit Accounts cannot be used formargin purposes. Funds in the Sweep Fund, however,can be used for margin purposes. If you wish to utilizeyour full cash balance for margin purposes, you mustselect an alternative sweep investment, if available, oruse your free credit balance to purchase an investmentthat can be used for margin purposes.reflect the balances in the Deposit Account(s) at eachSweep Bank and the Sweep Fund. Your Accountstatement will also show activity in Deposit Accounts,the total of your opening and closing DepositAccount balances, and the interest earned for theperiod beginning on the last business day of the priormonth (or, in the case of quarterly statements, the lastbusiness day of the month prior to the first month ofthe quarter) up to, but not including, the last businessday of the statement period. If, after electing theProgram, your funds are first swept on the next to lastbusiness day of the month, the interest earned on thatday will be reflected in your next account statement.Morgan Stanley is responsible for the accuracy of youraccount statements, not the Sweep Banks.All statements will be considered conclusive andbinding unless you object in writing within 10 daysof receiving your account statement. We can assist youin understanding your statement and can respond toany questions you may have. You should retain youraccount statements for your records.Amendments to the Program andAdditional Depository Institutions orMoney Market Mutual FundsMorgan Stanley, at its discretion, may modify theterms, conditions and procedures of the Program with30 days’ prior written notice to you. All such noticesmay be made by means of a letter, an entry on youraccount statement or by other means. In addition,other depository institutions, or alternative moneymarket mutual sweep funds, may be added at anyMORGAN STANLEY7

BANK DEPOSIT PROGRAM DISCLOSURE STATEMENTtime to the Program and one or more of the existingSweep Banks or Sweep Funds may be removed. IfMorgan Stanley adds depository institutions or moneymarket mutual sweep funds to the Program or changesthe deposit and withdrawal procedures, you will benotified prior to your funds being deposited with thatdepository institution, or swept into such fund, or priorto the implementation of any change to the depositand withdrawal procedures. In the event a depositoryinstitution is added to the Program, you authorizeMorgan Stanley to withdraw funds from yourDeposit Accounts at the Sweep Banks in excess of theDeposit Limit and deposit the funds in the DepositAccounts that are established at the additionaldepository institution.If FDIC deposit insurance limits are changed,Morgan Stanley may adjust the Deposit Limit withoutprior notice to you. You will be informed of suchchange by a posting on our website and a confirmingletter or an entry on your Account statement or byother means. If Morgan Stanley changes the DepositLimit pursuant to this paragraph, we may move yourfunds from one Sweep Bank to another Sweep Bank inorder to reflect the change in the Deposit Limit.If a Sweep Bank in which you have DepositAccounts ceases to participate in the Program,you will be notified by Morgan Stanley and giventhe opportunity to establish a direct depositoryrelationship with the Sweep Bank (subject to the rulesand requirements of that sweep bank with respectto establishing and maintaining deposit accounts).The consequences of maintaining a direct depositoryrelationship with a Sweep Bank are discussed belowunder “Your Relationship With Morgan Stanley andthe Sweep Banks.” If you choose not to establish adirect depository relationship with the Sweep Bank,your funds will be withdrawn from the Sweep Bank8MORGAN STANLEYand redeposited with the remaining Sweep Bank and/or other depository institution, as applicable.Your Relationship WithMorgan Stanley and the Sweep BanksThe Program is being offered to you byMorgan Stanley, acting as your agent and custodian inestablishing the Deposit Accounts at each Sweep Bankand depositing funds into, withdrawing funds fromand transferring funds among the Deposit Accountsat each Sweep Bank. Therefore, all transactions,including, if applicable, checks written on yourAccount and charges on your Morgan Stanley DebitCard, are effected through Morgan Stanley, as youragent and custodian, and are not effected directly byyou at the Sweep Banks. As a condition to participatein the Program, the Sweep Banks have, however,contractually agreed to provide Morgan Stanleywith Account records relating to IRA and ERISAAccounts. No evidence of ownership, such as apassbook or certificate, will be issued to you. DepositAccount ownership will be evidenced by a book entryin one or more master deposit accounts establishedby Morgan Stanley and maintained on the accountrecords of the Sweep Banks. Your Deposit Accountsat each Sweep Bank will be evidenced by recordsmaintained by Morgan Stanley as your agent andcustodian. Morgan Stanley may, in its sole discretion,terminate your participation in the Program at anytime upon written notice to you. You may, at any time,terminate your participation in the Program.If your Account sweeps to the Sweep Fund, thentermination of your participation in the Program willalso terminate the Sweep Fund investment. You maycontact us to invest your funds in an alternative moneymarket mutual fund, subject to eligibility.

BANK DEPOSIT PROGRAM DISCLOSURE STATEMENTIf either you or Morgan Stanley terminates yourparticipation in the Program, you may requestand establish a direct depository relationship witha Sweep Bank, subject to the Sweep Bank’s rulesand requirements with respect to establishing andmaintaining accounts. This will result in yourmaintaining deposit accounts that are separate fromyour Account. Morgan Stanley will have no furtherobligation with respect to such deposit accounts andthe interest paid on those deposits may be differentfrom what you would have otherwise earned in theProgram. In the alternative, if you wish to discontinueusing our brokerage services, but want to continueholding funds in the Sweep Bank(s) through theProgram and earning interest on the deposits in theSweep Bank(s), you can contact your Financial Advisoror Private Wealth Advisor to waive any annual orperiodic Brokerage Account fees. Such fees will bereinstated if or when you choose to use brokerageservices again. If your Account sweeps to the SweepFund, and you discontinue using our brokerageservices, then you will not be able to invest your fundsin any money market mutual fund.Each Deposit Account at each Sweep Bankconstitutes an obligation of the Sweep Bank and is notdirectly or indirectly an obligation of Morgan Stanley.You can obtain publicly available financial informationconcerning each Sweep Bank at www.ffiec.gov/nicpubweb/nicweb/nichome.aspx or by contactingthe FDIC Public Information Center by mail at 3501North Fairfax Drive, Arlington, VA 22226, or byphone at 1-877-275-3342. Morgan Stanley does notguarantee in any way the financial condition of aSweep Bank or the accuracy of any publicly availablefinancial information concerning a Sweep Bank.FDIC InsuranceGeneral InformationFunds in the Deposit Accounts at each Sweep Bank areinsured by the FDIC, an independent agency of the U.S.government, up to the Maximum Applicable InsuranceLimit (including principal and accrued interest) perdepositor when aggregated with all other deposits heldby you in the same insurable capacity at the Sweep Bank.The Maximum Applicable Insurance Limit is currently 250,000 for each insurable capacity. Generally, anyaccounts or deposits that you may maintain directly witha Sweep Bank, or through any other intermediary in thesame insurable capacity in which the Deposit Accountsare maintained, would be aggregated with the Accountsfor purposes of the Maximum Applicable InsuranceLimit. Your funds become eligible for FDIC insuranceimmediately upon deposit in a Deposit Account at aSweep Bank. A

Bank") up to the Deposit Limit at your Secondary Sweep Bank. Once your deposits reach the Deposit Limit at both the Primary and Secondary Sweep Banks, any free credit balance will be deposited into the Deposit Accounts at the Primary Sweep Bank, up to the Deposit Maximum, even if the amounts in the Deposit Accounts at the Primary Sweep Bank .