Document:

Unassociated Document

    Exhibit 4.1

     

    
      	
               

            	
              FORM
                OF FIXED RATE SENIOR NOTE

            

    

     

    
      	
              REGISTERED

            	 	
              REGISTERED

            
	
              No.
                FXR-1

            	 	
              U.S.
                $

            
	 	 	
              CUSIP:
                617475322

            

    

    

     

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

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

       

    

    MORGAN
      STANLEY

    SENIOR
      GLOBAL MEDIUM-TERM NOTE, SERIES F

    

    OUTPERFORMANCE
      PLUS DUE DECEMBER 20, 2008

    BASED
      ON THE PERFORMANCE OF THE S&P 100®
      INDEX

    RELATIVE
      TO THE RUSSELL 2000®
      INDEX

     

    
      	
              ORIGINAL
                ISSUE DATE:

               

            	
              INITIAL
                REDEMPTION DATE: N/A

            	
              INTEREST
                RATE: N/A

            	
              MATURITY
                DATE: See “Maturity Date” below.

            
	
              INTEREST
                ACCRUAL DATE: N/A

            	
              INITIAL
                REDEMPTION PERCENTAGE: N/A

            	
              INTEREST
                PAYMENT DATE(S): N/A

            	
              OPTIONAL
                REPAYMENT DATE(S): N/A

            
	
              SPECIFIED
                CURRENCY: U.S. dollars

            	
              ANNUAL
                REDEMPTION PERCENTAGE REDUCTION: N/A

            	
              INTEREST
                PAYMENT PERIOD: N/A

            	
              APPLICABILITY
                OF MODIFIED

              PAYMENT
                UPON ACCELERATION OR REDEMPTION: See “Alternate Exchange Calculation in
                Case of an Event of Default” below.

            
	
              IF
                SPECIFIED CURRENCY OTHER THAN U.S. DOLLARS, OPTION TO ELECT PAYMENT
                IN
                U.S. DOLLARS: N/A

            	
              REDEMPTION
                NOTICE PERIOD: N/A

            	
              APPLICABILITY
                OF ANNUAL INTEREST PAYMENTS: N/A

            	
              If
                yes, state Issue Price: N/A

            
	
              EXCHANGE
                RATE AGENT: N/A

            	
              TAX
                REDEMPTION AND PAYMENT OF ADDITIONAL AMOUNTS: NO

            	
              PRICE
                APPLICABLE UPON OPTIONAL REPAYMENT: N/A

            	
              ORIGINAL
                YIELD TO MATURITY: N/A

            
	
              OTHER
                PROVISIONS: See below

            	
              IF
                YES, STATE INITIAL OFFERING DATE: N/A

            	 	 

    

    

    
      	
              Terms
                used in this

            	 	 	 
	
              Outperformance
                PLUS

            	 	 	
              References
                in this Outperformance PLUS to:

            
	 	 	 	 
	
               

            	 	
              •

            	
              “we”,
                “us” or “our” are to Morgan Stanley, as Issuer of this Outperformance
                PLUS;

            
	 	 	 	 
	
               

            	 	
              •

            	
              “you”
                and “your” are to the Holder of this Outperformance PLUS;
                and

            
	 	 	 	 
	
               

            	 	
              •

            	
              “Outperformance
                PLUS” is to be construed as a reference to each $10 Stated Principal
                Amount of the Outperformance PLUS Due December 20, 2008, Based on
                the
                Performance of the S&P 100®
                Index Relative
                to the Russell 2000®
                Index.

            
	 	 	 	 
	
              Maturity
                Date

            	 	December
              20, 2008, subject to extension if the Valuation Date is postponed in
              accordance with the definition thereof.  If
              the  Valuation Date is postponed so that it falls less than two
              scheduled Business Days prior to the scheduled Maturity Date,
              

    

    

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

       

    

    
      	 	 	the
              Maturity Date will be the second scheduled Business Day following the
              Valuation Date as postponed.
	 	 	 
	 	 	 
	
              Pricing
                Date

            	 	
                                 ,
                the day we priced the Outperformance PLUS for initial sale to the
                public.

            
	 	 	 
	
              Denominations

            	 	
              $10
                and integral multiples thereof

            
	 	 	 
	
              Stated
                Principal Amount

            	 	
              $10
                per Outperformance PLUS

            
	 	 	 
	
              Payment
                at Maturity

            	 	
              At
                maturity, upon delivery of the Outperformance PLUS to the Trustee,
                we will
                pay with respect to the $10 Stated Principal Amount of each Outperformance
                PLUS an amount in cash equal to:

            
	 	 	 
	 	 	
              (a)
                if the OEX Index outperforms the RTY Index because the OEX Index
                Return is
                equal to or greater than the RTY Index Return,

            
	 	 	 
	 	 	
              $10
                x [1 + (Outperformance Return x Participation Rate)], subject to
                the
                Maximum Payment at Maturity; and

            
	 	 	 
	 	 	
              (b)
                if the OEX Index underperforms the RTY Index because the RTY Index
                Return
                is greater than the OEX Index Return, 

            
	 	 	 
	 	 	
              $10
                x (1 + Outperformance Return).

            
	 	 	 
	 	 	
              We
                shall, or shall cause the Calculation Agent to (i) provide written
                notice
                to the Trustee, on which notice the Trustee may conclusively rely,
                and to
                The Depository Trust Company, which we refer to as DTC, of the amount
                of
                cash to be delivered with respect to the $10 Stated Principal Amount
                of
                each Outperformance PLUS, on or prior to 10:30 a.m. on the Business
                Day
                preceding the Maturity Date, and (ii) deliver the aggregate cash
                amount
                due with respect to the Outperformance PLUS to the Trustee for delivery
                to
                DTC, as holder of the Outperformance PLUS, on the Maturity
                Date.

            
	 	 	 
	
              OEX
                Index

            	 	
              The
                S&P 100®
                Index

            
	 	 	 
	
              RTY
                Index

            	 	
              The
                Russell 2000®
                Index

            
	 	 	 
	
              Maximum
                Payment at Maturity

            	 	
              $              (          %
                of the Stated Principal Amount).

            
	 	 	 
	
              Participation
                Rate

            	 	          %
	 	 	 
	
              Outperformance
                Return

            	 	
              The
                Outperformance Return will equal the OEX Index Return less the RTY
                Index
                Return.

            
	 	 	 
	
              OEX
                Index Return

            	 	
              The
                OEX Index Return will equal (a) OEX Index Final Value less OEX
                Index Initial Value divided by (b) OEX Index Initial
                Value.

            

    

     

    
      
        
        

      

      
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              RTY
                Index Return

            	 	
              The
                RTY Index Return will equal (a) RTY Index Final Value less RTY
                Index Initial Value divided by (b) RTY Index Initial
                Value.

            
	 	 	 
	
              OEX
                Index Initial Value

            	 	
                                 ,
                the OEX Index Value on the Pricing Date.

            
	 	 	 
	
              OEX
                Index Final Value

            	 	
              The
                OEX Index Value on the Valuation Date.

            
	 	 	 
	
              RTY
                Index Initial Value

            	 	
                                 ,
                the RTY Index Value on the Pricing Date.

            
	 	 	 
	
              RTY
                Index Final Value

            	 	
              The
                RTY Index Value on the Valuation Date.

            
	 	 	 
	
              OEX
                Index Value

            	 	
              The
                OEX Index Value on any day will equal the closing value of the OEX
                Index
                published on such day on Bloomberg under ticker symbol “OEX”, or in the
                case of any Successor Index for the OEX Index (as defined below),
                the
                Bloomberg ticker for any such Successor Index.

            
	 	 	 
	
              RTY
                Index Value

            	 	
              The
                RTY Index Value on any day will equal the closing value of the RTY
                Index
                published on such day on Bloomberg under ticker symbol “RTY”, or in the
                case of any Successor Index for the RTY Index (as defined below),
                the
                Bloomberg ticker for any such Successor Index.

            
	 	 	 
	
              Valuation
                Date

            	 	
              December
                18, 2008, subject to adjustment for Market Disruption Events as described
                in the following paragraph.

            
	 	 	 
	 	 	
              If
                the Valuation Date is not an Index Business Day or if there is a
                Market
                Disruption Event on such day with respect to the OEX Index or the
                RTY
                Index, the Valuation Date with respect to both indices shall be the
                next
                succeeding Index Business Day with respect to such index on which
                there is
                no Market Disruption Event; provided that if a Market Disruption
                Event has occurred to either or both indices on each of the two Index
                Business Days immediately succeeding the scheduled Valuation Date,
                then
                (i) such second succeeding Index Business Day will be deemed to be
                the
                Valuation Date, notwithstanding the occurrence of a Market Disruption
                Event on such day and (ii) with respect to any such second Index
                Business
                Day on which a Market Disruption Event occurs with respect to an
                index,
                the Calculation Agent will determine the value on such second Index
                Business Day of (A) any undisrupted index in accordance with “RTY Index
                Value” or “OEX Index Value”, as applicable, and (B) any disrupted index in
                accordance with the formula for and method of calculating the disrupted
                index last in effect prior to the commencement of the Market Disruption
                Event, using the closing price (or, if trading in the relevant securities
                has been materially suspended or materially limited, its good faith
                estimate of the closing price that would have prevailed but for such
                suspension or limitation) on such Index Business Day of each security
                most
                recently constituting the disrupted
                index.

            

    

     

    
      
        
        

      

      
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              Index
                Business Day

            	 	
              Index
                Business Day means a day, for both the OEX Index and the RTY Index,
                as
                determined by the Calculation Agent, on which trading is generally
                conducted on each of the Relevant Exchange(s) for the OEX Index and
                the
                RTY Index (or Successor Index), as applicable, and on each exchange
                on
                which futures or options contracts related to the OEX Index and the
                RTY
                Index (or Successor Index), as applicable, are traded, other than
                a day on
                which trading on such exchange(s) is scheduled to close prior to
                the time
                of the posting of its regular final weekday closing
                price.

            
	 	 	 
	 	 	 
	
              Calculation
                Agent

            	 	
              Morgan
                Stanley & Co. Incorporated and its successors (“MS &
                Co.”)

            
	 	 	
              All
                determinations made by the Calculation Agent will be at the sole
                discretion of the Calculation Agent and will, in the absence of manifest
                error, be conclusive for all purposes and binding on you, the Trustee
                and
                us.

            
	 	 	 
	 	 	
              In
                addition to other calculations and determinations which the Calculation
                Agent will make in accordance with the terms of the Outperformance
                PLUS,
                the Calculation Agent will make all calculations and determinations
                required to be made, whether explicitly or implicitly or directly
                or
                indirectly under the provisions “Maturity Date”, “Payment at Maturity”,
                “Outperformance Return”, “OEX Index Return”, “RTY Index Return”, “OEX
                Index Initial Value”, “OEX Index Final Value”, “RTY Index Initial Value”,
                “RTY Index Final Value”, “OEX Index Value”, “RTY Index Value”, “Valuation
                Date”, “Index Business Day”, “Market Disruption Event”, “Relevant
                Exchange”, “Alternate Exchange Calculation in Case of an Event of Default”
                and “Discontinuance of the OEX Index or the RTY Index; Alteration of
                Method of Calculation.”

            
	 	 	 
	 	 	
              The
                Trustee is entitled to conclusively rely upon all calculations and
                determinations made by us or the Calculation Agent in accordance
                with the
                provisions of the Outperformance PLUS.

            
	 	 	 
	 	 	
              All
                calculations with respect to the Payment at Maturity, if any, will
                be
                rounded to the nearest one hundred-thousandth, with five one-millionths
                rounded upward (e.g., .876545 would be rounded to .87655); all
                dollar amounts related to determination of the amount of cash payable
                per
                Outperformance PLUS will be rounded to the nearest ten-thousandth,
                with
                five one hundred-thousandths rounded upward (e.g., .76545 would
                be rounded up to .7655); and all dollar amounts paid on the aggregate
                number of Outperformance PLUS will be rounded to the nearest cent,
                with
                one-half cent rounded upward.

            

    

    
      	 	 	 
	
              Market
                Disruption Event

            	 	
              Market
                Disruption Event means, with respect to each of the OEX Index and
                RTY
                Index (together with the OEX Index, an

            

    

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

    
 

    
      	 	 	 
	
               

            	 	
              “Underlying
                Index”) individually, the occurrence or existence of a
                suspension, absence or material limitation of trading of stocks then
                constituting 20 percent or more of the level of the respective Underlying
                Indices (or the Successor Index, as defined in “Discontinuance of the OEX
                Index or the RTY Index; Alteration of Method of Calculation”) on the
                Relevant Exchange(s) for such securities for more than two hours
                of
                trading or during the one-half hour period preceding the close of
                the
                principal trading session on such Relevant Exchange(s); or a breakdown
                or
                failure in the price and trade reporting systems of any Relevant
                Exchange
                as a result of which the reported trading prices for stocks then
                constituting 20 percent or more of the level of such Underlying Index
                (or
                the Successor Index) during the last one-half hour preceding the
                close of
                the principal trading session on such Relevant Exchange(s) are materially
                inaccurate; or the suspension, material limitation or absence of
                trading
                on any major securities market for trading in futures or options
                contracts
                or exchange traded funds related to such Underlying Index (or the
                Successor Index) for more than two hours of trading or during the
                one-half
                hour period preceding the close of the principal trading session
                on such
                market, in each case as determined by the Calculation Agent in its
                sole
                discretion.

            
	 	 	 
	 	 	
              For
                the purpose of determining whether a Market Disruption Event exists
                at any
                time, if trading in a security included in the Underlying Index is
                materially suspended or materially limited at that time, then the
                relevant
                percentage contribution of that security to the value of the Underlying
                Index shall be based on a comparison of (x) the portion of the value
                of
                such Underlying Index attributable to that security relative to (y)
                the
                overall value of such Underlying Index, in each case immediately
                before
                that suspension or limitation.

            
	 	 	 
	 	 	
              For
                purposes of determining whether a Market Disruption Event has
                occurred:  (1) a limitation on the hours or number of days of
                trading will not constitute a Market Disruption Event if it results
                from
                an announced change in the regular business hours of the relevant
                exchange
                or market, (2) a decision to permanently discontinue trading in the
                relevant futures or options contract or exchange traded fund will
                not
                constitute a Market Disruption Event, (3) limitations pursuant to
                the
                rules of any Relevant Exchange similar to NYSE Rule 80A (or any applicable
                rule or regulation enacted or promulgated by any other self-regulatory
                organization or any government agency of scope similar to NYSE Rule
                80A as
                determined by the Calculation Agent) on trading during significant
                market
                fluctuations will constitute a suspension, absence or material limitation
                of trading, (4) a suspension of trading in futures or options contracts
                on
                the 

            

    

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

      
        
          	 	 	
                  Underlying
                    Index by the primary securities market trading in such contracts
                    by reason
                    of (a) a price change exceeding limits set by such exchange or
                    market, (b)
                    an imbalance of orders relating to such contracts or (c) a disparity
                    in
                    bid and ask quotes relating to such contracts will constitute
                    a
                    suspension, absence or material limitation of trading in futures
                    or
                    options contracts related to the Underlying Index and (5) a “suspension,
                    absence or material limitation of trading” on any Relevant Exchange or on
                    the primary market on which futures or options contracts related
                    to the
                    Underlying Index are traded will not include any time when such
                    market is
                    itself closed for trading under ordinary circumstances.

                
	 	 	 
	
                  Relevant
                    Exchange

                	 	
                  Relevant
                    Exchange means, in respect of the OEX Index or the RTY Index,
                    as
                    applicable, the primary exchange or market of trading for any
                    security
                    then included in the OEX Index or the RTY Index, as applicable,
                    or any
                    Successor Index to the OEX Index or the RTY Index, as
                    applicable.

                
	 	 	 
	
                  Alternate
                    Exchange Calculation

                	 	 
	
                  in
                    Case of an Event of Default

                	 	
                  In
                    case an event of default with respect to the Outperformance PLUS
                    shall
                    have occurred and be continuing, the amount declared due and
                    payable for
                    each Outperformance PLUS upon any acceleration of the Outperformance
                    PLUS
                    (the “Acceleration Amount”) will be equal to the Payment at Maturity
                    determined as though the Valuation Date were the date of
                    acceleration.

                
	 	 	 
	 	 	
                  If
                    the maturity of the Outperformance PLUS is accelerated because
                    of an event
                    of default as described above, we shall, or shall cause the Calculation
                    Agent to, provide written notice to the Trustee at its New York
                    office, on
                    which notice the Trustee may conclusively rely, and to DTC of
                    the
                    Acceleration Amount and the aggregate cash amount due with respect
                    to the
                    Outperformance PLUS as promptly as possible and in no event later
                    than two
                    Business Days after the date of acceleration.

                
	 	 	 
	 	 	
                  We
                    shall provide, or cause the Calculation Agent to provide, the
                    notice
                    provided for in the preceding paragraph (i) to you by mailing
                    notice of
                    such acceleration by first class mail, postage prepaid, to your
                    last
                    address as it appears upon the registry books, and (ii) to the
                    Trustee by
                    telephone or facsimile confirmed by mailing such notice to the
                    Trustee by
                    first class mail, postage prepaid, at its New York office and
                    (iii) to DTC
                    by telephone or facsimile confirmed by mailing such notice to
                    DTC by first
                    class mail, postage prepaid.  Any notice that is mailed in the
                    manner herein provided shall be conclusively presumed to have
                    been duly
                    given, whether or not you receive the
                    notice.

                

        

         

        
          
            
            

          

          
            7

            
              

            

          

          
            
            

          

        

        

        
          	
                  Miscellaneous

                	 	
                  We
                    will, or will cause the Calculation Agent to, deliver any cash
                    due upon
                    any acceleration described above to the Trustee for delivery
                    to
                    you.

                
	 	 	 
	 	 	
                  If
                    the Outperformance PLUS are not surrendered for redemption at
                    maturity or
                    upon acceleration, they shall be deemed to be no longer outstanding
                    under,
                    and as defined in, the Indenture (unless we have defaulted in
                    making the
                    payment due at maturity or upon acceleration), except with respect
                    to your
                    right to receive any cash in respect of principal or interest
                    payments.

                
	 	 	 
	
                  Discontinuance
                    of the OEX

                	 	 
	
                  Index
                    or the RTY Index; 

                	 	 
	
                  Alteration
                    of Method 

                	 	 
	
                  of
                    Calculation

                	 	
                  If
                    the publisher of an Underlying Index discontinues publication
                    of such
                    Underlying Index and such publisher or another entity (including
                    Morgan
                    Stanley & Co. Incorporated, which we refer to as MS & Co.)
                    publishes a successor or substitute index that MS & Co., as the
                    Calculation Agent, determines, in its sole discretion, to be
                    comparable to
                    the discontinued Underlying Index (such index being referred
                    to herein as
                    a “Successor Index”), then the OEX Index Final Value or
                    the RTY Index Final Value, as applicable, will be determined
                    by reference
                    to the published value of such Successor Index at the regular
                    weekday
                    close of trading on the Valuation Date and any reference to the
                    Underlying
                    Index shall be deemed to refer to such Successor Index.

                
	 	 	 
	 	 	
                  Upon
                    any selection by the Calculation Agent of a Successor Index,
                    the
                    Calculation Agent will cause written notice thereof to be furnished
                    to the
                    Trustee, to Morgan Stanley and to DTC, as holder of the Outperformance
                    PLUS, within three Business Days of such selection.

                
	 	 	 
	 	 	
                  If
                    the publisher of an Underlying Index discontinues publication
                    of the
                    Underlying Index prior to, and such discontinuance is continuing
                    on the
                    Valuation Date and MS & Co., as the Calculation Agent, determines, in
                    its sole discretion, that no Successor Index is available at
                    such time,
                    then the Calculation Agent will determine the OEX Index Final
                    Value or the
                    RTY Index Final Value, as applicable.  The OEX Index Final Value
                    or the RTY Index Final Value, as applicable, will be computed
                    by the
                    Calculation Agent in accordance with the formula for calculating
                    the
                    relevant Underlying Index last in effect prior to such discontinuance,
                    using the closing price (or, if trading in the relevant securities
                    has
                    been materially suspended or materially limited, its good faith
                    estimate
                    of the closing price that would have prevailed but for such suspension
                    or
                    limitation) at the close of the principal trading session of
                    the Relevant
                    Exchange 

                

        

         

        
          
            
            

          

          
            8

            
              

            

          

          
            
            

          

        

        

        
          	 	 	on
                  such date of each security most recently constituting the Underlying
                  Index
                  without any rebalancing or substitution of such securities following
                  such
                  discontinuance.
	 	 	 
	 	 	
                  If
                    at any time the method of calculating the Underlying Index or
                    a Successor
                    Index, or the value thereof, is changed in a material respect,
                    or if the
                    Underlying Index or a Successor Index is in any other way modified
                    so that
                    such index does not, in the opinion of MS & Co., as the Calculation
                    Agent, fairly represent the value of the Underlying Index or
                    such
                    Successor Index had such changes or modifications not been made,
                    then,
                    from and after such time, the Calculation Agent will, at the
                    close of
                    business in New York City on the Valuation Date, make such calculations
                    and adjustments as, in the good faith judgment of the Calculation
                    Agent,
                    may be necessary in order to arrive at a value of a stock index
                    comparable
                    to the Underlying Index or such Successor Index, as the case
                    may be, as if
                    such changes or modifications had not been made, and the Calculation
                    Agent
                    will calculate the OEX Index Final Value or the RTY Index Final
                    Value, as
                    applicable, with reference to the relevant Underlying Index or
                    such
                    Successor Index, as adjusted.  Accordingly, if the method of
                    calculating the Underlying  Index or a Successor Index is
                    modified so that the value of such index is a fraction of what
                    it would
                    have been if it had not been modified (e.g., due to a split in
                    the index), then the Calculation Agent will adjust such index
                    in order to
                    arrive at a value of the Underlying  Index or such Successor
                    Index as if it had not been modified (e.g., as if such split had
                    not occurred).

                

        

      

       

    

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

     

    Morgan
      Stanley, a Delaware corporation (together with its successors and assigns,
      the
“Issuer”), for value received, hereby promises to pay to CEDE
& Co., or registered assignees, the amount of cash, as determined
      in
      accordance with the provisions set forth under “Payment at Maturity” above, due
      with respect to the principal sum of U.S.
      $                    (UNITED
      STATES
      DOLLARS                                 ),
      on the Maturity Date specified above (except to the extent redeemed or repaid
      prior to maturity) and to pay interest thereon at the Interest Rate per annum
      specified above, from and including the Interest Accrual Date specified above
      until the principal hereof is paid or duly made available for payment weekly,
      monthly, quarterly, semiannually or annually in arrears as specified above
      as
      the Interest Payment Period on each Interest Payment Date (as specified above),
      commencing on the Interest Payment Date next succeeding the Interest Accrual
      Date specified above, and at maturity (or on any redemption or repayment date);
      provided, however, that if the Interest Accrual Date occurs
      between a Record Date, as defined below, and the next succeeding Interest
      Payment Date, interest payments will commence on the second Interest Payment
      Date succeeding the Interest Accrual Date to the registered holder of this
      Note
      on the Record Date with respect to such second Interest Payment Date; and
provided, further, that if this Note is subject to “Annual Interest
      Payments,” interest payments shall be made annually in arrears and the term
“Interest Payment Date” shall be deemed to mean the first day
      of March in each year.

     

    Interest
      on this Note will accrue from and including the most recent date to which
      interest has been paid or duly provided for, or, if no interest has been paid
      or
      duly provided for, from and including the Interest Accrual Date, until but
      excluding the date the principal hereof has been paid or duly made available
      for
      payment.  The interest so payable, and punctually paid or duly
      provided for, on any Interest Payment Date will, subject to certain exceptions
      described herein, be paid to the person in whose name this Note (or one or
      more
      predecessor Notes) is registered at the close of business on the date 15
      calendar days prior to such Interest Payment Date (whether or not a Business
      Day
      (as defined below)) (each such date, a “Record Date”);
provided, however, that interest payable at maturity (or any redemption
      or repayment date) will be payable to the person to whom the principal hereof
      shall be payable.  As used herein, “Business Day”
means any day, other than a Saturday or Sunday, (a) that
      is neither a legal
      holiday nor a day on which banking institutions are authorized or required
      by
      law or regulation to close (x) in The City of New York or (y) if this Note
      is
      denominated in a Specified Currency other than U.S. dollars, euro or Australian
      dollars, in the principal financial center of the country of the Specified
      Currency, or (z) if this Note is denominated in Australian dollars, in Sydney
      and (b) if this Note is denominated in euro, that is also a day on which the
      Trans-European Automated Real-time Gross Settlement Express Transfer System
      (“TARGET”) is operating (a “TARGET Settlement
      Day”).

     

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

     

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

       

    

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

     

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

     

    If
      the
      holder elects to receive all or a portion of payments of principal of, premium,
      if any, and interest on this Note, if denominated in a Specified Currency other
      than U.S. dollars, in U.S. dollars, the Exchange Rate Agent (as defined on
      the
      reverse hereof) will convert such payments into U.S. dollars.  In the
      event of such an election, payment in respect of this Note will be based upon
      the exchange rate as determined by the Exchange Rate Agent based on the highest
      bid quotation in The City of New York received by such Exchange Rate Agent
      at
      approximately 11:00 a.m., New York City time, on the second Business Day
      preceding the applicable payment date from three recognized foreign exchange
      dealers (one of which may be the Exchange Rate Agent unless such Exchange Rate
      Agent is an affiliate of the Issuer) for the purchase by the quoting dealer
      of
      the Specified Currency for U.S. dollars for settlement on such payment date
      in
      the amount of the Specified Currency payable in the absence of such an election
      to such holder and at which the applicable dealer commits to execute a
      contract.  If such bid quotations are not available, such payment will
      be made in the Specified Currency.  All currency exchange costs will
      be borne by the holder of this Note by deductions from such
      payments.

     

    Reference
      is hereby made to the further provisions of this Note set forth on the reverse
      hereof, which further provisions shall for all purposes have the same effect
      as
      if set forth at this place.

     

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

     

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

       

    

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

    
       

      
        	 DATED:	 	
                MORGAN
                  STANLEY  

              	 
	 	 	 	 	 	 	 
	 	 	 	By:	/s/	 
	Date:	 	 	 	Name:	 	 
	 	 	 	 	Title:	 	 

      

      
        

         

        
          	
                  TRUSTEE’S
                    CERTIFICATE
    OF AUTHENTICATION

                   

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

                   

                	 
	
                  THE
                    BANK OF NEW YORK,
                    as
                    Trustee

                   

                	 
	
                  By:

                	 	 
	 	
                  Authorized
                    Signatory

                	 

        

      

    

    

    
      
        
        

      

      
        12

        
          

        

      

      
        
        

      

       

    

    FORM
      OF
      REVERSE OF SECURITY

     

    This
      Note
      is one of a duly authorized issue of Senior Global Medium-Term Notes, Series
      F,
      (the “Notes”) of the Issuer.  The Notes are issuable
      under a Senior Indenture, dated as of November 1, 2004, between the Issuer
      and
      The Bank of New York, a New York banking corporation (as successor Trustee
      to
      JPMorgan Chase Bank, N.A. (formerly known as JPMorgan Chase Bank)), as Trustee
      (the “Trustee,” which term includes any successor trustee under
      the Senior Indenture) (as may be amended or supplemented from time to time,
      the
“Senior Indenture”), to which Senior Indenture and all
      indentures supplemental thereto reference is hereby made for a statement of
      the
      respective rights, limitations of rights, duties and immunities of the Issuer,
      the Trustee and holders of the Notes and the terms upon which the Notes are,
      and
      are to be, authenticated and delivered.  The Issuer has appointed The
      Bank of New York (as successor to JPMorgan Chase Bank, N.A.) at its corporate
      trust office in The City of New York as the paying agent (the “Paying
      Agent,” which term includes any additional or successor Paying Agent
      appointed by the Issuer) with respect to the Notes.  The terms of
      individual Notes may vary with respect to interest rates, interest rate
      formulas, issue dates, maturity dates, or otherwise, all as provided in the
      Senior Indenture.  To the extent not inconsistent herewith, the terms
      of the Senior Indenture are hereby incorporated by reference
      herein.

     

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

     

    If
      so
      indicated on the face hereof, this Note may be redeemed in whole or in part
      at
      the option of the Issuer on or after the Initial Redemption Date specified
      on
      the face hereof on the terms set forth on the face hereof, together with
      interest accrued and unpaid hereon to the date of redemption.  If this
      Note is subject to “Annual Redemption Percentage Reduction,” the Initial
      Redemption Percentage indicated on the face hereof will be reduced on each
      anniversary of the Initial Redemption Date by the Annual Redemption Percentage
      Reduction specified on the face hereof until the redemption price of this Note
      is 100% of the principal amount hereof, together with interest accrued and
      unpaid hereon to the date of redemption.  If the face hereof indicates
      that this Note is subject to “Modified Payment upon Acceleration or Redemption”,
      the amount of principal payable upon redemption will be limited to the aggregate
      principal amount hereof multiplied by the sum of the Issue Price specified
      on
      the face hereof (expressed as a percentage of the aggregate principal amount)
      plus the original issue discount accrued from the Interest Accrual Date to
      the
      date of redemption (expressed as a percentage of the aggregate principal
      amount), with the amount of original issue discount accrued being calculated
      using a constant yield method (as described below).  Notice of
      redemption shall be mailed to the registered holders of the Notes designated
      for
      redemption at their addresses as the same shall appear on the Note register
      not
      less than 30 nor more than 60 calendar days prior to the date fixed for
      redemption or within the Redemption Notice Period specified on the face hereof,
      subject to all the conditions and provisions of the Senior
      Indenture.  In the event of redemption of this Note in part only, a
      new Note or Notes for the amount of the unredeemed portion hereof shall be
      issued in the name of the holder hereof upon the cancellation
      hereof.

     

    If
      so
      indicated on the face of this Note, this Note will be subject to repayment
      at
      the option of the holder on the Optional Repayment Date or Dates specified
      on
      the face hereof on the terms set forth herein.  On any Optional
      Repayment Date, this Note will be repayable in whole or in part in increments
      of
      $1,000 or, if this Note is denominated in a Specified Currency other than U.S.
      dollars, in increments of 1,000 units of such Specified Currency (provided
      that
      any remaining principal amount hereof shall not be less than the minimum
      authorized denomination hereof) at the option of the holder hereof at a price
      equal to 100% of the principal amount to be repaid, together with interest
      accrued and unpaid hereon to the date

     

    
      
        
        

      

      
        13

        
          

        

      

      
        
        

      

       

    

    of
      repayment, provided that if the face hereof indicates that this Note is
      subject to “Modified Payment upon Acceleration or Redemption”, the amount of
      principal payable upon repayment will be limited to the aggregate principal
      amount hereof multiplied by the sum of the Issue Price specified on the face
      hereof (expressed as a percentage of the aggregate principal amount) plus the
      original issue discount accrued from the Interest Accrual Date to the date
      of
      repayment  (expressed as a percentage of the aggregate principal
      amount), with the amount of original issue discount accrued being calculated
      using a constant yield method (as described below).  For this Note to
      be repaid at the option of the holder hereof, the Paying Agent must receive
      at
      its corporate trust office in the Borough of Manhattan, The City of New York,
      at
      least 15 but not more than 30 calendar days prior to the date of repayment,
      (i)
      this Note with the form entitled “Option to Elect Repayment” below duly
      completed or (ii) a telegram, telex, facsimile transmission or a letter from
      a
      member of a national securities exchange or the National Association of
      Securities Dealers, Inc. or a commercial bank or a trust company in the United
      States setting forth the name of the holder of this Note, the principal amount
      hereof, the certificate number of this Note or a description of this Note’s
      tenor and terms, the principal amount hereof to be repaid, a statement that
      the
      option to elect repayment is being exercised thereby and a guarantee that this
      Note, together with the form entitled “Option to Elect Repayment” duly
      completed, will be received by the Paying Agent not later than the fifth
      Business Day after the date of such telegram, telex, facsimile transmission
      or
      letter; provided, that such telegram, telex, facsimile transmission or
      letter shall only be effective if this Note and form duly completed are received
      by the Paying Agent by such fifth Business Day.  Exercise of such
      repayment option by the holder hereof shall be irrevocable.  In the
      event of repayment of this Note in part only, a new Note or Notes for the amount
      of the unpaid portion hereof shall be issued in the name of the holder hereof
      upon the cancellation hereof.

     

    Interest
      payments on this Note will include interest accrued to but excluding the
      Interest Payment Dates or the Maturity Date (or any earlier redemption or
      repayment date), as the case may be.  Unless otherwise provided on the
      face hereof, interest payments for this Note will be computed and paid on the
      basis of a 360-day year of twelve 30-day months.

     

    In
      the
      case where the Interest Payment Date or the Maturity Date (or any redemption
      or
      repayment date) does not fall on a Business Day, payment of interest, premium,
      if any, or principal otherwise payable on such date need not be made on such
      date, but may be made on the next succeeding Business Day with the same force
      and effect as if made on the Interest Payment Date or on the Maturity Date
      (or
      any redemption or repayment date), and no interest on such payment shall accrue
      for the period from and after the Interest Payment Date or the Maturity Date
      (or
      any redemption or repayment date) to such next succeeding Business
      Day.

     

    This
      Note
      and all the obligations of the Issuer hereunder are direct, unsecured
      obligations of the Issuer and rank without preference or priority among
      themselves and paripassu with all other existing and future
      unsecured and unsubordinated indebtedness of the Issuer, subject to certain
      statutory exceptions in the event of liquidation upon insolvency.

     

    This
      Note,
      and any Note or Notes issued upon transfer or exchange hereof, is issuable
      only
      in fully registered form, without coupons, and, if denominated in U.S. dollars,
      unless otherwise stated above, is issuable only in denominations of U.S. $1,000
      and any integral multiple of U.S. $1,000 in excess thereof.  If this
      Note is denominated in a Specified Currency other than U.S. dollars, then,
      unless a higher 

     

    
      
        
        

      

      
        14

        
          

        

      

      
        
        

      

    

     

    minimum
      denomination is required by applicable law, it is issuable only in denominations
      of the equivalent of U.S. $1,000 (rounded to an integral multiple of 1,000
      units
      of such Specified Currency), or any amount in excess thereof which is an
      integral multiple of 1,000 units of such Specified Currency, as determined
      by
      reference to the noon dollar buying rate in The City of New York for cable
      transfers of such Specified Currency published by the Federal Reserve Bank
      of
      New York (the “Market Exchange Rate”) on the Business Day
      immediately preceding the date of issuance.

     

    The
      Trustee has been appointed registrar for the Notes, and the Trustee will
      maintain at its office in The City of New York a register for the registration
      and transfer of Notes.  This Note may be transferred at the aforesaid
      office of the Trustee by surrendering this Note for cancellation, accompanied
      by
      a written instrument of transfer in form satisfactory to the Issuer and the
      Trustee and duly executed by the registered holder hereof in person or by the
      holder’s attorney duly authorized in writing, and thereupon the Trustee shall
      issue in the name of the transferee or transferees, in exchange herefor, a
      new
      Note or Notes having identical terms and provisions and having a like aggregate
      principal amount in authorized denominations, subject to the terms and
      conditions set forth herein; provided, however, that the Trustee will
      not be required (i) to register the transfer of or exchange any Note that has
      been called for redemption in whole or in part, except the unredeemed portion
      of
      Notes being redeemed in part, (ii) to register the transfer of or exchange
      any Note if the holder thereof has exercised his right, if any, to require
      the
      Issuer to repurchase such Note in whole or in part, except the portion of such
      Note not required to be repurchased, or (iii) to register the transfer of or
      exchange Notes to the extent and during the period so provided in the Senior
      Indenture with respect to the redemption of Notes.  Notes are
      exchangeable at said office for other Notes of other authorized denominations
      of
      equal aggregate principal amount having identical terms and
      provisions.  All such exchanges and transfers of Notes will be free of
      charge, but the Issuer may require payment of a sum sufficient to cover any
      tax
      or other governmental charge in connection therewith.  All Notes
      surrendered for exchange shall be accompanied by a written instrument of
      transfer in form satisfactory to the Issuer and the Trustee and executed by
      the
      registered holder in person or by the holder’s attorney duly authorized in
      writing.  The date of registration of any Note delivered upon any
      exchange or transfer of Notes shall be such that no gain or loss of interest
      results from such exchange or transfer.

     

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

     

    The
      Senior
      Indenture provides that (a) if an Event of Default (as defined in the Senior
      Indenture) due to the default in payment of principal of, premium, if any,
      or
      interest on, any series of debt securities issued under the Senior Indenture,
      including the series of Senior Medium-Term Notes of which this Note forms a
      part, or due to the default in the performance or breach of any other covenant
      or warranty of the Issuer applicable to the debt securities of such series
      but
      not applicable to all outstanding debt securities issued under the Senior
      Indenture shall have occurred and be continuing, either the Trustee or the
      holders

     

    
      
        
        

      

      
        15

        
          

        

      

      
        
        

      

    

     

    of
      not
      less than 25% in aggregate principal amount of the outstanding debt securities
      of each affected series, voting as one class, by notice in writing to the Issuer
      and to the Trustee, if given by the securityholders, may then declare the
      principal of all debt securities of all such series and interest accrued thereon
      to be due and payable immediately and (b) if an Event of Default due to a
      default in the performance of any other of the covenants or agreements in the
      Senior Indenture applicable to all outstanding debt securities issued
      thereunder, including this Note, or due to certain events of bankruptcy,
      insolvency or reorganization of the Issuer, shall have occurred and be
      continuing, either the Trustee or the holders of not less than 25% in aggregate
      principal amount of all outstanding debt securities issued under the Senior
      Indenture, voting as one class, by notice in writing to the Issuer and to the
      Trustee, if given by the securityholders, may declare the principal of all
      such
      debt securities and interest accrued thereon to be due and payable immediately,
      but upon certain conditions such declarations may be annulled and past defaults
      may be waived (except a continuing default in payment of principal or premium,
      if any, or interest on such debt securities) by the holders of a majority in
      aggregate principal amount of the debt securities of all affected series then
      outstanding.

     

    If
      the
      face hereof indicates that this Note is subject to “Modified Payment upon
      Acceleration or Redemption,” then (i) if the principal hereof is declared to be
      due and payable as described in the preceding paragraph, the amount of principal
      due and payable with respect to this Note shall be limited to the aggregate
      principal amount hereof multiplied by the sum of the Issue Price specified
      on
      the face hereof (expressed as a percentage of the aggregate principal amount)
      plus the original issue discount accrued from the Interest Accrual Date to
      the
      date of declaration (expressed as a percentage of the aggregate principal
      amount), with the amount of original issue discount accrued being calculated
      using a constant yield method (as described in the next paragraph), (ii) for
      the
      purpose of any vote of securityholders taken pursuant to the Senior Indenture
      prior to the acceleration of payment of this Note, the principal amount hereof
      shall equal the amount that would be due and payable hereon, calculated as
      set
      forth in clause (i) above, if this Note were declared to be due and payable
      on
      the date of any such vote and (iii) for the purpose of any vote of
      securityholders taken pursuant to the Senior Indenture following the
      acceleration of payment of this Note, the principal amount hereof shall equal
      the amount of principal due and payable with respect to this Note, calculated
      as
      set forth in clause (i) above.

     

    The
      constant yield shall be calculated using a 30-day month, 360-day year
      convention, a compounding period that, except for the initial period (as defined
      below), corresponds to the shortest period between Interest Payment Dates (with
      ratable accruals within a compounding period), and an assumption that the
      maturity will not be accelerated.  If the period from the Original
      Issue Date to the first Interest Payment Date (the “initial period”) is shorter
      than the compounding period for this Note, a proportionate amount of the yield
      for an entire compounding period will be accrued.  If the initial
      period is longer than the compounding period, then the period will be divided
      into a regular compounding period and a short period with the short period
      being
      treated as provided in the preceding sentence.

     

    If
      the
      face hereof indicates that this Note is subject to “Tax Redemption and Payment
      of Additional Amounts,” this Note may be redeemed, as a whole, at the option of
      the Issuer at any time prior to maturity, upon the giving of a notice of
      redemption as described below, at a redemption price equal to 100% of the
      principal amount hereof, together with accrued interest to the date fixed for
      redemption (except that if this Note is subject to “Modified Payment upon
      Acceleration or Redemption,” the amount of principal so payable will be limited
      to the aggregate principal amount hereof multiplied by the sum of the Issue
      Price specified on the face hereof (expressed as a percentage of the aggregate
      principal amount) plus the original issue discount accrued from the Interest
      Accrual Date to the date of redemption (expressed as a percentage of the
      aggregate principal amount), with the amount of original issue discount accrued
      being calculated using a constant yield method (as described above)), if the
      Issuer determines 

     

    
      
        
        

      

      
        16

        
          

        

      

      
        
        

      

    

     

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

     

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

     

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

     

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

     

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

     

    (c)           any
      tax, assessment or other governmental charge imposed by reason of such holder’s
      past or present status as a controlled foreign corporation or passive foreign
      investment company with respect to the United States or as a corporation which
      accumulates earnings to avoid U.S. federal income tax or as 

     

    
      
        
        

      

      
        17

        
          

        

      

      
        
        

      

    

     

    a
      private
      foundation or other tax-exempt organization or a bank receiving interest under
      Section 881(c)(3)(A) of the Internal Revenue Code of 1986, as
      amended;

     

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

     

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

     

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

     

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

     

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

     

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

     

    The
      Senior
      Indenture permits the Issuer and the Trustee, with the consent of the holders
      of
      not less than a majority in aggregate principal amount of the debt securities
      of
      all series issued under the Senior Indenture then outstanding and affected
      (voting as one class), to execute supplemental indentures adding any provisions
      to or changing in any manner the rights of the holders of each series so
      affected; provided that the Issuer and the Trustee may not, without the
      consent of the holder of each outstanding debt security affected thereby, (a)
      extend the final maturity of any such debt security, or reduce the principal
      amount thereof, or reduce the rate or extend the time of payment of interest
      thereon, or reduce any amount payable on redemption thereof, or change the
      currency of payment thereof, or modify or amend the provisions for conversion
      of
      any currency into any other currency, or modify or amend the provisions for
      conversion or exchange of the debt security for securities of the Issuer or
      other entities or for other property or the cash value of the property (other
      than as provided in the antidilution provisions or other similar adjustment
      provisions of the debt securities or otherwise in accordance with the terms
      thereof), or impair or affect the rights of any holder to institute suit for
      the
      payment thereof or (b) reduce the aforesaid 

     

    
      
        
        

      

      
        18

        
          

        

      

      
        
        

      

    

     

    percentage
      in principal amount of debt securities the consent of the holders of which
      is
      required for any such supplemental indenture.

     

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

     

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

     

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

     

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

     

    
      
        
        

      

      
        19

        
          

        

      

      
        
        

      

       

    

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

     

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

     

    Prior
      to
      due presentment of this Note for registration of transfer, the Issuer, the
      Trustee and any agent of the Issuer or the Trustee may treat the holder in
      whose
      name this Note is registered as the owner hereof for all purposes, whether
      or
      not this Note be overdue, and none of the Issuer, the Trustee or any such agent
      shall be affected by notice to the contrary.

     

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

     

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

     

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

     

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

     

    
      
        
        

      

      
        20

        
          

        

      

      
        
        

      

      
         

        ABBREVIATIONS

         

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

         

        TEN
          COM   –   as tenants in common

         

        TEN
          ENT    –   as tenants by the
          entireties

         

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

        

         

        UNIF
          GIFT
          MIN ACT – ______________________Custodian
          __________________________

        (Minor)                                                      (Cust)

         

        Under
          Uniform Gifts to Minors Act ______________________________

        (State)

         

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

         

        _______________________

         

       

      
        
          
          

        

        
          21

          
            

          

        

        
          
          

        

      

      
         

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

         

        ____________________________________________

        [PLEASE
          INSERT SOCIAL SECURITY OR OTHER

        IDENTIFYING
          NUMBER OF ASSIGNEE] 
           

           
            
              

            

          

           
            
              

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

              

            

          

        

         

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

         

        Dated:_______________________

         

        
          	
                  NOTICE:

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

                

 

        
          
            
            

          

          
            22

            
              

            

          

          
            
            

          

        

         

        OPTION
          TO ELECT REPAYMENT

         

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

         
          
            

          

        

         
          
            

          

        

         
          
            

          

        

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

         

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

         

        Dated:________________________                                _______________________________________

        
          	
                   

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

                

        

         

        23EX-4.05

 

Exhibit 4.05

CERTIFICATE OF TRUST

OF

CITIGROUP CAPITAL XXIII

     This Certificate of Trust is being executed as of November 15, 2007 for the purposes of
organizing a statutory trust pursuant to the Delaware Statutory Trust Act, 12 Del. C. §3801 et seq.
(the “Act”).

     The undersigned, the trustees of Citigroup Capital XXIII, hereby certify as follows:

     1. Name. The name of the statutory trust being formed hereby is “Citigroup Capital XXIII”
(the “Trust”).

     2. Delaware Trustee. The name and business address of the trustee of the Trust which has its
principal place of business in the State of Delaware are as follows:

The Bank of New York (Delaware)

100 White Clay Center

Route 273

P. O. Box 6995

Newark, DE 19711

     3. Effective. This Certificate of Trust shall be effective immediately upon filing in the
Office of the Secretary of State of the State of Delaware.

1

 

Dated: November 15, 2007

	 	 	 	 	 	 	 
	 

	 	By:
	 	/s/ John Gerspach
	 	 
	 

	 	 	 	 	 	 
	 	 	John Gerspach, as Regular Trustee
	 
	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Eric L. Wentzel	 	 
	 

	 	 	 	 	 	 
	 	 	Eric L. Wentzel, as Regular Trustee
	 
	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Saul Rosen	 	 
	 

	 	 	 	 	 	 
	 	 	Saul Rosen, as Regular Trustee
	 
	 	 	 	 	 	 
	 	 	THE BANK OF NEW YORK (DELAWARE),
	 	 	as Delaware Trustee
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Kristine K. Gullo	 	 
	 

	 	 	 	 	 	 
	 	 	Name: Kristine K. Gullo
	 	 	Title: Vice President
	 
	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 	 	CITIGROUP INC.,
	 	 	as Sponsor
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Charles E. Wainhouse	 	 
	 

	 	 	 	 	 	 
	 	 	Name: Charles E. Wainhouse
	 	 	Title: Vice President

2

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