This document will help you understand unit investment trusts (UITs), their features and costs, and how your Financial Advisor and Morgan Stanley are compensated when you buy a UIT.

Like mutual funds, UITs are securities that are offered through a disclosure document known as a prospectus. You should read the prospectus carefully before investing. You should also discuss your investment goals and objectives with your Financial Advisor. For additional information on UITs in general, you can visit educational Web sites, including those of the Securities and Exchange Commission (www.SEC.gov), Financial Industry Regulatory Authority (www.FINRA.org), the Securities Industry and Financial Markets Association (www.SIFMA.org) and the Investment Company Institute (www.ICI.org).

What is a UIT?
A UIT is a SEC-registered investment company that purchases a limited selection of bonds and/or equity securities according to a specific investment objective or strategy. Generally, a UIT’s portfolio is not actively traded and follows a "buy and hold" strategy, investing in a static portfolio of securities for a specified period of time. At the end of the specified period, the UIT terminates, all remaining portfolio securities are sold and the proceeds are paid to the investors.

UIT sponsors offer several different UITs that each seek a particular investment objective or follow an established investment strategy. In general, UIT sponsors offer successive "series" of each UIT - the offering period for each new series coincides with the time that the prior series terminates. This allows an investor to purchase successive series of a UIT with the same objective or strategy but with a new portfolio of securities. Investors can also reinvest the proceeds from one series and invest in a different series. Most UIT sponsors provide sale charge discounts (described below) for clients who choose to "rollover" or exchange the proceeds from one UIT series to another UIT series within the sponsor’s UIT offerings. Some UIT sponsors also offer sales charge discounts on rollovers or exchange from another sponsor’s UITs.

What are the Costs Associated with Investing in UITs
All UITs have fees and expenses. These costs, like all investing costs, are important to understand because they affect the return on your investment. UIT fees and expenses can be divided into those fees that relate to operation of the UIT, and those that relate to distribution of the UIT.

Sales Charges - UITs deduct a sales charge on your initial purchase amount. The sales charge is generally composed of three components. First, there is an initial sales charge applied to your purchase amount (equal to approximately 1.00% (100 bps)). Second, UITs generally charge a deferred sales charge. The deferred sales charge (equal to approximately 1.45% (145 bps)) is generally deducted in periodic installments following the end of the initial offering period. Finally, UITs generally charge a creation and development fee that compensates the UIT sponsor for creating and developing each UIT, including determining the UIT’s investment objective, investment policies, portfolio security selection and other administrative functions. The creation and development fee (generally 0.50% (50 bps)) is deducted at the end of the initial offering period. The above amounts may differ based on the duration of the UIT and based on the terms of each UIT sponsor’s prospectus terms.

Operating Expenses/Organization Costs - UITs make a charge against the UIT portfolio’s assets for amounts expended to organize the trust itself. UITs separately deduct for operating expenses, including portfolio supervision, bookkeeping, administrative costs and trading expenses. These amounts will vary by each UIT.

NOTE: Each UIT is different and may refer to their specific fees and charges by different names, or charge different amounts. The summary above is intended to be a general overview. You should review the terms of the prospectus for any UIT you intend to purchase.

Discounts to the Costs of Purchasing UITs

• UITs offer a provision similar to a mutual fund breakpoint whereby as the amount that you purchase increases, the maximum sales charge applied to your purchase is reduced. However, unlike with mutual funds, the sales charge discount generally only applies to purchases made by the same person (including the person’s spouse and children under age 21) on the same day through the same broker-dealer firm.
  For example, a typical maximum sales load for a 15 month equity UIT would be 2.95% for amounts invested up to $50,000. However, for amounts invested between $50,000 -$99,999, the sales load would be 2.70%; between $100,000 - $249,999, the sales load would be 2.45%; between $250,000 - $499,999, the sales load would be 2.20%; between $500,000 - $999,999, the sales load would be 1.95%; and amounts greater than $1,000,000, the sales load would be 1.40%.
• As referred to above, many UITs offer a 1.00% reduction in the sales charge if you invest in a UIT using termination proceeds from an earlier series of the same UIT or any other UIT from the same sponsor, or termination proceeds from another sponsor’s UIT. Certain UIT sponsor’s will offer similar sales charge reductions for exchanges between UITs from the same or different sponsors. Generally, you will only be eligible to receive the "rollover" discount if you reinvest the proceeds within 30 days of the date redeemed. Finally, if you are making use of the "rollover" discount, you generally will not also be able to take advantage of the quantity based discounts described above.

Please review the UIT prospectus carefully to determine if you may qualify for one of the above sales charge discounts.

How Morgan Stanley and your Financial Advisor are compensated when you buy UITs
UIT sponsors pay Morgan Stanley compensation when we sell their UITs. Morgan Stanley receives a portion of the maximum sales load described above, referred to as the dealer concession. For example, if the maximum sales charge is 2.95%, Morgan Stanley may receive as a dealer concession, up to 2.25%. The difference between the maximum sales charge and dealer concession is retained by the UIT sponsor. Just as the maximum sales charge declines with larger purchase amounts, the dealer concession that Morgan Stanley receives from the UIT sponsor also declines with larger purchases. Each UIT prospectus describes the applicable sales load and dealer concession for each different breakpoint. We pay a portion of the dealer concession to our Financial Advisors. In general, the portion of the dealer concession Morgan Stanley pays to our Financial Advisors (their payout rate) depends upon the type of pricing option and account you have established with us as well as the particular product you purchase. In addition, in general, the more overall revenue each Financial Advisor generates each year, the higher his or her payout rate.

For a more detailed discussion of how Morgan Stanley and your Financial Advisor are compensated for investments and services, please ask your Morgan Stanley Financial Advisor for a copy of our annual FYI brochure. Clients are always welcome to ask their Financial Advisor how he or she will be compensated for any unit investment trust transaction.

In addition to the dealer concession, UIT sponsors generally pay Morgan Stanley additional sales concessions based on the overall volume of UIT sales in a particular trust during the initial offering period. The sales volume required to be eligible to receive these additional amounts vary by UIT sponsor and by trust, and the additional amounts that Morgan Stanley may receive for such sales will also differ. Amounts may be up 0.15% (15 bps) in addition to the standard dealer concession. Morgan Stanley retains any additional volume-based concessions it receives and does not pay any portion of such amounts to your Financial Advisor.

A processing fee of $5.25 per transaction also applies.

Morgan Stanley's agreements with UIT sponsors
Morgan Stanley currently offers investors a broad spectrum of UIT products from three well known UIT sponsors - Van Kampen Funds, Inc., First Trust Portfolios LLP and Claymore Securities, Inc. Morgan Stanley may make additional UIT sponsors available in the future. In order to offer UITs through Morgan Stanley Financial Advisors, UIT sponsors are required to enter into a financial arrangement involving, among other things, payment of additional amounts to Morgan Stanley. The UIT’s sponsor make these payments (sometimes referred to as "revenue-sharing payments") in order to have the opportunity to distribute their UITs through Morgan Stanley’s retail sales force and to have access to Morgan Stanley’s branch offices, UIT department and sales desk personnel where they can, among other things, market the sponsor’s UIT offerings and educate Financial Advisors about UITs. In making these payments to Morgan Stanley, UIT sponsors also have the opportunity to have their UITs available on the Morgan Stanley’s order entry system.

Morgan Stanley negotiates these additional amounts separately with each sponsor and not all sponsors pay the same amount. Some sponsors make additional payments as a fixed amount payable monthly regardless of whether Morgan Stanley attains specific sales or asset targets. Other sponsors make an additional payment to Morgan Stanley on a fixed percentage of new UIT sales based on Morgan Stanley being a "preferred distributor". Please refer to each UIT prospectus for a description of each sponsor’s compensation practices to broker-dealers.

UIT sponsors make payments to Morgan Stanley from the portion of the maximum sales load the sponsor does not pay to distributors as the dealer concession, and other corporate assets that may be derived from profits on other fees and charges it receives from sponsoring and operating the UIT, including the creation and development fee.

Currently, all UIT sponsor’s offered by Morgan Stanley make these additional payments. Morgan Stanley may offer new UIT sponsor’s products in the future subject to different compensation arrangements than the current arrangements.

Conferences
Financial Advisors may qualify to attend conferences on the basis of their sale of all UITs offered through Morgan Stanley. At such conferences, Financial Advisors participate in programs and receive information with respect to UIT sponsors. UIT Sponsors, which may include Van Kampen UITs and other UIT sponsors pay for all or a portion of the costs associated with such conferences, including the qualifying Financial Advisors' expenses for travel and accommodations.

Van Kampen UITs
Van Kampen Funds Inc. is the sponsor of Van Kampen UITs offered by Morgan Stanley. Van Kampen Funds Inc. is a wholly owned subsidiary of Van Kampen Investments Inc, which is an indirect wholly owned subsidiary of Morgan Stanley & Co. Incorporated. Morgan Stanley Financial Advisors are paid the same portion of the dealer concession Morgan Stanley receives on sales of Van Kampen UITs as other sponsor’s UITs. Notwithstanding, Financial Advisors may have a conflict of interest in that sales of a Van Kampen UIT will result in the sponsor, Van Kampen, an affiliate of Morgan Stanley, receiving revenue.

Risk considerations
There is no assurance the trust will achieve its investment objective. An investment in this unit investment trust is subject to market risk, which is the possibility that the market values of securities owned by the trust will decline and that the value of trust units may therefore be less than what you paid for them. This trust is unmanaged and its portfolio is not intended to change during the trust’s life except in limited circumstances. Accordingly, you can lose money investing in this trust.

You should consider this trust as part of a long term investment strategy and you should consider your ability to pursue it by investing in successive trusts, if available. You will encounter tax consequences associated with reinvesting from one trust to another.

Clients should consult with their tax advisors before making any tax-related investment decisions, as Morgan Stanley and its Financial Advisors do not provide tax advice.

Investments and services are offered through Morgan Stanley & Co. Incorporated, member SIPC.

The information in this Bill of Rights is as of August 31, 2007. For additional and the most current information regarding these payments visit our website at www.morganstanleyindividual.com or call your Financial Advisor.

© 2007 Morgan Stanley