Document:

FORM OF FIXED RATE SENIOR NOTE

REGISTERED                                                       REGISTERED
No. FXR-1                                                        U.S. $
                                                                 CUSIP:

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

<PAGE>

                                 MORGAN STANLEY
                    SENIOR GLOBAL MEDIUM-TERM NOTES, SERIES F

                PERFORMANCE LEVERAGED UPSIDE SECURITIES ("PLUS")

                             PLUS DUE APRIL 30, 2008
                            MANDATORILY EXCHANGEABLE
                      FOR AN AMOUNT PAYABLE IN U.S. DOLLARS
                  BASED ON THE VALUE OF THE NIKKEI 225(R) INDEX
<TABLE>
<S>                            <C>                           <C>                         <C>
------------------------------- ---------------------------- ---------------------------- ----------------------------
ORIGINAL ISSUE DATE:            INITIAL REDEMPTION DATE:     INTEREST RATE: None          MATURITY DATE: See
                                   N/A                                                       "Maturity Date" below.
------------------------------- ---------------------------- ---------------------------- ----------------------------
INTEREST ACCRUAL DATE: N/A      INITIAL REDEMPTION           INTEREST PAYMENT DATES: N/A  OPTIONAL REPAYMENT
                                   PERCENTAGE: N/A                                           DATE(S):  N/A
------------------------------- ---------------------------- ---------------------------- ----------------------------
SPECIFIED CURRENCY: U.S.        ANNUAL REDEMPTION            INTEREST PAYMENT PERIOD:     APPLICABILITY OF MODIFIED
   dollars                         PERCENTAGE REDUCTION:        N/A                          PAYMENT UPON
                                   N/A                                                       ACCELERATION: See
                                                                                             "Alternate Exchange
                                                                                             Calculation in Case of
                                                                                             an Event of Default"
                                                                                             below.
------------------------------- ---------------------------- ---------------------------- ----------------------------
IF SPECIFIED CURRENCY OTHER     REDEMPTION NOTICE PERIOD:    APPLICABILITY OF ANNUAL      If yes, state Issue Price:
   THAN U.S. DOLLARS, OPTION       N/A                          INTEREST PAYMENTS: N/A       N/A
   TO ELECT PAYMENT IN U.S.
   DOLLARS: N/A
------------------------------- ---------------------------- ---------------------------- ----------------------------
EXCHANGE RATE AGENT: N/A        TAX REDEMPTION AND PAYMENT                                ORIGINAL YIELD TO
                                   OF ADDITIONAL AMOUNTS:                                    MATURITY: N/A
                                   N/A
------------------------------- ---------------------------- ---------------------------- ----------------------------
OTHER PROVISIONS: See below     If yes, state Initial
                                   Offering Date: N/A
------------------------------- ---------------------------- ---------------------------- ----------------------------
</TABLE>

Maturity Date................   April 30, 2008, subject to extension in
                                accordance with the following paragraph in the
                                event of a Market Disruption Event on the
                                scheduled Index Valuation Date (as defined
                                below).

                                If due to a Market Disruption Event or
                                otherwise, the Index Valuation Date is postponed
                                so that it falls less than two scheduled Trading
                                Days prior to the scheduled Maturity Date, the
                                Maturity Date shall be the second scheduled
                                Index Business Day that is also a

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                                Trading Day following that Index Valuation Date
                                as postponed. See "Index Valuation Date" below.

                                In the event that the Maturity Date of the PLUS
                                is postponed due to postponement of the Index
                                Valuation Date as described in the immediately
                                preceding paragraph, the Issuer shall give
                                notice of such postponement and, once it has
                                been determined, of the date to which the
                                Maturity Date has been rescheduled (i) to the
                                holder of this PLUS by mailing notice of such
                                postponement by first class mail, postage
                                prepaid, to the holder's last address as it
                                shall appear upon the registry books, (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 The Depository Trust Company
                                (the "Depositary") by telephone or facsimile
                                confirmed by mailing such notice to the
                                Depositary 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 the holder of
                                this PLUS receives the notice. The Issuer shall
                                give such notice as promptly as possible, and in
                                no case later than (i) with respect to notice of
                                postponement of the Maturity Date, the Business
                                Day immediately following April 26, 2008, and
                                (ii) with respect to notice of the date to which
                                the Maturity Date has been rescheduled, the
                                Business Day immediately following the actual
                                Index Valuation Date for determining the Final
                                Index Value (as defined below).

Denominations................   $10 and integral multiples thereof

Payment at Maturity..........   At maturity, upon delivery of this PLUS to the
                                Trustee, the Issuer shall pay with respect to
                                each $10 principal amount of this PLUS an amount
                                in cash equal to (i) if the Final Index Value is
                                greater than the Initial Index Value (as defined
                                below), $10 plus the Leveraged Upside Payment
                                (as defined below) or (ii) if the Final Index
                                Value is less than or equal to the Initial Index
                                Value, $10 times the Index Performance Factor
                                (as defined below).

                                The Issuer shall, or shall cause the Calculation
                                Agent to, (i) provide written notice to the
                                Trustee and to the

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                                Depositary of the amount of cash to be delivered
                                with respect to each $10 principal amount of
                                this PLUS, on or prior to 10:30 a.m. on the
                                Trading Day preceding the Maturity Date (but if
                                such Trading Day is not a Business Day, prior to
                                the close of business on the Business Day
                                preceding the Maturity Date), and (ii) deliver
                                the aggregate cash amount due with respect to
                                this PLUS to the Trustee for delivery to the
                                holder of this PLUS on the Maturity Date.

Leveraged Upside Payment ....   The product of (i) $10 and (ii) the Upside
                                Leverage Factor (as defined below) and (iii) the
                                Index Percent Increase (as defined below).

Upside Leverage Factor.......             %

Index Percent Increase.......   A fraction, the numerator of which shall be the
                                Final Index Value minus the Initial Index Value
                                and the denominator of which shall be the
                                Initial Index Value.

Index Performance Factor.....   A fraction, the numerator of which shall be the
                                Final Index Value and the denominator of which
                                shall be the Initial Index Value.

Initial Index Value..........

Final Index Value............   The Index Closing Value of the Nikkei 225 Index
                                on the Index Valuation Date.

Index Closing Value..........   The Index Closing Value on any Index Business
                                Day shall equal the closing value (2nd session)
                                of the Nikkei 225 Index or any Successor Index
                                (as defined under "Discontinuance of the Nikkei
                                225 Index; Alteration of Method of Calculation"
                                below) published by Nikkei at the regular
                                weekday close of trading on that Index Business
                                Day. In certain circumstances, the Index Closing
                                Value shall be based on the alternate
                                calculation of the Nikkei 225 Index described
                                under "Discontinuance of the Nikkei 225 Index;
                                Alteration of Method of Calculation."

Index Valuation Date.........   The Index Valuation Date shall be the second
                                scheduled Index Business Day prior to the
                                Maturity Date, subject to adjustment for Market
                                Disruption Events as described in the following
                                paragraph.

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<PAGE>

                                If there is a Market Disruption Event on the
                                scheduled Index Valuation Date or if the
                                scheduled Index Valuation Date is not otherwise
                                an Index Business Day, the Index Valuation Date
                                shall be the immediately succeeding Index
                                Business Day during which no Market Disruption
                                Event shall have occurred.

Index Business Day...........   A day, as determined by the Calculation Agent,
                                on which trading is generally conducted on the
                                Tokyo Stock Exchange, Inc. ("TSE") and on any
                                exchange on which futures or options contracts
                                related to the Nikkei 225 Index are traded,
                                other than a day on which trading on any such
                                exchange is scheduled to close prior to its
                                regular final weekday closing time.

Trading Day..................   A day, as determined by the Calculation Agent,
                                on which trading is generally conducted on the
                                New York Stock Exchange, Inc. ("NYSE"), the
                                American Stock Exchange LLC ("AMEX"), the Nasdaq
                                National Market, the Chicago Mercantile Exchange
                                and the Chicago Board of Options Exchange and in
                                the over-the-counter market for equity
                                securities in the United States.

Calculation Agent............   Morgan Stanley & Co. Incorporated and its
                                successors ("MS & Co.").

                                All determinations made by the Calculation Agent
                                shall be at the sole discretion of the
                                Calculation Agent and shall, in the absence of
                                manifest error, be conclusive for all purposes
                                and binding on the holder of this PLUS, the
                                Trustee and the Issuer.

                                All calculations with respect to the Payment at
                                Maturity, if any, shall 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 for each $10 principal amount of this
                                PLUS shall 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 PLUS

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<PAGE>

                                shall be rounded to the nearest cent, with
                                one-half cent rounded upward.

Market Disruption Event......   Market Disruption Event means, with respect to
                                the Nikkei 225 Index:

                                (i)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 Nikkei 225 Index (or the
                                Successor Index) on the Relevant Exchanges 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; 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 the Nikkei 225 Index (or the
                                Successor Index) during the last one-half hour
                                preceding the close of the principal trading
                                session on such Relevant Exchange 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 the Nikkei 225 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; and

                                (ii) a determination by the Calculation Agent in
                                its sole discretion that any event described in
                                clause (i) above materially interfered with the
                                ability of the Issuer or any of its affiliates
                                to unwind or adjust all or a material portion of
                                the hedge position with respect to the PLUS due
                                April 30, 2008, Mandatorily Exchangeable for an
                                Amount Payable in U.S. Dollars Based on the
                                Value of the Nikkei 225(R) Index.

                                For the purpose of determining whether a Market
                                Disruption Event exists at any time, if trading
                                in a security included in the Nikkei 225 Index
                                is materially suspended or materially limited at
                                that time, then the relevant percentage
                                contribution of that security to the level of
                                the Nikkei 225 Index shall be based on a

                                       6

<PAGE>

                                comparison of (x) the portion of the value of
                                the Nikkei 225 Index attributable to that
                                security relative to (y) the overall value of
                                the Nikkei 225 Index, in each case immediately
                                before that suspension or limitation.

                                For the purpose of determining whether a Market
                                Disruption Event has occurred: (1) a limitation
                                on the hours or number of days of trading shall
                                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 shall
                                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 shall constitute a
                                suspension, absence or material limitation of
                                trading, (4) a suspension of trading in futures
                                or options contracts on the Nikkei 225 Index by
                                the primary securities market trading in such
                                contracts by reason of (a) a price change
                                exceeding limits set by such securities 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 shall
                                constitute a suspension, absence or material
                                limitation of trading in futures or options
                                contracts related to the Nikkei 225 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 Nikkei 225
                                Index are traded shall not include any time when
                                such securities market is itself closed for
                                trading under ordinary circumstances.

Relevant Exchange............   Relevant Exchange means the primary exchange or
                                market of trading for any security then included
                                in the Nikkei 225 Index or any Successor Index.

                                       7

<PAGE>

Alternate Exchange
Calculation in Case of an
Event of Default.............   In case an event of default with respect to the
                                PLUS shall have occurred and be continuing, the
                                amount declared due and payable for each $10
                                principal amount of this PLUS upon any
                                acceleration of this PLUS shall be determined by
                                the Calculation Agent and shall be an amount in
                                cash equal to the Payment at Maturity calculated
                                using the Index Closing Value as of the date of
                                such acceleration as the Final Index Value.

                                If the maturity of the PLUS is accelerated
                                because of an event of default as described
                                above, the Issuer 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
                                the Depositary of the cash amount due with
                                respect to each $10 principal amount of this
                                PLUS as promptly as possible and in no event
                                later than two Business Days after the date of
                                acceleration.

Discontinuance of the Nikkei
225 Index; Alteration of
Method of Calculation........   If Nihon Keizai Shimbun, Inc. ("Nikkei")
                                discontinues publication of the Nikkei 225 Index
                                and Nikkei or another entity publishes a
                                successor or substitute index that the
                                Calculation Agent determines, in its sole
                                discretion, to be comparable to the discontinued
                                Nikkei 225 Index (such index being referred to
                                herein as a "Successor Index"), then any
                                subsequent Index Closing Value shall be
                                determined by reference to the published value
                                of such Successor Index at the regular weekday
                                close of trading on the Relevant Exchange on the
                                Index Business Day that any Index Closing Value
                                is to be determined.

                                Upon any selection by the Calculation Agent of a
                                Successor Index, the Calculation Agent shall
                                cause written notice thereof to be furnished to
                                the Trustee, to the Issuer and to the
                                Depositary, as holder of the PLUS, within three
                                Trading Days of such selection.

                                If Nikkei discontinues publication of the Nikkei
                                225 Index prior to, and such discontinuance is
                                continuing on, the Index Valuation Date or the
                                date of

                                       8

<PAGE>

                                acceleration and the Calculation Agent
                                determines, in its sole discretion, that no
                                Successor Index is available at such time, then
                                the Calculation Agent shall determine the Index
                                Closing Value for such date. The Index Closing
                                Value shall be computed by the Calculation Agent
                                in accordance with the formula for calculating
                                the Nikkei 225 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 on such date of each security most
                                recently constituting the Nikkei 225 Index
                                without any rebalancing or substitution of such
                                securities following such discontinuance.

                                If at any time the method of calculating the
                                Nikkei 225 Index or a Successor Index, or the
                                value thereof, is changed in a material respect,
                                or if the Nikkei 225 Index or a Successor Index
                                is in any other way modified so that such index
                                does not, in the opinion of the Calculation
                                Agent, fairly represent the value of the Nikkei
                                225 Index or such Successor Index had such
                                changes or modifications not been made, then,
                                from and after such time, the Calculation Agent
                                shall, at the close of business in New York City
                                on each date on which the Index Closing Value is
                                to be determined, 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 Nikkei 225 Index or such Successor Index,
                                as the case may be, as if such changes or
                                modifications had not been made, and the
                                Calculation Agent shall calculate the Final
                                Index Value with reference to the Nikkei 225
                                Index or such Successor Index, as adjusted.
                                Accordingly, if the method of calculating the
                                Nikkei 225 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 shall adjust
                                such index in order to arrive at a value of the
                                Nikkei 225 Index or such Successor Index

                                       9

<PAGE>

                                as if it had not been modified (e.g., as if such
                                split had not occurred).

Treatment of PLUS for
  United States Federal
  Income Tax Purposes........   The Issuer, by its sale of this PLUS, and the
                                holder of this PLUS (and any successor holder
                                of, or holder of a beneficial interest in, this
                                PLUS), by its respective purchase hereof, agree
                                (in the absence of an administrative
                                determination or judicial ruling to the
                                contrary) to characterize each $10 principal
                                amount of this PLUS for all tax purposes as a
                                single financial contract with respect to the
                                Nikkei 225 Index that (i) requires the holder of
                                this PLUS to pay to the Issuer at inception an
                                amount equal to $10 and (ii) entitles the holder
                                to receive at maturity an amount in cash based
                                upon the performance of the Nikkei 225 Index.

                                       10

<PAGE>

     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

                                       11

<PAGE>

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.

     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

                                       12

<PAGE>

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

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

     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.

                                       13

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

DATED:                                 MORGAN STANLEY

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

TRUSTEE'S CERTIFICATE
    OF AUTHENTICATION

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

JPMORGAN CHASE BANK, N.A.,
    as Trustee

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

                                       14

<PAGE>

                           FORM OF REVERSE OF SECURITY

     This Note is one of a duly authorized issue of Senior Global Medium-Term
Notes, Series F, having maturities more than nine months from the date of issue
(the "Notes") of the Issuer. The Notes are issuable under a Senior Indenture,
dated as of November 1, 2004, between the Issuer and 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
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. 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

                                       15

<PAGE>

hereof) at the option of the holder hereof at a price equal to 100% of the
principal amount to be repaid, together with interest accrued and unpaid hereon
to the date of repayment, provided that if this Note is issued with original
issue discount, this Note will be repayable on the applicable Optional Repayment
Date or Dates at the price(s) specified on the face hereof. 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 pari passu 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 minimum denomination is required by applicable

                                       16

<PAGE>

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

                                       17

<PAGE>

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 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 amortized from the Interest
Accrual Date to the date of declaration, which amortization shall be calculated
using the "interest method" (computed in accordance with generally accepted
accounting principles in effect on the date of declaration), (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.

     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," such redemption price would 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 amortized from

                                       18

<PAGE>

the Interest Accrual Date to the date of redemption, which amortization shall be
calculated using the "interest method" (computed in accordance with generally
accepted accounting principles in effect on the date of redemption) (the
"Amortized Amount")), if the Issuer determines that, as a result of any change
in or amendment to the laws, 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 becomes effective 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 United States 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 United States 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 United States 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;

                                       19

<PAGE>

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

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

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

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

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

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

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

In addition, the Issuer shall not be required to make any payment of Additional
Amounts (i) to any such holder where such withholding or deduction is imposed on
a payment to an individual and is required to be made pursuant to any law
implementing or complying with, or introduced in order to conform to, any
European Union Directive on the taxation of savings; or (ii) by or on behalf of
a holder who would have been able to avoid such withholding or deduction by
presenting this Note or the relevant coupon to another Paying Agent in a member
state of the European Union. Nor shall the Issuer pay Additional Amounts with
respect to any payment on this Note to a United States 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

                                       20

<PAGE>

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 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

                                       21

<PAGE>

Rate Agent is an affiliate of the Issuer. If those bid quotations are not
available, the Exchange Rate Agent shall determine the market exchange rate at
its sole discretion.

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

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

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

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

     No provision of this Note or of the 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.

                                       22

<PAGE>

     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 "United States Alien" means any person who is, for
United States 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 United States 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.

                                       23

<PAGE>

                                  ABBREVIATIONS

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

             TEN COM    -     as tenants in common
             TEN ENT    -     as tenants by the entireties
             JT TEN     -     as joint tenants with right of survivorship and
                              not as tenants in common

<TABLE>
<S>     <C>                  <C>                                       <C>
         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.
</TABLE>

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

                                       24

<PAGE>

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

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

________________________________________________________________________________

________________________________________________________________________________

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

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

Dated:_________________________

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

                                       25

<PAGE>

                            OPTION TO ELECT REPAYMENT

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

________________________________________________________________________________

________________________________________________________________________________

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

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

                                       26EXHIBIT 4.5

 

FORM OF
EXCHANGE NOTE AND GUARANTEE

Exhibit 4.5

     This Note is a Global Note within the meaning of the Indenture hereinafter referred to
and is registered in the name of the Depository or a nominee of the Depository. This Note
is exchangeable for Notes registered in the name of a person other than the Depository or
its nominee only in the limited circumstances described in the Indenture, and no transfer
of this Note (other than a transfer of this Note as a whole by the Depository to a nominee
of the Depository or by a nominee of the Depository to the Depository or another nominee of
the Depository) may be registered except in limited circumstances.

     Unless this Note 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 Note 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 hereon is made to Cede & Co., ANY TRANSFER, PLEDGE OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY A PERSON IS WRONGFUL since the registered owner hereof,
Cede & Co., has an interest herein.

No.

			
	 
	 	 
	CUSIP  No.
	 	[            ]

PLATINUM UNDERWRITERS FINANCE, INC.

6.371% SENIOR GUARANTEED NOTE DUE 2007

     PLATINUM UNDERWRITERS FINANCE, INC., a Delaware corporation (the “Company”, which term
includes any successor corporation under the Indenture hereinafter referred to), for value
received, hereby promises to pay to Cede & Co., the principal
sum of
[                ] on November 16, 2007 (such date is
hereinafter referred to as the “Stated Maturity Date”), and to pay interest on said
principal sum from August 16, 2005, or from the most recent interest payment date initially at the
rate of 6.371% per annum ( the “Interest Rate”); provided that any principal and installment of
interest which is overdue shall bear interest (to the extent that payment of such interest is
enforceable under applicable law) at the Interest Rate, from the dates such amounts are due until
they are paid or made available for payment, and such interest shall be payable on demand.
Interest on this Note shall be payable semi-annually in arrears on May 16 and November 16 of each
year (each, an “Interest Payment Date”), commencing on November 16, 2005, until the
principal hereof is paid or made available for payment. The amount of interest payable for any
period on any Interest Payment Date shall be computed on the basis of a 360-day year consisting of
twelve 30-day months. Except as provided in the following sentence, the amount of interest payable
for any period shorter than a full semi-annual period for which interest is computed will be
computed on the basis of the actual number

1

 

of days elapsed in such 180-day period. In the event that any date on which interest is
payable on this Note is not a Business Day, then payment of interest payable on such date will be
made on the next succeeding day that is a Business Day (and without any interest or other payment
in respect of any such delay), except that, if such Business Day is in the next succeeding calendar
year, such payment shall be made on the immediately preceding Business Day, in each case with the
same force and effect as if made on such date. The interest installment so payable, and punctually
paid or duly provided for, on any Interest Payment Date will, as provided in the Indenture, be paid
to the person in whose name this Note is registered at the close of business on the regular record
date for such interest installment, which as long as any Notes are represented by a Global Note
shall be the close of business on the Business Day next preceding such Interest Payment Date;
provided, however, if pursuant to the terms of the Indenture the Notes are no longer represented by
a Global Note, the Company may select such regular record date for such interest installment which
shall be more than one Business Day but less than 60 Business Days prior to such Interest Payment
Date. Any such interest installment not punctually paid or duly provided for shall forthwith cease
to be payable to the registered Holders on such regular record date and may be paid to the Person
in whose name this Note is registered at the close of business on a special record date to be fixed
by the Trustee for the payment of such defaulted interest, notice whereof shall be given to the
registered Holders of this series of Notes not less than 10 days prior to such special record date,
or may be paid at any time in any other lawful manner not inconsistent with the requirements of any
securities exchange on which the Notes may be listed, and upon such notice as may be required by
such exchange all as more fully provided in the Indenture. The principal of and the interest on
this Note shall be payable at the office or agency of the Company maintained for that purpose in
any coin or currency of the United States of America that at the time of payment is legal tender
for payment of public and private debts; provided, however, that payment of interest may be made at
the option of the Company by check mailed to the registered Holder at such address as shall appear
in the Register or by wire transfer to an account appropriately designated by the Holder entitled
thereto.

     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 fully 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 and the Guarantee endorsed herein shall not be
entitled to any benefit under the Indenture or be valid or obligatory for any purpose.

2

 

     IN WITNESS WHEREOF, the Company has caused this instrument to be executed under its corporate
seal.

Dated:

	 	 	 	 	 
	 	PLATINUM UNDERWRITERS

FINANCE, INC.

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 

[SEAL]

Attest:

 

3

 

CERTIFICATE OF AUTHENTICATION

     This is one of the Notes of the series designated herein referred to in the within-mentioned
Indenture.

	 	 	 	 	 
	 	JPMORGAN CHASE BANK, N.A.,

as Trustee

 	 
	 	By:  	 	 
	 	 	Authorized Officer 	 
	 	 	 	 
	 

4

 

(FORM OF REVERSE OF NOTE)

     This Note is one of a duly authorized series of the Senior Guaranteed Notes of the Company
(herein sometimes referred to as the “Securities”), specified in the Indenture hereinafter
referred to, all issued or to be issued in one or more series under and pursuant to an Indenture
dated as of October 10, 2002 (the “Base Indenture”), duly executed and delivered among the
Company, Platinum Underwriters Holdings, Ltd., as guarantor (herein called the “Guarantor”)
and JPMorgan Chase Bank, N.A., as Trustee (the “Trustee”) (such Base Indenture as
supplemented by the First Supplemental Indenture, dated November 1, 2002 and the Second
Supplemental Indenture, dated August 16, 2005, the “Indenture”), to which Indenture and all
indentures supplemental thereto reference is hereby made for a description of the rights,
limitations of rights, obligations, duties and immunities thereunder of the Trustee, the Company
and the Holders of the Securities. By the terms of the Indenture, the Securities are issuable in
series that may vary as to amount, date of maturity, rate of interest and in other respects as
provided in the Indenture. This series of Securities is limited in aggregate principal amount as
specified in said Second Supplemental Indenture.

     If a Tax Event (as herein defined) shall occur and be continuing, the Company may, at its
option, redeem the Notes then Outstanding in whole (but not in part) at any time (“Tax Event
Redemption”) at the Redemption Price (as herein defined).

     Notice of any redemption will be mailed at least 30 days but not more than 60 days before the
date of redemption (the “Tax Event Redemption Date”) to each registered Holder of Notes of
this Series to be redeemed at its registered address as more fully provided in the Indenture.
Unless the Company defaults in payment of the Redemption Price, on and after the Tax Event
Redemption Date interest shall cease to accrue on such Notes of this Series.

     “Quotation Agent” means Goldman, Sachs & Co. or any of its successors or any other primary
U.S. government securities dealer in The City of New York selected by the Company.

     “Redemption Price” means, for each Note, the product of (i) the principal amount of such Note
and (ii) a fraction whose numerator is the applicable Treasury Portfolio Purchase Price (as herein
defined) and whose denominator is the applicable Tax Event Redemption Principal Amount (as herein
defined).

     “Tax Event” means the receipt by the Company of an opinion of a nationally recognized tax
counsel experienced in such matters, to the effect that there is more than an insubstantial risk
that interest payable by the Company on the Notes on the next Interest Payment Date will not be
deductible, in whole or in part, by the Company for United States federal income tax purposes as a
result of (a) any amendment to, or change (including any announced proposed change) in, the laws
(or any regulations thereunder) of the United States or any political subdivision or taxing
authority thereof or therein affecting taxation (other than any such amendment, change or announced
proposed change to the so-called “earnings stripping” provisions of Section 163(j) of the

5

 

Internal Revenue Code, which limit the ability of U.S. corporations to deduct interest on
certain debt owed to or guaranteed by related foreign persons), (b) any amendment to or change in
an official interpretation or application of such laws or regulations by any legislative body,
court, governmental agency or regulatory authority or (c) any official interpretation,
pronouncement or application that provides for a position with respect to such laws or regulations
that differs from the generally accepted position on November 1, 2002, which amendment, change or
proposed change is effective or which interpretation or pronouncement is announced on or after
November 1, 2002.

     “Tax Event Redemption Principal Amount” means the aggregate principal amount of the Notes.

     “Treasury Portfolio Purchase Price” means the lowest aggregate price quoted by a primary U.S.
government securities dealer in New York City to the Quotation Agent on the third Business Day
immediately preceding the Tax Event Redemption Date for the purchase of the Treasury Portfolio for
settlement on the Tax Event Redemption Date.

     “Treasury Portfolio” means a portfolio (A) of zero coupon U.S. Treasury securities consisting
of principal or interest strips of U.S. Treasury securities that mature on or prior to the Maturity
Date in an aggregate amount equal to the applicable Tax Event Redemption Principal Amount and (B)
with respect to each scheduled Interest Payment Date on the Notes that occurs after the Tax Event
Redemption Date and on or before the Maturity Date, interest or principal strips of U.S. Treasury
securities that mature on or prior to such Interest Payment Date in an aggregate amount equal to
the aggregate interest payment that would be due on the applicable Tax Event Redemption Principal
Amount of the Notes Outstanding on the Tax Event Redemption Date.

     The Notes do not have the benefit of any sinking fund obligation.

     In case an Event of Default, as defined in the Indenture, shall have occurred and be
continuing, the principal of all of the Notes may be declared, and upon such declaration shall
become, due and payable, in the manner, with the effect and subject to the conditions provided in
the Indenture.

     The Indenture permits, with certain exceptions as therein provided, the amendment thereof and
the modification of the rights and obligations of the Company and the Guarantor and the rights of
the Holders of the Notes under the Indenture at any time by the Company, the Guarantor and the
Trustee with the consent of the majority of the Holders in principal amount of the Notes at the
time Outstanding. The Indenture also contains provisions permitting the Holders of specified
percentages in aggregate principal amount of the Notes at the time Outstanding, on behalf of the
Holders of all the Notes, to waive compliance by the Company or the Guarantor, or both, with
certain provisions of the Indenture and certain past defaults under the Indenture and their
consequences. Any such consent or waiver by the Holder of this Note shall be conclusive and
binding upon such Holder and upon all future Holders of this Note and of any Note issued upon the

6

 

registration of transfer hereof or in exchange herefor or in lieu hereof, whether or not
notation of such consent or waiver is made upon this Note.

     No reference herein to the Indenture and no provision of this Note or of the Indenture shall
alter or impair the obligation of the Company, which is absolute and unconditional, to pay the
principal of and premium, if any, and interest on this Note at the times, place and rate, and in
the coin or currency herein prescribed.

     As provided in the Indenture and subject to certain limitations therein set forth, this Note
is transferable by the registered Holder hereof on the Register of the Company, upon surrender of
this Note for registration of transfer at the office or agency of the Trustee in the City of New
York and State of New York accompanied by a written instrument or instruments of transfer in form
satisfactory to the Company or the Trustee duly executed by the registered Holder hereof or his
attorney duly authorized in writing, and thereupon one or more new Notes of authorized
denominations and for the same aggregate principal amount and series will be issued to the
designated transferee or transferees. No service charge will be made for any such transfer, but
the Company may require payment of a sum sufficient to cover any tax, assessment or other
governmental charge payable in relation thereto.

     Prior to due presentment for registration of transfer of this Note, the Company, the
Guarantor, the Trustee, any paying agent and the Registrar may deem and treat the registered holder
hereof as the absolute owner hereof (whether or not this Note shall be overdue and notwithstanding
any notice of ownership or writing hereon made by anyone other than the Registrar) for the purpose
of receiving payment of or on account of the principal hereof and premium, if any, and interest due
hereon and for all other purposes, and neither the Company, the Guarantor nor the Trustee nor any
paying agent nor any Registrar shall be affected by any notice to the contrary.

     No recourse shall be had for the payment of the principal of or the interest on this Note, or
for any claim based hereon, or otherwise in respect hereof, or based on or in respect of the
Indenture, against any incorporator, shareholder, officer or director, past, present or future, as
such, of the Company or the Guarantor or of any predecessor or successor corporations, 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 issuance hereof, expressly waived and released.

     The Indenture imposes certain limitations on the ability of the Company and the Guarantor to,
among other things, merge or consolidate with any other Person or sell, assign, transfer, lease or
convey all or substantially all of its properties and assets. All such covenants and limitations
are subject to a number of important qualifications and exceptions. The Company and Guarantor must
report periodically to the Trustee on compliance with the covenants in the Indenture.

     The Notes of this series are issuable only in registered form without coupons, in
denominations of $1000 and any integral multiple thereof. As provided in

7

 

the Indenture and subject to certain limitations therein set forth, Notes of this series so
issued are exchangeable for a like aggregate principal amount of Notes of this series of a
different authorized denomination, as requested by the Holder surrendering the same.

     This Note is a Global Note and is subject to the provisions of the Indenture relating to
Global Notes, including the limitations in Section 305 of the Base Indenture on transfers and
exchanges of Global Notes.

     All terms used in this Note that are defined in the Indenture shall have the meanings assigned
to them in the Indenture.

     This Note and the Guarantee endorsed herein shall be governed by and construed in accordance with
the laws of the State of New York, without giving effect to conflicts of laws principles
thereof.

8

 

GUARANTEE

     For value received, Platinum Underwriters Holdings, Ltd., a corporation organized under the
laws of Bermuda (herein called the “Guarantor”, which term includes any successor under the
Indenture referred to in the Note upon which this Guarantee is endorsed), hereby absolutely, fully
and unconditionally and irrevocably guarantees to the Holder of the Note upon which this Guarantee
is endorsed, and to the Trustee on behalf of such Holder, (a) the due and punctual payment of the
principal of and interest (and, if applicable, the Redemption Price) on such Note, whether at the
Stated Maturity or by acceleration, call for redemption or otherwise, (b) the due and punctual
payment of interest on overdue principal of and interest on such Note, if any, if lawful, and (c)
the due and punctual payment of any and all other payments due to the Holder, all in accordance
with the terms of such Note and of the Indenture. In case of the failure of the Company punctually
to make any such payment of principal, premium, if any, or interest, if any, the Guarantor hereby
agrees to cause any such payment to be made punctually when and as the same shall become due and
payable, whether at the Stated Maturity or by declaration of acceleration, call for redemption or
otherwise, and as if such payment were made by the Company.

     The Guarantor hereby agrees that its obligations hereunder are a guaranty of payment and not a
guaranty of collection or performance and shall be unconditional and absolute, irrespective of the
validity, regularity or enforceability of such Note or the Indenture or any limitation of the
Company thereunder or any limitation on the method or terms of payment thereunder which may now or
hereafter be caused or imposed in any manner whatsoever, the absence of any action to enforce the
same, any waiver or consent by the Holder of such Note or by the Trustee with respect to any
provisions thereof or of the Indenture, the obtaining of any judgment against the Company or any
action to enforce the same or any other circumstance which might otherwise constitute a legal or
equitable discharge or defense of a guarantor. The Guarantor hereby waives the benefits of
division and discussion, diligence, presentment, demand of payment, filing of claims with a court
in the event of insolvency or bankruptcy of the Company, any right to require a proceeding first
against the Company, protest or notice with respect to such Note or the indebtedness evidenced
thereby and all demands whatsoever, and covenants that this Guarantee will not be discharged except
by complete performance of the obligations contained in such Note and in this Guarantee. Without
limiting the generality of the foregoing, the Guarantor hereby agrees that the obligations of the
Guarantor hereunder shall not be released, affected or impaired by assignment or transfer in whole
or in part of the Note whether or not made without notice to or the consent of the Guarantor and
shall not be subject to any reduction, limitation, impairment or termination for any reason,
including any claim of waiver, release, surrender, alteration or compromise, and shall not be
subject to any defense of, including, but not limited to, setoff, counterclaim, recoupment or
termination whatsoever, and that such obligations shall not be released, affected or impaired
regardless of whether or not any Holder, including the Holder of the Note, or anyone on behalf of
any such Holder shall have instituted any suit, action or proceeding or exhausted its remedies or
taken any steps to enforce any rights against the Company or any other person to compel any such
performance or observance or to collect all or part of any such amount, either pursuant to

9

 

the provisions of the Indenture or the Note or at law or in equity, and regardless of any
other condition or contingency, or by reason of the invalidity, illegality or unenforceability of
the Note or the Indenture or otherwise and that such obligations shall not be discharged or
impaired or otherwise affected by the failure of the Trustee or any Holder of such Note to assert
any claim or demand or to enforce any remedy under the Indenture or such Note, any other guarantee
or any other agreement, by any waiver, amendment, indulgence or modification (whether material or
otherwise) of any provision of any thereof, by any default, failure or delay, willful or otherwise,
in the performance of any obligations under the Indenture, the Note or this Guarantee, or by the
voluntary or involuntary liquidation, sale or other disposition of all or substantially all of the
assets of the Company or the Guarantor, or any receivership, insolvency, bankruptcy,
reorganization, or other similar proceedings, affecting the Company or any of its assets, or the
release of any property from the lien and security interest created by the Indenture or the Note or
of any other security for the Note, or the release or discharge of the Company or the Guarantor
from the performance or observance of any agreement, covenant, term or condition contained in the
Indenture or the Note by operation of law, or the merger or consolidation of the Company or the
Guarantor, or any other cause, whether similar or dissimilar to the foregoing, or by any other act
or omission that may or might in any manner or to any extent vary the risk or obligations of the
Guarantor or that would otherwise operate as a discharge of a surety or guarantor as a matter of
law or equity (other than the performance of the obligations contained in such Note and in this
Guarantee).

     The Holder of the Note upon which this Guarantee is endorsed is entitled to the further
benefits relating hereto set forth in the Indenture. No reference herein to the Indenture and no
provision of this Guarantee or of the Indenture shall alter or impair the guarantee of the
Guarantor, which is absolute and unconditional, of the due and punctual payment of the principal of
and interest, or any such other payments, on the Note upon which this Guarantee is endorsed.

     This Guarantee shall be governed by and construed in accordance with the laws of the State of
New York, without giving effect to the conflicts of laws principles thereof.

     All terms used in this Guarantee which are defined in the Indenture shall have the meanings
assigned to them in the Indenture.

     This Guarantee shall not be valid or obligatory for any purpose until the certificate of
authentication on the Note upon which this Guarantee is endorsed shall have been executed by the
Trustee under the Indenture by the manual signature of one of its authorized officers.

10

 

     IN WITNESS WHEREOF, the Guarantor has caused this Guarantee to be duly executed.

	 	 	 	 	 
	 	PLATINUM UNDERWRITERS

HOLDINGS, LTD.

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 

Attest:

By:                                         

       Name:

       Title:

11

 

ASSIGNMENT

FOR VALUE RECEIVED, the undersigned assigns and transfers this Note to:

 

 

 

(Insert assignee’s social security or tax identification number)

 

 

 

(Insert address and zip code of assignee)

agent to transfer this Note on the Register. The agent may substitute another to act for him or
her.

     Dated:

	 	 	 	 	 
	 

	 	Signed:
	 	 
	 

	 	 	 	 
	 
	 	 	 	 
	 	 	Signature Guarantee:

(Sign exactly as your name appears on the other side of this Note)

     Signatures must be guaranteed by an “eligible guarantor institution” meeting the requirements
of the Registrar, which requirements include membership or participation in the Security Transfer
Agent Medallion Program (“STAMP”) or such other “signature guarantee program” as may be determined
by the Registrar in addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.

12

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