Document:

Indemnification DSL Amendment

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Exhibit 10.2

INDEMNIFICATION AGREEMENT 

 

Dated as of December 15, 2004 between

DOWNEY SAVINGS AND LOAN ASSOCIATION, F.A. ("Downey Savings"), and 

____________________________ ("Indemnitee")

          WHEREAS, the Board of Directors has determined that the ability to attract and retain qualified persons as directors is essential to the best interests of Downey Savings and that Downey Savings should act to assure such persons that there will be adequate certainty of protection through insurance and indemnification against risks of claims and actions against them arising out of their service to and activities on behalf of Downey Savings; 

          WHEREAS, 12 C.F.R. § 545.121 provides that a federal savings association shall indemnify its directors in accordance with the requirements set forth therein; and

          WHEREAS, Downey Savings desires to have Indemnitee serve or continue to serve as a director of Downey Savings free from undue concern for unpredictable, inappropriate or unreasonable legal risks and personal liabilities by reason of Indemnitee acting in good faith and the performance of Indemnitee’s duties to Downey Savings, and Indemnitee desires to serve or continue to serve Downey Savings, provided, and on the express condition, that he or she is furnished with the indemnity set forth hereinafter.

          Now, therefore, in consideration of Indemnitee’s service or continued service as a director of Downey Savings, the parties agree as follows:

          1.          Service by Indemnitee.  

          Indemnitee will serve and/or continue to serve as a director of Downey Savings faithfully and to the best of Indemnitee’s ability so long as Indemnitee is duly elected and until such time as Indemnitee is removed as permitted by law or tenders a resignation in writing.  Nothing contained in this Indemnification Agreement shall give rise to any right of continued service.

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          2.          Indemnification. 

          Downey Savings shall indemnify Indemnitee to the fullest extent permitted by the Federal Deposit Insurance Act (12 U.S.C. § 1811, et seq.) and 12 C.F.R. § 545.121.  

          3.          Advances to Pay Expenses.

          If Indemnitee is a party or is threatened to be made a party or witness to an action because Indemnitee is or was a director of Downey Savings, then Downey Savings  shall advance funds to pay all reasonable and necessary expenses incurred by Indemnitee at the request of Indemnitee, within thirty days after Downey Savings receives the request.  The request must include reasonable proof of the expenses which Indemnitee has incurred and shall be accompanied by an undertaking, in the form of Exhibit A attached hereto, which shall obligate Indemnitee to reimburse the advances made by Downey Savings if it is finally determined that Indemnitee is not entitled to indemnification.  Any advances to pay expenses shall not require pre-approval of the Board of Directors, so long as the other requirements in this Section 3 are satisfied.

          4.          Other Provisions. 

          (a)          This Agreement shall be interpreted and enforced in accordance with the laws of the United States and applicable regulations.

          (b)          All agreements and obligations of Downey Savings contained herein shall continue during the period Indemnitee is a director of Downey Savings and shall continue thereafter with respect to any possible claims based on the fact that Indemnitee was a director of Downey Savings.  This Agreement shall continue to be in full force and effect upon abrogation of any law or regulations requiring this indemnity, provided that Downey Savings and Indemnitee acknowledge that in certain instances, federal laws and regulations, affective orders issued by governmental agencies or applicable public policy may prohibit Downey Savings from indemnifying its directors under this Agreement or otherwise and Downey Savings intends to comply with such laws and regulations.

          (c)          No supplement, modification, or amendment of this Agreement shall be binding unless executed in writing by both parties hereto.  No waiver of any of the provisions of this Agreement shall be deemed or shall constitute a waiver of any other provisions hereof (whether or not similar) nor shall waiver constitute a continue of waiver.  

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                    IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day and year first above written.

                                                  DOWNEY SAVINGS AND LOAN ASSOCIATION, F.A

 

                                                                                                                             

                                                  

                                                  By  ____________________________________

                                                                                                                             

                                                  

                                                  Its ____________________________________

                                                                                                                             

                                                  

                                                   ____________________________________

                                                                                                                             

                                                   Indemnitee

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EXHIBIT A

UNDERTAKING

 

          WHEREAS the undersigned has applied to Downey Savings and Loan Association, F.A. ("Downey Savings") for an advance to cover expenses (including attorneys’ fees) actually and reasonably incurred in connection with the defense or settlement of an action or proceeding covered by an indemnification agreement or by-laws; and

          WHEREAS Downey Savings will not and cannot advance expenses in the absence of an unconditional undertaking.

          THE UNDERSIGNED HEREBY unconditionally undertakes to reimburse Downey Savings for all amounts advanced for reasonable costs incurred by the undersigned in defending a covered action or proceeding if it is ultimately determined by arbitration or the Delaware Court of Chancery that the undersigned is not entitled to be indemnified by Downey Savings as authorized by Section 145 of the Delaware General Corporation Law or by the Federal Deposit Insurance Act, 12 U.S.C. § 1811, et seq.  The reimbursement will be provided within ten days of written notice that the Chancery Court or arbitration has determined the undersigned is not entitled to indemnity.

          Executed at _________________ this _________ day of _____________ 200_.

                                                            __________________________________

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	Navigation LinksEXHIBIT 4.1

                        FORM OF FLOATING RATE SENIOR NOTE

REGISTERED                                                      REGISTERED
No. FLR                                                         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.

                                      A-1
<PAGE>

                                                   MORGAN STANLEY
                                     SENIOR GLOBAL MEDIUM-TERM NOTES, SERIES F
                                                  (Floating Rate)

                                    CAPITAL PROTECTED NOTE DUE SEPTEMBER 1, 2010
                                   BASED ON THE VALUE OF THE NASDAQ-100 INDEX(R)

<TABLE>
------------------------------------------------------------------------------------------------------------------
<S>                                  <C>                                     <C>
BASE RATE: None                      ORIGINAL ISSUE DATE:                    MATURITY DATE:
                                                                                See "Maturity Date" below.
------------------------------------------------------------------------------------------------------------------
INDEX MATURITY: N/A                  INTEREST ACCRUAL DATE: N/A              INTEREST PAYMENT DATE(S): N/A
------------------------------------------------------------------------------------------------------------------
SPREAD (PLUS OR MINUS): N/A          INITIAL INTEREST RATE: N/A              INTEREST PAYMENT PERIOD: N/A
------------------------------------------------------------------------------------------------------------------
REPORTING SERVICE: N/A               MAXIMUM INTEREST RATE: N/A              INTEREST RESET DATE(S): N/A
------------------------------------------------------------------------------------------------------------------
INDEX CURRENCY: N/A                  MINIMUM INTEREST RATE: N/A              CALCULATION AGENT: See "Calculation
                                                                                Agent" below.
------------------------------------------------------------------------------------------------------------------
EXCHANGE RATE AGENT: N/A             INITIAL REDEMPTION DATE: N/A            SPECIFIED CURRENCY:
                                                                                U.S. dollars
------------------------------------------------------------------------------------------------------------------
APPLICABILITY OF MODIFIED PAYMENT    INITIAL REDEMPTION PERCENTAGE: N/A      IF SPECIFIED CURRENCY OTHER THAN U.S.
   UPON ACCELERATION: See                                                       DOLLARS, OPTION TO ELECT PAYMENT
   "Alternate Exchange Calculation                                              IN U.S. DOLLARS: N/A
   in Case of an Event of Default"
   below.
------------------------------------------------------------------------------------------------------------------
                                     ANNUAL REDEMPTION PERCENTAGE            DESIGNATED CMT TELERATE PAGE: N/A
                                        REDUCTION: N/A
------------------------------------------------------------------------------------------------------------------
                                     OPTIONAL REPAYMENT DATE(S): N/A         DESIGNATED CMT MATURITY INDEX: N/A
------------------------------------------------------------------------------------------------------------------
                                     REDEMPTION NOTICE PERIOD: N/A
------------------------------------------------------------------------------------------------------------------
                                     TAX REDEMPTION AND PAYMENT OF
                                        ADDITIONAL AMOUNTS: N/A
------------------------------------------------------------------------------------------------------------------
                                     IF YES, STATE INITIAL OFFERING DATE:    OTHER PROVISIONS: See below.
                                        N/A
------------------------------------------------------------------------------------------------------------------
</TABLE>

Maturity Date..............   September 1, 2010, subject to extension in
                              accordance with the following paragraph in the
                              event of a Market Disruption Event on the final
                              Determination Date for calculating the Final
                              Average Index Value.

                              If, due to a Market Disruption Event or otherwise,
                              the final Determination Date is postponed so that
                              it falls

                                      A-2
<PAGE>

                              less than two scheduled Trading Days prior to the
                              scheduled Maturity Date, the Maturity Date shall
                              be the second scheduled Trading Day following the
                              final Determination Date as postponed. See
                              "Determination Dates" below.

                              In the event that the final Determination Date is
                              postponed due to a Market Disruption Event or
                              otherwise, the Issuer shall give notice of such
                              postponement as promptly as possible, and in no
                              case later than one Business Day following the
                              scheduled final Determination Date, (i) to the
                              holder of this Note 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 Note receives the notice.

Minimum Denominations......   $10

Issue Price................   $10

Maturity Redemption
Amount.....................   At maturity, upon delivery of this Note to the
                              Trustee, the Issuer shall pay with respect to each
                              $10 principal amount of this Note an amount in
                              cash equal to the $10 principal amount of this
                              Note plus the Supplemental Redemption Amount, if
                              any.

                              The Issuer shall, or shall cause the Calculation
                              Agent to, (i) 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 Maturity Redemption Amount, 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

                                      A-3
<PAGE>

                              Date) and (ii) deliver the aggregate cash amount
                              due with respect to this Note to the Trustee for
                              delivery to the holder of this Note on the
                              Maturity Date. See "Discontinuance of the
                              Nasdaq-100 Index; Alteration of Method of
                              Calculation" below.

Supplemental Redemption
Amount.....................   The Supplemental Redemption Amount shall be equal
                              to the product of $10 times the Nasdaq-100 Index
                              Percent Change; provided that the Supplemental
                              Redemption Amount shall not be less than zero. The
                              Calculation Agent shall calculate the Supplemental
                              Redemption Amount on the final Determination Date.

Nasdaq-100 Index Percent
Change.....................   The Nasdaq-100 Index Percent Change is a fraction,
                              the numerator of which shall be the Final Average
                              Index Value minus the Initial Index Value and the
                              denominator of which shall be the Initial Index
                              Value. The Nasdaq-100 Index Percent Change is
                              described by the following formula:

                               Final Average Index Value - Initial Index Value
                               -----------------------------------------------
                                             Initial Index Value

Initial Index Value........

Final Average Index Value..   The arithmetic average of the Index Closing Values
                              on the six Determination Dates, as calculated by
                              the Calculation Agent on the final Determination
                              Date.

Index Closing Value........   The Index Closing Value on any Trading Day shall
                              equal the closing value of the Nasdaq-100 Index or
                              any Successor Index (as defined under
                              "Discontinuance of the Nasdaq-100 Index;
                              Alteration of Method of Calculation" below)
                              published at the regular weekday close of trading
                              on that Trading Day. In certain circumstances, the
                              Index Closing Value shall be based on the
                              alternate calculation of the Nasdaq-100 Index
                              described under "Discontinuance of the Nasdaq-100
                              Index; Alteration of Method of Calculation."

                              In this Note, references to the Nasdaq-100 Index
                              shall include any Successor Index, unless the
                              context requires otherwise.

                                      A-4
<PAGE>

Determination Dates........   The Determination Dates shall be September 1,
                              2005, September 1, 2006, September 1, 2007,
                              September 1, 2008, September 1, 2009 and August
                              30, 2010, in each case subject to adjustment for
                              non-Trading Days or Market Disruption Events as
                              described in the two following paragraphs in this
                              section.

                              If any of the first five scheduled Determination
                              Dates is not a Trading Day or if a Market
                              Disruption Event occurs on any such date, such
                              Determination Date shall be the immediately
                              succeeding Trading Day during which no Market
                              Disruption Event shall have occurred; provided
                              that if a Market Disruption Event has occurred on
                              each of the five Trading Days immediately
                              succeeding any of the first five scheduled
                              Determination Dates, the Calculation Agent shall
                              determine the applicable Index Closing Value on
                              such fifth succeeding Trading Day in accordance
                              with the formula for calculating the value of the
                              Nasdaq-100 Index last in effect prior to the
                              commencement of the Market Disruption Event,
                              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 or limitation) on such fifth
                              succeeding Trading Day of each security most
                              recently constituting the Nasdaq-100 Index.

                              If August 30, 2010 (the final scheduled
                              Determination Date) is not a Trading Day or if a
                              Market Disruption Event occurs on such day, the
                              final Determination Date shall be the immediately
                              succeeding Trading Day during which no Market
                              Disruption Event shall have occurred.

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.

                                      A-5
<PAGE>

Market Disruption Event....   Market Disruption Event means, with respect to the
                              Nasdaq-100 Index 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 Nasdaq-100 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 Nasdaq-100 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 U.S. securities market for
                              trading in futures or options contracts or
                              exchange traded funds related to the Nasdaq-100
                              Index (or the Successor Index) for more than two
                              hours of trading or during the one-half hour
                              period preceding the close of the principal
                              trading session on such market, in each case as
                              determined by the Calculation Agent in its sole
                              discretion.

                              For the purpose of determining whether a Market
                              Disruption Event exists at any time, if trading in
                              a security included in the Nasdaq-100 Index is
                              materially suspended or materially limited at that
                              time, then the relevant percentage contribution of
                              that security to the value of the Nasdaq-100 Index
                              shall be based on a comparison of (x) the portion
                              of the value of the Nasdaq-100 Index attributable
                              to that security relative to (y) the overall value
                              of the Nasdaq-100 Index, in each case immediately
                              before that suspension or limitation.

                              For purposes of determining whether a Market
                              Disruption Event has occurred: (1) a limitation on
                              the hours or number of days of trading 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

                                      A-6
<PAGE>

                              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 Nasdaq-100
                              Index by the primary securities market trading in
                              such contracts by reason of (a) a price change
                              exceeding limits set by such exchange or market,
                              (b) an imbalance of orders relating to such
                              contracts or (c) a disparity in bid and ask quotes
                              relating to such contracts shall constitute a
                              suspension, absence or material limitation of
                              trading in futures or options contracts related to
                              the Nasdaq-100 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
                              Nasdaq-100 Index are traded shall not include any
                              time when such 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 Nasdaq-100 Index or any Successor Index.

Alternate Exchange
Calculation in Case of an
Event of Default...........   In case an event of default with respect to this
                              Note shall have occurred and be continuing, the
                              amount declared due and payable for each $10
                              principal amount of this Note upon any
                              acceleration of this Note (the "Acceleration
                              Amount") shall be equal to such $10 principal
                              amount plus the Supplemental Redemption Amount, if
                              any, determined as though the Index Closing Value
                              for any Determination Date scheduled to occur on
                              or after such date of acceleration were the Index
                              Closing Value on the date of acceleration.

                              If the maturity of this Note 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 Acceleration Amount and the

                                      A-7
<PAGE>

                              aggregate cash amount due with respect to this
                              Note as promptly as possible and in no event later
                              than two Business Days after the date of such
                              acceleration.

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 Note, the Trustee and the Issuer.

                              All calculations with respect to the Final Average
                              Index Value and the Supplemental Redemption
                              Amount, if any, shall be made by the Calculation
                              Agent and 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 per
                              Note 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 principal amount of this Note shall be
                              rounded to the nearest cent, with one-half cent
                              rounded upward.

Discontinuance of the
Nasdaq-100 Index;
Alteration of Method of
Calculation................   If Nasdaq discontinues publication of the
                              Nasdaq-100 Index and Nasdaq or another entity
                              publishes a successor or substitute index that MS
                              & Co., as the Calculation Agent, determines, in
                              its sole discretion, to be comparable to the
                              discontinued Nasdaq-100 Index (such index being
                              referred to herein as a "Successor Index"), then
                              any subsequent Index Closing Value shall be
                              determined by reference to the value of such
                              Successor Index at the regular official weekday
                              close of the principal trading session of the
                              NYSE, the AMEX, the Nasdaq National Market or the
                              Relevant Exchange or market for the Successor
                              Index on the date 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

                                      A-8
<PAGE>

                              the Issuer and to the Depositary, as holder of
                              this Note, within three Trading Days of such
                              selection.

                              If Nasdaq discontinues publication of the
                              Nasdaq-100 Index prior to, and such discontinuance
                              is continuing on, the date that any Index Closing
                              Value is to be determined and MS & Co., as the
                              Calculation Agent, determines, in its sole
                              discretion, that no Successor Index is available
                              at such time, then the Calculation Agent 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 Nasdaq-100 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 Nasdaq-100 Index without any
                              rebalancing or substitution of such securities
                              following such discontinuance.

                              If at any time the method of calculating the
                              Nasdaq-100 Index or a Successor Index, or the
                              value thereof, is changed in a material respect,
                              or if the Nasdaq-100 Index or a Successor Index is
                              in any other way modified so that such index does
                              not, in the opinion of MS & Co., as the
                              Calculation Agent, fairly represent the value of
                              the Nasdaq-100 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 Nasdaq-100 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 determine the Final
                              Average Index Value with reference to the
                              Nasdaq-100 Index or such Successor Index, as
                              adjusted. Accordingly, if the method of
                              calculating the Nasdaq-100 Index or a Successor
                              Index is modified so that the value of such

                                      A-9
<PAGE>

                              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 Nasdaq-100 Index or such Successor Index as if
                              it had not been modified (e.g., as if such split
                              had not occurred).

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

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

     Payment of the principal of and premium, if any, and interest on this Note
   due at maturity (or any redemption or repayment date), unless this Note is
denominated in a Specified Currency other than U.S. dollars and is to be paid in
whole or in part in such Specified Currency, will be made in immediately
available funds upon surrender of this Note at the office or agency of the
Paying Agent, as defined on the reverse hereof, maintained for that purpose in
the Borough of Manhattan, The City of New York, or at such other paying agency
as the Issuer may determine, in U.S. dollars. U.S. dollar payments of interest,
other than interest due at maturity or any date

                                      A-11
<PAGE>

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

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

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

                                      A-12
<PAGE>

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.

                                      A-13
<PAGE>

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

DATED:                                       MORGAN STANLEY

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

TRUSTEE'S CERTIFICATE OF AUTHENTICATION

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

JPMORGAN CHASE BANK, N.A., as Trustee

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

                                      A-14
<PAGE>

                               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 hereof) at the option of the holder hereof at a price
equal to 100% of the principal amount to be repaid, together with interest
accrued and unpaid hereon to the date of repayment. For this Note

                                      A-15
<PAGE>

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.

     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, 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

                                      A-16
<PAGE>

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;

          (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;

                                      A-17
<PAGE>

          (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
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.

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

                                      A-18
<PAGE>

Settlement Express Transfer System ("TARGET") is operating (a "TARGET Settlement
Day").

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

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

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

                                      A-19
<PAGE>

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

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

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

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

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

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

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

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

                                      A-20
<PAGE>

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

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

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

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

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

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

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

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

                                      A-21
<PAGE>

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

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

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

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

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

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

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

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

                                      A-22
<PAGE>

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

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

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

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

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

                                      A-23
<PAGE>

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

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

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

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

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

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

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

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

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

                                      A-24
<PAGE>

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

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

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

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

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

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

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

     (vi) if the rate described in (v) above is not so published by 3:00 p.m.,
New York City time, on the related Calculation Date, the rate on the applicable
Interest Determination Date calculated by the Calculation Agent as the Bond
Equivalent Yield of the arithmetic mean of the secondary market bid rates, as of
approximately 3:30 p.m., New York City time, on the applicable Interest
Determination Date, of three primary U.S. government securities dealers, which
may include the initial dealer and its affiliates, selected by the Calculation
Agent, for the issue of Treasury Bills with a remaining maturity closest to the
Index Maturity specified on the face hereof; or

                                      A-25
<PAGE>

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

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

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

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

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

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

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

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

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

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

     (iii) If the information set forth above is not provided by 3:00 p.m., New
York City time, on the related Calculation Date, then the Calculation Agent
shall determine the CMT Rate to be a yield to maturity, based on the arithmetic
mean of the secondary market closing offer side

                                      A-26
<PAGE>

prices as of approximately 3:30 p.m., New York City time, on the Interest
Determination Date, reported, according to their written records, by three
leading primary U.S. government securities dealers ("Reference Dealers") in The
City of New York, which may include the initial dealer or its affiliates,
selected by the Calculation Agent as described in the following sentence. The
Calculation Agent shall select five reference dealers (after consultation with
the Issuer) and shall eliminate the highest quotation or, in the event of
equality, one of the highest, and the lowest quotation or, in the event of
equality, one of the lowest, for the most recently issued direct noncallable
fixed rate obligations of the United States ("Treasury Notes") with an original
maturity of approximately the Designated CMT Maturity Index, a remaining term to
maturity of no more than 1 year shorter than that Designated CMT Maturity Index
and in a principal amount that is representative for a single transaction in the
securities in that market at that time. If two Treasury Notes with an original
maturity as described above have remaining terms to maturity equally close to
the Designated CMT Maturity Index, the quotes for the Treasury Note with the
shorter remaining term to maturity shall be used.

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

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

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

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

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

                                      A-27
<PAGE>

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

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

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

     This Note and all 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

                                      A-28
<PAGE>

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 or
premium, if any, or interest on, any series of debt securities issued under the
Senior Indenture, including the series of 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

                                      A-29
<PAGE>

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.

     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,
(i) extend the final maturity of any such debt security, or reduce the principal
amount thereof, or reduce the rate or extend the time of payment of interest
thereon, or reduce any amount payable on redemption thereof, or change the
currency of payment thereof, or modify or amend the provisions for conversion of
any currency into any other currency, or modify or amend the provisions for
conversion or exchange of the debt security for securities of the Issuer or
other entities or for other property or the cash value of the property (other
than as provided in the antidilution provisions or other similar adjustment
provisions of the debt securities or otherwise in accordance with the terms
thereof), or impair or affect the rights of any holder to institute suit for the
payment thereof or (ii) reduce the aforesaid percentage in principal amount of
debt securities the consent of the holders of which is required for any such
supplemental indenture.

     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

                                      A-30
<PAGE>

principal of or 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.

     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.

                                      A-31
<PAGE>

     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 and 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 or 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.

                                      A-32
<PAGE>

                                  ABBREVIATIONS

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

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

         UNIF GIFT MIN ACT -
                           _______________________ Custodian____________________
                                   (Minor)                         (Cust)

         Under Uniform Gifts to Minors Act______________________________________
                                                            (State)

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

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

                                      A-33
<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.

                                      A-34

<PAGE>

                            OPTION TO ELECT REPAYMENT

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

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

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

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

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

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

                                      A-35

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