EXHIBIT 4-i


                           [FORM OF FACE OF SECURITY]
                         FLOATING RATE SUBORDINATED NOTE


REGISTERED                                             REGISTERED
No. FLR                                                [PRINCIPAL AMOUNT]
                                                       CUSIP:

     Unless this certificate is presented by an authorized representative of The
Depository Trust Company (55 Water Street, New York, New York) to the issuer or
its agent for registration of transfer, exchange or payment, and any certificate
issued is registered in the name of Cede & Co. or such other name as requested
by an authorized representative of The Depository Trust Company and any payment
is made to Cede & Co., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL since the registered owner hereof,
Cede & Co., has an interest herein.(1)

     THESE SECURITIES ARE NOT INSURED OR PROTECTED BY THE SECURITIES INVESTOR
PROTECTION CORPORATION OR ANY OTHER GOVERNMENTAL AGENCY.







-----------------------
     (1) Applies only if this Note is a Registered Global Security.


<PAGE>


                                 MORGAN STANLEY
                 SUBORDINATED GLOBAL MEDIUM-TERM NOTE, SERIES F
                                 (Floating Rate)

--------------------------------------------------------------------------------
BASE RATE:                 ORIGINAL ISSUE DATE:          MATURITY DATE:
--------------------------------------------------------------------------------
INDEX MATURITY:            INTEREST ACCRUAL DATE:        INTEREST PAYMENT
                                                            DATE(S):
--------------------------------------------------------------------------------
SPREAD (PLUS OR MINUS):    INITIAL INTEREST RATE:        INTEREST PAYMENT
                                                            PERIOD:
--------------------------------------------------------------------------------
SPREAD MULTIPLIER:         INITIAL INTEREST RESET DATE:  INTEREST RESET PERIOD:
--------------------------------------------------------------------------------
REPORTING SERVICE:         MAXIMUM INTEREST RATE:        INTEREST RESET
                                                            DATE(S):
--------------------------------------------------------------------------------
INDEX CURRENCY:            MINIMUM INTEREST RATE:        CALCULATION AGENT:
--------------------------------------------------------------------------------
EXCHANGE RATE AGENT:       INITIAL REDEMPTION DATE:      SPECIFIED CURRENCY:
--------------------------------------------------------------------------------
                           INITIAL REDEMPTION            IF SPECIFIED CURRENCY
                              PERCENTAGE:                   OTHER THAN U.S.
                                                            DOLLARS, OPTION TO
                                                            ELECT PAYMENT IN
                                                            U.S. DOLLARS:
                                                            [YES](2)
--------------------------------------------------------------------------------
                           ANNUAL REDEMPTION PERCENTAGE  DESIGNATED CMT
                              REDUCTION:                    TELERATE PAGE:
--------------------------------------------------------------------------------
                           OPTIONAL REPAYMENT DATE(S):   DESIGNATED CMT
                                                            MATURITY INDEX:
--------------------------------------------------------------------------------
                           REDEMPTION NOTICE PERIOD:(3)
--------------------------------------------------------------------------------
                           TAX REDEMPTION AND PAYMENT
                              OF ADDITIONAL AMOUNTS:
                              NO(4)
--------------------------------------------------------------------------------
                           IF YES, STATE INITIAL         OTHER PROVISIONS:
                              OFFERING DATE:  N/A
--------------------------------------------------------------------------------

     Morgan Stanley, a Delaware corporation (together with its successors and
assigns, the "Issuer"), for value received, hereby promises to pay
to,                      or registered assignees, the principal sum of [    ] on
the Maturity Date specified above (except to the extent redeemed or repaid prior
to maturity) and to pay interest thereon from and including the Interest Accrual
Date specified above at a rate per annum equal to the Initial Interest Rate
specified above or determined in accordance with the provisions specified on the
reverse hereof until the Initial Interest Reset Date specified above, and
thereafter at a rate per annum determined in accordance with the provisions
specified on the reverse hereof until the principal hereof is paid or duly made


-----------------------------
     (2) Applies if this is a Registered Global Security, unless arrangements
are made with DTC outside of existing Letters of Representations, as has been
the case in the past.

     (3) Applicable if other than 30-60 calendar days. If this is a Registered
Global Security, minimum notice period is [10] calendar days [current DTC
limitation].

     (4) Default provision is NO. Indicate YES only for certain notes issued on
a global basis if specified in pricing supplement.


                                       2
<PAGE>


available for payment. Unless such rate is otherwise specified on the face
hereof, the Calculation Agent shall determine the Initial Interest Rate for this
Note in accordance with the provisions specified on the reverse hereof. The
Issuer will pay interest in arrears weekly, monthly, quarterly, semiannually or
annually as specified above as the Interest Payment Period on each Interest
Payment Date (as specified above), commencing with the first Interest Payment
Date next succeeding the Interest Accrual Date specified above, and on the
Maturity Date (or any redemption or repayment date); provided, however, that if
the Interest Accrual Date occurs between a Record Date, as defined below, and
the next succeeding Interest Payment Date, interest payments will commence on
the second Interest Payment Date succeeding the Interest Accrual Date to the
registered holder of this Note on the Record Date with respect to such second
Interest Payment Date; and provided, further, that if an Interest Payment Date
(other than the Maturity Date or redemption or repayment date) would fall on a
day that is not a Business Day, as defined on the reverse hereof, such Interest
Payment Date shall be the following day that is a Business Day, except that if
the Base Rate specified above is LIBOR or EURIBOR and such next Business Day
falls in the next calendar month, such Interest Payment Date shall be the
immediately preceding day that is a Business Day; and provided, further, that if
the Maturity Date or redemption or repayment date would fall on a day that is
not a Business Day, such payment shall be made on the following day that is a
Business Day and no interest shall accrue for the period from and after such
Maturity Date or redemption or repayment date.

     Interest on this Note will accrue from and including the most recent date
to which interest has been paid or duly provided for, or, if no interest has
been paid or duly provided for, from and including the Interest Accrual Date,
until but excluding the date the principal hereof has been paid or duly made
available for payment. The interest so payable, and punctually paid or duly
provided for, on any Interest Payment Date will, subject to certain exceptions
described herein, be paid to the person in whose name this Note (or one or more
predecessor Notes) is registered at the close of business on the date 15
calendar days prior to such Interest Payment Date (whether or not a Business
Day) (each such date, a "Record Date"); provided, however, that interest payable
at maturity (or any redemption or repayment date) will be payable to the person
to whom the principal hereof shall be payable.

     Payment of the principal of and premium, if any, and the interest on this
Note due at maturity (or any redemption or repayment date), unless this Note is
denominated in a Specified Currency other than U.S. dollars and is to be paid in
whole or in part in such Specified Currency, will be made in immediately
available funds upon surrender of this Note at the office or agency of the
Paying Agent, as defined on the reverse hereof, maintained for that purpose in
the Borough of Manhattan, The City of New York, or at such other paying agency
as the Issuer may determine, in U.S. dollars. U.S. dollar payments of interest,
other than interest due at maturity or any date of redemption or repayment, will
be made by U.S. dollar check mailed to the address of the person entitled
thereto as such address shall appear in the Note register. A holder of U.S.
$10,000,000 (or the equivalent in a Specified Currency) or more in aggregate
principal amount of Notes having the same Interest Payment Date, the interest on
which is payable in U.S. dollars, shall be entitled to receive payments of
interest, other than interest due at maturity or on any date of redemption or
repayment, by wire transfer of immediately available funds if appropriate wire
transfer instructions have been received by the Paying Agent in writing not less
than 15 calendar days prior to the applicable Interest Payment Date.


                                       3
<PAGE>


     If this Note is denominated in a Specified Currency other than U.S.
dollars, and the holder does not elect (in whole or in part) to receive payment
in U.S. dollars pursuant to the next succeeding paragraph, payments of
principal, premium, if any, and interest with regard to this Note will be made
by wire transfer of immediately available funds to an account maintained by the
holder hereof with a bank located outside the United States if appropriate wire
transfer instructions have been received by the Paying Agent in writing [not
less than 15 calendar days prior to the applicable payment date](5) [, with
respect to payments of interest, on or prior to the fifth Business Day after the
applicable Record Date and, with respect to payments of principal or any
premium, at least ten Business Days prior to the Maturity Date or any redemption
or repayment date, as the case may be];(6) provided that, if payment of
interest, principal or any premium with regard to this Note is payable in euro,
the account must be a euro account in a country for which the euro is the lawful
currency, provided, further, that if such wire transfer instructions are not
received, such payments will be made by check payable in such Specified Currency
mailed to the address of the person entitled thereto as such address shall
appear in the Note register; and provided, further, that payment of the
principal of this Note, any premium and the interest due at maturity (or on any
redemption or repayment date) will be made upon surrender of this Note at the
office or agency referred to in the preceding paragraph.

     If so indicated on the face hereof, the holder of this Note, if denominated
in a Specified Currency other than U.S. dollars, may elect to receive all or a
portion of payments on this Note in U.S. dollars by transmitting a written
request to the Paying Agent, on or prior to the fifth Business Day after such
Record Date or at least ten Business Days prior to the Maturity Date or on any
redemption or repayment date, as the case may be. Such election shall remain in
effect unless such request is revoked by written notice to the Paying Agent as
to all or a portion of payments on this Note at least five Business Days prior
to such Record Date, for payments of interest, or at least ten calendar days
prior to the Maturity Date or any redemption or repayment date, for payments of
principal, as the case may be.

     If the holder elects to receive all or a portion of payments of principal
of, premium, if any, and interest on this Note, if denominated in a Specified
Currency other than U.S. dollars, in U.S. dollars, the Exchange Rate Agent (as
defined on the reverse hereof) will convert such payments into U.S. dollars. In
the event of such an election, payment in respect of this Note will be based
upon the exchange rate as determined by the Exchange Rate Agent based on the
highest bid quotation in The City of New York received by such Exchange Rate
Agent at approximately 11:00 a.m., New York City time, on the second Business
Day preceding the applicable payment date from three recognized foreign exchange
dealers (one of which may be the Exchange Rate Agent unless such Exchange Rate
Agent is an affiliate of the Issuer) for the purchase by the


------------------------------------
     (5) Applies for a Registered Note that is not in global form.

     (6) Applies only for a Registered Global Security.


                                       4
<PAGE>


quoting dealer of the Specified Currency for U.S. dollars for settlement on such
payment date in the amount of the Specified Currency payable in the absence of
such an election to such holder and at which the applicable dealer commits to
execute a contract. If such bid quotations are not available, such payment will
be made in the Specified Currency. All currency exchange costs will be borne by
the holder of this Note by deductions from such payments.

     Reference is hereby made to the further provisions of this Note set forth
on the reverse hereof, which further provisions shall for all purposes have the
same effect as if set forth at this place, including, without limitation, the
provisions relating to the subordination of this Note to the Issuer's Senior
Indebtedness, as defined on the reverse hereof.

     Unless the certificate of authentication hereon has been executed by the
Trustee referred to on the reverse hereof by manual signature, this Note shall
not be entitled to any benefit under the Subordinated Indenture, as defined on
the reverse hereof, or be valid or obligatory for any purpose.







                                       5
<PAGE>


     IN WITNESS WHEREOF, the Issuer has caused this Note to be duly executed.

DATED:
                                         MORGAN STANLEY


                                         By:
                                             -----------------------------------
                                             Name:
                                             Title:

TRUSTEE'S CERTIFICATE
OF AUTHENTICATION

This is one of the Notes referred
   to in the within-mentioned
   Subordinated Indenture.

J.P. MORGAN TRUST COMPANY,
   NATIONAL ASSOCIATION,
   as Trustee


By:
    --------------------------------
    Authorized Officer






                                       6
<PAGE>


                          [FORM OF REVERSE OF SECURITY]

     This Note is one of a duly authorized issue of Subordinated Global
Medium-Term Notes, Series F, having maturities more than nine months from the
date of issue (the "Notes") of the Issuer. The Notes are issuable under a
Subordinated Indenture, dated as of October 1, 2004, between the Issuer and J.P.
Morgan Trust Company, National Association, as Trustee (the "Trustee," which
term includes any successor trustee under the Subordinated Indenture) (as may be
amended or supplemented from time to time, the "Subordinated Indenture"), to
which Subordinated Indenture and all indentures supplemental thereto reference
is hereby made for a statement of the respective rights, limitations of rights,
duties and immunities of the Issuer, the Trustee and holders of the Notes and
the terms upon which the Notes are, and are to be, authenticated and delivered.
The Issuer has appointed J.P. Morgan Trust Company, National Association, at its
corporate trust office in The City of New York as the paying agent (the "Paying
Agent," which term includes any additional or successor Paying Agent appointed
by the Issuer) with respect to the Notes. The terms of individual Notes may vary
with respect to interest rates, interest rate formulas, issue dates, maturity
dates, or otherwise, all as provided in the Subordinated Indenture. To the
extent not inconsistent herewith, the terms of the Subordinated Indenture are
hereby incorporated by reference herein.

     Unless otherwise indicated on the face hereof, this Note will not be
subject to any sinking fund and, unless otherwise provided on the face hereof in
accordance with the provisions of the following two paragraphs, will not be
redeemable or subject to repayment at the option of the holder prior to
maturity.

     If so indicated on the face hereof, this Note may be redeemed in whole or
in part at the option of the Issuer on or after the Initial Redemption Date
specified on the face hereof on the terms set forth on the face hereof, together
with interest accrued and unpaid hereon to the date of redemption. If this Note
is subject to "Annual Redemption Percentage Reduction," the Initial Redemption
Percentage indicated on the face hereof will be reduced on each anniversary of
the Initial Redemption Date by the Annual Redemption Percentage Reduction
specified on the face hereof until the redemption price of this Note is 100% of
the principal amount hereof, together with interest accrued and unpaid hereon to
the date of redemption. Notice of redemption shall be mailed to the registered
holders of the Notes designated for redemption at their addresses as the same
shall appear on the Note register not less than 30 nor more than 60 calendar
days prior to the date fixed for redemption or within the Redemption Notice
Period specified on the face hereof, subject to all the conditions and
provisions of the Subordinated Indenture. In the event of redemption of this
Note in part only, a new Note or Notes for the amount of the unredeemed portion
hereof shall be issued in the name of the holder hereof upon the cancellation
hereof.

     If so indicated on the face of this Note, this Note will be subject to
repayment at the option of the holder on the Optional Repayment Date or Dates
specified on the face hereof on the terms set forth herein. On any Optional
Repayment Date, this Note will be repayable in whole or in part in increments of
$1,000 or, if this Note is denominated in a Specified Currency other than U.S.
dollars, in increments of 1,000 units of such Specified Currency (provided that
any remaining principal amount hereof shall not be less than the minimum
authorized denomination


                                       7
<PAGE>


hereof) at the option of the holder hereof at a price equal to 100% of the
principal amount to be repaid, together with interest accrued and unpaid hereon
to the date of repayment. For this Note to be repaid at the option of the holder
hereof, the Paying Agent must receive at its corporate trust office in the
Borough of Manhattan, The City of New York, at least 15 but not more than 30
calendar days prior to the date of repayment, (i) this Note with the form
entitled "Option to Elect Repayment" below duly completed or (ii) a telegram,
telex, facsimile transmission or a letter from a member of a national securities
exchange or the National Association of Securities Dealers, Inc. or a commercial
bank or a trust company in the United States setting forth the name of the
holder of this Note, the principal amount hereof, the certificate number of this
Note or a description of this Note's tenor and terms, the principal amount
hereof to be repaid, a statement that the option to elect repayment is being
exercised thereby and a guarantee that this Note, together with the form
entitled "Option to Elect Repayment" duly completed, will be received by the
Paying Agent not later than the fifth Business Day after the date of such
telegram, telex, facsimile transmission or letter; provided, that such telegram,
telex, facsimile transmission or letter shall only be effective if this Note and
form duly completed are received by the Paying Agent by such fifth Business Day.
Exercise of such repayment option by the holder hereof shall be irrevocable. In
the event of repayment of this Note in part only, a new Note or Notes for the
amount of the unpaid portion hereof shall be issued in the name of the holder
hereof upon the cancellation hereof.

     This Note will bear interest at the rate determined in accordance with the
applicable provisions below by reference to the Base Rate shown on the face
hereof based on the Index Maturity, if any, shown on the face hereof (i) plus or
minus the Spread, if any, and/or (ii) multiplied by the Spread Multiplier, if
any, specified on the face hereof. Commencing with the Initial Interest Reset
Date specified on the face hereof, the rate at which interest on this Note is
payable shall be reset as of each Interest Reset Date specified on the face
hereof (as used herein, the term "Interest Reset Date" shall include the Initial
Interest Reset Date). For the purpose of determining the Initial Interest Rate,
references in this paragraph, the next succeeding paragraph and, if applicable,
clauses (i) and (ii) under "Determination of EURIBOR" below to Interest Reset
Date shall be deemed to mean the Original Issue Date. The determination of the
rate of interest at which this Note will be reset on any Interest Reset Date
shall be made on the Interest Determination Date (as defined below) pertaining
to such Interest Reset Dates. The Interest Reset Dates will be the Interest
Reset Dates specified on the face hereof; provided, however, that (a) the
interest rate in effect for the period from the Interest Accrual Date to the
Initial Interest Reset Date will be the Initial Interest Rate and (b) unless
otherwise specified on the face hereof, the interest rate in effect for the ten
calendar days immediately prior to maturity, redemption or repayment will be
that in effect on the tenth calendar day preceding such maturity, redemption or
repayment date. If any Interest Reset Date would otherwise be a day that is not
a Business Day, such Interest Reset Date shall be postponed to the immediately
succeeding day that is a Business Day, except that if the Base Rate specified on
the face hereof is LIBOR or EURIBOR and such Business Day is in the next
succeeding calendar month, such Interest Reset Date shall be the immediately
preceding Business Day. As used herein, "Business Day" means any day, other than
a Saturday or Sunday, (a) that is neither a legal holiday nor a day on which
banking institutions are authorized or required by law or regulation to close
(x) in The City of New York


                                       8
<PAGE>


or (y) if this Note is denominated in a Specified Currency other than U.S.
dollars, euro or Australian dollars, in the principal financial center of the
country of the Specified Currency, or (z) if this Note is denominated in
Australian dollars, in Sydney and (b) if this Note is denominated in euro, that
is also a day on which the Trans-European Automated Real-time Gross Settlement
Express Transfer System ("TARGET") is operating (a "TARGET Settlement Day").

     The Interest Determination Date pertaining to an Interest Reset Date for
Notes bearing interest calculated by reference to the Federal Funds Rate,
Federal Funds (Open) Rate and Prime Rate shall be on the Business Day prior to
the Interest Reset Date. The Interest Determination Date pertaining to an
Interest Reset Date for Notes bearing interest calculated by reference to the CD
Rate, Commercial Paper Rate and CMT Rate will be the second Business Day next
prior to such Interest Reset Date. The Interest Determination Date pertaining to
an Interest Reset Date for Notes bearing interest calculated by reference to
EURIBOR (or to LIBOR when the Index Currency is euros) shall be the second
TARGET Settlement Day prior to such Interest Reset Date. The Interest
Determination Date pertaining to an Interest Reset Date for Notes bearing
interest calculated by reference to LIBOR (other than for LIBOR Notes for which
the Index Currency is euros) shall be the second London Banking Day prior to
such Interest Reset Date, except that the Interest Determination Date pertaining
to an Interest Reset Date for a LIBOR Note for which the Index Currency is
pounds sterling will be such Interest Reset Date. As used herein, "London
Banking Day" means any day on which dealings in deposits in the Index Currency
(as defined herein) are transacted in the London interbank market. The Interest
Determination Date pertaining to an Interest Reset Date for Notes bearing
interest calculated by reference to the Treasury Rate shall be the day of the
week in which such Interest Reset Date falls on which Treasury bills normally
would be auctioned. Treasury Bills are normally sold at auction on Monday of
each week, unless that day is a legal holiday, in which case the auction is
normally held on the following Tuesday, except that the auction may be held on
the preceding Friday; provided, however, that if an auction is held on the
Friday of the week preceding such Interest Reset Date, the Interest
Determination Date shall be such preceding Friday; and provided, further, that
if an auction shall fall on any Interest Reset Date, then the Interest Reset
Date shall instead be the first Business Day following the date of such auction.
The Interest Determination Date pertaining to an Interest Reset Date for Notes
bearing interest calculated by reference to two or more base rates will be the
latest Business Day that is at least two Business Days before the Interest Reset
Date for the applicable Note on which each base rate is determinable.

     Unless otherwise specified on the face hereof, the "Calculation Date"
pertaining to an Interest Determination Date, including the Interest
Determination Date as of which the Initial Interest Rate is determined, will be
the earlier of (i) the tenth calendar day after such Interest Determination Date
or, if such day is not a Business Day, the next succeeding Business Day, or (ii)
the Business Day immediately preceding the applicable Interest Payment Date or
Maturity Date (or, with respect to any principal amount to be redeemed or
repaid, any redemption or repayment date), as the case may be.


                                       9
<PAGE>


     Determination of CD Rate. If the Base Rate specified on the face hereof is
the "CD Rate," for any Interest Determination Date, the CD Rate with respect to
this Note shall be the rate on that date for negotiable U.S. dollar certificates
of deposit having the Index Maturity specified on the face hereof as published
by the Board of Governors of the Federal Reserve System in "Statistical Release
H.15(519), Selected Interest Rates," or any successor publication of the Board
of Governors of the Federal Reserve System ("H.15(519)") under the heading "CDs
(Secondary Market)."

     The following procedures shall be followed if the CD Rate cannot be
determined as described above:

     (i) If the above rate is not published in H.15(519) by 3:00 p.m., New York
City time, on the Calculation Date, the CD Rate shall be the rate on that
Interest Determination Date set forth in the daily update of H.15(519),
available through the world wide website of the Board of Governors of the
Federal Reserve System at http://www.federalreserve.gov/releases/h15/update, or
any successor site or publication ("H.15 Daily Update") for the Interest
Determination Date for certificates of deposit having the Index Maturity
specified on the face hereof, under the caption "CDs (Secondary Market)."

     (ii) If the above rate is not yet published in either H.15(519) or the H.15
Daily Update by 3:00 p.m., New York City time, on the Calculation Date, the
Calculation Agent shall determine the CD Rate to be the arithmetic mean of the
secondary market offered rates as of 10:00 a.m., New York City time, on that
Interest Determination Date of three leading nonbank dealers in negotiable U.S.
dollar certificates of deposit in The City of New York, which may include the
initial dealer and its affiliates, selected by the Calculation Agent (after
consultation with the Issuer), for negotiable U.S. dollar certificates of
deposit of major U.S. money center banks of the highest credit standing in the
market for negotiable certificates of deposit with a remaining maturity closest
to the Index Maturity specified on the face hereof in an amount that is
representative for a single transaction in that market at that time.

     "Initial dealer" with respect to this Note means either Morgan Stanley &
Co. Incorporated or Morgan Stanley DW Inc., as applicable.

     (iii) If the dealers selected by the Calculation Agent are not quoting as
set forth above, the CD Rate for that Interest Determination Date shall remain
the CD Rate for the immediately preceding Interest Reset Period, or, if there
was no Interest Reset Period, the rate of interest payable shall be the Initial
Interest Rate.

     Determination of Commercial Paper Rate. If the Base Rate specified on the
face hereof is the "Commercial Paper Rate," for any Interest Determination Date,
the Commercial Paper Rate with respect to this Note shall be the Money Market
Yield (as defined herein), calculated as described below, of the rate on that
date for U.S. dollar commercial paper having the Index Maturity specified on the
face hereof, as that rate is published in H.15(519), under the heading
"Commercial Paper -- Nonfinancial."


                                       10
<PAGE>


     The following procedures shall be followed if the Commercial Paper Rate
cannot be determined as described above:

     (i) If the above rate is not published by 3:00 p.m., New York City time, on
the Calculation Date, then the Commercial Paper Rate shall be the Money Market
Yield of the rate on that Interest Determination Date for commercial paper of
the Index Maturity specified on the face hereof as published in the H.15 Daily
Update, or other recognized electronic source used for the purpose of displaying
the applicable rate, under the heading "Commercial Paper -- Nonfinancial."

     (ii) If by 3:00 p.m., New York City time, on that Calculation Date the rate
is not yet published in either H.15(519) or the H.15 Daily Update, or other
recognized electronic source used for the purpose of displaying the applicable
rate, then the Calculation Agent shall determine the Commercial Paper Rate to be
the Money Market Yield of the arithmetic mean of the offered rates as of 11:00
a.m., New York City time, on that Interest Determination Date of three leading
dealers of U.S. dollar commercial paper in The City of New York, which may
include the initial dealer and its affiliates, selected by the Calculation Agent
(after consultation with the Issuer), for commercial paper of the Index Maturity
specified on the face hereof, placed for an industrial issuer whose bond rating
is "Aa," or the equivalent, from a nationally recognized statistical rating
agency.

     (iii) If the dealers selected by the Calculation Agent are not quoting as
set forth above, the Commercial Paper Rate for that Interest Determination Date
shall remain the Commercial Paper Rate for the immediately preceding Interest
Reset Period, or, if there was no Interest Reset Period, the rate of interest
payable shall be the Initial Interest Rate.

     The "Money Market Yield" shall be a yield calculated in accordance with the
following formula:

                                          D x 360
                   Money Market Yield  -----------------  x 100
                                         360 - (D x M)

where "D" refers to the applicable per year rate for commercial paper quoted on
a bank discount basis and expressed as a decimal and "M" refers to the actual
number of days in the interest period for which interest is being calculated.

     Determination of EURIBOR. If the Base Rate specified on the face hereof is
"EURIBOR," for any Interest Determination Date, EURIBOR with respect to this
Note shall be the rate for deposits in euros as sponsored, calculated and
published jointly by the European Banking Federation and ACI - The Financial
Market Association, or any company established by the joint sponsors for
purposes of compiling and publishing those rates, for the Index Maturity
specified on the face hereof as that rate appears on the display on Moneyline
Telerate, or any successor service, on page 248 or any other page as may replace
page 248 on that service ("Telerate Page 248") as of 11:00 a.m., Brussels time.


                                       11
<PAGE>


     The following procedures shall be followed if the rate cannot be determined
as described above:

     (i) If the above rate does not appear, the Calculation Agent shall request
the principal Euro-zone office of each of four major banks in the Euro-zone
interbank market, as selected by the Calculation Agent (after consultation with
the Issuer), to provide the Calculation Agent with its offered rate for deposits
in euros, at approximately 11:00 a.m., Brussels time, on the Interest
Determination Date, to prime banks in the Euro-zone interbank market for the
Index Maturity specified on the face hereof commencing on the applicable
Interest Reset Date, and in a principal amount not less than the equivalent of
U.S. $1 million in euro that is representative of a single transaction in euro,
in that market at that time. If at least two quotations are provided, EURIBOR
shall be the arithmetic mean of those quotations.

     (ii) If fewer than two quotations are provided, EURIBOR shall be the
arithmetic mean of the rates quoted by four major banks in the Euro-zone
interbank market, as selected by the Calculation Agent (after consultation with
the Issuer), at approximately 11:00 a.m., Brussels time, on the applicable
Interest Reset Date for loans in euro to leading European banks for a period of
time equivalent to the Index Maturity specified on the face hereof commencing on
that Interest Reset Date in a principal amount not less than the equivalent of
U.S. $1 million in euro.

     (iii) If the banks so selected by the Calculation Agent are not quoting as
set forth above, the EURIBOR rate for that Interest Determination Date shall
remain the EURIBOR for the immediately preceding Interest Reset Period, or, if
there was no Interest Reset Period, the rate of interest payable shall be the
Initial Interest Rate.

     "Euro-zone" means the region comprised of member states of the European
Union that adopt the single currency in accordance with the relevant treaty of
the European Union, as amended.

     Determination of the Federal Funds Rate. If the Base Rate specified on the
face hereof is the "Federal Funds Rate," for any Interest Determination Date,
the Federal Funds Rate with respect to this Note shall be the rate on that date
for U.S. dollar federal funds as published in H.15(519) under the heading
"Federal Funds (Effective)" as displayed on Moneyline Telerate, or any successor
service, on page 120 or any other page as may replace page 120 on that service
("Telerate Page 120").

     The following procedures shall be followed if the Federal Funds Rate cannot
be determined as described above:

     (i) If the above rate is not published by 3:00 p.m., New York City time, on
the Calculation Date, the Federal Funds Rate shall be the rate on that Interest
Determination Date as published in the H.15 Daily Update, or other recognized
electronic source used for the purpose of displaying the applicable rate, under
the heading "Federal Funds (Effective)."


                                       12
<PAGE>


     (ii) If the above rate is not yet published in either H.15(519) or the H.15
Daily Update, or other recognized electronic source used for the purpose of
displaying the applicable rate, by 3:00 p.m., New York City time, on the
Calculation Date, the Calculation Agent shall determine the Federal Funds Rate
to be the arithmetic mean of the rates for the last transaction in overnight
U.S. dollar federal funds prior to 9:00 a.m., New York City time, on that
Interest Determination Date, by each of three leading brokers of U.S. dollar
federal funds transactions in The City of New York, which may include the
initial dealer and its affiliates, selected by the Calculation Agent (after
consultation with the Issuer).

     (iii) If the brokers selected by the Calculation Agent are not quoting as
set forth above, the Federal Funds Rate for that Interest Determination Date
shall remain the Federal Funds Rate for the immediately preceding Interest Reset
Period, or, if there was no Interest Reset Period, the rate of interest payable
shall be the Initial Interest Rate.

     Determination of Federal Funds (Open) Rate. If the Base Rate specified on
the face hereof is the "Federal Funds (Open) Rate", for any Interest
Determination Date, the Federal Funds (Open) Rate with respect to this Note
shall be the rate on that date for U.S. dollar federal funds as published in
H.15(519) under the heading "Federal Funds (Open)" as displayed on Moneyline
Telerate, or any successor service, on page 5 or any other page as may replace
page 5 on that service, ("Telerate Page 5").

     The following procedures shall be followed if the Federal Funds (Open) Rate
cannot be determined as described above:

          o    If the above rate is not published by 3:00 p.m., New York City
               time, on the Calculation Date, the Federal Funds (Open) Rate will
               be the rate on that Interest Determination Date as published in
               the H.15 Daily Update, or other recognized electronic source used
               for the purpose of displaying the applicable rate, under the
               heading "Federal Funds (Open)."

          o    If the above rate is not yet published in either H.15(519) or the
               H.15 Daily Update, or other recognized electronic source used for
               the purpose of displaying the applicable rate, by 3:00 p.m., New
               York City time, on the Calculation Date, the Calculation Agent
               will determine the Federal Funds (Open) Rate to be the arithmetic
               mean of the rates for the last transaction in overnight U.S.
               dollar federal funds (based on the Federal Funds (Open) Rate)
               prior to 9:00 a.m., New York City time, on that Interest
               Determination Date, by each of three leading brokers of U.S.
               dollar federal funds transactions in the City of New York, which
               may include the agent and its affiliates, selected by the
               Calculation Agent, after consultation with the Issuer.

          o    If the brokers selected by the Calculation Agent are not quoting
               as set forth above, the Federal Funds (Open) Rate for that
               Interest Determination Date shall remain the Federal Funds (Open)
               Rate for the immediately preceding Interest Reset Period, or, if
               there was no Interest Reset Period, the rate of interest payable
               will be the Initial Interest Rate.


                                       13
<PAGE>


     Determination of LIBOR. If the Base Rate specified on the face hereof is
"LIBOR," LIBOR with respect to this Note shall be based on London Interbank
Offered Rate. The Calculation Agent shall determine LIBOR for each Interest
Determination Date as follows:

     (i) As of the Interest Determination Date, LIBOR shall be either (a) if
"LIBOR Reuters" is specified as the Reporting Service on the face hereof, the
arithmetic mean of the offered rates for deposits in the Index Currency having
the Index Maturity designated on the face hereof, commencing on the second
London Banking Day immediately following that Interest Determination Date, that
appear on the Designated LIBOR Page, as defined below, as of 11:00 a.m., London
time, on that Interest Determination Date, if at least two offered rates appear
on the Designated LIBOR Page; except that if the specified Designated LIBOR
Page, by its terms provides only for a single rate, that single rate shall be
used; or (b) if "LIBOR Telerate" is specified as the Reporting Service on the
face hereof, the rate for deposits in the Index Currency having the Index
Maturity designated on the face hereof, commencing on the second London Banking
Day immediately following that Interest Determination Date or, if pounds
sterling is the Index Currency, commencing on that Interest Determination Date,
that appears on the Designated LIBOR Page at approximately 11:00 a.m., London
time, on that Interest Determination Date.

     (ii) If (a) fewer than two offered rates appear and LIBOR Reuters is
specified on the face hereof, or (b) no rate appears and the face hereof
specifies either (x) LIBOR Telerate or (y) LIBOR Reuters and the Designated
LIBOR Page by its terms provides only for a single rate, then the Calculation
Agent shall request the principal London offices of each of four major reference
banks in the London interbank market, as selected by the Calculation Agent
(after consultation with the Issuer), to provide the Calculation Agent with its
offered quotation for deposits in the Index Currency for the period of the Index
Maturity specified on the face hereof commencing on the second London Banking
Day immediately following the Interest Determination Date or, if pounds sterling
is the Index Currency, commencing on that Interest Determination Date, to prime
banks in the London interbank market at approximately 11:00 a.m., London time,
on that Interest Determination Date and in a principal amount that is
representative of a single transaction in that Index Currency in that market at
that time.

     (iii) If at least two quotations are provided, LIBOR determined on that
Interest Determination Date shall be the arithmetic mean of those quotations. If
fewer than two quotations are provided, LIBOR shall be determined for the
applicable Interest Reset Date as the arithmetic mean of the rates quoted at
approximately 11:00 a.m., London time, or some other time specified on the face
hereof, in the applicable principal financial center for the country of the
Index Currency on that Interest Reset Date, by three major banks in that
principal financial center selected by the Calculation Agent (after consultation
with the Issuer) for loans in the Index Currency to leading European banks,
having the Index Maturity specified on the face hereof and in a principal amount
that is representative of a single transaction in that Index Currency in that
market at that time.

     (iv) If the banks so selected by the Calculation Agent are not quoting as
set forth above, the LIBOR rate for that Interest Determination Date shall
remain the LIBOR for the immediately


                                       14
<PAGE>


preceding Interest Reset Period, or, if there was no Interest Reset Period, the
rate of interest payable shall be the Initial Interest Rate.

     The "Index Currency" means the currency specified on the face hereof as the
currency for which LIBOR shall be calculated, or, if the euro is substituted for
that currency, the Index Currency shall be the euro. If that currency is not
specified on the face hereof, the Index Currency shall be U.S. dollars.

     "Designated LIBOR Page" means either: (a) if LIBOR Reuters is designated as
the Reporting Service on the face hereof, the display on the Reuters Money 3000
Service for the purpose of displaying the London interbank rates of major banks
for the applicable Index Currency or its designated successor, or (b) if LIBOR
Telerate is designated as the Reporting Service on the face hereof, the display
on Moneyline Telerate, or any successor service, on the page specified on the
face hereof, or any other page as may replace that page on that service, for the
purpose of displaying the London interbank rates of major banks for the
applicable Index Currency.

     If neither LIBOR Reuters nor LIBOR Telerate is specified on the face
hereof, LIBOR for the applicable Index Currency shall be determined as if LIBOR
Telerate were specified, and, if the U.S. dollar is the Index Currency, as if
Page 3750 had been specified.

     Determination of Prime Rate. If the Base Rate specified on the face hereof
is "Prime Rate," for any Interest Determination Date, the Prime Rate with
respect to this Note shall be the rate on that date as published in H.15(519)
under the heading "Bank Prime Loan."

     The following procedures shall be followed if the Prime Rate cannot be
determined as described above:

     (i) If the above rate is not published prior to 3:00 p.m., New York City
time, on the Calculation Date, then the Prime Rate shall be the rate on that
Interest Determination Date as published in the H.15 Daily Update under the
heading "Bank Prime Loan."

     (ii) If the above rate is not published in either H.15(519) or the H.15
Daily Update by 3:00 p.m., New York City time, on the Calculation Date, then the
Calculation Agent shall determine the Prime Rate to be the arithmetic mean of
the rates of interest publicly announced by each bank that appears on the
Reuters Screen USPRIME 1 Page, as defined below, as that bank's Prime Rate or
base lending rate as in effect for that Interest Determination Date.

     (iii) If fewer than four rates for that Interest Determination Date appear
on the Reuters Screen USPRIME 1 Page by 3:00 p.m., New York City time, on the
Calculation Date, the Calculation Agent shall determine the Prime Rate to be the
arithmetic mean of the Prime Rates quoted on the basis of the actual number of
days in the year divided by 360 as of the close of business on that Interest
Determination Date by at least three major banks in The City of New York, which
may include affiliates of the initial dealer, selected by the Calculation Agent
(after consultation with the Issuer).


                                       15
<PAGE>


     (iv) If the banks selected by the Calculation Agent are not quoting as set
forth above, the Prime Rate for that Interest Determination Date shall remain
the Prime Rate for the immediately preceding Interest Reset Period, or, if there
was no Interest Reset Period, the rate of interest payable shall be the Initial
Interest Rate.

     "Reuters Screen USPRIME 1 Page" means the display designated as page
"USPRIME 1" on the Reuters Money 3000 Service, or any successor service, or any
other page as may replace the USPRIME 1 Page on that service for the purpose of
displaying prime rates or base lending rates of major U.S. banks.

     Determination of Treasury Rate. If the Base Rate specified on the face
hereof is "Treasury Rate," the Treasury Rate with respect to this Note shall be

     (i) the rate from the Auction held on the applicable Interest Determination
Date (the "Auction") of direct obligations of the United States ("Treasury
Bills") having the Index Maturity specified on the face hereof as that rate
appears under the caption "INVESTMENT RATE" on the display on Moneyline
Telerate, or any successor service, on page 56 or any other page as may replace
page 56 on that service ("Telerate Page 56") or page 57 or any other page as may
replace page 57 on that service ("Telerate Page 57"); or

     (ii) if the rate described in (i) above is not published by 3:00 p.m., New
York City time, on the Calculation Date, the Bond Equivalent Yield of the rate
for the applicable Treasury Bills as published in the H.15 Daily Update, or
other recognized electronic source used for the purpose of displaying the
applicable rate, under the caption "U.S. Government Securities/Treasury
Bills/Auction High"; or

     (iii) if the rate described in (ii) above is not published by 3:00 p.m.,
New York City time, on the related Calculation Date, the Bond Equivalent Yield
of the Auction rate of the applicable Treasury Bills, announced by the United
States Department of the Treasury; or

     (iv) if the rate described in (iii) above is not announced by the United
States Department of the Treasury, or if the Auction is not held, the Bond
Equivalent Yield of the rate on the applicable Interest Determination Date of
Treasury Bills having the Index Maturity specified on the face hereof published
in H.15(519) under the caption "U.S. Government Securities/Treasury
Bills/Secondary Market"; or

     (v) if the rate described in (iv) above is not so published by 3:00 p.m.,
New York City time, on the related Calculation Date, the rate on the applicable
Interest Determination Date of the applicable Treasury Bills as published in the
H.15 Daily Update, or other recognized electronic source used for the purpose of
displaying the applicable rate, under the caption "U.S. Government
Securities/Treasury Bills/Secondary Market"; or

     (vi) if the rate described in (v) above is not so published by 3:00 p.m.,
New York City time, on the related Calculation Date, the rate on the applicable
Interest Determination Date calculated by the Calculation Agent as the Bond
Equivalent Yield of the arithmetic mean of the


                                       16
<PAGE>


secondary market bid rates, as of approximately 3:30 p.m., New York City time,
on the applicable Interest Determination Date, of three primary U.S. government
securities dealers, which may include the initial dealer and its affiliates,
selected by the Calculation Agent, for the issue of Treasury Bills with a
remaining maturity closest to the Index Maturity specified on the face hereof;
or

     (vii) if the dealers selected by the Calculation Agent are not quoting as
described in (vi), the Treasury Rate for the immediately preceding Interest
Reset Period, or, if there was no Interest Reset Period, the rate of interest
payable shall be the Initial Interest Rate.

     The "Bond Equivalent Yield" means a yield calculated in accordance with the
following formula and expressed as a percentage:

                                                 D x N
                    Bond Equivalent Yield   ---------------  x 100
                                             360 - (D x M)

where "D" refers to the applicable per annum rate for Treasury Bills quoted on a
bank discount basis, "N" refers to 365 or 366, as the case may be, and "M"
refers to the actual number of days in the interest period for which interest is
being calculated.

     Determination of CMT Rate. If the Base Rate specified on the face hereof is
the "CMT Rate," for any Interest Determination Date, the CMT Rate with respect
to this Note shall be the rate displayed on the Designated CMT Telerate Page (as
defined below) under the caption "... Treasury Constant Maturities ... Federal
Reserve Board Release H.15... Mondays Approximately 3:45 p.m.," under the column
for the Designated CMT Maturity Index, as defined below, for:

     (1) the rate on that Interest Determination Date, if the Designated CMT
Telerate Page is 7051; and

     (2) the week or the month, as applicable, ended immediately preceding the
week in which the related Interest Determination Date occurs, if the Designated
CMT Telerate Page is 7052.

     The following procedures shall be followed if the CMT Rate cannot be
determined as described above:

     (i) If the above rate is no longer displayed on the relevant page, or if
not displayed by 3:00 p.m., New York City time, on the related Calculation Date,
then the CMT Rate shall be the Treasury Constant Maturity rate for the
Designated CMT Maturity Index as published in the relevant H.15(519).

     (ii) If the above rate is no longer published, or if not published by 3:00
p.m., New York City time, on the related Calculation Date, then the CMT Rate
shall be the Treasury Constant Maturity Rate for the Designated CMT Maturity
Index or other U.S. Treasury rate for the Designated CMT Maturity Index on the
Interest Determination Date as may then be published by either the Board of
Governors of the Federal Reserve System or the United States Department of the
Treasury that the Calculation Agent determines to be comparable to the rate
formerly displayed on the Designated CMT Telerate Page and published in the
relevant H.15(519).


                                       17
<PAGE>


     (iii) If the information set forth above is not provided by 3:00 p.m., New
York City time, on the related Calculation Date, then the Calculation Agent
shall determine the CMT Rate to be a yield to maturity, based on the arithmetic
mean of the secondary market closing offer side prices as of approximately 3:30
p.m., New York City time, on the Interest Determination Date, reported,
according to their written records, by three leading primary U.S. government
securities dealers ("Reference Dealers") in The City of New York, which may
include the initial dealer or another affiliate, selected by the Calculation
Agent as described in the following sentence. The Calculation Agent shall select
five reference dealers (after consultation with the Issuer) and shall eliminate
the highest quotation or, in the event of equality, one of the highest, and the
lowest quotation or, in the event of equality, one of the lowest, for the most
recently issued direct noncallable fixed rate obligations of the United States
("Treasury Notes") with an original maturity of approximately the Designated CMT
Maturity Index, a remaining term to maturity of no more than 1 year shorter than
that Designated CMT Maturity Index and in a principal amount that is
representative for a single transaction in the securities in that market at that
time. If two Treasury Notes with an original maturity as described above have
remaining terms to maturity equally close to the Designated CMT Maturity Index,
the quotes for the Treasury Note with the shorter remaining term to maturity
shall be used.

     (iv) If the Calculation Agent cannot obtain three Treasury Notes quotations
as described in (iii) above, the Calculation Agent shall determine the CMT Rate
to be a yield to maturity based on the arithmetic mean of the secondary market
offer side prices as of approximately 3:30 p.m., New York City time, on the
Interest Determination Date of three reference dealers in The City of New York,
selected using the same method described in (iii) above, for Treasury Notes with
an original maturity equal to the number of years closest to but not less than
the Designated CMT Maturity Index and a remaining term to maturity closest to
the Designated CMT Maturity Index and in a principal amount that is
representative for a single transaction in the securities in that market at that
time.

     (v) If three or four, and not five, of the reference dealers are quoting as
described in (iv) above, then the CMT Rate shall be based on the arithmetic mean
of the offer prices obtained and neither the highest nor the lowest of those
quotes shall be eliminated.

     (vi) If fewer than three reference dealers selected by the Calculation
Agent are quoting as described in (iv) above, the CMT Rate for that Interest
Determination Date shall be the CMT Rate for the immediately preceding Interest
Reset Period, or, if there was no Interest Reset Period, the rate of interest
payable shall be the Initial Interest Rate.

     "Designated CMT Telerate Page" means the display on Moneyline Telerate, or
any successor service, on the page designated on the face hereof or any other
page as may replace that page on that service for the purpose of displaying
Treasury Constant Maturities as reported in H.15(519). If no page is specified
on the face hereof, the Designated CMT Telerate Page shall be 7052, for the most
recent week.


                                       18
<PAGE>


     "Designated CMT Maturity Index" means the original period to maturity of
the U.S. Treasury securities, which is either 1, 2, 3, 5, 7, 10, 20 or 30 years,
as specified in the applicable pricing supplement for which the CMT Rate shall
be calculated. If no maturity is specified on the face hereof, the Designated
CMT Maturity Index shall be two years.

     Notwithstanding the foregoing, the interest rate hereon shall not be
greater than the Maximum Interest Rate, if any, or less than the Minimum
Interest Rate, if any, specified on the face hereof. The Calculation Agent shall
calculate the interest rate hereon in accordance with the foregoing on or before
each Calculation Date. The interest rate on this Note will in no event be higher
than the maximum rate permitted by New York law, as the same may be modified by
United States Federal law of general application.

     At the request of the holder hereof, the Calculation Agent will provide to
the holder hereof the interest rate hereon then in effect and, if determined,
the interest rate that will become effective as of the next Interest Reset Date.

     Unless otherwise indicated on the face hereof, interest payments on this
Note shall be the amount of interest accrued from and including the Interest
Accrual Date or from and including the last date to which interest has been paid
or duly provided for to but excluding the Interest Payment Dates or the Maturity
Date (or any earlier redemption or repayment date), as the case may be. Accrued
interest hereon shall be an amount calculated by multiplying the face amount
hereof by an accrued interest factor. Such accrued interest factor shall be
computed by adding the interest factor calculated for each day in the period for
which interest is being paid. The interest factor for each such date shall be
computed by dividing the interest rate applicable to such day (i) by 360 if the
Base Rate is CD Rate, Commercial Paper Rate, EURIBOR, Federal Funds Rate,
Federal Funds (Open) Rate, Prime Rate or LIBOR (except if the Index Currency is
pounds sterling); (ii) by 365 if the Base Rate is LIBOR and the Index Currency
is pounds sterling; or (iii) by the actual number of days in the year if the
Base Rate is the Treasury Rate or the CMT Rate. All percentages resulting from
any calculation of the rate of interest on this Note will be rounded, if
necessary, to the nearest one hundred-thousandth of a percentage point (with
..000005% being rounded up to .00001%) and all dollar amounts used in or
resulting from such calculation on this Note will be rounded to the nearest
cent, with one-half cent rounded upward. All Japanese Yen amounts used in or
resulting from such calculations will be rounded downwards to the next lower
whole Japanese Yen amount. All amounts denominated in any other currency used in
or resulting from such calculations will be rounded to the nearest two decimal
places in such currency, with .005 being rounded up to .01. The interest rate in
effect on any Interest Reset Date will be the applicable rate as reset on such
date. The interest rate applicable to any other day is the interest rate from
the immediately preceding Interest Reset Date (or, if none, the Initial Interest
Rate).

     This Note and all other obligations of the Issuer hereunder will constitute
part of the subordinated debt of the Issuer, will be issued under the
Subordinated Indenture and will be subordinate and junior in right of payment,
to the extent and in the manner set forth in the Subordinated Indenture, to all
"Senior Indebtedness" of the Issuer. The Subordinated Indenture defines "Senior
Indebtedness" as (i) obligations (other than non-recourse obligations, the debt


                                       19
<PAGE>


securities, including this Note, issued under the Subordinated Indenture or any
other obligations specifically designated as being subordinate in right of
payment to Senior Indebtedness) of, or guaranteed or assumed by, the Issuer for
borrowed money or evidenced by bonds, debentures, notes or other similar
instruments, and amendments, renewals, extensions, modifications and refundings
of any such indebtedness or obligation and (ii) if provided in the supplemental
indenture under which a series of Securities is issued or in the form of
Security for such series, any additional obligations that the Issuer determines
to include within the definition of Senior Indebtedness in order to assure that
the Securities of such series will be accorded the regulatory capital
recognition desired by the Issuer in accordance with Rule 15c3-1 under the
Securities Exchange Act of 1934, as amended, or any other rule or regulation
governing the definition of capital that is applicable to the Issuer or its
affiliates.

     This Note, and any Note or Notes issued upon transfer or exchange hereof,
is issuable only in fully registered form, without coupons, and, if denominated
in U.S. dollars, is issuable only in denominations of U.S. $1,000 and any
integral multiple of U.S. $1,000 in excess thereof. If this Note is denominated
in a Specified Currency other than U.S. dollars, then, unless a higher minimum
denomination is required by applicable law, it is issuable only in denominations
of the equivalent of U.S. $1,000 (rounded down to an integral multiple of 1,000
units of such Specified Currency), or any amount in excess thereof which is an
integral multiple of 1,000 units of such Specified Currency, as determined by
reference to the noon dollar buying rate in The City of New York for cable
transfers of such Specified Currency published by the Federal Reserve Bank of
New York (the "Market Exchange Rate") on the Business Day immediately preceding
the date of issuance.

     The Trustee has been appointed registrar for the Notes (the "Registrar,"
which term includes any successor registrar appointed by the Issuer), and the
Registrar will maintain at its office in The City of New York a register for the
registration and transfer of Notes. This Note may be transferred at the
aforesaid office of the Registrar by surrendering this Note for cancellation,
accompanied by a written instrument of transfer in form satisfactory to the
Issuer and the Registrar and duly executed by the registered holder hereof in
person or by the holder's attorney duly authorized in writing, and thereupon the
Registrar shall issue in the name of the transferee or transferees, in exchange
herefor, a new Note or Notes having identical terms and provisions and having a
like aggregate principal amount in authorized denominations, subject to the
terms and conditions set forth herein; provided, however, that the Registrar
will not be required (i) to register the transfer of or exchange any Note that
has been called for redemption in whole or in part, except the unredeemed
portion of Notes being redeemed in part, (ii) to register the transfer of or
exchange any Note if the holder thereof has exercised his right, if any, to
require the Issuer to repurchase such Note in whole or in part, except the
portion of such Note not required to be repurchased, or (iii) to register the
transfer of or exchange Notes to the extent and during the period so provided in
the Subordinated Indenture with respect to the redemption of Notes. Notes are
exchangeable at said office for other Notes of other authorized denominations of
equal aggregate principal amount having identical terms and provisions. All such
exchanges and transfers of Notes will be free of charge, but the Issuer may
require payment of a sum sufficient to cover any tax or other governmental
charge in connection therewith. All Notes surrendered for exchange shall be
accompanied by a written instrument of transfer in form


                                       20
<PAGE>


satisfactory to the Issuer and the Registrar and executed by the registered
holder in person or by the holder's attorney duly authorized in writing. The
date of registration of any Note delivered upon any exchange or transfer of
Notes shall be such that no gain or loss of interest results from such exchange
or transfer.

     In case this Note shall at any time become mutilated, defaced or be
destroyed, lost or stolen and this Note or evidence of the loss, theft or
destruction thereof (together with the indemnity hereinafter referred to and
such other documents or proof as may be required in the premises) shall be
delivered to the Registrar, the Issuer in its discretion may execute a new Note
of like tenor in exchange for this Note, but, if this Note is destroyed, lost or
stolen, only upon receipt of evidence satisfactory to the Registrar and the
Issuer that this Note was destroyed or lost or stolen and, if required, upon
receipt also of indemnity satisfactory to each of them. All expenses and
reasonable charges associated with procuring such indemnity and with the
preparation, authentication and delivery of a new Note shall be borne by the
owner of the Note mutilated, defaced, destroyed, lost or stolen.

     The Subordinated Indenture provides that, (a) if an Event of Default (as
defined in the Subordinated Indenture) pursuant to Section 5.01(c) of the
Subordinated Indenture is provided in the supplemental indenture relating to the
series of Subordinated Medium-Term Notes of which this Note forms a part or in
the form of debt security for such series (if such Event of Default is with
respect to less than all outstanding debt securities issued under the
Subordinated Indenture) and such Event of Default shall have occurred and be
continuing, either the Trustee or the holders of not less than 25% in aggregate
principal amount of the outstanding debt securities of each affected series,
voting as one class, by notice in writing to the Issuer and to the Trustee, if
given by the securityholders, may then declare the principal of all debt
securities of all such series and interest accrued thereon to be due and payable
immediately and (b) if an Event of Default due to certain events of bankruptcy,
insolvency or reorganization of the Issuer shall have occurred and be continuing
or if an Event of Default pursuant to Section 5.01(c) of the Subordinated
Indenture is provided in the supplemental indenture relating to the series of
Subordinated Medium-Term Notes of which this Note forms a part or in the form of
debt security for such series (if such Event of Default is with respect to all
outstanding debt securities issued under the Subordinated Indenture) and such
Event of Default shall have occurred and be continuing, either the Trustee or
the holders of not less than 25% in aggregate principal amount of all
outstanding debt securities issued under the Subordinated Indenture, voting as
one class, by notice in writing to the Issuer and to the Trustee, if given by
the securityholders, may declare the principal of all such debt securities and
interest accrued thereon to be due and payable immediately, but upon certain
conditions such declarations may be annulled and past defaults may be waived
(except a continuing default in payment of principal or premium, if any, or
interest on such debt securities) by the holders of a majority in aggregate
principal amount of all the debt securities of all affected series then
outstanding.

     If the face hereof indicates that this Note is subject to "Tax Redemption
and Payment of Additional Amounts," this Note may be redeemed, as a whole, at
the option of the Issuer at any time prior to maturity, upon the giving of a
notice of redemption as described below, at a redemption price equal to 100% of
the principal amount hereof, together with accrued interest to


                                       21
<PAGE>


the date fixed for redemption, if the Issuer determines that, as a result of any
change in or amendment to the laws (including a holding, judgment or as ordered
by a court of competent jurisdiction), or any regulations or rulings promulgated
thereunder, of the United States or of any political subdivision or taxing
authority thereof or therein affecting taxation, or any change in official
position regarding the application or interpretation of such laws, regulations
or rulings, which change or amendment occurs, becomes effective or, in the case
of a change in official position, is announced on or after the Initial Offering
Date hereof, the Issuer has or will become obligated to pay Additional Amounts,
as defined below, with respect to this Note as described below. Prior to the
giving of any notice of redemption pursuant to this paragraph, the Issuer shall
deliver to the Trustee (i) a certificate stating that the Issuer is entitled to
effect such redemption and setting forth a statement of facts showing that the
conditions precedent to the right of the Issuer to so redeem have occurred, and
(ii) an opinion of independent legal counsel satisfactory to the Trustee to such
effect based on such statement of facts; provided that no such notice of
redemption shall be given earlier than 60 calendar days prior to the earliest
date on which the Issuer would be obligated to pay such Additional Amounts if a
payment in respect of this Note were then due.

     Notice of redemption will be given not less than 30 nor more than 60
calendar days prior to the date fixed for redemption or within the Redemption
Notice Period specified on the face hereof, which date and the applicable
redemption price will be specified in the notice.

     If the face hereof indicates that this Note is subject to "Tax Redemption
and Payment of Additional Amounts," the Issuer will, subject to certain
exceptions and limitations set forth below, pay such additional amounts (the
"Additional Amounts") to the holder of this Note who is a U.S. Alien as may be
necessary in order that every net payment of the principal of and interest on
this Note and any other amounts payable on this Note, after withholding or
deduction for or on account of any present or future tax, assessment or
governmental charge imposed upon or as a result of such payment by the United
States, or any political subdivision or taxing authority thereof or therein,
will not be less than the amount provided for in this Note to be then due and
payable. The Issuer will not, however, make any payment of Additional Amounts to
any such holder who is a U.S. Alien for or on account of:

          (a) any present or future tax, assessment or other governmental charge
     that would not have been so imposed but for (i) the existence of any
     present or former connection between such holder, or between a fiduciary,
     settlor, beneficiary, member or shareholder of such holder, if such holder
     is an estate, a trust, a partnership or a corporation for U.S. federal
     income tax purposes, and the United States, including, without limitation,
     such holder, or such fiduciary, settlor, beneficiary, member or
     shareholder, being or having been a citizen or resident thereof or being or
     having been engaged in a trade or business or present therein or having, or
     having had, a permanent establishment therein or (ii) the presentation by
     or on behalf of the holder of this Note for payment on a date more than 15
     calendar days after the date on which such payment became due and payable
     or the date on which payment thereof is duly provided for, whichever occurs
     later;


                                       22
<PAGE>


          (b) any estate, inheritance, gift, sales, transfer, excise or personal
     property tax or any similar tax, assessment or governmental charge;

          (c) any tax, assessment or other governmental charge imposed by reason
     of such holder's past or present status as a controlled foreign corporation
     or passive foreign investment company with respect to the United States or
     as a corporation which accumulates earnings to avoid U.S. federal income
     tax or as a private foundation or other tax-exempt organization or a bank
     receiving interest under Section 881(c)(3)(A) of the Internal Revenue Code
     of 1986, as amended;

          (d) any tax, assessment or other governmental charge that is payable
     otherwise than by withholding or deduction from payments on or in respect
     of this Note;

          (e) any tax, assessment or other governmental charge required to be
     withheld by any Paying Agent from any payment of principal of, or interest
     on, this Note, if such payment can be made without such withholding by any
     other Paying Agent in a city in Western Europe;

          (f) any tax, assessment or other governmental charge that would not
     have been imposed but for the failure to comply with certification,
     information or other reporting requirements concerning the nationality,
     residence or identity of the holder or beneficial owner of this Note, if
     such compliance is required by statute or by regulation of the United
     States or of any political subdivision or taxing authority thereof or
     therein as a precondition to relief or exemption from such tax, assessment
     or other governmental charge;

          (g) any tax, assessment or other governmental charge imposed by reason
     of such holder's past or present status as the actual or constructive owner
     of 10% or more of the total combined voting power of all classes of stock
     entitled to vote of the Issuer or as a direct or indirect subsidiary of the
     Issuer; or

          (h) any combination of items (a), (b), (c), (d), (e), (f) or (g).

In addition, the Issuer shall not be required to make any payment of Additional
Amounts (i) to any such holder where such withholding or deduction is imposed on
a payment to an individual and is required to be made pursuant to any law
implementing or complying with, or introduced in order to conform to, any
European Union Directive on the taxation of savings; or (ii) by or on behalf of
a holder who would have been able to avoid such withholding or deduction by
presenting this Note or the relevant coupon to another Paying Agent in a member
state of the European Union. Nor shall the Issuer pay Additional Amounts with
respect to any payment on this Note to a U.S. Alien who is a fiduciary or
partnership or other than the sole beneficial owner of such payment to the
extent such payment would be required by the laws of the United States (or any
political subdivision thereof) to be included in the income, for tax purposes,
of a beneficiary or settlor with respect to such fiduciary or a member of such
partnership or a


                                       23
<PAGE>


beneficial owner who would not have been entitled to the Additional Amounts had
such beneficiary, settlor, member or beneficial owner been the holder of this
Note.

     The Subordinated Indenture permits the Issuer and the Trustee, with the
consent of the holders of not less than a majority in aggregate principal amount
of the debt securities of all series issued under the Subordinated Indenture
then outstanding and affected (voting as one class), to execute supplemental
indentures adding any provisions to or changing in any manner the rights of the
holders of each series so affected; provided that the Issuer and the Trustee may
not, without the consent of the holder of each outstanding debt security
affected thereby, (i) extend the final maturity of any such debt security, or
reduce the principal amount thereof, or reduce the rate or extend the time of
payment of interest thereon, or reduce any amount payable on redemption thereof,
or change the currency of payment thereof, or modify or amend the provisions for
conversion of any currency into any other currency, or modify or amend the
provisions for conversion or exchange of the debt security for securities of the
Issuer or other entities or for other property or the cash value of the property
(other than as provided in the antidilution provisions or other similar
adjustment provisions of the debt securities or otherwise in accordance with the
terms thereof), or impair or affect the rights of any holder to institute suit
for the payment thereof or (ii) reduce the aforesaid percentage in principal
amount of debt securities the consent of the holders of which is required for
any such supplemental indenture; provided, however, that neither this Note nor
the Subordinated Indenture may be amended to alter the subordination provisions
hereof or thereof without the written consent of each holder of Senior
Indebtedness then outstanding that would be adversely affected thereby.

     Except as set forth below, if the principal of, premium, if any, or
interest, if any, on this Note is payable in a Specified Currency other than
U.S. dollars and such Specified Currency is not available to the Issuer for
making payments hereon due to the imposition of exchange controls or other
circumstances beyond the control of the Issuer or is no longer used by the
government of the country issuing such currency or for the settlement of
transactions by public institutions within the international banking community,
then the Issuer will be entitled to satisfy its obligations to the holder of
this Note by making such payments in U.S. dollars on the basis of the Market
Exchange Rate on the date of such payment or, if the Market Exchange Rate is not
available on such date, as of the most recent practicable date; provided,
however, that if the euro has been substituted for such Specified Currency, the
Issuer may at its option (or shall, if so required by applicable law) without
the consent of the holder of this Note effect the payment of principal of,
premium, if any, or interest on any Note denominated in such Specified Currency
in euro in lieu of such Specified Currency in conformity with legally applicable
measures taken pursuant to, or by virtue of, the Treaty establishing the
European Community, as amended. Any payment made under such circumstances in
U.S. dollars or euro where the required payment is in an unavailable Specified
Currency will not constitute an Event of Default. If such Market Exchange Rate
is not then available to the Issuer or is not published for a particular
Specified Currency, the Market Exchange Rate will be based on the highest bid
quotation in The City of New York received by the Exchange Rate Agent at
approximately 11:00 a.m., New York City time, on the second Business Day
preceding the date of such payment from three recognized foreign exchange
dealers (the "Exchange Dealers") for the purchase by the quoting Exchange Dealer
of the Specified Currency for U.S. dollars for settlement on the payment date,
in the


                                       24
<PAGE>


aggregate amount of the Specified Currency payable to those holders or
beneficial owners of Notes and at which the applicable Exchange Dealer commits
to execute a contract. One of the Exchange Dealers providing quotations may be
the Exchange Rate Agent unless the Exchange Rate Agent is an affiliate of the
Issuer. If those bid quotations are not available, the Exchange Rate Agent shall
determine the market exchange rate at its sole discretion.

     The "Exchange Rate Agent" shall be Morgan Stanley & Co. Incorporated,
unless otherwise indicated on the face hereof.

     All determinations referred to above made by, or on behalf of, the Issuer
or by, or on behalf of, the Exchange Rate Agent shall be at such entity's sole
discretion and shall, in the absence of manifest error, be conclusive for all
purposes and binding on holders of Notes and coupons.

     So long as this Note shall be outstanding, the Issuer will cause to be
maintained an office or agency for the payment of the principal of and premium,
if any, and interest on this Note as herein provided in the Borough of
Manhattan, The City of New York, and an office or agency in said Borough of
Manhattan for the registration, transfer and exchange as aforesaid of the Notes.
The Issuer may designate other agencies for the payment of said principal,
premium and interest at such place or places (subject to applicable laws and
regulations) as the Issuer may decide. So long as there shall be such an agency,
the Issuer shall keep the Trustee advised of the names and locations of such
agencies, if any are so designated. If any European Union Directive on the
taxation of savings comes into force, the Issuer will, to the extent possible as
a matter of law, maintain a Paying Agent in a member state of the European Union
that will not be obligated to withhold or deduct tax pursuant to any such
Directive or any law implementing or complying with, or introduced in order to
conform to, such Directive.

     With respect to moneys paid by the Issuer and held by the Trustee or any
Paying Agent for payment of the principal of or interest or premium, if any, on
any Notes that remain unclaimed at the end of two years after such principal,
interest or premium shall have become due and payable (whether at maturity or
upon call for redemption or otherwise), (i) the Trustee or such Paying Agent
shall notify the holders of such Notes that such moneys shall be repaid to the
Issuer and any person claiming such moneys shall thereafter look only to the
Issuer for payment thereof and (ii) such moneys shall be so repaid to the
Issuer. Upon such repayment all liability of the Trustee or such Paying Agent
with respect to such moneys shall thereupon cease, without, however, limiting in
any way any obligation that the Issuer may have to pay the principal of or
interest or premium, if any, on this Note as the same shall become due.

     No provision of this Note or of the Subordinated Indenture shall alter or
impair the obligation of the Issuer, which is absolute and unconditional, to pay
the principal of, premium, if any, and interest on this Note at the time, place,
and rate, and in the coin or currency, herein prescribed unless otherwise agreed
between the Issuer and the registered holder of this Note.

     Prior to due presentment of this Note for registration of transfer, the
Issuer, the Trustee and any agent of the Issuer or the Trustee may treat the
holder in whose name this Note is


                                       25
<PAGE>


registered as the owner hereof for all purposes, whether or not this Note be
overdue, and none of the Issuer, the Trustee or any such agent shall be affected
by notice to the contrary.

     No recourse shall be had for the payment of the principal of, premium, if
any, or the interest on this Note, for any claim based hereon, or otherwise in
respect hereof, or based on or in respect of the Subordinated Indenture or any
indenture supplemental thereto, against any incorporator, shareholder, officer
or director, as such, past, present or future, of the Issuer or of any successor
corporation, either directly or through the Issuer or any successor corporation,
whether by virtue of any constitution, statute or rule of law or by the
enforcement of any assessment or penalty or otherwise, all such liability being,
by the acceptance hereof and as part of the consideration for the issue hereof,
expressly waived and released.

     This Note shall for all purposes be governed by, and construed in
accordance with, the laws of the State of New York.

     As used herein, the term "U.S. Alien" means any person who is, for U.S.
federal income tax purposes, (i) a non-resident alien individual, (ii) a foreign
corporation, (iii) a non-resident alien fiduciary or a foreign estate or trust
or (iv) a foreign partnership one or more members of which is, for U.S. federal
income tax purposes, a non-resident alien individual, a foreign corporation or a
non-resident alien fiduciary of a foreign estate or trust.

     All terms used in this Note which are defined in the Subordinated Indenture
and not otherwise defined herein shall have the meanings assigned to them in the
Subordinated Indenture.






                                       26
<PAGE>


                                  ABBREVIATIONS

     The following abbreviations, when used in the inscription on the face of
this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:

           TEN COM  -  as tenants in common

           TEN ENT  -  as tenants by the entireties

           JT TEN   -  as joint tenants with right of survivorship and not as
                       tenants in common

     UNIF GIFT MIN ACT - ___________________Custodian ______________________
                               (Minor)                       (Cust)

     Under Uniform Gifts to Minors Act ______________________________
                                                  (State)

     Additional abbreviations may also be used though not in the above list.

                             _______________________






                                       27
<PAGE>


     FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto

____________________________________________
[PLEASE INSERT SOCIAL SECURITY OR OTHER
     IDENTIFYING NUMBER OF ASSIGNEE]

_______________________________________________________________________________


_______________________________________________________________________________


_______________________________________________________________________________
    [PLEASE PRINT OR TYPE NAME AND ADDRESS, INCLUDING ZIP CODE, OF ASSIGNEE]

the within Note and all rights thereunder, hereby irrevocably constituting and
appointing such person attorney to transfer such note on the books of the
Issuer, with full power of substitution in the premises.


Dated:_______________________


NOTICE:    The signature to this assignment must correspond with the name as
           written upon the face of the within Note in every particular without
           alteration or enlargement or any change whatsoever.







                                       28
<PAGE>


                            OPTION TO ELECT REPAYMENT

     The undersigned hereby irrevocably requests and instructs the Issuer to
repay the within Note (or portion thereof specified below) pursuant to its terms
at a price equal to the principal amount thereof, together with interest to the
Optional Repayment Date, to the undersigned at

______________________________________________________________________________


______________________________________________________________________________


______________________________________________________________________________
         (Please print or typewrite name and address of the undersigned)


     If less than the entire principal amount of the within Note is to be
repaid, specify the portion thereof which the holder elects to have repaid:
_________________; and specify the denomination or denominations (which shall
not be less than the minimum authorized denomination) of the Notes to be issued
to the holder for the portion of the within Note not being repaid (in the
absence of any such specification, one such Note will be issued for the portion
not being repaid): __________________.


Dated:____________________________     _________________________________________
                                       NOTICE: The signature on this Option to
                                       Elect Repayment must correspond with the
                                       name as written upon the face of the
                                       within instrument in every particular
                                       without alteration or enlargement.







                                       29