EXHIBIT 10.04

                               CUSTOMER AGREEMENT

            THIS CUSTOMER AGREEMENT (this "Agreement") made as of June 30, 2000,
by and among MORGAN STANLEY DEAN WITTER SPECTRUM COMMODITY L.P. a Delaware
limited partnership (the "Customer") and MORGAN STANLEY & CO. INTERNATIONAL
LIMITED ("MSIL");

                              W I T N E S S E T H:
                              - - - - - - - - - -

            WHEREAS, Customer and MSIL wish to enter into this Agreement to set
forth the terms and conditions upon which MSIL will perform brokerage services
with respect to Client Contracts, Contracts and Transactions for Customer
through an account carried by MSIL on behalf and in the name of Customer (the
"Account").

            NOW, THEREFORE, the parties hereto hereby agree as follows:

            1. Incorporation by Reference. The Non-Private Customer Agreement
annexed hereto is hereby incorporated by reference herein and made a part hereof
to the same extent as if such document were set forth in full herein. If any
provision of this Agreement is or at any time becomes inconsistent with the
annexed document, the terms of this Agreement shall control.

            2. Standard of Liability and Indemnity.

            (a) Standard of Liability. MSIL and its affiliates (as defined
        below) shall not be liable to Customer, the general partner or the
        limited partners, or any of its or their respective successors or
        assigns, for any act, omission, conduct, or activity undertaken by or on
        behalf of the Customer pursuant to this Agreement which MSIL determines,
        in good faith, to be in the best interest of the Customer, unless such
        act, omission, conduct, or activity by MSIL or its affiliates
        constituted misconduct or negligence. Without limiting the foregoing,
        MSIL shall have no responsibility or liability to Customer hereunder (i)
        in connection with the performance or non-performance by any Exchange,
        Clearing House or other third party (including floor brokers not
        selected by MSIL) and/or Broker to MSIL of its obligations in respect of
        any Contract or Transaction or other property of Customer; (ii) as a
        result of any prediction, recommendation or advice made or given by a
        representative of MSIL whether or not made or given at the request of
        Customer; (iii) as a result of MSIL's reliance on any instructions,
        notices and communications that it believes to be that of an individual
        authorized to act on behalf of Customer; (iv) as a result of any delay
        in the performance or non-performance of any of MSIL's obligations
        hereunder directly or indirectly caused by the occurrence of any
        contingency beyond the control of MSIL including, but not limited to,
        the unscheduled closure of an Exchange or Clearing House or delays in
        the transmission of orders due to breakdowns or failures of transmission
        or communication facilities, execution, and/or trading facilities or
        other systems, it being understood that MSIL shall be excused from
        performance of its obligations hereunder for such period of time as is
        reasonably necessary after such occurrence to remedy the effects
        therefrom; (v) as a result of any action taken by MSIL to comply with
        Market Requirements or Applicable Law; or (vi) for any acts or omissions
        of those neither employed nor supervised by MSIL (excluding floor
        brokers selected by MSIL). In no event will MSIL be liable to Customer
        for consequential, incidental or special damages hereunder.

            (b) Indemnification by Customer. Customer shall indemnify, defend
        and hold harmless MSIL and its affiliates from and against any loss,
        liability, damage, cost or expense (including attorneys' and
        accountants' fees and expenses incurred in the defense of any demands,
        claims or lawsuits) actually and reasonably incurred arising from any
        act, omission, conduct, or activity undertaken by MSIL on behalf of
        Customer, including, without limitation, any demands, claims or lawsuits
        initiated by a limited partner (or assignee thereof); provided that (i)
        MSIL has determined, in good faith, that the act, omission, conduct, or
        activity giving rise to the claim for indemnification was in the best
        interests of the Customer, and (ii) the act, omission, conduct or
        activity that was the basis for such loss, liability, damage, cost or
        expense was not the result of misconduct or negligence. Notwithstanding
        the foregoing, no indemnification of MSIL or its affiliates by Customer
        shall be permitted for any losses, liabilities or expenses arising from
        or out of any alleged violation of federal or state securities laws
        unless (i) there has been a successful adjudication on the merits of
        each count involving alleged securities law violations as to the
        particular indemnitee, or (ii) such claims have been dismissed with
        prejudice on the merits by a court of competent jurisdiction as to the
        particular indemnitee, or (iii) a court of competent jurisdiction
        approves a settlement of the claims against the particular indemnitee
        and finds that indemnification of the settlement and related costs
        should be made, provided with regard to such court approval, the
        indemnitee must apprise the court of the position of the SEC and the
        positions of the respective securities administrators of Massachusetts,
        Missouri, Tennessee and/or those other states and jurisdictions in which
        the plaintiffs claim that they were offered or sold Units, with respect
        to indemnification for securities laws violations before seeking court
        approval for indemnification. Furthermore, in any action or proceeding
        brought by a limited partner in the right of Customer to which MSIL or
        any affiliate thereof is a party defendant, any such person shall be
        indemnified only to the extent and subject to the conditions specified
        in the Delaware Revised Uniform Limited Partnership Act, as amended, and
        this Section 2. The Customer shall make advances to MSIL or its
        affiliates hereunder only if: (i) the demand, claim lawsuit or legal
        action relates to the performance of duties or services by such persons
        to Customer; (ii) such demand, claim lawsuit or legal action is not
        initiated by a limited partner; and (iii) such advances are repaid, with
        interest at the legal rate under Delaware law, if the person receiving
        such advance is ultimately found not to be entitled to indemnification
        hereunder.

            (c) Indemnification by MSIL. MSIL shall indemnify, defend and hold
        harmless Customer and its successors or assigns from and against any
        losses, liabilities, damages, costs or expenses (including in connection
        with the defense or settlement of claims; provided MSIL has approved
        such settlement) incurred as a direct result of the activities of MSIL
        or its affiliates, provided, further, that the act, omission, conduct or
        activity giving rise to the claim for indemnification was the result of
        bad faith, misconduct or negligence of MSIL or its affiliates.

            (d) Limitation on Indemnities. The indemnities provided in this
        Section 2 by Customer to MSIL and its affiliates shall be inapplicable
        in the event of any losses, liabilities, damages, costs or expenses
        arising out of, or based upon, any material breach of any agreement of
        MSIL contained in this Agreement to the extent caused by such event.
        Likewise, the indemnities provided in this Section 2 by MSIL to Customer
        and its successors and assigns shall be inapplicable in the event of any
        losses, liabilities, damages, costs or expenses arising out of, or based
        upon, any material breach of any representation, warranty or agreement
        of Customer contained in this Agreement to the extent caused by such
        breach.


            (e) Definition of "Affiliate." As used in this Section 2, the term
        "affiliate" of MSIL shall mean: (i) any natural person, partnership,
        corporation, association, or other legal entity directly or indirectly
        owning, controlling, or holding with power to vote 10% or more of the
        outstanding voting securities of MSIL; (ii) any partnership,
        corporation, association, or other legal entity 10% or more of whose
        outstanding voting securities are directly or indirectly owned,
        controlled, or held with power to vote by MSIL; (iii) any natural
        person, partnership, corporation, association, or other legal entity
        directly or indirectly controlling, controlled by, or under common
        control with, MSIL; or (iv) any officer or director of MSIL.
        Notwithstanding the foregoing, "affiliates" for purposes of this Section
        2 shall include only those persons acting on behalf of MSIL and
        performing services for Customer within the scope of the authority of
        MSIL, as set forth in this Agreement.

            3. MSIL Responsibilities. MSIL agrees to notify the applicable
trading advisor for the Customer immediately upon discovery of any error
committed by MSIL or any of its agents with respect to a trade for the Account
which MSIL believes was not executed or cleared in accordance with proper
instructions given by the Customer, its trading advisors or any other authorized
agent of Customer. Errors made by floor brokers appointed or selected by MSIL
shall constitute errors made by MSIL. However, MSIL shall not be responsible for
errors committed by the trading advisors.

            MSIL agrees to report to Dean Witter Reynolds Inc. ("DWR") its own
errors and the errors of any trading advisor for the Account which MSIL becomes
aware of, provided that such reporting may be via telephone. Notwithstanding the
foregoing, the failure to comply with such reporting obligation does not
increase MSIL's liability for its own errors beyond that otherwise expressly set
forth in this Agreement, nor does it make MSIL in any way responsible for errors
committed by the trading advisors.

            MSIL acknowledges that the other partnerships of which Demeter
Management Corporation (the general partner of Customer) is the general partner
or trading manager, do not constitute affiliates of the Customer.

            4. Minimum Margins. All Contracts for the Account shall be margined
at the applicable Exchange or Clearing House minimum rates for speculative
accounts.

            5. Payment of Interest. MSIL shall pay to DWR at each month-end
interest on Customer's funds in its possession as agreed between MSIL and DWR
from time to time. Customer understands that it will not receive any interest
income on its assets held by MSIL other than that paid by DWR pursuant to the
Customer's DWR Customer Agreement. DWR (and not the Customer) shall pay MSIL
interest on any debit balances in the Account at such rates as MSIL and DWR
shall agree from time to time.

            6. Recording. Each of MSIL, the Customer, and the Customer's agents
(including DWR), in their sole and absolute discretion, may record, on tape or
otherwise, any telephone conversation between or among MSIL, the Customer or the
Customer's agents with respect to the Account and Transactions therein and each
of MSIL and the Customer hereby agrees and consents thereto.

            7. Termination. This Agreement may be terminated at any time by any
party upon thirty (30) days' prior written notice to the other parties hereto.
In the event of such notice, Customer shall either close out open positions in
the Account or arrange for such open positions to be transferred to another
futures broker. Upon satisfaction by Customer of all of Customer's liabilities
to MSIL, MSIL shall transfer to another futures broker all Contracts, if any,
then held for the Account, and shall transfer to Customer or to another futures
broker, as Customer may instruct, all cash, securities and other property held
in the Account, whereupon this Agreement shall terminate. Notwithstanding the
foregoing, in the event MSIL is required by a regulatory authority to transfer
the Account to another futures broker or in the event that MSIL abandons the
futures brokerage business, then MSIL shall have the right to terminate this
Agreement by written notice effective the date contained therein, provided that
MSIL cooperates in the transfer of open positions to another futures broker and
that the termination of the Agreement is not made effective earlier than the
completion of the transfer.

            8. Complete Agreement. This Agreement constitutes the entire
agreement among the parties with respect to the matters referred to herein, and
no other agreement, verbal or otherwise, shall be binding as among the parties
with respect to such matters unless in writing and signed by the party against
whom enforcement is sought.

            9. Assignment. This Agreement may not be assigned by any party
without the express written consent of the other parties.

            10. Amendment. This Agreement may not be amended except by the
written consent of the parties and provided such amendment is consistent with
Customer's Limited Partnership Agreement.

            11. Notices. All notices required or desired to be delivered under
this Agreement shall be sent to the following addresses:

            if to the Partnership:

                           MORGAN STANLEY DEAN WITTER SPECTRUM
                           COMMODITY L.P .

                           c/o Demeter Management Corporation
                           Two World Trade Center, 62nd Floor
                           New York, New York  10048
                           Attention:  Robert E. Murray

            if to MSIL:

                           as set forth in the Non-Private Customer Agreement.

            12. Survival. The provisions of this Agreement shall survive the
termination of this Agreement with respect to any matter arising while this
Agreement was in effect.

            13. Headings. Headings of Sections herein are for the convenience of
the parties only and are not intended to be a part of or to affect the meaning
or interpretation of this Agreement.

            IN WITNESS WHEREOF, this Agreement has been executed for and on
behalf of the undersigned as of the day and year first above written.


                                        MORGAN STANLEY DEAN WITTER SPECTRUM
                                        COMMODITY L.P.

                                        By: Demeter Management Corporation
                                            General Partner



                                        By: /s/ Robert E. Murray
                                            ------------------------------
                                            Robert E. Murray
                                            President

                                        MORGAN STANLEY & CO. INTERNATIONAL
                                        LIMITED



                                        By: /s/ Brian Daly
                                            ------------------------------
                                        Name:  Brian Daly
                                        Title: Executive Director


<PAGE>


                              MORGAN STANLEY & CO.
                             INTERNATIONAL LIMITED





                                2. MORGAN STANLEY
                               SECURITIES LIMITED






                               CUSTOMER DOCUMENTS
                  (Market Counterparty / Non-Private Customer)

                        Exchange-traded Derivatives Only








                                    May 1999


<PAGE>


                         NON-PRIVATE CUSTOMER DOCUMENTS
                          (EXCHANGE-TRADED DERIVATIVES)

            (a) TABLE OF CONTENTS

Please read the contents of Part One before signing the Customer Signatures
pages in Part Three.

                                                                            Page

PART ONE:     NON-PRIVATE CUSTOMER AGREEMENT                                 1
              (Exchange-Traded Derivatives)

Chapter       I      Introduction                                            1

              II     Terms Applicable to Dealings                            4

              III    Margin                                                  6

              IV     Material Interests                                      9

              V      Powers and Exclusions of Liability                     10

              VI     Authorisation                                          13

              VII    General                                                14


PART TWO:     MASTER NETTING AGREEMENT                                      17


PART THREE:   SCHEDULES                                                     26


PART FOUR:    CUSTOMER SIGNATURE PAGES                                      32

              Non-Private Customer Documents
              Customers Domiciled in Luxembourg only
              Third Party Trading Authorisation
              Certificates of Authority to Deal
              Certificate of Trustees


<PAGE>


                                    PART ONE
                         NON-PRIVATE CUSTOMER AGREEMENT
                          (Exchange-Traded Derivatives)

Made in compliance with the Rules of The Securities and Futures Authority
Limited ("SFA")

THIS AGREEMENT is made as of the date specified on the first customer signature
page below

BETWEEN:

(A)      You, as the client named on the customer signature page; and

(B)      MORGAN STANLEY & CO. INTERNATIONAL LIMITED ("MSIL") AND/OR MORGAN
         STANLEY SECURITIES LIMITED ("MSSL") both of 25 Cabot Square, Canary
         Wharf, London E14 4QA. MSIL is regulated by SFA, and MSSL is regulated
         by SFA and a member of the London Stock Exchange.

IT IS HEREBY AGREED AS FOLLOWS:
We will treat you as a NON-PRIVATE CUSTOMER regarding all investment business
regulated by SFA which we carry on for or with you pursuant to this Agreement
other than for any business referred to below under "Market Counterparties".

All investment business mentioned in Clause 2 below which we carry out with you
or on your behalf as a Non-Private Customer will be carried out under the terms
and conditions set out below (as amended or supplemented from time to time) and
the Customer Documents.

Market Counterparties
The terms of this Agreement and the Customer Documents will also apply to
investment business which we carry out with you or on your behalf if, in respect
of such business, you are a market counterparty.

                            CHAPTER 1 - INTRODUCTION

1.       Interpretation
         In the Customer Agreement, the words and phrases below have the
         following meanings:-

         "acting in due capacity" in relation to you means as beneficial owner
         or, where some other person is beneficial owner, as trustee or agent
         for and (in either case) with all requisite authorities from that other
         person;

         "Applicable Law" includes without limitation

         (a)      Market Requirements, and

         (b)      the rules, regulations, orders, directives, announcements,
                  decisions, procedures, terms, other requirements and/or
                  customs made, given or issued by, or published under the
                  authority of any Regulatory Body, all as amended, supplemented
                  or replaced from time to time;

         "Approved Custodian" means such bank, financial institution or company
         approved by us, or any nominee company or trust corporation which is a
         subsidiary thereof;

         "Asset" means currencies, Securities (including futures or option
         contracts), deposits or physical assets;

         "Associated Firm" means any company in the Morgan Stanley Dean Witter &
         Co. group of companies and, as the context requires, any other person
         connected with us.

         "Broker" means such member of an Exchange and/or Clearing House as is
         instructed by us to enter, clear or settle any transaction on an
         Exchange;

         "Charged Securities" means such Securities as

         (a)      with our agreement, you (or any person for your account) by
                  way of security have deposited with or transferred to or may
                  hereafter deposit with or transfer to us or our agents or
                  nominees (or with or to our or their order, account, direction
                  or control), wholly or partly in satisfaction of a demand for
                  Margin. We shall have sole discretion to determine the type,
                  amount and quality of the Securities that you may deposit or
                  transfer as Charged Securities;

         (b)      are or may at any time hereafter be held (in a clearance
                  system or otherwise)

                  (i)      to our order by or for the account of an Approved
                           Custodian or

                  (ii)     by, or to the order of, for the account of or under
                           the control or direction of us (or our agents or
                           nominees) and in either case which have, with our
                           agreement, by way of security been made subject to
                           the terms of the charge in Clause 19.2;

         "Clearing House" means any clearing house providing settlement or
         clearing or similar services for, or as part of, an Exchange;

         "Client Contract" means a futures or option contract between us and
         you, which is matched by an identical Contract;

         "Client Money" means all initial and variation cash Margin, option
         premiums and all other sums received from or due to you pursuant to the
         Customer Documents which is "Client Money" within the meaning of the
         Client Money Regulations;

         "Client Money Regulations" means The Financial Services (Client Money)
         Regulations 1991, The Financial Services (Client Money) (Supplementary)
         Regulations 1991 and the related client money rules in Chapter 4 of the
         rules of SFA;

         "close out" means the entering into of a Contract equal and opposite to
         a Contract previously entered into (and each matching a Client
         Contract) to create a level position in relation to the Assets
         underlying the Contracts, or in relation to the Contracts themselves,
         and fix the amount of profit or loss arising from such Contracts and
         the corresponding Client Contracts;

         "Contract" means a futures or option contract entered into by us on an
         Exchange or with or through a Broker pursuant to Clause 3;

         "Customer Documents" means this Agreement, Master Netting Agreement,
         any notice (including but not limited to any "Notice of treatment as a
         Non-Private Customer" or "Notice of treatment as a Market
         Counterparty") and any Further Schedules (including, without
         limitation, confirmations, contract notes and statements) and
         additional documents relating directly to or indirectly to the services
         provided under Clause 2 below and accompanying this Agreement whether
         or not expressly incorporated in this Agreement and each as amended
         and/or supplemented from time to time;

         "Exchange" means any exchange, market or association of dealers in any
         part of the world on or through which investments or currencies or
         assets underlying, derived from or otherwise related directly or
         indirectly to investments or currencies are bought and sold and
         includes, without limitation, any automated trading system administered
         by an Exchange;

         "FSA" means the Financial Services Authority and any successor thereto,
         the central regulatory authority for United Kingdom investment
         business;

         "FSA1986" means the Financial Services Act 1986 of the United Kingdom
         and any successor thereto;

         "Further Schedule" means any further schedule or notice issued by us to
         you after the date of this Agreement;

         "a futures or option contract" means a contract, for future delivery
         and/or settlement, to (a) buy or sell an Asset and/or (b) pay or
         receive a sum of money by reference to an index or formula (including
         without limitation the price or value of any Assets);

         "LCH" means The London Clearing House Limited;

         "LIFFE" means the London International Financial Futures and Options
         Exchange and/or, as the context requires, LIFFE Administration and
         Management;

         "Margin" means the amount of cash (including premiums) as may from time
         to time be demanded by us from you to protect us against any loss or
         risk of loss on present, future or contemplated Contracts and/or Client
         Contracts;

         "Margin Account" means a client bank account with such approved bank or
         banks as we may from time to time determine, which (in the case of any
         such account in which Client Money is held) is a margined transaction
         bank account within the meaning of the Client Money Regulations;

         "Market Requirements" means

         (a)      the constitution, by-laws, rules, regulations, orders,
                  directives, announcements, decisions, procedures, standard
                  terms and customs made, issued by, or published under the
                  authority of any Exchange, Clearing House, self-regulating
                  organisation or market of which we or any relevant Associated
                  Firm or any Broker is a member, or to whose authority we are
                  or any of them is subject, directly or indirectly, or where
                  the relevant transaction is executed and/or cleared, and

         (b)      any other requirements of the relevant Exchange, Clearing
                  House or Broker (including without limitation any and all
                  agreements and deeds entered into by us or any relevant
                  Associated Firm or Broker with or in favour of the relevant
                  Exchange, Clearing House or Broker),

         all as amended, supplemented or replaced from time to time;

         "Open Contract" means a Contract which has not been closed out and
         which has not yet matured;

         "Regulatory Body" means any Exchange, Clearing House, governmental,
         quasi-governmental or other department, agency or self-regulating
         organisation of which we are a member which has direct or indirect
         regulatory or enforcement authority or responsibility over us (or to
         any relevant Associated Firm or Broker), or any investment business
         conducted by us or such relevant Associated Firm or Broker for or with
         you;

         "Rules" means the FSA Statements of Principle, the rules of SFA, the
         Client Money Regulations and the Common Unsolicited Calls Regulations;

         "Securities" means securities, investments and financial instruments;

         "Taxes" means taxes, duties, imposts and fiscal and regulatory charges
         of any nature, wherever and whenever imposed, including without
         limitation, value added taxes, stamp and other documentary taxes and
         Exchanges and Clearing House and investment industry levies; and

         "Transaction" means the entering into of a Contract, closing out or
         effecting delivery and/or settlement of a Contract (which terms shall
         include exercise or allocation of an option Contract) pursuant to the
         Customer Documents.

         References herein to "we" or "us" shall mean MSIL and/or MSSL and/or
         each or any of our Associated Firms or members of a relevant Exchange
         to whom we have delegated pursuant to Clause 3 and /or (in Clauses 9,
         21 and 22) any associate of MSIL and/or MSSL, and references to "our"
         shall be construed accordingly.

         Any words or expressions to which a meaning is given in the Rules,
         shall, except where the context indicates otherwise, have the same
         meaning in the Customer Documents.

         Words importing the singular shall, where the context permits, include
         the plural and vice versa. The expression "person" shall include any
         firm, partnership, association of persons and body corporate and any
         such persons acting jointly and the personal representatives or
         successors in title of any such person. Where the customer comprises
         two or more persons the liabilities and obligations under the Customer
         Documents shall be joint and several. References to "writing" shall
         include telex, facsimile transmission or transmission of text by any
         other electronic means. References to statutory provisions, rules and
         regulations shall include any modification, re-enactment or re-making
         thereof.

         All headings are for convenience only and shall not affect the
         interpretation of the Customer Documents.

2.       Services to be provided

2.1      The services which we may provide to you are general investment and
         dealing services in financial and commodity options, futures and
         contracts for differences traded on an Exchange, together with related
         research, advice, clearing and settlement facilities and any other
         services agreed between us.

2.2      We shall not undertake discretionary transactions for you unless you
         have signed and returned to us a Discretionary Trading Authorisation.

3.       Delegation

3.1      We may arrange for any of our Associated Firms or any other member of a
         relevant Exchange to carry out the services to you, which we agree to
         provide to you pursuant to this Agreement.

3.2      We may designate a Broker to execute, clear and/or settle any
         transaction subject to the Rules and to such conditions as we may
         impose.

4.       Introduction of business

4.1.     We may introduce you to any Associated Firm outside the United Kingdom
         and you hereby authorise us on any such Associated Firm's behalf to
         expressly invite it to call you with a view to entering into investment
         transactions from time to time with or for you. If such Associated Firm
         agrees to do so:

         (a)      you shall have a direct relationship solely with such
                  Associated Firm and, in any dispute between, or claim against,
                  you and/or any such Associated Firm, you shall have no
                  recourse to us; and

         (b)      you may place orders with us for the Associated Firm to
                  execute, subject to its terms. In any of these transactions,
                  we will act as agent for the Associated Firm, and nothing we
                  do in connection with such transactions will make us your
                  agent.

4.2      For any transaction or other investment services provided to you by
         such Associated Firms, only the following provisions of this Agreement
         will apply as between us and you, as the context may require and each
         as amended from time to time;

         (a)      Clauses 1, 2, 4, 5.2, 8, 9, 21, 22, 26, 29-31and Chapters VI
                  and VII, Schedule 2 and Schedule 3; and

         (b)      in the case of the latest Notice of Treatment sent by us to
                  you as a non-private customer or market counterparty,
                  paragraphs 1 and 2 of that Notice.

5.       Dealings and rules, regulations and restrictions

5.1      All Client Contracts and Transactions shall be subject to applicable
         Market Requirements and Applicable Law; provided that:

         (a)      if there is a conflict between (i) the Customer Documents and
                  (ii) any such requirements  and/or law, the latter will
                  prevail; and

         (b)      we are entitled to take or omit to take any action we consider
                  fit or appropriate to ensure compliance with such laws and
                  requirements; all actions we take will be binding on you.

5.2      We are authorised by you at any time to do any thing or disclose any
         matters concerning you or your dealings (whether or not pursuant to the
         Customer Documents) if required by any Applicable Law, or which we are
         requested to do or disclose by any Regulatory Body.

                    CHAPTER II - TERMS APPLICABLE TO DEALINGS

6.       Contracts and Client Contracts

6.1      If we carry out a Transaction on your request or pursuant to Clause 24
         below:

         (a)      a corresponding Client Contract shall come into existence on
                  the purchase or sale of a Contract or, as the case may be
                  exercise and allocation of an option Contract in respect of
                  which the underlying Asset is a futures Contract. The Client
                  Contract will terminate when the Contract is closed out,
                  settled or delivered; and

         (b)      you will have the obligations in relation to the Transaction
                  and the Client Contract that are mentioned in this Agreement
                  and the Customer Documents.

6.2      For each Client Contract, we will have made or placed an equivalent
         Contract on the floor of the relevant market (by open outcry on the
         floor of, or on an automated trading system administered by, a futures
         and options Exchange or the futures or options market of any other
         Exchange) or will have entered into an equivalent Contract with or
         through a Broker pursuant to Clause 3 and we shall thus have an
         interest in the Transaction.

6.3      Any Contract which we acquire as a result of your instructions will,
         unless the position has been closed out, result in you becoming liable
         to us in relation to the corresponding Client Contract for actual
         delivery of its underlying Asset or payment of the relevant price,
         under and subject to Market Requirements.

7.       Acceptance and execution of orders

7.1      Every order which we may take is accepted and executed, and every
         Client Contract shall be entered into, on the basis that we contract
         with you only as a principal and not as agent for you unless otherwise
         required by Market Requirements.

7.2      If we have to carry out a Transaction as agent on an Exchange where we
         would not deal as principal then, for that Transaction, you agree to be
         bound by all Market Requirements of that Exchange and you undertake to
         sign and deliver to us any further Customer Documents as we may
         require. Unless we otherwise require, Market Requirements of that
         Exchange will be incorporated herein.

8.       Aggregation of orders
         We may aggregate your orders with our own (in-house) orders and/or
         orders of our associates, connected customers and/or other customers.
         This aggregation may operate on some occasions to your advantage and on
         others to your disadvantage.

9.       Research and recommendations

9.1      We are under no obligation to provide research reports and
         recommendations to you and, where provided, you may not receive them at
         the same time as our other customers.

9.2      Our employees, officers and directors may receive, know about, act upon
         or use such research reports and recommendations before they are
         received by our customers. We are under no obligation to take account
         of these reports or recommendations when we deal with or for you.

10.      Client actions

10.1     You will take any action and give us in relation to the corresponding
         Client Contract any information that we ask for in relation to the
         delivery, settlement, and, if a purchased Option Contract, the exercise
         or allocation, of any Contract which has not been closed out.

10.2     Notwithstanding Clause 10.1 above and regardless of any right of
         equity, set-off or counterclaim which you may have or allege against
         us, any of our Associated Firms or any person connected with us, you
         will promptly take all action necessary (including the supply of
         information) to enable us to settle or deliver any Contract which you
         have instructed us to open and which has not been closed out at the
         time such Contract is to be performed.

11.      Closing Out

11.1     Subject in particular to Clauses 3 to 8 and 33.3, Market Requirements
         and any further requirements we notify you of, you may at any time
         before the date for performance of a Client Contract request us to
         close out the matching Contract or, if a purchased option Contract,
         exercise that Contract in accordance with its terms. If the closing out
         or exercise results in a sum of money being due to us, the relevant
         Exchange, Clearing House and/or Broker, we shall notify you of that
         amount, which will be payable by you immediately.

11.2     Unless we in our absolute discretion determine otherwise or we accept
         instructions from you to do otherwise, equal and opposite Contracts and
         Client Contracts (closing out being determined on a "first in, first
         out" basis) will automatically fix the amount of profit or loss in
         relation thereto.

12.      Allocation
         If the relevant Clearing House and/or Broker does not allocate long
         Open Contracts at maturity directly to a specific account of ours or to
         short Client Contracts (or vice versa) we may allocate those Contracts
         at random or in a way which seems to us to be most equitable as between
         clients. If dealings on our own account are involved at the same time,
         allocation will be to all clients first, and we will receive no
         allocation until all relevant Client Contracts have been satisfied.

13.      Delivery to you
         When we receive any amounts and/or Assets (including documents of
         title), pursuant to a Transaction, provided that you have fulfilled all
         your obligations under this Agreement and subject to Clause 15, 18.3,
         22.2 and 24.2, we will deliver such amounts and/or Assets to you in
         respect of the corresponding Client Contract, after deduction of any
         Charges and Taxes.

14.      Option Premiums
         In respect of an option Contract matching a Client Contract:-

         (a)      if you are a buyer, you will pay to us on demand any premium
                  payable under the rules of the relevant  Exchange and/or
                  Clearing House (the "premium"); and

         (b)      if you are a seller, when we receive premium from the relevant
                  Exchange, Clearing House and/or Broker we will pay it into the
                  Margin Account as Margin for your account. You may be required
                  to pay further margin in respect of the relevant Contract and
                  corresponding Client Contract.

15.      Alteration of Contracts

         If the relevant Exchange, Clearing House or Broker requires any terms
         or conditions of any Contract matching a Client Contract (including the
         Assets subject to it) to be altered, we may take all actions as may, in
         our absolute discretion, be necessary, desirable or expedient to comply
         with such requirements or to avoid or mitigate loss resulting from any
         alteration. All actions taken by us will be binding on you, and any
         alteration will be deemed incorporated into the corresponding Client
         Contract. We shall notify you of any alteration (in advance, where
         reasonably practicable).

16.      Charges

16.1     Our charges will either be a commission or a mark-up or mark-down on
         the fee payable by us to any Exchange, Clearing House and/or Broker for
         the relevant Transaction and/or such other amounts as may be agreed
         from time to time between you and us. Our charges vary according to the
         transaction and customer, so the charges you pay for any particular
         transaction may differ from those another customer may pay in a similar
         transaction.

16.2     We may share charges with our Associated Firms or other third parties
         or receive remuneration from them for transactions carried out with or
         for you. Details of any such arrangements will be made available to you
         on your written request.

17.      Interest

17.1     We will not pay interest to you on any Client Money or other money,
         which we receive from you or hold on your behalf, unless we separately
         agree to do so.

17.2     Interest will accrue on the amount that you have not paid us when due
         until payment (as well after as before judgement). Such interest will
         be calculated at the rate not to exceed 2 per cent per annum above the
         base rate or prime rate (or local equivalent thereof) of the bank (or
         if there is more than one bank, the one determined by us in our
         absolute discretion) at which we maintain our principal securities
         settlement or other relevant account in the relevant currency. If such
         rate cannot be ascertained for any reason or is insufficient in our
         sole judgement to compensate us for our loss or expense, such interest
         shall be calculated at the rate per annum conclusively determined by us
         to be equal to the loss of interest we suffer or, as applicable, our
         cost of funding at prevailing markets rates the amount you owe from
         such sources and for such periods as we may decide.

                            (i) CHAPTER III - MARGIN

18.      Margin payment and Client Money

18.1     You will pay to us upon demand such sums as we may in our absolute
         discretion require from time to time as Margin in respect of all
         present, future or contemplated Contracts and Client Contracts.

18.2     As soon as practicable we will pay or credit all Client Money or other
         Margin to a Margin Account at an approved bank (which may be any of our
         Associated Firms) that we select. The currency of the Margin you pay to
         us shall be the currency of the relevant underlying Contract or, if
         agreed by us and you, another currency. Settlement of all transactions
         (including Margin payments thereon) will be made in the currency of the
         relevant underlying Contract and you bear all risk and cost in respect
         of any conversion of currency in a Margin Account. Any such conversion
         will be made by us at such reasonable market rate or rates as we will
         determine.

18.3     You agree that we will hold your interest under the trust declared
         under the Client Money Regulations and all other Client Money, which is
         in a Margin Account on trust in the following order of priority:

         (a)      for  ourselves  to the extent of all amounts  which are or may
                  become due to us or payable by us on your behalf under or
                  pursuant to the Customer Documents; and, thereafter

         (b)      for you to the extent of any  surplus  which is due to you
                  after the  payment of all  amounts due to or payable by us
                  under paragraph (a) above.

18.4     We may withdraw Client Money and/or any other money held in a Margin
         Account to pay to any Broker, Clearing House, Exchange or other parties
         all margins, premiums and other sums on futures and options Contracts
         demanded or due from us in respect of our clients, and for any other
         purposes allowed under the Client Money Regulations.

18.5     Subject to the terms of the Client Money Regulations, any loss incurred
         on default by any Exchange, Clearing House or Broker in respect of
         Margin paid by us shall be borne by all of our clients at the date of
         such loss pari passu, in proportion to their respective entitlement to
         monies in the relevant Margin Account at that time.

18.6     Where you agree to effect transactions, or if you give instructions to
         us to effect transactions in a jurisdiction outside the United Kingdom,
         then we may need to appoint an intermediate broker, settlement agent or
         custodian to undertake those transactions. In order to meet the margin
         and settlement obligations to the relevant Exchange or Clearing House,
         we may need to pass your money and/or assets to an intermediate broker,
         settlement agent or custodian in that jurisdiction. In that event you
         should note that there may be different settlement and legal and
         regulatory requirements in these overseas jurisdictions together with
         different practices for the separate identification of your investments
         and your money might not be protected as effectively when held by such
         an intermediate broker as if it were held in a client bank account in
         the United Kingdom. You should note that in the event of a shortfall
         arising on the money available to meet the claims of segregated
         clients, your claim will be restricted to the money held in our client
         bank accounts in respect of transactions carried on through that
         intermediate broker and to any money received from the intermediate
         broker relating to those transactions.

18.7     The approved bank at which your money is held may be located outside
         the United Kingdom. You should note that the legal and regulatory
         regime applying to such banks may be different from that of the United
         Kingdom and in the event of a default of the approved bank, your money
         may be treated differently from the position that would apply if the
         money was held by an approved bank in the United Kingdom.

19.      Margin Securities

19.1     Amounts you owe to us by way of Margin under Clause 18 may, in our
         absolute discretion, be satisfied by way of deposit or transfer of
         Charged Securities as security. We may, in our discretion, permit you
         to deliver by way of Margin, Charged Securities other than those
         accepted by the relevant Exchange or Clearing House as Margin. Our
         charges for providing this facility to you will be separately agreed
         with you. This Clause 19 will apply to all Securities delivered by way
         of Margin. Charged Securities will not (unless we agree otherwise) be
         registered in your name.

19.2     As continuing security for all your liabilities and obligations under
         the Customer Documents, you acting in due capacity (and with the intent
         that the security so constituted shall be a security in our favour
         extending to all beneficial interests in the assets hereby charged and
         to any proceeds of sale or other realisation thereof, including any
         redemption monies paid or payable in respect thereof) hereby assign,
         charge and pledge to us, free of all adverse interests whatsoever by
         way of first fixed charge, all Charged Securities. Each Approved
         Custodian will hold to our order all Charged Securities held by it for
         its account.

19.3     You will forthwith execute on request all transfers, assignments,
         mortgages, charges and other documents, give notices and directions and
         do any other acts and things as we may specify, to enable us or our
         nominee to be registered as the owner of or otherwise obtain legal
         title to any Charged Securities, to perfect our rights with respect to
         the security referred to in this Clause 19, to secure further your
         liabilities and obligations, to facilitate the exercise of our rights
         hereunder, or to satisfy any Market Requirements.

19.4     You will not, without our prior written consent, at any time during the
         term of this Agreement, grant or agree to grant any option over, sell,
         assign or transfer, or agree to attempt to sell, assign or transfer, or
         create, agree or attempt to create, or allow to exist any charge, lien,
         or other encumbrance on or over any or all of the Charged Securities,
         except for the charge set out above.

19.5     We will hold all Charged Securities for the purposes of satisfying any
         and all of your obligations and liabilities under the Customer
         Documents. We may, without prior notice, free of any interest therein
         of yours, any client of yours or any other person for whom you are
         trustee or agent:

         (a)      deposit,  charge,  pledge or otherwise create security over
                  the Charged Securities with, to the order of or in favour of
                  any Exchange, Clearing House or Broker

                  (i)      on such terms as such Exchange or Clearing House may
                           prescribe, and

                  (ii)     on terms that, subject to the Rules, the Broker may
                           deal with the Charged Securities in accordance with
                           Market Requirements and any agreement made with us;

                  The relevant Exchange, Clearing House or Broker may enforce
                  and retain such deposit, charge, pledge or other security to
                  satisfy any obligations of yours or ours to the Exchange,
                  Clearing House or Broker; and

         (b)      register, sell, realise, charge or otherwise deal with the
                  Charged Securities on such terms (including as to the
                  consideration received therefor) as we may in our absolute
                  discretion think fit (with prior reference to you where
                  practicable, but in any case with subsequent notice to you,
                  and without being responsible for any loss or diminution in
                  price). Any consideration received will be credited to the
                  Margin Account.

         If Charged Securities are denominated in a different currency from that
         in which any relevant cost, damages, loss, liability or expense is
         denominated, we may convert any amount realised at such rate as we
         determine at the time.

19.6     Where we deposit, pledge or charge Charged Securities under Clause
         19.5(a), the part of the proceeds of any sale of those securities which
         exceeds your margin requirements to us will be subject, in the event of
         our default, to the pooling rules under the Client Money Regulations.
         This means that money held in our Client Money bank accounts is pooled
         and distributed pari passu to meet the claims of all customers who are
         entitled to protection under the Client Money Regulations. If there is
         a shortfall in an overseas Client Money bank account, a separate pool
         may be formed for all customers whose money was held in that account.

19.7     When we are satisfied that all costs, damages, losses, liabilities and
         expenses incurred under the Customer Documents have been satisfied,
         discharged or otherwise released, we may re-transfer or, re-deliver any
         certificates or documents of title relating to you upon request.

19.8     You agree that if we re-transfer or re-deliver fungible Securities
         (whether Charged Securities or otherwise) to you, these need not be the
         identical Securities originally deposited, charged, or transferred to
         us, and you will accept Securities of the same class and denomination
         or other Securities which then represent the same.

19.9     Pending the re-transfer or re-delivery we will credit any income
         received in respect of Charged Securities, net of any Taxes payable by
         us (whether by withholding or otherwise) on the income, to the Margin
         Account. You may direct us as to the exercise of any voting or other
         rights attached to or conferred on any Charged Securities.

19.10    Unless the context otherwise requires, references in this Clause 19 to
         "we" or "us" includes references to any person holding any of the
         Securities or in whose name any of them may be registered.

20.      Custodian activities and documents of title

20.1     We may (subject to the Rules) act, or may appoint any of our Associated
         Firms which are eligible custodians or any other eligible custodian (as
         defined by the SFA) to act, as custodians of your documents of title or
         certificates evidencing title to your assets (including Charged
         Securities, except where absolute title passes to us).

20.2     If we consider it appropriate to register your registrable assets in a
         name other than your own, then we may arrange such registration in the
         name of a nominee company, which is controlled by:

         (a)      ourselves;

         (b)      an Associated Firm;

         (c)      a recognised or designated investment exchange; or

         (d)      an eligible custodian (as defined by the Rules) which may be
                  an Associated Firm.

         Such assets will be held by such nominee on trust for you, except that,
         in the case of assets held by a custodian which is not an affiliate of
         ours, the nominee shall hold its rights against such custodian on trust
         for you.

20.3     Where, due to the nature of the law or market practice of an overseas
         jurisdiction, it is in your best interests, or it is not feasible to do
         otherwise we shall register your assets in the name of an eligible
         custodian or ourselves. If your assets are registered in our name you
         should note that your assets may not be segregated from the assets of
         our firm and in the event of our default you may not be as well
         protected.

20.4     Assets will only be held/registered outside the normal SFA requirements
         upon your specific written instructions. You should note that the
         consequences of doing so are entirely at your own risk.

20.5     Where assets are held on your behalf overseas, you should note that
         there may be different settlement, legal and regulatory requirements in
         those jurisdictions from those applying in the UK, together with
         different practices for the separate identification of your
         investments.

20.6     Your assets may be pooled with those of one or more customers. This
         means that individual customer entitlements may not be identifiable by
         separate certificates, other physical documents of title or equivalent
         electronic record and in the event of an unreconcilable shortfall after
         the default of a custodian, customers may share in that shortfall
         pro-rata.

20.7     We will collect any dividends, interest, or other entitlements, in cash
         or in kind, to which you may be entitled and of which we are notified
         and will remit to you such dividends or interest as soon as possible
         after deduction of any Taxes payable or credit them to such account of
         yours as we may consider appropriate.

20.8     In respect of any investments held on your behalf by us or a third
         party appointed by us under or pursuant to the Customer Documents, if
         we are notified of any voting and/or any other rights or privileges
         (including without limitation conversion and subscription rights and
         rights or privileges arising in connection with takeovers, other offers
         or capital reorganistions) attaching to those investments may be
         exercised, we will notify you as soon as reasonably practicable of such
         rights and/or privileges.

         If you unambiguously inform us in writing within 14 days of such notice
         (or such shorter period as may be specified or appropriate) that you
         wish us to exercise the rights and/or privileges and we have sufficient
         cleared funds, we will do so but only on such terms as you advise in
         writing and which are reasonably acceptable to us.

         Otherwise we will not exercise any such rights and/or privileges.
         Notwithstanding the absence of satisfactory instructions or sufficient
         funds, in the event that we are notified that subscription rights
         attach to any investments that we or such third party hold on your
         behalf we may, in our or its absolute discretion, dispose of such
         rights on your behalf in such manner as we think, or it thinks, fit.

20.9     If we are notified by any third party appointed by us under or pursuant
         to the Customer Documents, or by any company in which we or such third
         party hold investments on your behalf that such company intends to make
         calls upon those investments in respect of any monies whatsoever unpaid
         on them, we will notify you as soon as practicable of such calls. If
         you provide us with the relevant funds in sufficient time for us to do
         so, we will satisfy such calls on your behalf and on such terms as you
         advise in writing and which are reasonably practicable to us. Otherwise
         we shall take no action on your behalf and will have no liability
         whatsoever in respect of the consequences of a failure to satisfy the
         calls made. However, where the custodian is legally liable to meet such
         calls it may do so and you will reimburse us forthwith upon demand.

20.10    Subject to Clauses 19, 20.11 and 24 and the Rules we are not authorised
         to:

         (a)      borrow money on your behalf against the security of your
                  Securities; or

         (b)      lend any documents of title or certificates evidencing title
                  to any third party; or

         (c)      otherwise use your documents of title or other documents
                  evidencing title to investments belonging to you for our own
                  account or for the account of another of our customers.

         In each case, unless we have first entered into a written agreement
         with you giving us such authorisation.

20.11(a) Without prejudice to Clause 19.5, you hereby authorise MSIL at any time
         or times to borrow, lend or otherwise use for its own purposes any
         Charged Securities without giving notice of such borrowing, lending or
         other use to you. MSIL may retain for its own account all fees, profits
         and other benefits received in connection with any such borrowing, loan
         or use. Upon such borrowing, lending or other use, such Charged
         Securities will become the absolute property of MSIL (or that of such
         transferee) free from the security created hereunder and from any
         equity, right, title or interest of yours and you will thereupon have a
         right against MSIL for the delivery of Securities of the same issuer,
         forming part of the same issue and of an identical type, nominal value,
         description and amount as such Charged Securities (provided that where
         there has been any corporate action or other events in relation to any
         such Charged Securities, we may determine what assets (which may
         consist of and include money or other property) are to be treated as
         equivalent for this purpose) ("Equivalent Securities").

20.11(b) MSIL may deliver, or procure the delivery of, Equivalent Securities to
         you under Clause 20.11(a) by causing such Equivalent Securities to be
         transferred, appropriated or designated to your account(s) charged to
         it from which such Securities were held prior to such use or, if not
         possible to do so, to such other of your accounts charged to MSIL as
         MSIL shall determine. Such Securities shall upon such transfer,
         appropriation or designation become subject to all the provisions of
         the Customer Documents, including, without limitation, those of Clause
         19 and this Clause 20.11.

20.11(c) Our obligation to return Equivalent Securities under this paragraph
         may, if we so elect, be included in any set-off of obligations of ours
         to you against any obligation of yours to us (whether under Clauses 24
         or 28 below or otherwise), on the basis that there is for that purpose
         due from us to you an amount equal to the Default Market Value of such
         Equivalent Securities, and our obligation to return Equivalent
         Securities shall, if and to the extent so included, be extinguished
         accordingly. For this purpose -

         (i)    the "Default Market Value" of such Equivalent Securities means:

                (A)      if during the Default Valuation Period (as defined
                         below) we have sold Securities forming part of the same
                         issue and being of an identical type and description to
                         those Securities and in substantially the same amount
                         as those Securities, the net proceeds of sale (after
                         deducting all reasonable costs, fees and expenses
                         incurred in connection therewith); and

                (B)      failing such sale during the Default Valuation Period,
                         the market value of such Securities at the Default
                         Valuation Time as determined by us in good faith;

         (ii)   the "Default Valuation Period" means:

                (A)      if the relevant set-off occurs on a day that is a
                         dealing day in the most appropriate market for
                         Securities of the relevant description (as determined
                         by us), a period commencing on the opening of business
                         on that day and ending at the close of business on the
                         following dealing day; and

                (B)      in any other case, the close of business on the second
                         dealing day in that market after the day on which the
                         set-off occurs.

         (iii)  the "Default Valuation Time" means the end of the Default
                Valuation Period.

         Where the amount of any Securities sold as mentioned in (i)(A) above is
         not identical to that of the Securities to be valued for the purposes
         of this definition, the Default Market Value of those Securities shall
         be ascertained by dividing the net proceeds of sale by the amount of
         the Securities sold so as to obtain a net unit price and multiplying
         that net unit price by the amount of the Securities to be valued.


                         CHAPTER IV - MATERIAL INTERESTS

21.1     The relationship between you and us is as described in the Customer
         Documents. Neither that relationship nor the services we provide nor
         any other matter will give rise to any fiduciary or equitable duties on
         our part which would prevent or hinder us from doing business for or
         with you (whether acting as principal or agent), doing business with
         associates, connected customers, and other investors and generally
         acting as provided in the Customer Documents.

         We may give advice or make recommendations to you, enter into
         Transactions for or with you or act as your agent or provide any other
         service pursuant to Clause 2 notwithstanding that we may have a
         relationship, arrangement or interest that is material in relation to
         the Transaction, advice or recommendation concerned and/or the Asset
         underlying any Contract or Client Contract, including (but not limited
         to) the following circumstances where:-

         (a)      we have acted, are acting or are seeking to act as a financial
                  adviser or lending banker to the issuer (or any of its
                  affiliated companies) of the Assets the subject of a
                  Transaction or have advised or are advising any person in
                  connection with a merger, acquisition or take-over by or for
                  such issuer (or any of its affiliated companies);

         (b)      we have sponsored or underwritten or otherwise participated
                  in, or are sponsoring or underwriting or otherwise
                  participating in the Assets the subject of a Transaction;

         (c)      we have a holding, dealing, or market-making position or may
                  otherwise be trading or dealing in the Assets the subject of a
                  Transaction or in investments (including without limitation
                  any futures or option Contracts) or assets of any kind
                  underlying, derived from or otherwise directly or indirectly
                  related to such investments;

         (d)      we have received or are receiving payments or other benefits
                  for giving  business to the firm with which your order is
                  placed;

         (e)      we have been or are an associate of the issuer (or any of its
                  affiliated  companies)  of the Assets the subject of a
                  Transaction;

         (f)      we are matching your transaction with that of any other client
                  (including without limitation us, any Associated Firm,
                  connected customer or other customer of us) either by acting
                  on behalf of such person as well as on behalf of you ("agency
                  cross") or by executing matching transactions at or about the
                  same time with you and such persons ("back-to-back principal
                  trade").

21.2     No further disclosure to you is required of any relationship,
         arrangement or interest which falls within one of the circumstances
         referred to in Clause 21.1 above, and we will be entitled to retain any
         profit or benefit arising as if no such relationship, arrangement or
         interest existed.

21.3     We will not be obliged to disclose to you any matter, fact or thing,
         whether or not such disclosure would or might be a breach of any duty
         owed by us to any other person, and we shall not be obliged to disclose
         to you any matter, fact or thing which comes to the notice of any of
         our employees, officers or directors if the employee, officer or
         director who is dealing for or with you is unaware of such matter, fact
         or thing.

21.4     We may in our absolute discretion decline to carry out a Transaction
         for or with you or to give advice or make a recommendation to you where
         we may have an interest in respect thereof which will or may conflict
         with your interests.

                 CHAPTER V - POWERS AND EXCLUSIONS OF LIABILITY

22.      Exclusion and restriction of liability

22.1     Nothing in the Customer Documents shall exclude or restrict any
         liability which we have under the Rules or the regulatory system
         established by the FSA, and which may not be excluded or restricted
         thereunder.

22.2     We shall not be liable to you in respect of any relevant Client
         Contract, any matching Contract or otherwise if and to the extent that
         the relevant Exchange, Clearing House and/or Broker has ceased for any
         reason (including netting-off our positions with it) to recognise the
         existence of any Contract or fails to perform or close out any Contract
         or defaults in respect of margin or collateral. This will not affect
         your obligations and liabilities hereunder in respect of Contracts,
         which you have instructed us to open, and which have not been closed
         out.

22.3     Neither we nor any of our employees, officers or directors will be
         liable for any loss resulting from any act or omission made under or in
         relation to or in connection with the Customer Documents, except where
         such loss results from any bad faith, wilful default, fraud or
         negligence of us or any of our employees, officers or directors.

22.4     Neither we nor our employees, officers or directors will be liable for
         any consequential or special damages howsoever arising.

22.5     We will not be liable for the solvency, acts or omissions of:-

         (i)      any nominee, custodian or other third party with whom any
                  Charged Securities (or other investments) are held pursuant to
                  Clauses 19 and 20 above; or

         (ii)     any bank with which we maintain any client bank account; or

         (iii)    any other third party with whom we deal or transact business
                  or who is appointed by us in good faith on your behalf,

         unless such nominee, custodian, bank or other third party is an
         Associated Firm, but we will make available to you, when and to the
         extent reasonably so requested, any rights that we may have against
         such person.

22.6     If any claim is made by or against us or any of our employees, officers
         or directors against or by any third party in connection with this
         Agreement, any Contract acquired or Transaction effected on your
         instructions or a corresponding Client Contract or arising out of any
         act or omission by us or our employees, officers or directors, you
         hereby agree to provide us or our employees, officers or directors with
         any assistance which you may be reasonably asked to give.

22.7     Neither we nor any of our directors, officers or employees will have
         any responsibility or liability whatsoever for:

         (a)      any advice or opinion which may be given to you concerning the
                  Customer Documents; or

         (b)      any expense, loss or damage suffered by you as a result of (i)
                  our carrying out your instructions, if we acted in accordance
                  with such instructions or otherwise acted reasonably, or (ii)
                  properly carrying out or failing to carry out any actions
                  which we are permitted but not required to carry out under the
                  Customer Documents.

23.      Indemnity

         You will fully indemnify us, our Associated Firms and any of our or
         their employees, officers or directors (each an "Indemnified Person")
         against all costs, expenses, damages, liabilities and losses which any
         such Indemnified Person may suffer or incur directly or indirectly as a
         result of, or in connection with, or arising out of the Customer
         Documents or any Transaction effected on your instructions or arising
         out of any act or omission by such Indemnified Person or by any other
         person permitted under the Customer Documents, and against any claims
         which may be made against any such Indemnified Person in the
         performance of the powers or duties of any such Indemnified Person
         (including in any such case any cost of enforcing the same). The
         indemnity will not extend to any Indemnified Person if such costs,
         expenses, damages, liabilities and losses result primarily from the bad
         faith, wilful default, fraud or negligence of such Indemnified Person.

24.      Morgan Stanley's powers

24.1     If we have determined, in our absolute discretion, that you have not
         performed (or may not be able or willing in the future to perform) any
         of your obligations to us under or pursuant to the Customer Documents,
         we may (with prior notice only if reasonably practicable) take such
         steps as we consider necessary or desirable to comply with, perform,
         cancel or satisfy any of our obligations to the relevant Exchange,
         Clearing House or Broker in respect of any Contract or Contracts
         acquired on your instructions, or otherwise to protect our position,
         including closing out and/or performing any or all such Open Contracts.
         For such purpose, we may:

         (a)      buy or sell the Asset  underlying  any Open  Contract in any
                  manner  including to or from  ourselves or any Connected
                  Company;

         (b)      buy or sell futures or  options contracts;

         (c)      open new long or short positions in order to establish a
                  spread or straddle;

         (d)      borrow, buy or sell any currency;

         (e)      apply any Margin;

         (f)      cancel, terminate or otherwise liquidate any Transaction
                  between you and us; and/or

         (g)      set off any obligation to you against any of your obligations
                  to us;

         in each case so that all amounts spent by us in connection with any
         such actions that are in excess of the amount held in the Margin
         Account for you shall be paid by you to us on demand.

24.2     On the exercise of our rights under Clause 24.1 above:

         (a)      we are not obliged to deliver to you in respect of any
                  corresponding Client Contract the underlying Asset or any
                  money received or receivable on closing out until all of your
                  liabilities to us are satisfied or discharged to our
                  satisfaction, and all amounts you owe us are paid, and:

                  (i)      any such underlying Asset may be registered in our
                           name or that of our nominee (which may be an
                           Associated Firm), and we or such nominee may be the
                           custodian of the documents of title or certificates
                           evidencing title to such Asset;

                  (ii)     if such amounts are not paid and/or liabilities to us
                           are not satisfied or discharged to our satisfaction,
                           we may sell or realise the underlying Asset upon
                           terms (including the consideration received therefor)
                           as we in our absolute discretion think fit, without
                           being responsible for any loss or diminution in
                           price; any consideration received therefor shall be
                           credited to the Margin Account; and

                  (iii)    any income in respect of such Asset paid to us, net
                           of any Taxes payable by us (whether by withholding or
                           otherwise) in respect of such income, shall be
                           credited to the Margin Account; and

         (b)      all amounts owing to us hereunder will become immediately
                  payable.

24.3     We do not have to close out Contracts or take any other action in
         respect of Open Contracts acquired on your instruction. In particular
         (subject to Clause 24.1 above), no failure by you to pay Margin when
         demanded will require us to close out any relevant Contract to which
         such Margin is attributable.

24.4     We may convert any funds realised pursuant to this Clause 24 at such
         rate and into such currencies as we may reasonably consider appropriate
         at the relevant time.

25       Certificates conclusive
         Our certificate that any of our rights under the Customer Documents
         have been exercisable, or as to any amount payable or due under the
         Customer Documents, will be conclusive and binding on you, absent
         manifest error. No purchaser, pledgee or transferee of Charged
         Securities will need to enquire whether any such power has become
         enforceable, or to establish the proper application of any money paid.

26.      Time of the essence
         Time shall be of the essence in relation to all matters arising under
         or pursuant to the Customer Documents in respect of Transactions or
         Client Contracts or otherwise in respect of your dealing in futures or
         options.

27.      Retention of title
         Title to Securities purchased by you (whether upon exercise of an
         option Client Contract or otherwise) will pass only when you pay the
         amount due for such purchase.

28.      Lien and set-off
         As further security for all of your obligations hereunder (but subject
         to the Rules) we shall have the right to retain (and apply as set out
         below) all of your property which we or any of our Associated Firms
         hold for any purpose, including, but not limited to, property held in
         any other of your accounts with us or any of our Associated Firms,
         whether or not we have made any advances in connection with such
         property. From time to time we may, without notice, transfer and
         re-transfer any money or other property between any such accounts. You
         shall execute such documents and take such other action as we shall
         reasonably request in order to perfect our rights with respect to any
         security referred to in this Clause 28.

29.      Force majeure
         We shall not be liable to you for the non-performance of any of our
         obligations under this Agreement due to any cause beyond our reasonable
         control, including without limitation any breakdown or failure of
         transmission or communication or computer facilities, postal or other
         strikes or similar industrial action, or the failure of any relevant
         Exchange, Clearing House or Broker to perform its obligations for any
         reason.

30.      Taxes

30.1     All amounts which you must pay under the Customer Documents do not
         include any applicable Taxes. You must pay any Taxes to us at the same
         time as the amounts to which those Taxes relate.

30.2     You are fully responsible for paying all other Taxes due and the making
         of all claims in relation thereto whether for exemption from
         withholding taxes or otherwise, for filing any and all tax returns, and
         for providing any relevant tax authorities with all necessary
         information in relation to any investment business we carry on for or
         with you or any investments which we hold on your behalf.

30.3     We will use all reasonable endeavours to send you any tax documents
         which we receive relating to you or to any monies or investments we
         hold under the Customer Documents.

31.      Advice

31.1     You rely on your own judgement when you give orders or instructions to
         us.

31.2     We do not provide any legal or tax advice. Accordingly, if you consider
         it necessary you should consult your own legal or tax advisers.


<PAGE>


                           CHAPTER VI - AUTHORISATION

32.      Due authorisation

32.1     You represent, warrant and undertake to us that:-

         (a)      in any  investment  business we carry on for or with you under
                  this  Agreement,  you are and will be acting either as
                  principal or as agent;

         (b)      you have and will have full power and capacity and have taken
                  all necessary corporate and other action, and in the case of a
                  trustee of a particular trust you have and will have full
                  power and capacity under the relevant trust deeds, to enter
                  into and perform your obligations under this Agreement
                  (including without limitation the powers and capacity to grant
                  us the charge and any other security herein provided for) and
                  to confer on us the rights and powers contained in or given
                  pursuant to this Agreement. Without limitation:

                  (i)      your execution, delivery and performance of this
                           Agreement will not violate or conflict with any
                           Applicable Law or your constitution or any charge,
                           trust deed, contract or other instrument to which you
                           are a party or which is binding upon you or your
                           assets; and

                  (ii)     the terms and conditions contained in this Agreement
                           will be your legal, valid and binding obligations;

         (c)      you are (or some other person for whom you are trustee or
                  agent and from whom you hold and will at all times hold all
                  requisite authorities is) and will at all times during the
                  continuance of this Agreement be the sole beneficial owner of
                  all Charged Securities. In each case such Charged Securities
                  are and shall be fully paid and free from all mortgages,
                  charges, liens and other encumbrances other than those which
                  may arise in our favour. No other person has or will have any
                  rights or interests therein and you are lawfully entitled to
                  create in our favour the security evidenced or intended to be
                  evidenced hereby;

         (d)      when further Securities become Charged Securities or otherwise
                  subject to the charge in Clause 19.2 above you shall be deemed
                  to have made a further and separate representation and
                  warranty in the terms of paragraph (c) above;

         (e)      you and any person designated by you have and shall have, due
                  authorisation to act in all respects in relation to this
                  Agreement and each Transaction, Contract and Client Contract
                  and, in relation thereto, you have obtained, shall obtain and
                  shall maintain in effect all necessary authorisations,
                  consents or approvals (including without limitation any
                  required by any Regulatory Body) and shall comply with the
                  terms of the same and with all Applicable Law, and shall
                  provide us with copies or other evidence of such consents or
                  approvals and such evidence of compliance with such law as we
                  may reasonably require.

32.2     You agree that, in all investment business which we carry on for or
         with you where you are acting as agent, only you will be our customer
         and we shall have no responsibility to any principal of yours as our
         customer.

32.3     If you are acting as agent for, or on behalf of another in relation to
         any Contract and/or Client Contract carried out under this Agreement
         then:

         (a)      you have and will have full power and capacity to enter into
                  this Agreement and to perform all obligations pursuant hereto
                  to be performed by your principal under this Agreement;

         (b)      you are expressly authorised by your principal to instruct us
                  in relation to such Contract and/or Client Contract in
                  accordance with the terms and conditions of this Agreement;
                  and

         (c)      you will be, and you will procure that your principal will be,
                  jointly and severally liable, each as if a principal, to us in
                  respect of all obligations and liabilities to be performed by
                  you pursuant to and in respect of any such Contract and/or
                  Client Contract.

32.4     You agree to supply us with such financial information about yourself
         (or any immediate, intermediate or ultimate holding company) as we may
         reasonably request.

33.      Authorised instructions

33.1     You may from time to time notify us in writing of the names of those
         persons who are authorised to give instructions on your behalf. Until
         we receive notice in writing to the contrary, we shall be entitled to
         assume that any of those persons have full and unrestricted power to
         give us instructions on your behalf.

33.2     We are entitled to rely and act without further enquiry on any
         instruction, notice, demand, request or information (by whatever means
         transmitted and whether or not in writing) which purports or appears to
         come and which we reasonably believe in good faith to come from you or
         from any person who is or appears to us to be a person designated in
         the attached Certificate (if any) or otherwise authorised by you for
         the purpose of the Customers Documents or from someone acting on your
         behalf, and we shall not be liable for any actions taken or omitted to
         be taken in good faith pursuant thereto nor shall we be under any
         obligation to confirm instructions before they are executed or the
         accuracy or completeness of any such information before it is acted or
         otherwise relied upon.

33.3     We are not under any obligation to execute or otherwise enter into any
         particular Transaction, or to accept and act in accordance with any
         order or instructions, nor shall we be obliged to give any reasons for
         declining to do so.

33.4     If we decline to carry out a Transaction we will promptly notify you.
         We will have no liability for any expense, loss or damage incurred by
         you by reason of any omission so to notify you, otherwise than as a
         result of our bad faith, wilful default or negligence; in no event will
         we have any liability for any consequential or special damage.

                              CHAPTER VII - GENERAL

34.      Information

34.1     You warrant, represent and undertake that:

         (a)      you will notify us promptly in writing of any significant
                  change in your financial  position  (including  changes in
                  assets, net assets or called-up share capital); and

         (b)      in entering into this Agreement, we have not made and you are
                  not relying upon any statements, representations, promises or
                  undertakings whatsoever that are not contained in this
                  Agreement;

34.2     You will:

         (a)      provide us on request all information in your agent's
                  possession or control of you or your agents as may be required
                  to be filed or disclosed pursuant to Applicable Law, in each
                  case regarding us, you, the Customer Documents or any
                  Contract, Client Contract;

         (b)      file (within any applicable time periods) such reports,
                  letters and other communications as may be required from time
                  to time by any Regulatory Body relating to you or us, you, the
                  Customer Documents, or any Contract, Client Contract; and

         (c)      send a copy of all such reports referred to in paragraph (b)
                  above to us promptly upon such filing, and we may send a copy
                  of the same to any relevant Exchange, Clearing House member or
                  Broker.

35.      Confirmation and Statements
         As soon as practicable after we have carried out a Transaction we shall
         confirm details of that Transaction to you. We will provide to you at
         agreed intervals a statement of your overall trading (and Margin)
         positions with us at the then available current market price.

36.      Telephone recording
         We may use voice record orders, instructions or conversations we
         receive by telephone. Our voice records shall be prima facie evidence
         of the order, instructions or conversations recorded, and you agree
         that such records shall be admissible as such evidence in any
         Proceedings (as defined in Clause 43.2).

37.      Notices

37.1     Any instructions or requests you give, or demands or confirmations by
         us may be given in writing or, where permitted under the Rules, orally.
         Any notice in writing (including without limitation any contract note,
         confirmation or demand) may be given by posting or delivering it or by
         sending it by telex, facsimile transmission or any other electronic
         transmission.

37.2     Any notice or demand given by post will be sent first class, or where
         appropriate, by air mail and will, subject to Clauses 37.3 and 37.4
         below, be deemed given seven business days after posting and any notice
         given by delivery or by telex, facsimile transmission or any other
         electronic transmission will be deemed given upon delivery or
         transmission (as the case may be), and in proving service of notice it
         shall be sufficient to prove, in the case of delivery by post, that the
         letter was correctly addressed and was posted first class or, where
         appropriate, air mail or, in the case of delivery otherwise than by
         post, that it was delivered to the correct address or, in the case of
         transmission by facsimile or telex, that it was transmitted to the
         correct number and (in the case of telex) received the proper answer
         back.

37.3     Any contract note, confirmation or account statement which we give in
         writing shall be deemed correct, conclusive and binding on you if not
         objected to in writing within the earlier of five business days of
         despatch by us or one business day of your receipt thereof.

37.4     Any statement produced may be delivered by post, or by sending it by
         telex, facsimile or other electronic transmission. Where you are
         ordinarily resident outside of the UK, we may retain statements
         relating to investments and collateral held by a custodian.

37.5     Communications from you under Clause 33.1, 33.2 and 40.1 and any
         objection pursuant to Clauses 37.3 and 39.2 shall be deemed received
         only if actually delivered.

38.      Correct addresses and numbers
         Our address for serving notices is shown at the front of this document,
and our facsimile and telex numbers are:

         Fax No:           0171 425 8990/0171 513 8990
         Telex No:         8812564 MORSTAN

         We may change any of these details by written notice to you. Unless you
         tell us otherwise we will assume that your correct address and
         facsimile and telex numbers are those shown on any communication we
         receive which we reasonably believe to come from you.

39.      Entire agreement and amendments

39.1     This Agreement, together with all other Customer Documents, represent
         the entire terms on which we will undertake for or with your investment
         business in Exchange-traded futures and options contracts which is
         regulated by SFA. Any alteration to the Customer Documents must be
         agreed by us in writing.

39.2     We may amend or supplement our arrangements with you by sending you
         Further Schedules or a revised Agreement or by written agreement with
         you. Any amendment or supplement will, unless we have received your
         written objection, take effect twenty-one days after despatch to you or
         on such later date as we may specify, and will apply in respect of any
         commitment or transaction entered into by us after that date. Any
         amendment or supplement that relates to or results from a change of
         Applicable Law may take effect immediately or otherwise as we may
         specify.

40.      Termination

40.1     Either party can terminate this Agreement without penalty by giving
         notice in writing, which will take effect seven days after the notice
         is given or after any other period specified in the notice.

40.2     Termination of this Agreement will not affect the rights or liabilities
         of either party in respect of Contracts and any corresponding Client
         Contracts for which you have already given an instruction which we have
         accepted, or in respect of which there is an outstanding liability with
         us. Any termination will be without prejudice to our rights to all
         Margin and amounts in the Margin Account. The Customer Documents will
         apply to these liabilities until all Contracts have been closed out,
         settled or delivery effected and all liabilities discharged.

40.3     Termination of this Agreement will not affect any provision of the
         Customer Documents which is intended to survive termination.

41.      Assignment and Transfer

41.1     The Customer Documents shall be binding upon, and inure to the benefit
         of, MSIL and its successors and assigns.

41.2     MSIL may at any time cause all or any part of its rights, benefits
         and/or obligations under the Customer Documents to be novated to any
         subsidiary or holding company (as defined in section 736 of the
         Companies Act 1985) of MSIL or a subsidiary of any such holding company
         or any company otherwise affiliated with MSIL (any such company being a
         "Connected Company") by delivering to you a written substitution
         notice. Upon delivery of a substitution notice to you:

         a)       to the extent that in the substitution notice MSIL seeks to
                  cause its rights and/or its obligations hereunder to be
                  novated, you and MSIL shall be released from further
                  obligations to each other hereunder and their respective
                  rights against each other shall be cancelled;

         b)       you and the Connected Company shall acquire the same rights
                  and assume the same obligations between themselves as they
                  would have acquired or assumed by it as a result of such
                  novation.

41.3     You may not assign any of your rights under the Customer Documents, any
         Contract or Client Contact without our prior written consent. Any
         purported assignment of your rights will be invalid.

42.      Miscellaneous

42.1     If any term or part of the Customer Documents is void, voidable or
         unenforceable, the rest of the Customer Documents will not be affected.

42.2     Our rights, remedies, powers and privileges in this Agreement are
         cumulative and not exclusive of any rights or remedies provided by law.
         Our failure to exercise, or delay in exercising, any of our rights,
         remedies, powers or privileges will not operate as a waiver thereof,
         nor shall any single or partial exercise thereof preclude any other or
         further exercise thereof.

43.      Governing Law

43.1     The Customer Documents and all Transactions thereunder shall be
         governed by and construed in accordance with English Law.

43.2     Any suit action, claim or proceeding (together in this Clause referred
         to as "Proceedings") arising out of or in connection with the Customer
         Documents or any Transaction thereunder may be brought in the English
         courts. Any objection that you or we may have now or in the future to
         the laying of the venue of any Proceedings in any English court, and
         any claim that any Proceedings have been brought in an inconvenient
         forum, is waived.

43.3     If you are entitled in any jurisdiction to claim immunity for yourself
         or for your property or assets from service of process, jurisdiction,
         suit, judgement, execution, attachment (whether before judgement, in
         aid of execution or otherwise) or legal process in respect of your
         obligations under this Agreement, or to the extent that in any
         jurisdiction there may be attributed to you or your property or assets
         such immunity (whether or not claimed), you waive such immunity to the
         fullest extent under the laws of such jurisdiction.

43.4     You irrevocably and generally consent in respect of any legal action or
         Proceedings arising out of or in connection with the Customer Documents
         or any Transaction to the giving of any relief or the issue of any
         process in connection with such action or Proceedings, including,
         without limitation, the making, enforcement or execution against any
         property, asset, or revenues whatsoever (irrespective of their use or
         intended use) of any order or judgement which may be made or given in
         such action or Proceedings.

IN WITNESS WHEREOF, this Agreement has been entered into on the date written in
the Customer Signature pages below.

Signed on behalf of

Morgan Stanley & Co. International Limited
           -and-
Morgan Stanley Securities Limited


By:    ...../s/ R S Rosenthal......

Name:  R S Rosenthal
Title: Company Secretary


<PAGE>


                                    PART TWO
                            MASTER NETTING AGREEMENT

THIS MASTER NETTING AGREEMENT is made as of the date specified on the first
customer signature page

BETWEEN

(A)      You, as the client named on the customer signature page; and

(B)      MORGAN STANLEY & CO. INTERNATIONAL LIMITED ("MSIL") AND/OR MORGAN
         STANLEY SECURITIES LIMITED ("MSSL") both of 25 Cabot Square, Canary
         Wharf, London E14 4QA . MSIL is regulated by SFA, and MSSL is regulated
         by SFA and a member of the London Stock Exchange.


IT IS HEREBY AGREED AS FOLLOWS:

1.       Scope of this Agreement

1.1      Unless otherwise agreed in writing by the Parties in Annex 1 or
         otherwise and subject to the next sentence, these terms and the
         particular terms agreed by the Parties govern each Transaction entered
         into or outstanding between any two Designated Offices of the Parties
         on or after the date of execution of these terms. In the case of
         Transactions within paragraph (i), (ii), (iii) or (iv) of the
         definition of "Transaction", these terms govern only those Transactions
         where the exchange mentioned in such definition is a Specified
         Exchange.

1.2      These terms, the particular terms of, and applicable to, each and every
         Transaction governed by these terms, the Schedules to these terms and
         all amendments to any of such items shall together constitute a single
         agreement between the Parties. The Parties acknowledge that all
         Transactions governed by these terms, which are entered into on or
         after the date of execution of these terms, are entered into in
         reliance upon the fact that all such items constitute a single
         agreement between the Parties.

2.       Settlement and Exchange of Clearing Organisation Rules

2.1      Unless a Liquidation Date has occurred or has been effectively set, a
         Party shall not be obliged to make any payment or delivery scheduled to
         be made by that Party under a Transaction governed by these terms for
         so long as an Event of Default or Potential Event of Default with
         respect to the other Party has occurred and is continuing.

2.2      Unless otherwise agreed in writing by the Parties, if the Parties enter
         into any Transaction governed by these terms to close out any existing
         Transaction between the Parties then their obligations under such
         Transactions shall automatically and immediately be terminated upon
         entering into the second Transaction, except for any settlement payment
         due from one Party to the other in respect of such closed-out
         Transactions.

2.3      These terms shall not be applicable to any Transaction to the extent
         that action which conflicts with or overrides the provisions of this
         agreement has been started in relation to that Transaction by a
         relevant exchange or clearing organisation under applicable rules or
         laws and is continuing.

3.       Representations, Warranties and Covenants

3.1      Each Party represents and warrants to the other Party as of the date of
         execution of these terms and, in the case of the representation and
         warranty in (v) of the Clause 3.1 relating to the entering into of
         Transactions, as of the date of entering into each Transaction governed
         by these terms that: (i) it has authority to enter into this agreement;
         (ii) the person entering into the agreement on its behalf have been
         duly authorised to do so: (iii) this agreement and the obligations
         created under this agreement are binding upon it and enforceable
         against it in accordance with their terms (subject to applicable
         principles of equity) and do not and will not violate the terms of any
         agreements to which such Party is bound; (iv) no Event of Default or
         Potential Event of Default has occurred and is continuing with respect
         to it; and (v) it acts as principal and sole beneficial owner (and not
         as trustee) in entering into these terms and each and every Transaction
         governed by these terms.

3.2      Each Party covenants to the other Party that: (i) it will at all times
         obtain and comply with the terms of and do all that is necessary to
         maintain in full force and effect all authorisations, approvals,
         licences and consents required to enable it lawfully to perform its
         obligations under this agreement; and (ii) it will promptly notify the
         other Party of the occurrence of any Event of Default or Potential
         Event of Default with respect to itself or any credit Support Provider
         in relation to it.

4        Termination and Liquidation

4.1      If, at any time:

         (i)      a Party fails to make any payment when due under or to make or
                  take delivery of any property when due under, or to observe or
                  perform any other provision of, this agreement (including any
                  Transaction governed by these terms) and such failure
                  continues for two business days after notice of
                  non-performance has been given by the other Party to the
                  defaulting Party;

          (ii)    a Party commences a voluntary case or other procedure seeking
                  or proposing liquidation, reorganisation, an arrangement or
                  composition, a freeze or moratorium, or other similar relief
                  with respect to itself or to its debts under any bankruptcy,
                  insolvency, regulatory, supervisory or similar law (including
                  any corporate or other law with potential application to an
                  insolvent Party), or seeking the appointment of a trustee,
                  receiver, liquidator, conservator, administrator, custodian,
                  examiner or other similar official (each a "Custodian") of it
                  or any part of its assets; or takes any corporate action to
                  authorise any of the foregoing; and, in the case of a
                  reorganisation, arrangement or composition, the other Party
                  does not consent to the proposals;

         (iii)    an involuntary case or other procedure is commenced against a
                  Party seeking or proposing liquidation, reorganisation, an
                  arrangement or composition, a freeze or moratorium, or other
                  similar relief with respect to it or its debts under any
                  bankruptcy, insolvency, regulatory, supervisory or similar law
                  (including any corporate or other law with potential
                  application to an insolvent Party) or seeking the appointment
                  of a Custodian of it or any part of its assets and such
                  involuntary case or other procedure either (a) has not been
                  dismissed within five days of its institution or presentation
                  or (b) has been dismissed within such period but solely on the
                  grounds of an insufficiency of assets to cover the costs of
                  such case or other procedure;

         (iv)     a Party dies, become of unsound mind, is unable to pay its
                  debts as they fall due or is bankrupt or insolvent, as defined
                  under any bankruptcy or insolvency law applicable to such
                  Party; or indebtedness of a Party is not paid on the due date
                  therefor or becomes, or becomes capable at any time of being
                  declared, due and payable under agreements or instruments
                  evidencing such indebtedness before it would otherwise have
                  been due and payable, or proceedings are commenced for any
                  execution, any attachment or garnishment, or any distress
                  against, or an encumbrancer takes possession of, the whole or
                  any part of the property, undertaking or assets (tangible and
                  intangible) of a Party;

         (v)      a Party or any Credit Support Provider in relation to a Party
                  (or any Custodian acting on behalf of a Party or any Credit
                  Support Provider in relation to a Party) disaffirms, disclaims
                  or repudiates any obligation under this agreement (including
                  any Transaction governed by these terms) or any Credit Support
                  Document;

         (vi)     any representation or warranty made or deemed made by a Party
                  pursuant to this agreement or pursuant to any Credit Support
                  Document proves to have been false or misleading in any
                  material respect as at the time it was made or given;

        (vii)     (a) any Credit Support Provider in relation to a Party or the
                  relevant Party itself fails to comply with or perform any
                  agreement or obligation to be complied with or performed by it
                  in accordance with the applicable Credit Support Document; (b)
                  any Credit Support Document relating to a Party expires or
                  ceases to be in full force and effect prior to the
                  satisfaction of all obligations of such Party under this
                  agreement (including any Transaction governed by these terms),
                  unless the other Party has agreed in writing that this shall
                  not be an Event of Default; (c) any representation or warranty
                  made or deemed made by any Credit Support Provider in relation
                  to a Party pursuant to any Credit Support Document proves to
                  have been false or misleading in any material respect as at
                  the time it was made or given or deemed made or given; or (d)
                  any event referred to in (ii) to (iv) or (viii) of this Clause
                  4.1 occurs in respect of any Credit Support Provider in
                  relation to a Party;

         (viii)   a Party is dissolved, or in respect of a Party whose existence
                  is dependent upon a formal registration, such registration is
                  removed or ends, or any procedure is commenced seeking or
                  proposing a Party's dissolution or the removal or ending of
                  such a registration of a Party; or

         (ix)     any event of default (however described) occurs under any
                  terms of business in place between the Parties or any other
                  event specified for these purposes in Annex 1 or otherwise
                  occurs, then the other Party (the "Non-Defaulting Party") may
                  exercise its rights under Clause 4.2, except that, if so
                  agreed in writing by the Parties (whether by specifying as
                  such in Annex 1 hereto or otherwise), in the case of the
                  occurrence of any Event of Default specified in paragraph (ii)
                  or (iii) above the provisions of Clause 4.3 shall apply.

4.2      Subject to Clause 4.3, at any time following the occurrence of an Event
         of Default, the Non-Defaulting Party may, by notice to the Defaulting
         Party, specify a Liquidation Date for the termination and liquidation
         of Transactions in accordance with the provisions of Clause 4.4.

4.3      If the Parties have so agreed, the date of the occurrence of any Event
         of Default specified in paragraph (ii) or (iii) of Clause 4.1 shall
         automatically constitute a Liquidation Date, without the need for any
         notice by either Party and to the intent that the provisions of Clause
         4.4 shall then apply.

4.4      Upon the occurrence of a Liquidation Date:

         (i)      neither Party shall be obliged to make any further payments or
                  deliveries under any Transactions governed by these terms
                  which would, but for this Clause, have fallen due for
                  performance on or after the Liquidation Date and such
                  obligations shall be satisfied by settlement (whether by
                  payment, set-off or otherwise) of the Liquidation Amount;

         (ii)     the Non-Defaulting Party shall (on, or as soon as reasonably
                  practicable after, the Liquidation Date) determine
                  (discounting if appropriate), in respect of each Transaction
                  governed by these terms, its total cost, loss or, as the case
                  may be, gain, in each case expressed in the Non-Defaulting
                  Party's Base Currency (and, if appropriate, including any loss
                  of bargain, cost of funding or, without duplication, cost,
                  loss or, as the case may be, gain as a result of the
                  termination, liquidation, obtaining, performing or
                  re-establishing of any hedge or related trading position), as
                  a result of the termination, pursuant to this agreement, of
                  each payment or delivery which would otherwise have been
                  required to be made under such Transaction (assuming
                  satisfaction of each applicable condition precedent and having
                  due regard to, if appropriate, such market quotations
                  published on, or official settlement prices set by, a relevant
                  exchange or clearing organisation as may be available on, or
                  immediately preceding, the date of calculation); and

         (iii)    the Non-Defaulting Party shall treat each cost or loss to it,
                  determined as above, as a positive amount and each gain by it,
                  so determined, as a negative amount and aggregate all of such
                  amounts to produce a single, net positive or negative amount,
                  denominated in the Non-Defaulting Party's Base Currency (the
                  "Liquidation Amount").

4.5      If the Liquidation Amount determined pursuant to Clause 4.4 is a
         positive amount, the Defaulting Party shall pay it to the
         Non-Defaulting Party and if it is a negative amount, the Non-Defaulting
         Party shall pay it to the Defaulting Party. The Non-Defaulting Party
         shall notify the Defaulting Party of the Liquidation Amount, and by
         which Party it is payable, immediately after the calculation of such
         amount.

4.6      Unless the Parties specify otherwise in Annex 1 or otherwise, where
         termination and liquidation occurs in accordance with Clause 4.4, the
         Non-Defaulting Party shall also be entitled, at its discretion, to
         apply the provisions of Clause 4.4 to any other Transactions entered
         into between the Parties which are then outstanding, as if each such
         Transaction were a Transaction governed by these terms.

4.7      The amount payable by one Party to the other Party pursuant to the
         provisions of Clause 4.5, or any applicable laws or regulations, shall
         be paid in the Non-Defaulting Party's Base Currency by the close of
         business on the business day following the completion of the
         termination and liquidation under Clause 4.4, or any laws or
         regulations having a similar effect, (converted as required by
         applicable law into any other currency, any costs of such conversion to
         be borne by, and (if applicable) deducted from any payment to, the
         Defaulting Party). Any such amount which is not paid on the due date
         therefor shall bear interest, at the average rate at which overnight
         deposits in the currency of such payment are offered by major banks in
         the London interbank market as of 11.00 a.m. (London time) (or, if no
         such rate is available, at such reasonable rate as the Non-Defaulting
         Party may select) plus 1% per annum, for each day for which such amount
         remains unpaid.

4.8      For the purpose of any calculation hereunder, the Non-Defaulting Party
         may convert amounts denominated in any other currency into the
         Non-Defaulting Party's Base Currency at such rate prevailing at the
         time of the calculation as it shall reasonably select.

4.9      The Non-Defaulting Party's rights under this Clause 4 shall be in
         addition to, and not in limitation or exclusion of, any other rights
         which the Non-Defaulting Party may have (whether by agreement,
         operation of law or otherwise).

5        Set-Off

         Without prejudice to any other right or remedy which it may have,
         either Party may, on or after the occurrence of a Liquidation Date and
         the determination of the Liquidation Amount, set off any amount owing
         by it (whether actual or contingent, present or future and including,
         if applicable and without limitation, the Liquidation Amount and any
         amount due and payable on or before the Liquidation Date but remaining
         unpaid) to the other Party against any amount owing by such other Party
         (whether actual or contingent, present or future and including, if
         applicable and without limitation, the Liquidation Amount and any
         amount due and payable before the Liquidation Date but remaining
         unpaid) to the first Party.

6        Currency Indemnity

         If a Party (the first Party) receives or recovers any amount in respect
         of an obligation of the other Party (the second Party) in a currency
         other than that in which such amount was payable, whether pursuant to a
         judgement of any court or otherwise, the second Party shall indemnify
         and hold harmless the first Party from and against any cost (including
         costs of conversion) and loss suffered by the first Party as a result
         of receiving such amount in a currency other than the currency in which
         it was due.

7.       Assignments and Transfers

         Neither Party may assign, charge or otherwise transfer or purport to
         assign, charge or otherwise transfer its rights or obligations under
         this agreement (including the Transactions governed by these terms) or
         any interest therein without the prior written consent of the other
         Party, and any purported assignment, charge or transfer in violation of
         this Clause shall be void.

8.       Notices

         Unless otherwise agreed, all notices, instructions and other
         communications to be given to a Party under this agreement shall be
         given to the address, telex (if confirmed by the appropriate
         answerback) or facsimile (confirmed if requested) number and to the
         individual or department specified in Annex 1, the Customer Signature
         page or by notice in writing by such Party. Unless otherwise specified,
         any notice, instruction or other communication given in accordance with
         this Clause shall be effective upon receipt.

9.       Termination, Waiver and Partial Invalidity

9.1      Either of the Parties hereto may terminate this agreement at any time
         by seven days' prior notice to the other Party and termination shall be
         effective at the end of such seventh day; provided, however, that any
         such termination shall not affect any then outstanding Transactions
         governed by these terms, and the provisions of this agreement shall
         continue to apply until all the obligations of each Party to the other
         under this agreement (including the Transactions governed by these
         terms) have been fully performed.

9.2      A Party may waive any right, power or privilege under this agreement
         only by (and to the extent of) an express statement in writing.

9.3      If, at any time, any provision of these terms is or becomes illegal,
         invalid or unenforceable in any respect under the law of any
         jurisdiction, neither the legality, validity or enforceability of the
         remaining provisions of these terms nor the legality, validity or
         enforceability of such provision under the law of any other
         jurisdiction shall in any way be affected or impaired thereby.

10.      Time of Essence

         Time shall be of the essence in this agreement.

11.      Payments

         Every payment to be made by a Party under these terms shall be made in
         same day (or immediately available) and freely transferable funds to
         the bank account designated by the other Party for such purpose.

12.      Governing Law and Jurisdiction

         Unless the Parties specify otherwise in Annex 1 or otherwise:

12.1     These terms shall be governed by, and construed in accordance with, the
         laws of England and Wales.

12.2     With respect to any Proceedings, each Party irrevocably (i) agrees that
         the courts of England shall have exclusive jurisdiction to determine
         any Proceedings and irrevocably submits to the jurisdiction of the
         English courts and (ii) waives any objection which it may have at any
         time to the bringing of any Proceedings in any such court and agrees
         not to claim that such Proceedings have been brought in an inconvenient
         forum or that such court does not have jurisdiction over such Party.


<PAGE>



12.3     Each Party irrevocably waives to the fullest extent permitted by
         applicable law, with respect to itself and its revenues and assets
         (irrespective of their use or intended use), all immunity on the
         grounds of sovereignty or other similar ground from (i) suit, (ii)
         jurisdiction of any courts, (iii) relief by way of injunction, order
         for specific performance or for recovery of property, (iv) attachment
         of its assets (whether before or after judgement) and (v) execution or
         enforcement of any judgement to which it or its revenues or assets
         might otherwise be entitled in any Proceedings in the courts of any
         jurisdiction and irrevocably agrees to the extent permitted by
         applicable law that it will not claim any such immunity in any
         Proceedings. Each Party consents generally in respect of any
         Proceedings to the giving of any relief or the issue of any process in
         connection with such Proceedings, including, without limitation, the
         making, enforcement or execution against any property whatsoever of any
         order or judgement which may be made or given in such Proceedings.

13       Interpretation

13.1     In these terms:

         "Base Currency" means, as to a Party, the currency specified as such in
         Annex 1 or agreed as such in relation to it in writing between the
         Parties or, failing any such specification or agreement, the lawful
         currency of the United Kingdom;

         "Credit Support Document" means, as to a Party (the first Party), a
         guarantee, hypothecation agreement, margin or security agreement or
         document, or any other document containing an obligation of a third
         party ("Credit Support Provider"), or of the first Party, in favour of
         the other Party supporting any obligations of the first Party under
         this agreement;

         "Credit Support Provider" has the meaning given to it in the definition
         of Credit Support Document;

         "Custodian" has the meaning given to it in Clause 4.1;

         "Defaulting Party" means the Party in respect of which, or related to a
         Credit Support Provider in respect of which, an Event of Default has
         occurred;

         "Designated Office(s)" means, as to a Party, the office identified with
         its name on page 1 of these terms and any other office(s) specified in
         Annex 1 or otherwise agreed by the Parties to be its Designated
         Office(s) for the purpose of this agreement;

         "Liquidation Date" means a day on which, pursuant to the provisions of
         Clause 4, the Non-Defaulting Party commences the termination and
         liquidation of Transactions or such a termination and liquidation
         commences automatically;

         "Potential Event of Default" means any event which may become (with the
         passage of time, the giving of notice, the making of any determination
         hereunder or any combination thereof) an Event of Default;

         "Proceedings" means any suit, action, or other proceedings relating to
         this agreement;

         "Specified Exchanges" means the exchanges specified in Annex 2 and any
         other exchanges agreed by the Parties to be Specified Exchanges for the
         purpose of Clause 1.1; and "Specified Exchange" means any of them;

         "Transaction" means:

         (i)      a contract made on an exchange or pursuant to the rules of an
                  exchange;

         (ii)     a contract subject to the rules of an exchange; or

         (iii)    a contract which would (but for its term to maturity only) be
                  a contract made on, or subject to the rules of, an exchange
                  and which, at the appropriate time, is to be submitted for
                  clearing as a contract made on, or subject to the rules of, an
                  exchange,

         in any of cases (i), (ii), (iii) being a future, option, contract for
         differences, spot or forward contract of any kind in relation to any
         commodity, metal, financial instrument (including any security),
         currency, interest rate, index or any combination thereof;

        (iv)     a transaction which is back-to-back with any transaction within
                 paragraph (i), (ii) or (iii) of this definition; or

        (v)      any other transaction which the Parties agree shall be a
                 Transaction.

13.2     In these terms, "Event of Default" means any of the events listed in
         Clause 4.1; "Liquidation Amount" has the meaning ascribed to it in
         Clause 4.4; and "Non-Defaulting Party" has the meaning ascribed to it
         in Clause 4.1.

13.3     Any reference in these terms to:

         a "business day" shall be construed as a reference to a day (other than
         a Saturday or Sunday) on which:

         (i)      in relation to a date for the payment of any sum denomination
                  in (a) any currency (other than ecu or euro), banks generally
                  are open for business in the principal financial centre of the
                  country of such currency; (b) ecu, the Ecu Clearing and
                  Settlement System operated by the Ecu Banking Association,
                  (or, if such clearing system ceases to be operative, any other
                  clearing or settlement system determined by the Parties) is
                  open for business; or (c) euros, settlement of payments
                  denominated in euros is generally possible in London or any
                  other financial centre in Europe selected by the Parties; and

         (ii)     in relation to a date for the delivery of any property,
                  property of such type is capable of being delivered in
                  satisfaction of obligations incurred in the market in which
                  the obligation to deliver such first property was incurred;

         a "Clause" or "Annex" shall be construed as a reference to,
         respectively, a clause or Annex of these terms, unless the context
         requires otherwise;

         a "currency" shall be construed so as to include any unit of account;

         "indebtedness" shall be construed so as to include any obligation
         (whether present or future, actual or contingent, as principal or
         surety or otherwise) for the payment or repayment of money;

          "Parties" shall be construed as a reference to the parties to this
         agreement and shall include their successors and permitted assigns; and
         "Party" shall be construed as a reference to which of the Parties is
         appropriate in the context in which such expression may be used;

         a Party to which a Credit Support Provider relates shall be construed
         as a reference to the Party whose obligations under this agreement are
         supported by that Credit Support Provider; and

         these "terms" or this "agreement" shall be construed as including the
         Annexes and as a reference to these terms or this agreement as the same
         may be amended, varied, novated or supplemented from time to time.


<PAGE>


ANNEX 1 TO MASTER NETTING AGREEMENT

1.       Scope of Agreement

        (a)      Each of the following shall be a Transaction for the purpose of
                 paragraph (v) of the definition of "Transaction" in Clause
                 13.1: Not applicable.

        (b)      For the purposes of Clause 1.1, these terms shall not apply to
                 [all] [the following] Transactions outstanding between the
                 Parties on the date of execution of these terms: Not
                 applicable.

        (c)      In the event of a discrepancy between these terms and the
                 Customer Documents for Exchange-traded Derivatives, these terms
                 will govern in relation to close out netting of Transactions
                 but without prejudice to any other rights that Morgan Stanley
                 may have under the Customer Documents for Exchange-traded
                 Derivatives.

2.       Designated Offices

         Each of the following shall be a Designated Office: The offices
         specified in Section 7 "Notices" below or in the Customer Signature
         page.

3.       Representations, Warrants and Covenants

         Clause 3.1 is hereby amended by deleting the words "in the case of the
         representation and warranty in (v) of the Clause 3.1 relating to the
         entering into of Transactions,".


4.       Additional Event(s) of Default

         Each of the following shall be an Event of Default for the purpose of
         paragraph (ix) of Clause 4.1: Not Applicable

5.       Automatic Termination

         Upon the occurrence of any Event of Default specified in paragraph (ii)
         or (iii) of Clause 4.1, the provisions of Clause 4.3 shall apply.

6.       Termination of Other Transactions

         The provisions of Clause 4.6 shall not apply.

7.       Notices

         Morgan Stanley

         Name                  :   Morgan Stanley & Co. International Limited

         Address               :   25 Cabot Square, Canary Wharf, London E14 4QA

         Telephone Numbers     :   44-171-425-8000

         Telex number          :   8812564

         Facsimile number      :   44-171-425-4976

         Name of individual or department to whom notices are to be sent:
         Compliance

8.       No Reliance

         In connection with these terms and the Customer Documents for
         Exchange-Traded Derivatives, each Transaction and any other
         documentation relating to these terms, both Parties represent and
         acknowledge that (i) it is entering into each Transaction with a full
         understanding of all material terms and risks thereof, and it is
         capable of assuming those risks; (ii) it has made its investment and
         trading decisions (including decisions regarding the suitability of any
         transaction) based upon its own judgement and upon any advice from such
         advisors as it has deemed necessary, and not in reliance upon any view
         expressed by the other Party; (iii) the other Party is not acting as a
         fiduciary or an advisor for it, and all decisions have been the results
         of arm's length negotiations between the Parties; and (iv) the other
         Party has not given to it any assurance or guarantee as to the expected
         performance or result of any Transaction.

9.       Governing Law and Jurisdiction

         The following provisions shall not apply in place of the provisions of
         Clause 12:

         12.1     These terms shall be governed by, and construed in accordance
                  with, the laws of the State of New York without giving effect
                  to conflict of law provisions.

         12.2     With respect to any Proceedings, each Party irrevocably (i)
                  submits to the non-exclusive jurisdiction of the courts of the
                  State of New York and the United States District Court located
                  in the Borough of Manhattan in New York City and (ii) waives
                  any objection which it may have at any time to the laying of
                  venue of any Proceedings brought in any such court and agrees
                  not to claim that such Proceedings have been brought in any
                  inconvenient forum or that such court does not have
                  jurisdiction over such Party.

         12.3     Each party irrevocably waives to the fullest extent permitted
                  by applicable law, with respect to itself and its revenues and
                  assets (irrespective of their use or intended use), all
                  immunity of the grounds of sovereignty or other similar
                  grounds from (i) suit, (ii) jurisdiction of any courts, (iii)
                  relief by way of injunction, order for specific performance or
                  for recovery of property, (iv) attachment of its assets
                  (whether before or after judgement) and (v) execution or
                  enforcement of any judgement to which it or its revenues or
                  assets might otherwise be entitled in any Proceedings in the
                  courts of any jurisdiction and irrevocably agrees to the
                  extent permitted by applicable law that it will not claim any
                  such immunity in any Proceedings. Each Party consents
                  generally in respect of any Proceedings to the giving of any
                  relief or the issue of any process in connection with such
                  Proceedings, including, without limitation, the making
                  enforcement or execution against any property whatsoever of
                  any order or judgement which may be made or given in such
                  Proceedings.

         12.4     Each Party hereby irrevocably waives any and all right to
                  trial by jury in any Proceedings.

10.      Base Currency:  US Dollars

11.      Selected Financial Centres for Euro Settlements:  Not Applicable

12.      FDICIA Representations

         The following provisions shall not apply to this agreement. Each Party
         represents and warrants to the other Party that it is a financial
         institution under the provisions of Title IV of the Federal Deposit
         Insurance Corporation Improvement Act of 1991 ("FDICIA"), and the
         Parties agree that this agreement shall be a netting contract, as
         defined in FDICIA, and each receipt or payment or delivery obligation
         hereunder shall be a covered contractual payment entitlement or covered
         contractual payment obligations, respectively, as defined in and
         subject to FDICIA.


<PAGE>


ANNEX 2 TO MASTER NETTING AGREEMENT

Specific Exchanges

The following exchanges are Specified Exchanges for the purposes of Clause 1.1;

Any Recognised Exchange, Recognised Investment Exchange, Designated Investment
Exchange or Approved Exchange as defined by the Financial Services Authority or
the Securities and Futures Authority and as amended from time to time.


IN WITNESS WHEREOF, this Agreement has been entered into on the date written in
the Customer Signature pages.

Signed on behalf of

Morgan Stanley & Co. International Limited
           -and-
Morgan Stanley Securities Limited


By:    .../s/ R S Rosenthal................

Name:  R S Rosenthal
Title: Company Secretary


<PAGE>


                                   PART THREE
                                   SCHEDULE 1

                          SELECTED ASSOCIATED FIRMS OF
                   MORGAN STANLEY & CO. INTERNATIONAL LIMITED
                      AND MORGAN STANLEY SECURITIES LIMITED


                            Morgan Stanley Group Inc.
                        Morgan Stanley & Co. Incorporated
                       Morgan Stanley Market Products Inc.
                      Morgan Stanley Capital Services Inc.
                        Morgan Stanley Capital Group Inc.
             Morgan Stanley & Co. International Limited Incorporated
                          Morgan Stanley Japan Limited
                             Morgan Stanley Bank AG*
                                Morgan Stanley SA
                           Morgan Stanley Asia Limited
                          Morgan Stanley & Co. Limited
               Morgan Stanley & Co. International Holdings Limited
                            Morstan Nominees Limited
                      Morgan Stanley Services (UK) Limited
                          Morgan Stanley Canada Limited
                Morgan Stanley Asset Management Singapore Limited
                     Morgan Stanley Asset Management Limited
                      Morgan Stanley Asset Management Inc.
                           MS Securities Services Inc.
                               Morgan Stanley SpA
               Morgan Stanley Capital Group Singapore Pte Limited
                   Morgan Stanley Hong Kong Securities Limited
                    Morgan Stanley Hong Kong Nominees Limited
                    Morgan Stanley Futures Hong Kong Limited
                    Morgan Stanley Futures Singapore Limited
                        Morgan Stanley Australia Limited
             Morgan Stanley Global Securities Services Incorporated
                             Bank Morgan Stanley AG*


* Approved Banks


<PAGE>


                                   PART THREE
                                   SCHEDULE 2

                         ADDITIONAL PROVISIONS FOR LIFFE

The provisions of this Schedule 2 apply where the Contract is a futures or
options contract subject to the Rules of LIFFE.

1.       General Provisions

1.1      Morgan Stanley & Co. International Limited is an individual clearing
         member of LIFFE. Morgan Stanley Securities Limited is a non-clearing
         member of LIFFE.

1.2      You accept that in relation to LIFFE:

         (a)      any allocation pursuant to Clause 12 of this Agreement shall
                  be made as follows. We shall allocate as between clients,
                  first, on the basis of a first in first out (FIFO) basis and,
                  secondly, pro rata in respect of Open Contracts for which
                  there is a corresponding Client Contract;

         (b)      any dispute arising from or relating to this Agreement,
                  insofar as it relates to Contracts or Clients Contracts
                  subject to the rules of LIFFE, and any dispute arising from or
                  relating to any such Contract or Client Contract as aforesaid
                  and made hereunder shall, unless resolved between us, be
                  referred to the arbitration rules of LIFFE, or to such other
                  organisation as LIFFE may direct before either of us resorts
                  to the jurisdiction of the courts (other than to obtain an
                  injunction or an order for security for a claim). Clause 43 of
                  this Agreement shall be subject to the agreement contained in
                  this sub-paragraph; and

        (c)      subject to the arbitration clause in sub-paragraph (b) above,
                 disputes arising from this Agreement or from Contracts or
                 Client Contracts made under or pursuant to this Agreement shall
                 (for our benefit) be subject to the exclusive jurisdiction of
                 the English courts to which both parties hereby irrevocably
                 submit.

        (d)      in both our interests, LIFFE may from time to time sanction the
                 making of contracts by us outside the pit or outside its
                 electronic trading system in order to satisfy your order, where
                 there has been an error in the execution of your order. Where a
                 better price (an improvement) can be obtained, we will seek to
                 secure and offer that improvement to you. However, you should
                 note that where, in response to your order, we have bought or
                 sold in accordance with the instruction in your order to buy
                 or, as the case may be, to sell but have traded the wrong
                 delivery/expiry month or wrong exercise price of the relevant
                 contract, then we may in accordance with LIFFE's Rules offset
                 any loss arising from that trade against any improvement
                 achieved for you in the course of correctly satisfying your
                 order, thus offering you only the net improvements, if any.


2.       Exclusion of Liability

2.1      As a member of LIFFE and pursuant to the Rules of LIFFE, we are
         required to include a provision dealing with exclusion of liability in
         our agreement with you. The following provisions and paragraph 3.1
         shall apply without prejudice to the generality of Clauses 22, 23, 27
         and 28 of this Agreement with you.

2.2      LIFFE Administration and Management (the "Exchange") is obliged under
         the FSA1986 to ensure that business conducted by means of its market
         facilities is conducted in an orderly manner and so as to afford proper
         protection to investors. We and the Exchange wish to draw to your
         attention that, inter alia, business on the market may from time to
         time be suspended or restricted, or the market may from time to time be
         closed for a temporary period or for such longer period as may be
         determined in accordance with LIFFE's rules on the occurrence of one or
         more events which require such action to be taken in the interests of,
         inter alia, maintaining a fair and orderly market. Any such action may
         result in our being unable, and through us you and your clients (if
         any) may from time to time be prevented from or hindered in entering
         into contracts in accordance with LIFFE's rules as a result of a
         failure of some or all market facilities. We and the Exchange wish to
         draw the following exclusion of liability to your attention and to the
         attention of your clients (if any). Unless otherwise expressly provided
         in LIFFE's rules or in any other agreement to which LIFFE is party, we
         and LIFFE shall not be liable to you or any client of yours for loss
         (including any indirect or consequential loss including, without
         limitation, loss of profit), damage, injury or delay, whether direct or
         indirect, arising from any of the circumstances or occurrences referred
         to above, or from any act or omission of the Exchange, its officers,
         employees, agents or representatives, under LIFFE's rules or pursuant
         to the Exchange's obligations under statute, or from any breach of
         contract by or any negligence howsoever arising of the Exchange, its
         officers, employees, agents or representatives.

2.3      Paragraphs 2.1 and 2.2 of this Schedule 2 shall be construed as
         applying to, and having the same effect in relation to, business which
         we transact, or which we would transact, but for one of the events
         referred to in this Paragraph occurring, on other futures and options
         markets.

3.       Linked Contracts

DEFINITIONS

"LCH"                                            means The London Clearing House
                                                 Limited;

"LIFFE"                                          means LIFFE Administration and
                                                 Management;

"LIFFE Contract"                                 means an Exchange  Contract to
                                                 which a Linked  Participating
                                                 Exchange Contract is linked;

"Linked LIFFE Contract"                          means an Exchange Contract made
                                                 available for trading on the
                                                 market pursuant to a Link,
                                                 which is specified as such in a
                                                 General Notice published from
                                                 time to time by the Exchange
                                                 and is linked to a
                                                 Participating Exchange
                                                 Contract;

"Linked Participant Exchange Contract"           means a Participating  Exchange
                                                 Contract  specified as such in
                                                 a General Notice published from
                                                 time to time by the Exchange
                                                 and is linked to an Exchange
                                                 Contract;

"Participating Exchange"                         means an exchange  which has
                                                 concluded one or more
                                                 agreements in relation to a
                                                 Link with the  Exchange  and/or
                                                 LCH  pursuant  to which: (i)
                                                 contracts  in the terms of one
                                                 or more Linked LIFFE Contracts
                                                 are to be transferred to, for
                                                 clearing  by, such  exchange or
                                                 its clearing  house; or (ii)
                                                 contracts in the terms of a
                                                 Linked  Participating  Exchange
                                                 Contract are to be transferred
                                                 to, for clearing  by, LCH. The
                                                 term "Participating Exchange"
                                                 shall include any clearing
                                                 house, which from time to time
                                                 provides clearing services to
                                                 such exchange;

"Participating Exchange Contract"                in respect of a Participating
                                                 Exchange, means a class of
                                                 contract permitted to be made
                                                 by Participating Exchange
                                                 Members under Participating
                                                 Exchange rules.

GENERAL PROVISIONS

3.1      Exclusion of Liability

         We and LIFFE Administration and Management ("LIFFE") wish to draw to
         your attention that LIFFE shall have no liability whatsoever to any
         member or client in contract, tort (including, without limitation,
         negligence), trust, as fiduciary or under any other cause of action
         (except in respect of gross negligence, wilful default or fraud on its
         part), in respect of any damage, loss, cost or expense of whatsoever
         nature suffered or incurred by any member or client, as the case may
         be, as a result of: any suspension, restriction or closure of the
         market administered by either a Participating Exchange or LIFFE,
         whether for a temporary period or otherwise, or as a result of a
         decision taken on the occurrence of a market emergency; any failure by
         a Participating Exchange, LIFFE or LCH to supply each other with data
         or information in accordance with arrangements from time to time
         established between all or any of them; the failure of communications
         facilities or technology supplied, operated or used by either a
         Participating Exchange, LIFFE or LCH for the purposes of the Link; any
         event which is outside its or their control; any act or omission of
         either a Participating Exchange (where a Participating Exchange is
         acting otherwise than in connection with its clearing function) or
         LIFFE in connection with any Participating Exchange Contract, Linked
         LIFFE Contract or Linked Participating Exchange Contract or any act or
         omission of a Participating Exchange, LIFFE, or LCH (as the case may
         be) in connection with the operation of the Link or the arrangements
         for the transfer of contracts.

3.2      Governing Law

         This agreement and all contracts in the terms of LIFFE Contracts made
         under this agreement shall be subject to and construed in accordance
         with English Law.

3.3      Margin and Client Money/Assets

         Following the transfer of a contract in the terms of a Linked LIFFE
         Contract and the creation of a contract in the terms of a Participating
         Exchange Contract or prior to the transfer of a contract in the terms
         of a Linked Participating Exchange Contract and the creation of a
         contract in the terms of a LIFFE Contract (as the case may be), margin
         requirements will be determined in accordance with the rules of the
         Participating Exchange rather than LIFFE Rules. Any money or assets
         held in any country other than the UK may be subject to the applicable
         law of that country rather than UK client money and other assets rules,
         and you should satisfy yourself that this is acceptable to you before
         instructing us to transact any such business.

PROVISIONS RELATING TO OUTWARD TRANSFERS OF LINKED LIFFE CONTRACTS

3.4      Rules of LIFFE

         All contracts in the terms of a Linked LIFFE Contract made on LIFFE
         shall be subject to the Rules of LIFFE as from time to time in force.

3.5      Transfer

         We shall endeavour to secure the transfer through the relevant Link of
         each contract in the terms of a Linked LIFFE Contract made between us
         which is intended for transfer. Upon confirmation by the relevant
         Participating Exchange of receipt of trade/position details from LCH,
         rights and obligations under such contract, save for outstanding
         obligations with respect to fees and margin and those rights and
         obligations referred to in the Rules of LIFFE and the Regulations of
         LCH, shall be discharged and there shall arise simultaneously a
         contract in the terms of a Participating Exchange Contract between us.
         The contract in terms of a Participating Exchange Contract shall be
         subject to the rules of the relevant Participating Exchange and shall
         not be subject to the provisions of this agreement.

3.6      Delayed Transfer

         In the event that, on any LIFFE trading day, LCH is unable for whatever
         reason to transmit details of all contracts in the terms of a Linked
         LIFFE Contract, or the relevant Participating Exchange is unable to
         receive or acknowledge receipt of all such details, any such contract
         made between us on that day shall remain as an undischarged contract in
         the terms of a Linked LIFFE Contract (but without prejudice to any
         default provisions agreed between us which may be operated to discharge
         such contract), subject to the Rules of LIFFE and the General
         Regulations and Default Rules of LCH as from time to time in force,
         until such time as transfer can be achieved.

3.7      Impossibility of Transfer

         If it is not possible for whatever reason for details of contracts in
         the terms of the Linked LIFFE Contract to be transmitted by LCH, or for
         the relevant Participating Exchange to receive or acknowledge receipt
         of all such details, so that transfer of such contracts cannot occur on
         any particular day, and any circumstances preventing such transfer
         continues so that the Link is suspended or terminated, any such
         contract made between us during any such period shall remain as an
         undischarged contract in the terms of a Linked LIFFE Contract, subject
         to the Rules of LIFFE and the Regulations of LCH as from time to time
         in force, and shall be performed in accordance with its terms or may be
         closed out or otherwise discharged, in accordance with the Rules and
         any agreement reached between us.

PROVISIONS RELATING TO INWARD TRANSFERS OF LINKED PARTICIPATING EXCHANGE
CONTRACTS

3.8      Transfer

         In respect of each contract in the terms of a Linked Participating
         Exchange Contract made between us which is intended for transfer
         through the relevant Link, rights and obligations under such contract,
         save for outstanding obligations with respect to fees or margin and any
         other rights or obligations referred to in the Rules of the
         Participating Exchange, shall be discharged upon confirmation by LCH of
         receipt of trade/position details from the Participating Exchange and
         there shall arise simultaneously a contract in the terms of a LIFFE
         Contract between us. The LIFFE Contract shall be subject to the Rules
         of LIFFE and the General Regulations and Default Rules of LCH.

3.9      Delayed Transfer

         In the event that, on any Participating Exchange trading day, the
         relevant Participating Exchange is unable for whatever reason to
         transmit details of all contracts in the terms of a Linked
         Participating Exchange Contract, or LCH is unable to receive or
         acknowledge receipt of all such details, any such contract made between
         us on that Participating Exchange on that day shall remain an
         undischarged contract in the terms of a Linked Participating Exchange
         Contract (but without prejudice to any default provisions agreed
         between us which might be operated to discharge such contract), subject
         to the rules of the Participating Exchange as from time to time in
         force, until such time as transfer can be achieved.

3.10     Impossibility of Transfer

         If it is not possible for whatever reason for details of contracts in
         the terms of a Linked Participating Exchange Contract to be transmitted
         by the relevant Participating Exchange, or for LCH to receive or
         acknowledge receipt of all such details, so that transfer of such
         contracts cannot occur on any particular day, and any circumstance
         preventing such transfer continues so that the Link is suspended or
         terminated, any such contract made between us on that Participating
         Exchange during that period shall remain as an undischarged contract in
         the terms of a Linked Participating Exchange Contract, subject to the
         rules of the Participating Exchange as from time to time in force and
         shall be performed in accordance with its terms or may be closed out or
         otherwise discharged in accordance with the Rules and any agreement
         reached between us.


<PAGE>


                                   PART THREE
                                   SCHEDULE 3

                  ELECTRONIC TRADING AND ORDER ROUTING SYSTEMS
                            FIA DISCLOSURE STATEMENT


         Electronic trading and order routing systems differ from traditional
         open outcry pit trading and manual order routing methods. Transactions
         using an electronic system are subject to the rules and regulations of
         the exchange(s) offering the system and/or listing the contract. Before
         you engage in transactions using an electronic system, you should
         carefully review the rules and regulations of the exchange(s) offering
         the system and/or listing contracts you intend to trade.

         DIFFERENCES AMONG ELECTRONIC TRADING SYSTEMS

         Trading or routing orders through electronic systems varies widely
         among the different electronic systems. You should consult the rules
         and regulations of the exchange offering the electronic system and/or
         listing the contract traded or order routed to understand, among other
         things, in the case of trading systems, the system's order matching
         procedure, opening and closing procedures and prices, error trade
         policies, and trading limitations or requirements; and in the case of
         all systems, qualifications for access and grounds for termination and
         limitations on the types of orders that may be entered into the system.
         Each of these matters may present different risk factors with respect
         to trading on or using a particular system. Each system may also
         present risks related to system access, varying response times, and
         security. In the case of internet-based systems, there may be
         additional types of risks related to system access, varying response
         times and security, as well as risks related to service providers and
         the receipt and monitoring of electronic mail.

         RISKS ASSOCIATED WITH SYSTEM FAILURE

         Trading through an electronic trading or order routing system exposes
         you to risks associated with system or component failure. In the event
         of system or component failure, it is possible that, for a certain time
         period, you may not be able to enter new orders, execute existing
         orders, or modify or cancel orders that were previously entered. System
         or component failure may also result in loss of orders or order
         priority.

         SIMULTANEOUS OPEN OUTCRY PIT AND ELECTRONIC TRADING

         Some contracts offered on an electronic trading system may be traded
         electronically and through open outcry during the same trading hours.
         You should review the rules and regulations of the exchange offering
         the system and/or listing the contract to determine how orders that do
         not designate a particular process will be executed.

         LIMITATION OF LIABILITY

         Exchanges offering an electronic trading or order routing system and/or
         listing the contract may have adopted rules to limit their liability,
         the liability of FCMs, and software and communication system vendors
         and the amount of damages you may collect for system failure and
         delays. These limitations of liability provisions vary among the
         exchanges. You should consult the rules and regulations of the relevant
         exchange(s) in order to understand these liability limitations.


<PAGE>


                                    PART FOUR
                         NON-PRIVATE CUSTOMER DOCUMENTS
                          (Exchange-traded Derivatives)

                               CUSTOMER SIGNATURES

To:      Morgan Stanley & Co. International Limited
         Morgan Stanley Securities Limited

The undersigned agrees to the terms of the Non-Private Customer Documents
(Exchange-traded Derivatives) including without limitation, the indemnities,
exclusions and restrictions of duties and liabilities in your favour therein and
any additional enclosures, all of which we have read and understood.

Date:                      June 30, 2000.....              .....................

Signed:                    Demeter Management Corporation, General Partner......

Name(s):                   By:  Robert E. Murray, President & Chairman..........
                           [Signed]  /s/ Robert E. Murray

Authorised Signatory(ies)
for and on behalf of       Morgan Stanley Dean Witter Spectrum Commodity L.P....
                           [Print Name of Client (Non-Private Customer)]

All notices or other documents pursuant to this booklet shall be served at the
following address:

Address:                   c/o Demeter Management Corporation
                                Two World Trade Center,. 62nd Floor
                               New York, NY 10048



For the attention of:      Robert E. Murray

Telex and Answerback:

Fax:                       (212) 392-2804


Corporate Registered Office:
(if different from above)


Designated Offices for the purposes of Master Netting Agreement:
(if different from above)



                     CUSTOMERS DOMICILED IN LUXEMBOURG ONLY

I/We confirm that I/we specifically and expressly consent to Clause 9, 21, 22,
23, 32, 33, 34, 39, 40 and 42 of the above Agreement for the purposes of Article
1135-1 of the Civil Code and Article 1 of the Protocol annexed to the Convention
on Jurisdiction and the Enforcement of Judgements in Civil and Commercial
Matters signed in Brussels on 27th September 1968.

Signed:


<PAGE>


                        THIRD PARTY TRADING AUTHORISATION

THIS DOCUMENT SHOULD BE COMPLETED ONLY BY CUSTOMERS WHO HAVE SIGNED THE CUSTOMER
SIGNATURE PAGES BUT WHO WISH TO DELEGATE AUTHORITY TO AN INVESTMENT ADVISOR,
INVESTMENT MANAGER OR OTHER THIRD PARTY.

To:      Morgan Stanley & Co. International Limited
         Morgan Stanley Securities Limited

Dear Sirs

I/We refer to the Non-Private Customer Documents (Exchange-traded Derivatives)
set out on the preceding pages of this booklet which is supplemented hereby.
Terms used herein have the same meanings as ascribed to them in the Agreement
and any Customer Documents referred to therein.

I/We hereby authorise the individual or organisation named as agent (in the
"Agent's Details" section below) and hereinafter referred to as the "Agent" as
my/our agent to purchase, sell and trade generally in, exercise, and otherwise
enter into and carry out transactions and give other instructions relating to
financial and commodity futures, options and contracts for differences (and any
related transactions including without limitation, foreign exchange transactions
to facilitate any of the foregoing), on margin or otherwise, for my/our account
and risk and in my/our name or number on your books, including trades which will
or may result in me/us having short position in any such investment. I/We
authorise you to accept and act on:

        (a)      any and all orders and instructions received in connection with
                 such transactions; and

        (b)      any other instructions of the Agent in any respect concerning
                 my/our account(s) with you (including, without limitation,
                 delivering or otherwise transferring as the Agent may order or
                 direct, and whether or not any such delivery or other transfer
                 is to be made against payment, or any such payment is to be
                 made against delivery or other transfer).

In all matters or things mentioned above or otherwise concerning or incidental
to any of my/our accounts(s) with you, the Agent is authorised to act for me/us
and on my/our behalf in the same manner and with the same effect as I/we
myself/ourselves might or could do. The Agent may from time to time appoint (in
writing, effective upon receipt thereof by you) individuals to sign documents
and give instructions pursuant to this authorisation.

I/We acknowledge that any Transaction entered into by the Agent pursuant to the
above authority will be governed by the Customer Documents and that I/we shall
have all the rights and obligations in respect thereof as are contained in the
Customer Documents and, without prejudice to the generality of the foregoing,
I/we shall indemnify you and hold you harmless from, and pay you promptly on
demand, any and all losses, costs, expenses, damages and liabilities whatsoever
(including consequential and special damage) arising directly or indirectly from
any such Transaction or debt balances due thereon.

This authorisation and indemnity is in addition to, and in no way limits or
restricts, any rights which you may have under the Customer Documents and any
other agreement or agreements entered between us.

I/We acknowledge that neither you nor any of your associates nor any of your or
their directors, officers or employees will be liable for any loss howsoever
suffered by me/us pursuant to this authorisation unless loss arises from your
negligence, bad faith, wilful default, or fraud. I/We have carefully examined
the provisions of the documents by which I/we have given trading authority or
control over my/our account(s) to the Agent and understand fully the obligations
which I/we have assumed by executing that document. I/We understand that neither
you nor any of your associates are in any way responsible for any loss to me/us
occasioned by the actions of the Agent, and you do not, by implication or
otherwise, endorse the operating methods of the Agent. We further understand
that to the extent that we now or hereafter give to the Agent authority to
exercise any of my/our account(s) I/we do so at our my/own risk.

This authorisation may be terminated by me/us at any time with effect from
actual receipt by you of written notice of termination. Termination of this
authorisation shall not affect any liability resulting from transactions
initiated prior to such termination. This authorisation and indemnity shall
inure to your benefit and that of your successors and assigns.

Yours faithfully

Signed:                    .

AGENT'S DETAILS (please print)

         Name of Agent:
         Address of Agent:
         Telephone:
         Telex and Answerback:


<PAGE>


                        CERTIFICATES OF AUTHORITY TO DEAL
                      FOR USE BY COMPANIES AND PARTNERSHIPS

Certificate of Company Secretary/Authorised Partner*

Extracts  from the Minutes of the  Meeting of the Board of  Directors/Partners/
Management  Committee*  of  ......................  (the "Company/Partnership")
held at ......................... on ..................... 19....

IT WAS RESOLVED THAT:
(1)      the Company/Partnership* is by its Memorandum and Articles of
         Association/Partnership Agreement/constitutional documents* empowered
         to trade in financial and commodity futures, options and contracts for
         differences ("investments") and to enter into and perform the
         Non-Private Customer Documents between the Company and Morgan Stanley &
         Co. International Limited and Morgan Stanley Securities Limited
         concerning investment and dealing and related services (including such
         transactions in such investments);

(2)+     trading or dealing in financial and commodity futures, options and
         contracts for differences and/or other investments pursuant to the
         Non-Private Customer Documents would be carrying on the ordinary
         business of the Partnership;

(2/3*)   any one/two* of the undermentioned designated persons be hereby
         authorised, on behalf of the Company/Partnership*

        (a)      to accept and sign the Non-Private Customer Documents;

        (b)      to sign all documents in connection with, and give all
                 instructions relating to, trading in investments and otherwise
                 howsoever under and pursuant to the Non-Private Customer
                 Documents; and

        (c)      to delegate authority to one or more persons to sign any
                 documents, give any instructions and do anything else permitted
                 to be signed given or done by such designated person.

                               DESIGNATED PERSONS

                     Name               Position             Signature













I certify that the above is a true extract from the Minutes of a duly convened
and held meeting of the Board of Directors/Partners/Management Committee* of the
Company/Partnership*

                  Signed:

                  Name:

                  Title:            Secretary/Director/Authorised Partner*

                  Date:

*Delete as appropriate
+ Partnerships

Note:    Companies incorporated outside the UK, British Dependent Territories
         and Commonwealth may, instead of extract minutes comprising a
         director's resolution, provide a certificate signed by a duly
         authorised officer of the Company (and showing the officer's name and
         title) and comprising both paragraphs (1) and (2) as applicable to
         companies but preceded by the words "This is to certify that".

                  Corporate general partners of a limited partnership should
                  provide a certificate as a company but including appropriate
                  additional references to the partnership (including paragraph
                  2 for partnerships).

                             CERTIFICATE OF TRUSTEES
                              (FOR USE BY TRUSTEES)

Extracts from the Minutes of a Meeting of the trustees of
(the "Trust") held at ................................ on.................19....

IT WAS RESOLVED THAT all the Trustees accept and authorise the signature on
behalf of each of them of the Non-Private Customer Documents between the
Trustees and Morgan Stanley & Co. International Limited and Morgan Stanley
Securities Limited concerning transactions in financial and commodity futures,
options and contracts for difference and that, in connection therewith:

(1)      The Trustees, after taking legal advice, were satisfied that they were
         empowered by the Trust Deed(s) constituting the Trust to enter into and
         perform the Non-Private Customer Documents and all liabilities and
         obligations attaching to the "Private Customer" (as defined)
         thereunder;

(2)      The exercise of all rights and privileges of the "Non-Private Customer"
         (as so defined) under the Non-Private Customer Documents would be
         carried out only in accordance with the said powers contained in the
         Trust Deed(s) constituting the Trust and in particular after obtaining
         all proper and requisite investment advice;

(3)      The Trustees were satisfied that they were empowered by the said Trust
         Deed(s) to delegate the requisite powers and pursuant to that power any
         one/two* of the undermentioned persons be hereby authorised, on behalf
         of the Trustees:

        (a)      to sign the Non-Private Customer Documents and all documents in
                 connection with, and give all instructions relating to, the
                 Non-Private Customer Documents; and

        (b)      to delegate authority to one or more persons to sign any
                 documents, give any instructions and do anything else permitted
                 to be signed, given or done by such designated person;

                               DESIGNATED PERSONS

                     Name               Position             Signature












(4)      The Trustees would give to Morgan Stanley & Co. International Limited
         and Morgan Stanley Securities Limited written notice in the terms if
         sub-paragraph (3) above each time there was an alteration in the
         persons authorised as referred to in such sub-paragraph.

I certify that the above is a true extract from the Minutes of a duly convened
and held meeting of all the Trustees of the Trust.


Signed:           .................       .................

Name:             .................       .................

Title: Chairman of the Trustees/Authorised Trustee*

                  .................       .................

Date:             .................       .................


* Delete as appropriate



<PAGE>

                              MORGAN STANLEY & CO.
                              INTERNATIONAL LIMITED







                               CUSTOMER DOCUMENTS

                        Exchange-Traded Derivatives Only

                     Additional Documents for U.S. Customers

                                  OCTOBER 1995


<PAGE>


                              MORGAN STANLEY & CO.
                              INTERNATIONAL LIMITED

                        Exchange-Traded Derivatives Only

                     ADDITIONAL DOCUMENTS FOR U.S. CUSTOMERS

         The documents in this booklet supplement for U.S. customers our
standard customer document booklet for dealing in financial and commodity
futures and options. The standard booklet contains our terms and conditions of
dealing and risk warnings required by regulatory authorities in the United
Kingdom.

         The Commodity Futures Trading Commission (CFTC) has granted Morgan
Stanley & Co. International Limited an exemption from registering as a Futures
Commission Merchant (FCM) and from certain requirements of its rules in respect
of trading foreign (i.e. non-U.S.) futures and options with customers resident
in the United States. This booklet is issued to satisfy certain conditions of
that exemption and other CFTC requirements relating to the offer or sale of
foreign futures and options in the U.S. It modifies our standard terms in
certain respects and contains additional disclosures relating to options
generally and to non-U.S. futures and options in particular.

         This disclosure document meets the risk disclosure requirements in the
jurisdictions identified below ONLY for those instruments which are specified.

United States:             commodity futures, options on commodity futures and
                           options on commodities subject to the Commodity
                           Exchange Act.

United Kingdom:            futures, options on futures, options on commodities
                           and options on equities traded by members of the
                           United Kingdom Securities and Futures Authority
                           pursuant to the Financial Services Act, 1986.

Ireland:                   financial futures and options and options on
                           financial futures traded by members of futures
                           exchanges on exchanges whose rules have been approved
                           by the Central Bank of Ireland under Chapter VIII of
                           the Central Bank Act, 1989.

         Finally, the booklet contains a form of consent whereby you would agree
that, in the event of a dispute, you would exhaust certain mediation or
conciliation procedures made available by our principal UK regulator (the
Securities and Futures Authority ("SFA")) prior to starting NFA or SFA
arbitration proceedings. As required, we enclose details of these
mediation/conciliation procedures and SFA arbitration proceedings.


<PAGE>


                                    CONTENTS

                                                                            Page

         Risk Disclosure Statement for Futures and Options
- please read and sign acknowledgement                                         4

         Form of Consent
- please read, insert customer name in first paragraph and sign                7

         Enclosures: the Securities and Futures Authority publications

         i)    An outline of the SFA
ii)      Complaints Bureau of the SFA

         - for information only.


<PAGE>


                RISK DISCLOSURE STATEMENT FOR FUTURES AND OPTIONS

         This brief statement does not disclose all of the risks and other
significant aspects of trading in futures and options. In light of the risks,
you should undertake such transactions only if you understand the nature of the
contracts (and contractual relationships) into which you are entering and the
extent of your exposure to risk. Trading in futures and options is not suitable
for many members of the public. You should carefully consider whether trading is
appropriate for you in light of your experience, objectives, financial resources
and other relevant circumstances.

Futures

3.       EFFECT OF 'LEVERAGE' OR 'GEARING'

         Transactions in futures carry a high degree of risk. The amount of
         initial margin is small relative to the value of the futures contract
         so that transactions are 'leveraged' or 'geared'. A relatively small
         market movement will have a proportionately larger impact on the funds
         you have deposited or will have to deposit: this may work against you
         as well as for you. You may sustain a total loss of initial margin
         funds and any additional funds deposited with the firm to maintain your
         position. If the market moves against your position or margin levels
         are increased, you may be called upon to pay substantial additional
         funds on short notice to maintain your position. If you fail to comply
         with a request for additional funds within the time prescribed, your
         position may be liquidated at a loss and you will be liable for any
         resulting deficit.

4.       RISK-REDUCING ORDERS OR STRATEGIES

         The placing of certain orders (e.g. 'stop-loss' orders, where permitted
         under local law, or 'stop-limit' orders) which are intended to limit
         losses to certain amounts may not be effective because market
         conditions may make it impossible to execute such orders. Strategies
         using combinations of positions, such as 'spread' and 'straddle'
         positions may be as risky as taking simple 'long' or 'short' positions.

Options

5.       VARIABLE DEGREE OF RISK

         Transactions in options carry a high degree of risk. Purchasers and
         sellers of options should familiarise themselves with the type of
         option (i.e. put or call) which they contemplate trading and the
         associated risks. You should calculate the extent to which the value of
         the options must increase for your position to become profitable,
         taking into account the premium and all transaction costs.

         The purchaser of options may offset or exercise the options or allow
         the options to expire. The exercise of an option results either in a
         cash settlement or in the purchaser acquiring or delivering the
         underlying interest. If the option is on a future, the purchaser will
         acquire a futures position with associated liabilities for margin (see
         the section on Futures above). If the purchased options expire
         worthless, you will suffer a total loss of your investment which will
         consist of the option premium plus transaction costs. If you are
         contemplating purchasing deep-out-of-the money options, you should be
         aware that the chance of such options becoming profitable ordinarily is
         remote.

         Selling ('writing' or 'granting') an option generally entails
         considerably greater risk than purchasing options. Although the premium
         received by the seller is fixed, the seller may sustain a loss well in
         excess of that amount. The seller will be liable for additional margin
         to maintain the position if the market moves unfavourably. The seller
         will also be exposed to the risk of the purchaser exercising the option
         and the seller will be obligated to either settle the option in cash or
         to acquire or deliver the underlying interest. If the option is on a
         future, the seller will acquire a position in a future with associated
         liabilities for margin (see the section on Futures above). If the
         option is 'covered' by the seller holding a corresponding position in
         the underlying interest or a future or another option, the risk may be
         reduced. If the option is not covered, the risk of loss can be
         unlimited. Certain exchanges in some jurisdictions permit deferred
         payment of the option premium, exposing the purchaser to liability for
         margin payments not exceeding the amount of the premium. The purchaser
         is still subject to the risk of losing the premium and transaction
         costs. When the option is exercised or expires, the purchaser is
         responsible for any unpaid premium outstanding at that time.

Additional risks common to futures and options

6.       TERMS AND CONDITIONS OF CONTRACTS

         You should ask the firm with which you deal about the terms and
         conditions of the specific futures or options which you are trading and
         associated obligations (e.g. the circumstances under which you may
         become obligated to make or take delivery of the underlying interest of
         a futures contract and, in respect of options, expiration dates and
         restrictions on the time for exercise). Under certain circumstances the
         specifications of outstanding contracts (including the exercise price
         of an option) may be modified by the exchange or clearing house to
         reflect changes in the underlying interest.

7.       SUSPENSION OR RESTRICTION OF TRADING AND PRICING RELATIONSHIPS

         Market conditions (e.g. illiquidity) and/or the operation of the rules
         of certain markets (e.g. the suspension of trading in any contract or
         contract month because of the price limits or 'circuit breakers') may
         increase the risk of loss by making it difficult or impossible to
         effect transactions or liquidate/offset positions. If you have sold
         options, this may increase the risk of loss.

         Further, normal pricing relationships between the underlying interest
         and the future, and the underlying interest and the option may not
         exist. This can occur when, for example, the futures contract
         underlying the option is subject to price limits while the option is
         not. The absence of an underlying reference price may make it difficult
         to judge 'fair' value.

8.       DEPOSITED CASH AND PROPERTY

         You should familiarise yourself with the protections accorded money or
         other property you deposit for domestic and foreign transactions,
         particularly in the event of a firm insolvency or bankruptcy. The
         extent to which you may recover your money or property may be governed
         by specified legislation or local rules. In some jurisdictions,
         property which had been specifically identifiable as your own will be
         pro-rated in the same manner as cash for purposes of distribution in
         the event of a shortfall.

9.       COMMISSION AND OTHER CHARGES

         Before you begin to trade, you should obtain a clear explanation of all
         commission, fees and other charges for which you will be liable. These
         charges will affect your net profit (if any) or increase your loss.

10.      TRANSACTIONS IN OTHER JURISDICTIONS

         Transactions on markets in other jurisdictions, including markets
         formally linked to a domestic market, may expose you to additional
         risk. Such markets may be subject to regulation which may offer
         different or diminished investor protection. Before you trade, you
         should enquire about any rules relevant to your particular
         transactions. Your local regulatory authority will be unable to compel
         the enforcement of the rules of regulatory authorities or markets in
         other jurisdictions where your transactions have been effected. You
         should ask the firm with which you deal for details about the types of
         redress available in both your home jurisdiction and other relevant
         jurisdictions before you start to trade.

11.      CURRENCY RISKS

         The profit or loss in transactions in foreign currency-denominated
         contracts (whether they are traded in your own or another jurisdiction)
         will be affected by fluctuations in currency rates where there is a
         need to convert from the currency denomination of the contract to
         another currency.

12.      TRADING FACILITIES

         Most open-outcry and electronic trading facilities are supported by
         computer-based component systems for the order-routing, execution,
         matching, registration or clearing of trades. As with all facilities
         and systems, they are vulnerable to temporary disruption or failure.
         Your ability to recover certain losses may be subject to limits on
         liability imposed by the system provider, the market, the clearing
         house and/or member firms. Such limits may vary; you should ask the
         firm with which you deal for details in this respect.

13.      ELECTRONIC TRADING

         Trading on an electronic trading system may differ not only from
         trading in an open-outcry market but also from trading on other
         electronic trading systems. If you undertake transactions on an
         electronic trading system, you will be exposed to risk associated with
         the system including the failure of hardware and software. The result
         of any system failure may be that your order is either not executed
         according to your instructions or is not executed at all.

14.      OFF-EXCHANGE TRANSACTIONS

         In some jurisdictions, and only then in restricted circumstances, firms
         are permitted to effect off-exchange transactions. The firm with which
         you deal may be acting as your counterparty to the transaction. It may
         be difficult or impossible to liquidate an existing position, to assess
         the value, to determine a fair price or to assess the exposure to risk.
         For these reasons, these transactions may involve increased risks.
         Off-exchange transactions may be less regulated or subject to a
         separate regulatory regime. Before you undertake such transactions, you
         should familiarise yourself with applicable rules and attendant risks.


--------------------------------------------------------------------------------

         I/we hereby acknowledge that 1/we have received and understood this
risk disclosure statement furnished to me/us by Morgan Stanley & Co.
International Limited.

         Signature(s):/s/ Robert E. Murray
                      .............................

         Name(s):     Demeter Management Corporation, General Partner

         Title(s):    By:  Robert E. Murray, President & Chairman

         Authorised Signatory(ies) for and on behalf of:

         Morgan Stanley Dean Witter Spectrum Commodity L.P.

         Name of Customer (please print)

         Date:..........................May 1, 2000


<PAGE>


                                 FORM OF CONSENT

         In the event that a dispute arises between you, Morgan Stanley Dean
Witter Spectrum Commodity L.P., (Customer's name) and Morgan Stanley & Co.
International Limited with respect to transactions subject to Part 30 of the
Commodity Futures Trading Commission's Rules, various forums may be available
for resolving the dispute, including courts of competent jurisdictions in the
United States and United Kingdom.

         In the event you wish to initiate an arbitration proceeding against
this firm to resolve such dispute under the applicable rules of the National
Futures Association ("NFA") in the United States, you hereby consent that you
will first commence mediation or conciliation in accordance with such procedures
as may be available by the relevant United Kingdom regulator, information for
which is provided to you herewith. The outcome of such United Kingdom mediation
or conciliation is non-binding. You may subsequently accept this resolution, or
you may proceed either to binding arbitration under the rules of the relevant
United Kingdom regulator or to binding arbitration in the United States under
the rules of NFA. In this connection, you should know that NFA will reject any
request for arbitration involving a claim arising primarily out of delivery,
clearing, settlement or floor practices on any foreign exchange. If you accept
the mediated or conciliated resolution or elect to proceed to arbitration, or to
any other form of binding resolution under the rules of the relevant United
Kingdom regulator or foreign exchange, you will be precluded for subsequently
initiating an arbitration proceeding at NFA.

         You may initiate an NFA arbitration proceeding upon receipt of
documentation from the relevant United Kingdom regulator:

        (i)      evidencing completion of the mediation or conciliation process
                 and reminding you of your rights of access to NFA's arbitration
                 proceeding;

                 OR

        (ii)     representing that more than nine months have elapsed since you
                 commenced the mediation or conciliation process and that such a
                 process is not yet complete and reminding you of your right of
                 access to NFA's arbitration proceedings.

         The documentation referred to above must be presented to NFA at the
time you initiate the NFA arbitration proceeding. NFA will exercise its
discretion not to accept your demand for arbitration absent such documentation.

         By signing this consent, you are now waiving any other rights to any
other legal remedies available under law.

--------------------------------------------------------------------------------

         Signature(s): /s/ Robert E. Murray
                      .............................

         Name(s):     Demeter Management Corporation, General Partner

         Title(s):    By:  Robert E. Murray, President & Chairman

         Authorised Signatory(ies) for and on behalf of:

         Morgan Stanley Dean Witter Spectrum Commodity L.P.

         Name of Customer (please print)

         Date:..........................May 1, 2000


<PAGE>


                            'A SERVICE FOR INVESTORS'








                          THE COMPLAINTS BUREAU OF SFA










                      THE SECURITIES AND FUTURES AUTHORITIY


<PAGE>


         INTRODUCTION

         THE SECURITIES AND FUTURES AUTHORITY (SFA) is responsible for
         regulating firms involved in the securities and futures sectors of the
         financial services industry. It is recognised under the Financial
         Services Act 1986 as a self regulating organisation and through the
         Securities and Investments Board is responsible, ultimately to
         Parliament, for protecting investors from incompetent or fraudulent
         practice by its member firms.

         A fuller explanation of SFA's role and of its regulatory process is
         given in a separate leaflet entitled "Putting the investor first!"
         which is available on request.

         Member firms of SFA aim to provide a wholly satisfactory service to
         their customers and are expected to respond to their clients'
         requirements with skill and consideration. Though the common aim is to
         secure a profitable return, it cannot be guaranteed; the markets are
         not without risk. Occasionally however, an investor may feel
         dissatisfied with the service provided. If you, as a customer of an SFA
         member firm, are unhappy with the way it has conducted your affairs,
         you can complain to us. (See note)

         This leaflet is an introduction to our complaints service. It describes
         the role of our Complaints Bureau and outlines the purpose of the
         Consumer Arbitration Scheme. It also explains the function of the
         independent Complaints Commissioner.








                  Note: The Financial Services Act (Section 62) allows you to
         seek compensation in the courts if you have suffered loss as a result
         of a member firm's breach of our rules. This remedy is separate from
         SFA's complaints procedures and you should seek independent legal
         advice.


<PAGE>


         FIRST STEP . . .

         Complain to the firm first. All member firms must deal with customers'
         complaints promptly. If you cannot resolve your complaint with your
         usual contact at that firm you should write to its compliance officer.
         This person is a senior employee of the firm, responsible for ensuring
         that it observes SFA's rules. Most complaints are resolved at this
         stage, many of them proving to be simply a misunderstanding.

         If your complaint is not properly remedied, the firm is obliged to
         inform you of your right to refer the matter to us and may do this by
         sending you a copy of this leaflet.

          . . . THEN CONTACT US

         If you are not satisfied with the member firm's findings or with the
         way it has dealt with your complaint, write giving details to our
         Complaints Bureau. Before you do so however, please note that we can,
         in most cases, only consider your complaint if:

         (a)  It is not already the subject of litigation or arbitration.

         (b)  It is about something which happened on or after 29 April 1988
              (i.e. when the Financial Services Act came into force).

              We will:

              --   acknowledge your letter within one day of receipt.

              --   require answers from the member firm within ten working days.

              --   aim to resolve all complaints within three months.


<PAGE>


         WHAT WE WILL DO

         We will look into the complaint. No payment is required for this
         service. We may ask you to provide further details and it is usual for
         us to ask the firm for its comments and help too. Firms are obliged to
         co-operate fully and promptly with us.

         After considering your complaint we will make a decision as quickly as
         possible:

         o    In some cases we may refer the matter back to the member firm. We
              will do this if we are confident that the firm can settle the
              dispute satisfactorily itself.

         o    In other cases we will endeavour to conciliate between you and the
              firm to reach a fair settlement. If this is achieved, our
              participation will have ended, and the dispute cannot normally be
              re-opened in court, or through our arbitration proceedings.

         o    If we find evidence suggesting that a member firm has breached our
              rules the matter will be further examined by our enforcement
              inspectors. Disciplinary action against the firm could ensue.

         o    It may be that we conclude that the complaint does not warrant
              action by us. If we do we will explain to you why we have taken
              that view.

         ARBITRATION

         If we have been unable to resolve the dispute to your satisfaction, you
         have the right to refer the matter to our Consumer Arbitration Scheme.
         This is restricted to private customers where the claim is not more
         than (pound)50,000. You will be asked to make a payment of (pound)50
         for this service.

         For claims falling outside the Consumer Arbitration Scheme, there is
         also a separate SFA Full Arbitration Scheme which is available by
         mutual agreement between yourself and the firm. If you arbitrate you
         may not seek to resolve the same dispute in the courts.



<PAGE>


         DISSATISFIED WITH US?

         If you are unhappy with the way we have handled your complaint, you may
         write to the Complaints Commissioner. His is an independent role, the
         purpose of which is to oversee the work undertaken by the Complaints
         Bureau. He will not consider the merits of the complaint itself but
         will look at the way we have handled it and will consider whether we
         have dealt with it correctly, fairly and promptly. The Commissioner may
         require us to look at your complaint again. He reports to the
         Securities and Investments Board each year on our complaints handling
         process, and his annual report is published.

         Summary

         1.     Make your complaint to the member firm in question. Give the
                firm a reasonable opportunity to look into the matter.

         2.     If dissatisfied with the firm's response, notify us in writing
                and we will investigate the complaint.

         3.     We will try to arrange a settlement between you and the firm or
                we may conclude no further action is necessary.

         4.     If no settlement is reached, you may have recourse to
                arbitration.

         5.     If our handling of your complaint does not satisfy you, you can
                apply to the independent Complaints Commissioner for a review of
                the process.


<PAGE>


         WHO TO CONTACT

         If you have tried unsuccessfully to get your complaint dealt with by
         the member firm and you want us to deal with the matter, write to:

         The Complaints Bureau,
         The Securities and Futures Authority,
         Cottons Centre,
         Cottons Lane,
         London SEl 2QB.

         If you have had your complaint dealt with by us but are unhappy with
         the way we have handled it, write to:

         The Complaints Commissioner.
         c/o SFA Tribunal Secretariat,
         Cottons Centre,
         Cottons Lane,
         London SEl 2QB.


<PAGE>


         FURTHER INFORMATION

         Further details are available concerning our complaints service and
         arbitration procedures:

         o    Consumer Arbitration Scheme Rules.

         o    Full Arbitration Scheme Rules.

         o    Annual Report of the Complaints Commissioner.

         OTHER PUBLICATIONS

         "Putting the investor first!" An outline of SFA.

         o    Professional Dealing Handbook*

         o    Rulebook and amendment service*

         o    Board Notices*

         o    Membership Directory*

         o    Briefing, SFA's membership newsletter

         o    Annual Report and Accounts


           * Available by subscription


           SFA

           The Securities and Futures Authority Limited
           Cottons Centre
           Cottons Lane
           London SE1 2QB

           Tel: 071 378 9000
           Fax: 071 403 7569

           Registered in England and Wales No. 1998622
           Registered Office as above
           Published May 1994


<PAGE>


                          'PUTTING THE INVESTOR FIRST!'




                              AN OUTLINE OF THE SFA









                      THE SECURITIES AND FUTURES AUTHORITY


<PAGE>
<TABLE>
<CAPTION>

<S>                                 <C>
PARLIAMENT                          Introduction
    |
    |                               The Securities and Futures Authority (SFA) is responsible for
    |                               regulating firms involved in the securities and futures sectors of the
    |                               financial services industry. Its aim is to promote and maintain high
    |                               standards of integrity and fair dealing in the carrying on of
    |                               investment business, thereby providing effective protection for the
    |                               investor.
    |
    |                               The purpose of this leaflet is to outline SFA's role and briefly to
TREASURY                            describe what it does and how it does it. Those who are not familiar
    |                               with UK financial services regulation will find this a useful
    |                               introduction to SFA. But before we take a closer look at SFA, it might
    |                               be helpful to put it into a broader industry perspective.
    |
    |                               The history of the UK's financial services industry is well documented.
    |                               Banking, insurance, shares trading and futures dealing have developed
    |                               into highly organised services and markets to make London one of the
    |                               financial capitals of the world.
SECURITIES AND
INVESTMENTS                         As the markets in financial services developed, rules were introduced
BOARD                               and continually refined so that business could be conducted in an
(SIBB)                              orderly and fair manner. Of course, rules are not a guarantee of
    |                               successful investment. There is risk. World events, government
    |                               policies, natural disasters or just simply corporate decisions and
    |                               company performance all influence the way prices move. Nevertheless,
    |                               professionals in the industry apply knowledge, experience and skill in
    |                               order to make the best judgement for their clients and for themselves.
    |                               But there are those who through fraudulent of incompetent practice.
    |---SFA*                        place their clients' money in jeopardy. To combat this, Parliament
    |   Securities and              introduced legislation which heralded a new system of financial
    |   derivatives                 services regulations.
    |   dealers and
    |   advisers                    With the primary aim of improving investor protection, the Financial
    |                               Services Act 1986 brought about a major restructuring in the way
    |                               investment services are regulated. Is became a criminal offence to
    |                               carry on investment business if not authorised to do so. A new
    |                               organisation, the Securities and Investments Board (SIB) was
    |---IMRO                        established to oversee the implementation of the Act.
    |   Fund managers
    |                               SIB devolved its powers so authorise and the task of day-to-day
    |                               enforcement to specialist self-regulatory organisations (SROs), though
    |                               it retains the overall responsibility for ensuring that the regulatory
    |---PIA**                       system is meeting its obligations.
    |   Life assurance
    |   and unit trust              SROs must ensure that investment businesses and individuals that come
    |   salesmen, financial         within their scope meet appropriate standards in order to be permitted
    |   intermediaries/             to undertake business.
    |   independent
    |   financial advisers
    |
    |
    |
    |
    |


*SFA was formed in April
1991 from the merger of The
Securities Association and
the Association of Futures,
Brokers and Dealers

**PIA (Personal Investment
Authority) was recognised
by SIB in July 1994 and is
taking over the regulatory
functions of LAUTRO and
FIMBRA who will be
derecognised in 1995



<PAGE>


                                    SFA'S ROLE

INVESTOR PROTECTION...              SFA's role is to help protect investors, both private and professional,
                                    from financial loss caused by members' insolvency, failure to meet
                                    adequate standards of competence, or deliberate acts of deception.
                                    Furthermore, good market practice is one of London's attractions for
 ...GOOD MARKET PRACTICE...          international business. SFA's aim is to deliver effective regulation
                                    which will not stifle innovation or be so restrictive that business
 ...ATTRACTIVE TO INTERNATIONAL      would be driven to competing international markets.
BUSINESS

                                    MEMBER FIRMS

MEMBER FIRMS ACTIVE ON:             Firms regulated by SFA are involved in dealing or advising in
                                    securities or derivatives. This encompasses shares, bonds, traded
-  LONDON STOCK EXCHANGE            options, corporate finance, financial futures and commodities futures
                                    on metals, oil, cereals, coffee and others. Firms regulated by SFA are
-  LONDON INTERNATIONAL FINANCIAL   active on many UK and overseas exchanges. Their earnings make a
   FUTURES AND OPTIONS EXCHANGE     significant contribution to the British economy.

-  LONDON METAL EXCHANGE            SFA has 1300 member firms. Many of them have a long and successful
                                    business pedigree; others are newer ventures created in response to
-  INTERNATIONAL PETROLEUM          demand for new or specialised products and services. Most are located
   EXCHANGE                         in London where the organised markets are, some are in other UK cities
                                    and towns serving the needs of their regional client base.
-  LONDON COMMODITIES EXCHANGE
                                    The greater proportion are UK firms but significant numbers are
-  OPTIONS MARKET, LONDON           incorporated overseas, notably in North America, Japan and Western
                                    Europe, with branches in the UK.
-  OVERSEAS EXCHANGES
                                    Member firms will state their membership of SFA on their stationery or
                                    advertisements. An updated list of members is published from time so
                                    time, and a claim to membership can always be verified by checking with
                                    SFA.

                                    Whatever their activities or origin, all member firms endorse the
                                    principles of self regulation and through the payment of subscriptions
                                    cover the cost of its administration. The taxpayer does not pay for
                                    investor protection.

                                    Through representation on the Board and in committees, members help to
                                    develop and refine the rules by bringing to bear their practical
                                    knowledge and experience. Furthermore, there is a senior person in each
                                    firm directly responsible for ensuring that this is in compliance with
                                    the rules.


<PAGE>


                                    THE PROCESS

                                    The regulatory process undertaken by SFA has four main parts:

                                    Authorisation -- This is the initial vetting of a firm to ensure that
                                    it is suitable to be permitted to conduct investment business. Firms
                                    that seek authorisation must provide information which demonstrates
                                    that they are adequately funded, have viable business plans, that their
AUTHORISATION OF FIRMS...           management and staff are suitably experienced and competent and that
                                    there is no history of malpractice. SFA check the information and if
                                    applicant firms are considered to be "fit and proper" they are granted
                                    authorisation (i.e. licensed) and become members of SFA. They are
                                    obliged to comply with SFA's rules.

                                    Authorisation includes the individual registration of directors,
                                    managers and investment staff in the firm. Some will have to take an
                                    examination to show that they understand the fundamentals of market
                                    practice and regulation. Those who are not registered are not permitted
                                    to deal or to give customer advice.
 ... AND KEY INDIVIDUALS
                                    Monitoring is an important task for SFA. Once a firm has been
                                    authorised, and becomes a member, it is not the end of the regulatory
                                    story. All members are required to provide a wide range of financial
                                    and other information to SFA on a regular basis and sometimes upon
MONITORING TO CHECK COMPLIANCE      special request. Teams of inspectors make routine visits to firms to
WITH THE RULES                      check on their compliance with the rules. In some cases the visits may
                                    be made without warning.

                                    If the monitoring process uncovers non-compliance with rules, steps are
                                    quickly taken by SFA to ensure that the investors' interests are
DETAILED INVESTIGATION WHEN         protected. In most instances the "infringement" is only of a minor
NON--COMPLIANCE IS SUSPECTED        administrative nature offering no immediate danger to the investor.
                                    Firms usually put things right as soon as it is brought to their
                                    attention.

                                    Investigation -- Where a more serious breach of rules is suspected
                                    either as a result of routine monitoring, or from reports received from
                                    other sources, a more focussed investigation is undertaken to gather
PROSECUTION CAN RESULT IN           the relevant facts. Monitoring and investigation may sometimes involve
DISCIPLINE OF MEMBER FIRMS          liaison with other UK and overseas regulatory authorities.

                                    Prosecution -- If the investigators feel that a member has committed a
                                    serious breach of the rules, or if other good reason exists, the case
                                    is considered at a more formal level. If the judgement is against the
                                    firm the nature of the breach will determine the penalty. It could be a
                                    warning, a direction, a fine, a temporary order to stop trading or
                                    expulsion from membership i.e. de-authorisation. SFA cannot undertake
                                    criminal prosecution through the courts. Should such a prosecution be
                                    necessary the results of SFA's investigations are passed to a relevant
                                    body e.g. the Department of Trade and Industry or the Police.


<PAGE>


                                    COMPLAINTS AND ARBITRATION

                                    Member firms are expected to service their customers' needs with skill
                                    and consideration. Occasionally things go wrong and a customer may have
                                    a complaint. Where the firm and its customer are unable to reach
INVESTORS CAN COMPLAIN TO SFA       agreement between themselves the customer can refer the matter to SFA's
ABOUT ITS MEMBERS                   Complaints Bureau. The Bureau will consider the complaint and attempt
                                    to resolve the dispute between both parties Arbitration procedures are
                                    also available if the firm's customer is not satisfied with the
                                    findings of the Bureau.

AN INDEPENDENT COMMISSIONER         The work of the Complaints Bureau is overseen by a completely
CHECKS SFA'S COMPLAINTS             independent Complaints Commissioner. His role is not to re-examine the
PROCEDURES                          detail of cases but to determine if they have been dealt with properly
                                    and fairly by the Bureau. The Commissioner publishes an annual report
                                    on the work of the Bureau which is widely circulated.

                                    ORGANISATION

POLICY DETERMINED BY SENIOR         SFA has over two hundred full time staff reporting to the Chief
PRACTITIONERS AND INDEPENDENTS      Executive. He is supported directly by an executive team, each member
SUPPORTSED BY A PROFESSIONAL        of which has senior management responsibility for a specific aspect of
EXECUTIVE AND STAFF                 SFA's activity.

                                    Overseeing the work of the executive is the Chairman and Board of
                                    Directors. These are not employees of SFA but are either senior
                                    practitioners from member firms or persons independent of SFA and its
                                    firms who represent the interests of the investor. The Board delegates
                                    responsibility for the detail of policy, rulemaking and disciplinary
                                    procedures to specialist committees which are also composed of
                                    practitioners and independents. Supported by a professional staff, this
                                    combination provides for effective and flexible self-regulation.

REGULAR CONTACT WITH GOVERNMENT     PUBLIC RELATIONS
BODIES, 'CITY' INSTITUTIONS,
PROFESSIONAL BODIES AND THE PRESS   SFA's communication with the public, Parliament, 'City' institutions,
                                    professional bodies and other regulators, at home and abroad, plays an
                                    important part in the process of developing confidence in SFA members'
                                    businesses and in furthering the success of the regulatory system as a
                                    whole. Accordingly SFA maintains regular contact with the press and
                                    other media. Press coverage of disciplinary action taken by SFA acts as
                                    a reassurance to the public and to the financial community that SFA is
                                    actively seeking to help promote good practice in London's markets.



</TABLE>

<PAGE>




         FURTHER INFORMATION

         More details are available on the various aspects of SFA's work and
         what it does to put the investor first.

         Other publications include:

         o    Rule Book and amendment service*

         o    Professional Dealing Handbook*

         o    Board Notices*

         o    Membership Directory*

         o    Briefing, SFA's Membership newsletter

         o    Annual Report and Accounts (with Regulatory Plan)

         o    Complaints Bureau

         o    Annual Report of the Complaints Commissioner

         o    Annual Report of the Chairman of the Arbitration Panel

         o    Consumer Arbitration Scheme

         o    Full Arbitration Scheme Rules

         o    Membership Application Pack**

         o    Available by subscription

         **   For applicant firms (after a preliminary discussion)

         SFA

         The Securities and Futures Authority Limited
         Cottons Centre
         Cottons Lane
         London SE1 2QB

         Tel:     071 378 9000
         Fax:     071 403 7569

         Registered in England and Wales No 1998622
         Registered Office as above
         Fifth edition July 1994