Document:

Exhibit
4.1

       

      FORM
OF FIXED RATE SENIOR NOTE

    

     

    
      	
              REGISTERED

            	
              REGISTERED

            
	
              No.
      FXR-1

            	
              U.S.
      $

            
	 
      	
              CUSIP:
      617480314

            

    

     

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

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

       

    

    MORGAN
STANLEY

    SENIOR
GLOBAL MEDIUM-TERM NOTE, SERIES F

     

    PERFORMANCE
LEVERAGED UPSIDE SECURITIES (“PLUS”)

     

    PLUS
DUE JUNE 20, 2009

    BASED
ON THE VALUE OF THE S&P 500®
INDEX

     

    
      	
              ORIGINAL
      ISSUE DATE:

               

            	
              INITIAL
      REDEMPTION DATE: N/A

            	
              INTEREST
      RATE: None

            	
              MATURITY
      DATE: See “Maturity Date” below.

            
	
              INTEREST
      ACCRUAL DATE: N/A

            	
              INITIAL
      REDEMPTION PERCENTAGE: N/A

            	
              INTEREST
      PAYMENT DATE(S): N/A

            	
              OPTIONAL
      REPAYMENT DATE(S):  N/A

            
	
              SPECIFIED
      CURRENCY: U.S. dollars

            	
              ANNUAL
      REDEMPTION PERCENTAGE REDUCTION: N/A

            	
              INTEREST
      PAYMENT PERIOD: N/A

            	
              APPLICABILITY
      OF MODIFIED

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

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

            	
              REDEMPTION
      NOTICE PERIOD: N/A

            	
              APPLICABILITY
      OF ANNUAL INTEREST PAYMENTS: N/A

            	
              If
      yes, state Issue Price: N/A

            
	
              EXCHANGE
      RATE AGENT: N/A

            	
              TAX
      REDEMPTION AND PAYMENT OF ADDITIONAL AMOUNTS: NO

            	
              PRICE
      APPLICABLE UPON OPTIONAL REPAYMENT: N/A

            	
              ORIGINAL
      YIELD TO MATURITY: N/A

            
	
              OTHER
      PROVISIONS: See below

            	
              IF
      YES, STATE INITIAL OFFERING DATE: N/A

            	 
      	 
      

    

    

    
      	
              Stated
      Principal Amount

            	 
      	
              $10

            
	 	 	 
	
              Underlying
      Index

            	 
      	
              S&P
      500®
      Index

            
	 	 	 
	
              Underlying
      Index Publisher

            	 
      	
              Standard
      & Poor's®
      Corporation

            
	 	 	 
	
              Initial
      Index Value

            	 
      	 
      
	 	 	 
	
              Pricing
      Date

            	 
      	 
      
	 	 	 
	
              Denominations

            	 
      	
              $10
      and integral multiples thereof

            
	 	 	 
	
              Bull
      Market or Bear Market PLUS

            	 
      	
              Bull
      Market PLUS

            

    

     

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

       

    

    
      	
              Maximum
      Payment at Maturity

            	 
      	
              $           
      per Stated Principal Amount

            
	 	 	 
	
              Minimum
      Payment at Maturity

            	 
      	 
      
	
              if
      Bear Market PLUS

            	 
      	
              N/A

            
	 	 	 
	
              Leverage
      Factor

            	 
      	
                   
       %

            
	 	 	 
	
              Index
      Valuation Date(s)

            	 
      	
              June
      18, 2009.

            
	 	 	 
	 
      	 
      	
              If
      there is only one Index Valuation Date, the Final Index Value shall be
      determined on that Index Valuation Date.  If there are multiple
      Index Valuation Dates, then the Final Average Index Value shall be
      determined on the last Index Valuation Date, which is referred to as the
      “Final Index Valuation Date.”

            
	 	 	 
	 
      	 
      	
              If a
      Market Disruption Event with respect to the Underlying Index occurs on any
      scheduled Index Valuation Date, or if any such Index Valuation Date is not
      an Index Business Day, the Index Closing Value for such date shall be
      determined on the immediately succeeding Index Business Day on which no
      Market Disruption Event shall have occurred; provided that the Final
      Index Value or the Final Average Index Value, as applicable, shall not be
      determined on a date later than the fifth scheduled Index Business Day
      after the scheduled Index Valuation Date or Final Index Valuation Date, as
      applicable, and if such date is not an Index Business Day or if there is a
      Market Disruption Event on such date, the Calculation Agent shall
      determine the Index Closing Value of the Underlying Index on such date in
      accordance with the formula for calculating such index last in effect
      prior to the commencement of the Market Disruption Event (or prior to the
      non-Index Business Day), without rebalancing or substitution, 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,
      limitation or non-Index Business Day) on such date of each security most
      recently constituting the Underlying Index.

            
	 	 	 
	
              Maturity
      Date

            	 
      	
              June
      20, 2009, subject to extension if the scheduled Index Valuation Date or
      Final Index Valuation Date, as applicable, is postponed in accordance with
      the definition thereof.  If the scheduled Index
      Valuation

            

    

     

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

       

    

    
      	 	 	
              Date
      or Final Index Valuation Date, as applicable, 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 Trading Day
      following the Index Valuation Date or Final Index Valuation Date, as
      applicable, as postponed.  See “Index Valuation
      Date(s).”

            
	 	 	 
	 
      	 
      	
              In
      the event that the Maturity Date of the PLUS is postponed due to
      postponement of the Index Valuation Date or the Final Index Valuation
      Date, as applicable, 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 the scheduled Index Valuation Date or
      Final Index Valuation Date, as applicable, 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 or Final Index
      Valuation Date, as applicable, for determining the Final Index Value (as
      defined below) or Final Average Index Value (as defined below), as
      applicable.

            
	 	 	 
	
              Payment
      at Maturity

            	 
      	
              At
      maturity, upon delivery of this PLUS to the Trustee, the Issuer shall pay
      with respect to each Stated Principal Amount of this PLUS an amount in
      cash equal to:

            

    

     

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

       

    

    
      	 
      	 
      	
              1.  For a Bull Market PLUS,
      (i) if the Final Index Value, or Final Average Index Value, as applicable,
      is greater than the Initial Index Value, the Stated Principal Amount plus
      the Leveraged Upside Payment, subject to the Maximum Payment at Maturity
      or (ii) if the Final Index Value or Final Average Index Value, as
      applicable, is less than or equal to the Initial Index Value, the Stated
      Principal Amount times the Index Performance Factor.

            
	 	 	 
	 
      	 
      	
              2.  For a Bear Market PLUS,
      (i) if the Final Index Value or Final Average Index Value, as applicable,
      is less than the Initial Index Value, the Stated Principal Amount plus the
      Enhanced Downside Payment, subject to the Maximum Payment at Maturity or
      (ii) if the Final Index Value or Final Average Index Value, as applicable,
      is greater than or equal to the Initial Index Value, the Stated Principal
      Amount minus the Upside Reduction Amount, subject to the Minimum Payment
      at Maturity.

            
	 	 	 
	 
      	 
      	
              The
      Issuer shall, or shall cause the Calculation Agent to, (i) provide written
      notice to the Trustee and to the Depositary of the amount of cash to be
      delivered with respect to each Stated 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.

            

    

    

    Applicable
only for BULL MARKET PLUS

     

    
      	
              Leveraged
      Upside Payment

            	 
      	
              The
      product of (i) the Stated Principal Amount and (ii) the Leverage Factor
      and (iii) the Index Percent Increase.

            
	 	 	 
	
              Index
      Performance Factor

            	 
      	
              A
      fraction, the numerator of which shall be the Final Index Value or Final
      Average Index Value, as applicable, and the denominator of which shall be
      the Initial Index Value.

            

    

    

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

       

    

    
      Applicable
only for BEAR MARKET PLUS

    

     

    
      	
              Enhanced
      Downside Payment

            	 
      	
              The
      product of (i) the Stated Principal Amount and (ii) the Leverage Factor
      and (iii) the Index Percent Decrease.

            
	 	 	 
	
              Upside
      Reduction Amount

            	 
      	
              The
      product of (i) the Stated Principal Amount and (ii) the Index Percent
      Increase.

            
	 	 	 
	
              Index
      Percent Decrease

            	 
      	
              A
      fraction, the numerator of which shall be the Initial Index Value minus
      the Final Index Value or Final Average Index Value, as applicable, and the
      denominator of which shall be the Initial Index Value.

            
	 	 	 
	
              Applicable
      for all PLUS

            	 
      	 
      
	 	 	 
	
              Index
      Percent Increase

            	 
      	
              A
      fraction, the numerator of which shall be the Final Index Value or Final
      Average Index Value, as applicable, minus the Initial Index Value and the
      denominator of which shall be the Initial Index Value.

            
	 	 	 
	
              Final
      Index Value

            	 
      	
              For
      PLUS with a single Index Valuation Date, the Index Closing Value of the
      Underlying Index on the Index Valuation Date, as determined by the
      Calculation Agent; and

            
	 	 	 
	 
      	 
      	
              for
      PLUS with multiple Index Valuation Dates, the arithmetic average of the
      Index Closing Values of the Underlying Index on the Index Valuation Dates,
      as calculated by the Calculation Agent, which is referred to as the “Final
      Average Index Value.”

            
	 	 	 
	
              Index
      Closing Value

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

            
	 	 	 
	
              Price
      Source

            	 
      	
              As
      reported on Bloomberg under the ticker symbol “SPX,” which shall be used
      by the Calculation Agent

            

    

     

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

     

    
      	 	 	
              to
      determine the Index Closing Value of the Underlying
  Index.

            
	 	 	 
	 
      	 
      	
              If
      such service or any successor service no longer displays the Index Closing
      Value of the Underlying Index, then the Calculation Agent shall designate
      an alternate source of such Index Closing Value, which shall be the
      publisher of the Underlying Index, unless the Calculation Agent, in its
      sole discretion, determines that an alternate service has become the
      market standard for transactions related to such index.

            
	 	 	 
	
              Trading
      Day

            	 
      	
              A
      day, as determined by the Calculation Agent, on which trading is generally
      conducted on the New York Stock Exchange LLC (“NYSE”), the American Stock
      Exchange LLC, The NASDAQ Stock Market LLC, the Chicago Mercantile
      Exchange, the Chicago Board of Options Exchange and in the
      over-the-counter market for equity securities in the United
      States.

            
	 	 	 
	
              Index
      Business Day

            	 
      	
              A
      day, as determined by the Calculation Agent, on which trading is generally
      conducted on each of the Relevant Exchange(s) for the Underlying Index,
      other than a day on which trading on such exchange(s) is scheduled to
      close prior to the time of the posting of its regular final weekday
      closing price.

            
	 	 	 
	
              Relevant
      Exchange

            	 
      	
              Relevant
      Exchange means the primary exchange(s) or market(s) of trading for (i) any
      security then included in the Underlying Index, or any Successor Index,
      and (ii) any futures or options contracts related to the Underlying Index
      or to any security then included in the Underlying
  Index.

            
	 	 	 
	
              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 shall be rounded to
      the nearest one billionth, with five ten-billionths rounded upward (e.g.,

            

    

     

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

     

    
      	 	 	
              .9876543215
      would be rounded to .987654322); all dollar amounts related to
      determination of the amount of cash payable for each Stated 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 shall be rounded to the nearest cent, with
      one-half cent rounded upward.

            
	 	 	 
	
              Market
      Disruption Event

            	 
      	
              Market
      Disruption Event means, with respect to the Underlying Index, the
      occurrence or existence of any of the following events, as determined by
      the Calculation Agent in its sole discretion:

            
	 	 	 
	 
      	 
      	
              (i)(a)
      a suspension, absence or material limitation of trading of stocks then
      constituting 20 percent or more of the value of the Underlying 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

            
	 	 	 
	 
      	 
      	
              (b)
      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 value of the Underlying
      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

            
	 	 	 
	 
      	 
      	
              (c)
      the suspension, material limitation or absence of trading on any major
      U.S. securities market for trading in futures or options contracts or
      exchange traded funds related to the Underlying Index (or the Successor
      Index) for more than two hours of trading or during the one-half hour
      period preceding the close of the principal trading session on such
      market; 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

            

    

     

     

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

     

    
      	 	 	
              portion
      of the hedge position with respect to this issuance of
    PLUS.

            
	 	 	 
	 
      	 
      	
              For
      the purpose of determining whether a Market Disruption Event exists at any
      time, if trading in a security included in the Underlying Index is
      materially suspended or materially limited at that time, then the relevant
      percentage contribution of that security to the value of the Underlying
      Index shall be based on a comparison of (x) the portion of the value of
      the Underlying Index attributable to that security relative to (y) the
      overall value of the Underlying 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 or
      exchange traded funds on the Underlying Index by the primary securities
      market trading in such contracts or funds 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 funds, or (c) a
      disparity in bid and ask quotes relating to such contracts or funds shall
      constitute a suspension, absence or material limitation of trading in
      futures or options contracts or exchange traded funds related to the
      Underlying Index and (5) a “suspension, absence or material limitation of
      trading” on any Relevant Exchange or on the primary market on which
      futures

            

    

     

     

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

     

    
      	 	 	
              or
      options contracts or exchange traded funds related to the Underlying Index
      are traded shall not include any time when such securities market is
      itself closed for trading under ordinary circumstances.

            
	 	 	 
	
              Alternate
      Exchange Calculation

            	 
      	 
      
	
              in
      the 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 Stated
      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 or Final Average
      Index Value, as applicable, plus, if applicable, any accrued but unpaid
      interest as of the date of such acceleration.

            
	 	 	 
	 
      	 
      	
              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 Stated 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

            	 
      	 
      
	
              Underlying
      Index;

            	 
      	 
      
	
              Alteration
      of  Method of

            	 
      	 
      
	
              Calculation

            	 
      	
              If
      the Underlying Index Publisher discontinues publication of the Underlying
      Index and the Underlying Index Publisher or another entity (including MS
      & Co.) publishes a successor or substitute index that the Calculation
      Agent determines, in its sole discretion, to be comparable to the
      discontinued Underlying Index (such index being referred to herein as a
      “Successor Index”), then 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 any Index Business Day that the
      Index Closing Value is to be
determined.

            

    

     

     

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

     

    
      	 
      	 
      	
              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
      the Underlying Index Publisher discontinues publication of the Underlying
      Index prior to, and such discontinuance is continuing on, any Index
      Valuation Date or the date of 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 Index Valuation Date or date of
      acceleration.  The Index Closing Value shall be computed by the
      Calculation Agent in accordance with the formula for and method of
      calculating the Underlying Index last in effect prior to such
      discontinuance, using the closing price (or, if trading in the relevant
      securities has been materially suspended or materially limited, its good
      faith estimate of the closing price that would have prevailed but for such
      suspension or limitation) at the close of the principal trading session of
      the Relevant Exchange on such Index Valuation Date or date of acceleration
      of each security most recently constituting the Underlying Index without
      any rebalancing or substitution of such securities following such
      discontinuance.

            
	 	 	 
	 
      	 
      	
              If
      at any time the method of calculating the Underlying Index or a Successor
      Index, or the value thereof, is changed in a material respect, or if the
      Underlying Index or a Successor Index is in any other way modified so that
      such index does not, in the opinion of the Calculation Agent, fairly
      represent the value of such 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
      Underlying Index or such Successor Index, as the case may be, as if such
      changes or modifications had not been made, and
  the

            

    

     

     

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

    

     

    
      	 	 	
              Calculation
      Agent shall calculate the Final Index Value or Final Average Index Value,
      as applicable, with reference to the Underlying Index or such Successor
      Index, as adjusted.  Accordingly, if the method of calculating
      the Underlying Index or a Successor Index is modified so that the value of
      such index is a fraction of what it would have been if it had not been
      modified (e.g., due to a split in the index), then the Calculation Agent
      shall adjust such index in order to arrive at a value of the Underlying
      Index or such Successor Index as if it had not been modified (e.g., as if
      such split had not occurred).

            

    

     

     

    
      
        
        

      

      
        12

        
          

        

      

      
        
        

      

    

     

    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

     

     

    
      
        
        

      

      
        13

        
          

        

      

      
        
        

      

    

     

    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

     

     

    
      
        
        

      

      
        14

        
          

        

      

      
        
        

      

    

     

    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.

     

     

    
      
        
        

      

      
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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.

              
	 
	
                THE
      BANK OF NEW YORK,

                as
      Trustee

              
	 
	 
	
                By:
      

              	 
      
	
                Authorized
      Signatory

              

      

      
 

      
        
          
          

        

        
          16

          
            

          

        

        
          
          

        

      

       

    

    FORM OF
REVERSE OF SECURITY

     

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

     

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

     

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

     

     

    
      
        
        

      

      
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    If so indicated on the face of this
Note, this Note will be subject to repayment at the option of the holder on the
Optional Repayment Date or Dates specified on the face hereof on the terms set
forth herein.  On any Optional Repayment Date, this Note will be
repayable in whole or in part in increments of $1,000 or, if this Note is
denominated in a Specified Currency other than U.S. dollars, in increments of
1,000 units of such Specified Currency (provided that any remaining principal
amount hereof shall not be less than the minimum authorized denomination hereof)
at the option of the holder hereof at a price equal to 100% of the principal
amount to be repaid, together with interest accrued and unpaid hereon to the
date of repayment, provided
that if the face hereof indicates that this Note is subject to “Modified
Payment upon Acceleration or Redemption”, the amount of principal payable upon
repayment will be limited to the aggregate principal amount hereof multiplied by
the sum of the Issue Price specified on the face hereof (expressed as a
percentage of the aggregate principal amount) plus the original issue discount
accrued from the Interest Accrual Date to the date of
repayment  (expressed as a percentage of the aggregate principal
amount), with the amount of original issue discount accrued being calculated
using a constant yield method (as described below).  For this Note to
be repaid at the option of the holder hereof, the Paying Agent must receive at
its corporate trust office in the Borough of Manhattan, The City of New York, at
least 15 but not more than 30 calendar days prior to the date of repayment, (i)
this Note with the form entitled “Option to Elect Repayment” below duly
completed or (ii) a telegram, telex, facsimile transmission or a letter from a
member of a national securities exchange or the National Association of
Securities Dealers, Inc. or a commercial bank or a trust company in the United
States setting forth the name of the holder of this Note, the principal amount
hereof, the certificate number of this Note or a description of this Note’s
tenor and terms, the principal amount hereof to be repaid, a statement that the
option to elect repayment is being exercised thereby and a guarantee that this
Note, together with the form entitled “Option to Elect Repayment” duly
completed, will be received by the Paying Agent not later than the fifth
Business Day after the date of such telegram, telex, facsimile transmission or
letter; provided, that
such telegram, telex, facsimile transmission or letter shall only be effective
if this Note and form duly completed are received by the Paying Agent by such
fifth Business Day.  Exercise of such repayment option by the holder
hereof shall be irrevocable.  In the event of repayment of this Note
in part only, a new Note or Notes for the amount of the unpaid portion hereof
shall be issued in the name of the holder hereof upon the cancellation
hereof.

     

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

     

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

     

    
      
        
        

      

      
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    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 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

     

     

    
      
        
        

      

      
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    transfer
of Notes shall be such that no gain or loss of interest results from such
exchange or transfer.

     

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

     

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

     

    If the
face hereof indicates that this Note is subject to “Modified Payment upon
Acceleration or Redemption,” then (i) if the principal hereof is declared to be
due and payable as described in the preceding paragraph, the amount of principal
due and payable with respect to this Note shall be limited to the aggregate
principal amount hereof multiplied by the sum of the Issue Price specified on
the face hereof (expressed as a percentage of the aggregate principal amount)
plus the original issue discount accrued from the Interest Accrual Date to the
date of declaration (expressed as a percentage of the aggregate principal
amount), with the amount of

     

     

    
      
        
        

      

      
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    original
issue discount accrued being calculated using a constant yield method (as
described in the next paragraph), (ii) for the purpose of any vote of
securityholders taken pursuant to the Senior Indenture prior to the acceleration
of payment of this Note, the principal amount hereof shall equal the amount that
would be due and payable hereon, calculated as set forth in clause (i) above, if
this Note were declared to be due and payable on the date of any such vote and
(iii) for the purpose of any vote of securityholders taken pursuant to the
Senior Indenture following the acceleration of payment of this Note, the
principal amount hereof shall equal the amount of principal due and payable with
respect to this Note, calculated as set forth in clause (i) above.

     

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

     

    If the face hereof indicates that this
Note is subject to “Tax Redemption and Payment of Additional Amounts,” this Note
may be redeemed, as a whole, at the option of the Issuer at any time prior to
maturity, upon the giving of a notice of redemption as described below, at a
redemption price equal to 100% of the principal amount hereof, together with
accrued interest to the date fixed for redemption (except that if this Note is
subject to “Modified Payment upon Acceleration or Redemption,” the amount of
principal so payable will be limited to the aggregate principal amount hereof
multiplied by the sum of the Issue Price specified on the face hereof (expressed
as a percentage of the aggregate principal amount) plus the original issue
discount accrued from the Interest Accrual Date to the date of redemption
(expressed as a percentage of the aggregate principal amount), with the amount
of original issue discount accrued being calculated using a constant yield
method (as described above)), if the Issuer determines that, as a result of any
change in or amendment to the laws (including a holding, judgment or as ordered
by a court of competent jurisdiction), or any regulations or rulings promulgated
thereunder, of the United States or of any political subdivision or taxing
authority thereof or therein affecting taxation, or any change in official
position regarding the application or interpretation of such laws, regulations
or rulings, which change or amendment occurs, becomes effective or, in the case
of a change in official position, is announced on or after the Initial Offering
Date hereof, the Issuer has or will become obligated to pay Additional Amounts,
as defined below, with respect to this Note as described below.  Prior
to the giving of any notice of redemption pursuant to this paragraph, the Issuer
shall deliver to the Trustee (i) a certificate stating that the Issuer is
entitled to effect such redemption and setting forth a statement of facts
showing that the conditions precedent to the right of the Issuer to so redeem
have occurred, and (ii) an opinion of independent legal counsel
satisfactory to the Trustee to such effect based on such statement of facts;
provided that no such
notice of redemption shall be given earlier than 60 calendar days prior to the
earliest date on which the Issuer would be obligated to pay such Additional
Amounts if a payment in respect of this Note were then due.

     

     

    
      
        
        

      

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

     

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

     

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

     

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

     

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

     

     

    
      
        
        

      

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

     

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

     

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

     

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

     

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

     

     

    
      
        
        

      

      
        23

        
          

        

      

      
        
        

      

       

    

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

     

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

     

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

     

    So long as
this Note shall be outstanding, the Issuer will cause to be maintained an office
or agency for the payment of the principal of and premium, if any, and interest
on this Note as herein provided in the Borough of Manhattan, The City of New
York, and an office or agency in said Borough of Manhattan for the registration,
transfer and exchange as aforesaid of the Notes.  The Issuer may
designate other agencies for the payment of said principal, premium and interest
at such place or places (subject to applicable laws and regulations) as the
Issuer may decide.  So long as there shall be such an agency, the
Issuer shall keep the Trustee advised of the names and locations of such
agencies, if any are so designated.  If any European Union Directive
on the taxation of savings comes into force, the Issuer will, to the extent
possible as a matter of law,

     

     

    
      
        
        

      

      
        24

        
          

        

      

      
        
        

      

    

     

    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.

     

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

     

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

     

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

     

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

     

     

    
      
        
        

      

      
        25

        
          

        

      

      
        
        

      

    

     

    ABBREVIATIONS

     

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

       

      TEN
COM   –   as tenants in common

       

      TEN
ENT    –   as tenants by the
entireties

       

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

      

       

      UNIF GIFT
MIN ACT – ______________________Custodian
__________________________

      (Minor)                                                      (Cust)

       

      Under
Uniform Gifts to Minors Act ______________________________

      (State)

       

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

       

      _______________________

       

       

      
        
          
          

        

        
          26

          
            

          

        

        
          
          

        

      

      
         

        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.

                

        

         

         

        
          
            
            

          

          
            27

            
              

            

          

          
            
            

          

        

         

        OPTION TO ELECT
REPAYMENT

         

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

         

          
            

          

        

         

          
            

          

        

         

          
            

          

        

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

         

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

         

        
           

          
            	Dated:
      ______________________________	____________________________________________
	 	
                    NOTICE:  The
      signature on this Option to Elect Repayment must

                    correspond
      with the name as written upon the face of the within

                    instrument
      in every particular without alteration or
  enlargement.

                  

          

           

        

         

         

        28Exhibit
4.01

    
       

      ASSIGNMENT AND NOVATION
AGREEMENT

      

               THIS
ASSIGNMENT AND NOVATION AGREEMENT (this "Agreement") is made as of April 16,
2008 by and among Shire Limited (“NewShire”), a public company limited by shares
incorporated under the laws of Jersey, Shire
plc  ("OldShire"), a public limited company incorporated
under the laws of England and Wales, and JPMorgan Chase Bank, N.A., (the
"Depositary").

      

      WHEREAS, OldShire has entered into a
Deposit Agreement dated as of November 21, 2005 (the "Deposit Agreement") with
the Depositary and all holders from time to time of American Depositary Receipts
issued thereunder;

      

      WHEREAS, OldShire will undergo a scheme
of arrangement (the "Scheme of Arrangement") pursuant to which a new listed
holding company of OldShire, NewShire, will be put in place through a court
approved scheme of arrangement under sections 895 to 899 of the Companies
Act
2006;

      

      

WHEREAS, in connection with the Scheme
of Arrangement, American Depositary Shares (“ADSs”) of OldShire issued under the
Deposit Agreement will become ADSs of  NewShire without any action
required on the part of the holders thereof;

      

      

WHEREAS, in connection with the Scheme
of Arrangement, OldShire desires to transfer and assign to NewShire its rights,
duties and obligations under the Deposit Agreement and to cause the Deposit
Agreement to be novated in favor of NewShire;

      

      WHEREAS, NewShire agrees that the
Deposit Agreement shall be novated in its favor and is willing to acquire the
rights and assume the duties and obligations of OldShire under the Deposit
Agreement on the terms and conditions set forth herein; and

      

      WHEREAS, the Depositary agrees to the
novation of the Deposit Agreement in favor of NewShire on the terms and
conditions set forth herein;

      

      NOW THEREFORE, in consideration of the
mutual covenants herein contained, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties agree as follows:

      

      1.              OldShire hereby assigns, transfers and
conveys to NewShire, effective immediately prior to the time at which the Scheme
of Arrangement becomes effective in accordance with its terms (the "Effective
Time"), all of OldShire's rights, duties and obligations under the Deposit
Agreement and the Depositary consents to such assignment, transfer and
conveyance.

      

      2.              NewShire hereby accepts such assignment
and covenants and agrees with OldShire and the Depositary that it will, from and
including the Effective Time:

      

      
        
           

        

        
          1

          
            

          

        

        
           

        

         

      

      (i)  perform and discharge all
of OldShire’s duties and obligations under the Deposit Agreement and otherwise
observe and perform all of the provisions of the Deposit Agreement binding on
OldShire; and

      

      (ii) be liable to the Depositary for any
breach, non-observance or non-performance by NewShire or OldShire of their
respective obligations under the Deposit Agreement whether occurring on, prior
to, or following the Effective Time;

      

      in each case as if NewShire had been a
party to the Deposit Agreement in place of OldShire from the date on which the
Deposit Agreement was entered into and the Depositary accepts the performance
and liability of NewShire in place of OldShire.

      

      3.              With effect from and including the
Effective Time, OldShire shall:

      

      (i) be released from the further
performance of its duties and obligations under the Deposit Agreement;
and

      

      (ii) cease to have any rights under the
Deposit Agreement, including without limitation any rights to indemnification or
in respect of any breach, non-observance or non-performance by the Depositary of
its obligations under the Deposit Agreement,  whether past, present or
future.

      

      4.              OldShire, NewShire and the Depositary
hereby agree that this Agreement shall constitute a novation of the rights and
obligations of OldShire under the Deposit Agreement and, accordingly, with
effect from and including the Effective Time all of the rights, duties and
obligations of OldShire under the Deposit Agreement are hereby assumed by
NewShire and the Depositary shall perform its obligations under the Deposit
Agreement and be bound by its terms in every way as if NewShire had at all times
been a party to the Deposit Agreement.

      

      5.              Each of OldShire, NewShire and the
Depositary represents and warrants to each other party that:

      

      (i)  it has full power,
authority and legal right to enter into and perform this
Agreement;

      

      (ii)  it has taken all
necessary legal and corporate action to authorize the execution and performance
of this Agreement; and

      

      (iii)  this Agreement
constitutes a legal, valid and binding obligation of such
party.

      

      6.              Each of NewShire and the Depositary
agree that in the Deposit Agreement (i) the terms "
deliver", "
execute", "
issue", "
register
", "surrender
", "transfer
" or "
cancel" are meant to also refer to entries or
electronic transfers in the direct registration system (which is the system for
the uncertificated registration of ownership of securities established by The
Depository Trust Company and utilized by the Depositary pursuant to which the
Depositary may record the ownership of ADRs without the issuance of a
certificate, which ownership shall be evidenced by periodic statements issued by
the Depositary to the holders entitled thereto), (ii) "ADRs" as such term is
defined in the Deposit Agreement, may either be in physical certificated form or
in book-

       

      
        
           

        

        
          2

          
            

          

        

        
           

        

      

       

      entry form through such direct
registration system and (iii) references in the Deposit Agreement to such ADRs
shall include certificated ADRs as well as those issued through the direct
registration system, unless the context otherwise requires.

      

      7.              OldShire and NewShire hereby instruct
the Depositary that, in relation to dividends on Deposited Securities (as
defined in the Deposit Agreement), to the extent that holders of Shares of
NewShire are permitted to elect to receive dividends from OldShire (a company
resident for tax purposes in the United Kingdom) or from Shire Limited (a
company resident for tax purposes in the Republic of Ireland), the Depositary
shall elect to receive all such dividends from OldShire and shall be entitled to
any and all protections afforded to the Depositary under the Deposit Agreement
in connection with abiding by such instructions.  The Depositary
agrees to abide by such instruction.

      

      8.              This Agreement shall inure to the
benefit of and be binding upon the parties hereto and their respective
successors and assigns.

      

      9.              The parties hereto agree that they will
take all actions reasonably necessary to carry out the matters contemplated by
this Agreement.

      

      10.             This Agreement constitutes the entire
agreement and understanding among the parties hereto with respect to the subject
matter hereof and supersedes any and all prior agreements and understandings,
oral or written, relating to the subject matter hereof.

      

      11.             No amendment, modification or waiver of
any provision of this Agreement, nor consent to any departure therefrom, shall
in any event be effective unless the same shall be in writing and signed by the
parties hereto, and then such amendment, modification or waiver shall be
effective only in the specific instance and for the specific purpose for which
given.  No failure or delay by any party in exercising any right,
power or privilege hereunder shall operate as a waiver thereof nor shall any
single or partial exercise thereof preclude any other or further exercise
thereof or the exercise of any other right, power or
privilege.

      

      12.             If any term or provision of this
Agreement should be declared invalid by a court of competent jurisdiction, the
remaining terms and provisions of this Agreement shall be unimpaired and the
invalid term or provision shall be replaced by such valid term or provision as
comes closest to the intention underlying the invalid term or
provision.

      

      13.             This Agreement shall be governed by and
construed in accordance with the laws of the State of New York, without regard to its conflict of laws
principles.

      

      14.   
         This Agreement may be executed in
several counterparts each of which will be deemed to be an original and together
will constitute one and the same agreement.

      

      

      

      
        
           

        

        
          3

          
            

          

        

        
           

        

      

      

      

      IN WITNESS WHEREOF, the undersigned have
executed this Agreement as of the date first written above.

      

      

      
        	
                SHIRE
    LIMITED

              	 
	 
      	 
      	 
	 
      	 
      	 
	
                By:

              	
                /s/Tatjana
    May

              	 
	
                Name:

              	
                Tatjana May

              	 
	
                Title:

              	
                Company Secretary and General
      Counsel

              	 
	 	 	 
	 
      	 
      	 
	 
      	 
      	 
	
                SHIRE PLC

              	 
	 
      	 
      	 
	 
      	 
      	 
	
                By:

              	
                /s/Tatjana
    May

              	 
	
                Name:

              	
                Tatjana May

              	 
	
                Title:

              	
                Company Secretary and General
      Counsel

              	 
	 	 	 
	 
      	 
      	 
	 
      	 
      	 
	
                JPMORGAN CHASE BANK,
      N.A.

              	 
	 
      	 
      	 
	 
      	 
      	 
	
                By:

              	
                /s/Melinda L.
      VanLuit

              	 
	
                Name:

              	
                Melinda L.
      VanLuit

              	 
	
                Title:

              	
                Vice
    President

              	 

      

       

       

      

        4

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