Morgan Stanley plans contingent income autocallables on Starbucks

By Susanna Moon

Chicago, April 25 - Morgan Stanley plans to price contingent income autocallable securities due May 2016 linked to Starbucks Corp. shares, according to an FWP with the Securities and Exchange Commission.

The notes will pay a contingent quarterly coupon of 2.15% to 2.65% if Starbucks stock closes at or above the 80% barrier level on the determination date for that quarter. The exact percentage will be set at pricing.

If the shares close at or above the redemption threshold level on any of the first 11 quarterly determination dates, the notes will be called at par plus the contingent coupon. The redemption level will be 105% of the initial share price for the first four redemption dates, 110% of the initial share price for the next four redemption dates and 115% of the initial share price after that.

If Starbucks stock finishes at or above the 80% trigger level, the payout at maturity will be par plus the contingent payment.

Otherwise, investors will receive a number of shares of Starbucks stock equal to $10 divided by the initial share price or, at the issuer's option, the cash value of those shares.

Morgan Stanley & Co. LLC is the agent.

The notes will price in April and settle in May.

The Cusip number is 61762E208.

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