Document:

Agreement between Morgan Stanley and James P. Gorman, dated August 16, 2005

 EXHIBIT 10.2 

August 16, 2005 
 James P. Gorman

 [Address Redacted] 
 Dear James:

 I am pleased to extend to you an offer of employment as President & Chief Operating Officer of Individual Investor Group and a
Managing Director of Morgan Stanley. We anticipate that you will begin employment with Morgan Stanley on February 16, 2006 (your “date of hire”). You will report to Zoe Cruz, Acting President of Morgan Stanley, and will be a member of
the Firm’s Management Committee or any successor committee thereto (the “Management Committee”). 
 Base Salary. Your
annualized base salary for fiscal 2006 will be $300,000, payable in semi-monthly installments. 
 Total Reward. In recognition of the
2005 compensation you will be forfeiting from your current employer, you will be awarded a 2005 Total Reward amount on your date of hire. The 2005 Total Reward will consist of an amount representing a year-end discretionary bonus that we anticipate
will be payable 45% in cash and 55% in the form of an equity-based award (such as restricted stock units or other equity-based awards in effect at the time, at the discretion of the Compensation, Management Development and Succession Committee (the
“Committee”)) under the Firm’s Equity Incentive Compensation Plan, plus an amount equal to the base salary that you would have earned with the Firm had you been employed by the Firm from December 1, 2004 to your date of hire
(minus any amount that you have received or do receive as base salary or 2005 year-end bonus from your current employer). Your 2005 year-end bonus will be determined as if you had been employed by the Firm for the full fiscal year and will take into
consideration the 2005 year-end bonus previously expected by you from your current employer. 
 From time to time, we review the terms of the
equity-based compensation and the percentage component that it constitutes of Total Reward with the Committee. Your actual award in any year will be consistent with the terms and conditions of other Management Committee members at the time of the
award and will be subject to certain restrictions and cancellation provisions (for example, your equity award, even if vested, is subject to cancellation if you engage in certain prohibited conduct). All payments are subject to applicable
withholdings and deductions. 
 Replacement Equity/New Hire Stock Units. The Firm will make you awards of Morgan Stanley stock options
and restricted stock units intended to offset the equity-based awards at your current employer (whether or not vested) that you forfeit to any extent (including, if a stock option is not forfeited, the loss of any time value in an option resulting
from the truncation of the exercise period for such option, including by virtue of your exercise of such option, but in the case of the Specified Stock Options (as such term is defined in Annex A), only to the extent that you exercise such options
because they were at risk for forfeiture by your current employer) (“Replacement Equity”). Such awards will be made on your date of hire in the case of any such forfeiture prior to such date or any option as to which the option term is
limited on such date to not more than 90 days following such date. In the case of any other 

 
such forfeiture after your date of hire, the Firm shall, at its discretion, make a cash payment or grant an equity-based award (i.e., stock options or restricted stock units, as applicable) as
soon as administratively practicable after such date of forfeiture (any such time, a “post-forfeiture grant date”). The terms of such Replacement Equity are described in Annex A. Notwithstanding the foregoing, with respect to the 32,233
stock units granted on January 23, 2001 described in Annex A, the value of such units shall be payable in cash on your date of hire if your current employer causes their forfeiture. 

The value of your Morgan Stanley stock options will be determined on your date of hire (or the post-forfeiture grant date, if applicable) based on the
closing price of your current employer’s stock on that date and the value of your forfeited stock options on your date of hire (or the date of forfeiture, if later). The number and strike price of the Morgan Stanley stock options you will
receive corresponding to the value of your forfeited stock options will be determined using the closing price of Morgan Stanley common stock on your date of hire (or the post-forfeiture grant date, if applicable). The values of your forfeited stock
options and the Morgan Stanley stock options will be determined using the methodology and assumptions previously agreed to by you and the Firm. Your Morgan Stanley stock options will expire ten years after their grant. 

The value of your Morgan Stanley restricted stock units will be determined based on the closing price of your current employer’s stock on the date
of this letter. The number of Morgan Stanley restricted stock units you will receive corresponding to the value of your forfeited equity-based awards (other than stock options) will be determined using the closing price of Morgan Stanley common
stock on the date of this letter. 
 In addition, on your date of hire, the Firm will make you a one-time new hire award of Morgan Stanley
restricted stock units valued at $2,500,000 (“New Hire Stock Units”). The number of Morgan Stanley restricted stock units you will receive corresponding to this value will be determined using the closing price of Morgan Stanley common
stock on the date of this letter. 
 Subject to continued employment, your stock options and restricted stock units forming your Replacement
Equity and New Hire Stock Units will vest and be paid out as shown in Annex A. The Replacement Equity is intended as an offset of the awards you forfeit at your current employer and is contingent upon satisfactory confirmation of such previous
awards. Your Replacement Equity and New Hire Stock Units will be subject to the cancellation provisions described in Annex A. Except as specifically provided in this letter (including the attached Annexes), the terms and conditions of the
Replacement Equity and New Hire Stock Units will be substantially similar to the terms and conditions of the 2004 Management Committee annual stock unit awards granted under the Firm’s Equity Incentive Compensation Plan (including the
definition and effect of a Full Career Retirement). Your Replacement Equity and New Hire Stock Units will not constitute part of your Total Reward. 

If you are terminated other than for Cause, you resign for Good Reason or you terminate your employment as a result of your death or Disability (as such
terms are defined in Annex B), then notwithstanding any other provision of this letter agreement, the Replacement Equity and New Hire Stock Units will vest, all stock units forming part of such awards will be paid out upon such termination and all
stock options forming part of the Replacement Equity will remain exercisable for their full respective terms, or, if the Replacement Equity and the New Hire Stock Units have not been granted, you will receive a cash payment equal to the value of any
awards you forfeit at your current employer and the value of your New Hire Stock Units. 
 Equity-Based Awards Generally. All payments
relating to your awards are subject to applicable withholding and deductions. If any stock unit award that is granted to you (not including restricted stock units awarded as part of Replacement Equity) is scheduled to be paid to you when you are an
executive officer of Morgan Stanley and is not deemed to be granted pursuant to performance criteria and 

 
therefore not deductible to the Firm, payment or conversion of such stock units will be deferred until six (6) months after your employment terminates; provided, however, that in the event
that you die or there is a Change in Ownership of Morgan Stanley (as will be defined in your award certificate), in each case that occurs at any time on or after the deferral from the original conversion date, payment will be made as soon as
administratively practicable after such event. 
 The foregoing awards and their terms will be subject to approval by the Committee and, except
as specifically provided in this letter (including the attached Annexes), will be subject to the same cancellation provisions, sales restrictions and other terms as are in effect at the time for similar equity-based awards (for example, your equity
awards, even if vested but not converted in the case of stock units, are subject to cancellation if you engage in certain prohibited conduct) and the terms and conditions of the award certificate and the equity compensation plan under which the
awards are issued. The Management Committee Equity Ownership Commitment will apply to any Morgan Stanley common stock you own and any equity-based award that may be granted to you. 

Severance. In the event that you resign other than for Good Reason or are terminated for Cause prior to the end of the applicable fiscal year, you
will receive solely your unpaid base salary as of the date of termination. If you are terminated other than for Cause, you resign for Good Reason or you terminate your employment as a result of your death or Disability on or prior to
November 30, 2006, you will receive a severance payment that is no less than your 2005 Total Reward (on an annualized basis), payable to you in cash within 30 days of such termination. 

All payments are subject to your execution and non-revocation of a release in a form reasonably acceptable to the Firm and to you. Except as specifically
provided in this letter (including the attached Annexes), your entitlements upon death or Disability shall be governed by the applicable Morgan Stanley benefits programs. Historically, all stock units and stock options issued under the Equity
Incentive Compensation Plan have vested immediately on an employee’s termination of employment due to death, Disability or Full Career Retirement. 

Full Career/Section 409A/Section 4999. You will be accorded Full Career Retirement status for purposes of all equity-based awards granted to you
during your employment at Morgan Stanley and for any other purpose for which Full Career Retirement status is provided generally to other members of the Management Committee. Full Career Retirement status provides that so long as you do not engage
in any conduct that constitutes a cancellation event under the relevant equity-based award, such equity-based award will vest upon your termination of employment. Transfer restrictions will lift on schedule (e.g., restricted stock units will convert
to shares of Morgan Stanley common stock on their scheduled conversion date). Your awards will remain subject to all terms and conditions approved by the Committee for such awards, including without limitation, the cancellation of the award for
certain prohibited conduct. 
 Notwithstanding any provision of this agreement to the contrary, if at the time of your termination you are a
“specified employee” as defined in Section 409A of the U.S. Internal Revenue Code of 1986, as amended (the “Code”), you shall not be entitled to any payments upon a termination of your employment until the earlier of
(i) the date which is six (6) months after your termination of employment for any reason other than death or, in the case of any severance to which you are entitled under this letter or New Hire Stock Units and Replacement Equity,
disability (as such term is used in Section 409A(a)(2)(C) of the Code) or (ii) the date of your death, or in the case of any severance to which you are entitled under this letter or New Hire Stock Units and Replacement Equity, disability
(as such term is used in Section 409A(a)(2)(C) of the Code). The provisions of this paragraph shall only apply if required to comply with Section 409A of the Code. In addition, if any provision of this agreement contravenes
Section 409A of the Code or any regulations or Treasury guidance promulgated thereunder, the Firm shall reform such provision; provided that the Firm shall: 

 
(i) maintain, to the maximum extent practicable, the original intent of the applicable provision without violating the provisions of Section 409A of the Code and (ii) notify and
consult with you regarding such amendments or modifications prior to the effective date of any such change. 
 In the event it shall be
determined that any payment or distribution you receive from Morgan Stanley (a “Payment”) would be subject to the excise tax imposed by Section 4999 of the Internal Revenue Code, or any interest or penalties are incurred by you with
respect to such excise tax (together, the “Excise Tax”), you shall be entitled to receive an additional payment (the “Gross-Up Payment”) in an amount such that after payment by you of all taxes (including any interest or
penalties imposed with respect to such taxes), including any income taxes (and any interest and penalties imposed with respect thereto) and Excise Tax imposed upon the Gross-Up Payment, you retain an amount on an after-tax basis of the Gross-Up
Payment equal to the Excise Tax imposed upon all such Payments. 
 Benefits. You will be eligible for the Firm’s benefits programs
in accordance with the terms and conditions of those programs. For details on all benefits plans, please read the Summary Plan Descriptions included in your orientation package. In addition, you will be entitled to participate in all perquisite and
other plans, programs or arrangements on a basis no less favorable than provided to all members of the Management Committee to the extent such perquisites, plans, programs or arrangements are offered to all members of the Management Committee.
Notwithstanding the foregoing, during your employment with the Firm, the Firm shall provide you with a car and driver, without any out-of-pocket expense (including with respect to any tax arising therefrom, if other members of the Management
Committee with this benefit are reimbursed for such tax) on your part. 
 You are eligible for immediate participation in the Firm’s Health
and Welfare benefits program, under which you may elect an individualized package of medical, dental, disability, life and accidental death and dismemberment insurance coverage, for which the Firm pays a substantial portion of the cost. 

Approximately two to three weeks from the date of your acceptance of this letter, you will receive a personalized Health and Welfare Benefits Enrollment
package, which includes your benefit costs and options. You will have 31 days from the date printed on the personalized Enrollment Worksheet to contact the Benefit Center to enroll. Otherwise, you will receive the coverages listed in the ‘If
You Do Not Make Elections’ section of the Worksheet. Alternatively, if you prefer, within approximately one week after we send the Benefits Enrollment package, we will arrange a meeting to complete your benefits selections, or you may access
the Benefit Center’s Web site at [web site address redacted] to review your options and enroll in coverage by using your Social Security number and Personal Identification Number (PIN). Your initial PIN is [redacted]. Any elected health and
welfare coverage will be effective as of your date of hire. 
 Upon your date of hire, you will be eligible to participate in the Morgan Stanley
401(k) Plan (“401(k) Plan”) and you will be eligible for the Firm’s 401(k) Match. Generally, you must remain employed through December 31 to receive a Match for that year. With respect to your own contributions to the 401(k)
Plan, enrollment is ongoing. You may elect to contribute to this Plan from your base salary, bonus and commissions, as applicable, at any time. 

On the first of the month following your completion of one year of service, you may elect to participate in the Firm’s Employee Stock Purchase Plan
(ESPP) which allows eligible participants to purchase Morgan Stanley common stock at a discount with after-tax payroll deductions. 
 Also on
the first of the month following your completion of one year of service, you will be eligible to participate in the Firm’s Pension Plan. Enrollment is automatic. You will be vested in your 401(k) Match after three years of service, and you will
be vested under the Pension Plan after five years of service. 

 You will also be eligible for six weeks of vacation for each calendar year, pro-rated from your date of
hire. 
 Additional Terms and Conditions. We remind you that this offer is contingent upon a number of additional steps in the employment
process including, but not limited to, background and reference checking and a drug screening test. The Health Center is open Monday through Friday from 9:00 am until 2:00 pm. Please come in no earlier than 48 hours from your date of hire for your
drug screening. You do not need to make an appointment. You are also required to show appropriate proof of authorization to commence work in the United States. We ask that you complete Part 1 of the attached Form I-9, on or before your first day of
work (see, in the attached packet, a list of the type of documentation we will need). This is a requirement of the Immigration Reform and Control Act of 1986. If you are not legally able to work for the Firm in the United States in the position
offered you, or if any part of the screening process proves unsatisfactory to the Firm or you are unable to complete Part 1 of the Form I-9, the Firm reserves the right to rescind any outstanding offer of employment or terminate your employment
without notice or severance benefits and rescind any stock unit or stock option or restricted stock awards described herein. Further, this offer is contingent on your obtaining and retaining all licenses and registrations from the NASD, exchanges,
state securities commissions and other regulatory bodies as Morgan Stanley shall determine necessary for your position. Also in the enclosed packet, please find personnel forms that need to be completed and brought with you on your date of hire.

 You acknowledge that in the course of your employment with the Firm, you are not permitted to make any unauthorized use of documents or other
information that are the confidential, trade secret or proprietary information (“Confidential Information”) of another individual or company. Likewise, you may not bring onto Firm premises any Confidential Information, whether documents or
other tangible forms, relating to your prior employer(s)’ business. 
 In the event of your termination of employment, you will not be
required to seek other employment or take any other action by way of mitigation of amounts payable to you under any provision of this letter or otherwise, and such amounts shall not be reduced whether or not you obtain other employment. 

Except as expressly set forth herein, nothing in this letter should be construed as a guarantee of any particular level of benefits, of your
participation in any benefit plan, or of continued employment for any period of time. You should understand that your employment will be “at will”, which means that either you or the Firm may terminate your employment for any reason, at
any time, subject to the terms of this letter. Morgan Stanley reserves the right, subject to the terms of this letter, to amend, modify or terminate, in its sole discretion, all benefit and compensation plans in effect from time to time. This offer
constitutes the entire understanding and contains a complete statement of all agreements between you and Morgan Stanley and supersedes all prior or contemporaneous verbal or written agreements, understandings or communications. If there is any
conflict with the benefit information included in this letter or any verbal representation and the Plan documents or insurance contracts, the Plan documents or insurance documents control. This letter is governed by and construed in accordance with
the laws of the State of New York, without reference to principles of conflicts of laws. This letter may not be amended or modified otherwise than by a written agreement executed by the parties or their respective successors and legal
representatives. 
 With the formalities covered, we are looking forward to your joining Morgan Stanley. If you have questions regarding the
above, please feel free to call Karen Jamesley at [redacted]. 
 We ask that you confirm your acceptance by signing and dating this offer letter
in the area designated below and returning this letter to Karen at [redacted]. Your signature below confirms that you are subject to no contractual or other restriction or obligation that is inconsistent with your accepting this offer of employment
and performing your duties. 

 Please retain the additional copy of this offer letter for your reference. 

Very truly yours, 
  

	
	 /s/ Zoe Cruz

Offer Accepted and Agreed To: 
  

			
	Signed:	 	 /s/ James P. Gorman

		
	Date:	 	August 18, 2005

 Annex A 

The Replacement Equity awarded in the form of Morgan Stanley restricted stock units and stock options shall have the following terms: 

Restricted Stock Units: Morgan Stanley restricted stock units granted in lieu of 261,399 unvested stock unit awards that are expected to be
forfeited: 
  

			
	 Vesting and conversion dates:
  

•   33.3% on February 16, 2007

 
 •   33.3% on
February 16, 2008
  

•   33.3% on February 16, 2009
	 	 Subject to cancellation until conversion under the following circumstances (the “RSU Cancellation Provisions”):

 

•     Violation of 90 day notice period, except for non-Cause or Good Reason
termination
  

•     Violation of Morgan Stanley non-compete, as defined for the 2004 annual EICP
awards made to members of the Management Committee
  

•     All other Morgan Stanley cancellation provisions applicable to 2004 annual
EICP awards made to members of the Management Committee will apply as provided in such awards, except for Cause as modified by Annex B

Stock Units: Vested stock unit awards at your current employer that you may nonetheless forfeit: 

 

					
	 Grant Date

(Current Employer)
	  	# of Shares (Vested)	  	Settlement Date
	 1/23/01
	  	32,233	  	1/31/06
	 1/28/02
	  	36,997	  	1/31/07

 If either of the above two vested
stock unit awards are forfeited by your current employer, Morgan Stanley shall: 
  

	 	1.	if the January 2001 grant is forfeited, pay you the cash value of that grant as of your date of hire; and 

 

	 	2.	if the January 2002 grant is forfeited, grant you a vested stock unit award that will be paid in shares of common stock on or about January 31, 2007 and will be
subject to all of the RSU Cancellation Provisions. 

 Stock Options: 

 

			
	 Vesting dates:
  

•     As of your date of hire, 60% of Morgan Stanley stock options granted to
offset stock options at your current employer other than Specified Stock Options, plus all Specified Stock Options
	 	 Stock options subject to cancellation prior to exercise until the scheduled expiration date under the following
circumstances:
  

•     Violation of 90 day notice period, except for non-Cause or Good Reason
termination

			
	 •   40% on February 16, 2007

 
 NOTE: Any stock options that are granted on a post-forfeiture grant date will be
vested when granted.
	 	 •     Violation of Morgan Stanley non-compete, as defined for
the 2004 annual EICP awards made to members of the Management Committee ; provided that the giving of 90 days notice shall not, prior to the expiration of such notice period, be deemed to constitute a violation of such non-compete, notwithstanding
your potential engagement in competition following the expiration of such notice period
  

•     All other Morgan Stanley cancellation provisions applicable to 2004 annual
EICP awards made to members of the Management Committee will apply as provided in such awards, except for Cause as modified by Annex B

These Morgan Stanley stock options are intended to offset stock option awards at your current employer that are either (1) forfeited by you on or
prior to your date of hire (or the post-forfeiture grant date, if applicable) or (2) as to which you lose time value either (a) because you exercise them prior to your date of hire to preclude their forfeiture by your current employer or
(b) because the circumstances result in the truncation of the exercise period of such options. In consideration for such lost value, Morgan Stanley shall either (as applicable): 

 

	 	1.	grant you a stock option having a value at grant equal to the value of the option that was forfeited on your date of hire (or the date of forfeiture, if later); or

  

	 	2.	grant you a stock option having a value equal to the excess of the notional Black-Scholes value of such vested stock option at your date of hire (assuming no exercise)
over the intrinsic value of such vested stock option on the date of exercise (or, if none, your date of hire). 

 For the
avoidance of doubt, the following is a schedule of your vested and unvested stock options at your current employer (with the understanding that you may forfeit your vested stock options, notwithstanding their vested status): 

 

										
	 Grant Date
	  	# of Shares
(Vested) (1)	  	# of Shares
(Unvested) (1)	  	Strike Price /
Share	  	Expiration
Date
	 7/31/99
	  	107,660	  	0	  	$	35.82812	  	7/26/09
	 1/31/00
	  	101,760	  	0	  	$	43.78125	  	1/27/10
	 1/23/01(2)
	  	128,929	  	0	  	$	77.5625	  	1/23/11
	 1/28/02(2)
	  	110,990	  	0	  	$	53.745	  	1/28/12
	 1/27/03
	  	71,385	  	23,795	  	$	36.065	  	1/27/13
	 1/26/04
	  	26,954	  	26,954	  	$	59.85	  	1/26/14

 (1) The vested status of awards assumes (a) a termination date with respect to your current employer of
February 14, 2006 and (b) that vesting will continue during the period from the date of this letter through such date. 
 (2) This
award is a Specified Stock Option. 
 The New Hire Stock Units awarded in the form of Morgan Stanley restricted stock units shall have
the following terms: 
  

			
	 Vesting and conversion dates:
  

•   20% on February 16, 2007

 
 •   20% on
February 16, 2008
  

•   20% on February 16, 2009

 
 •   20% on
February 16, 2010
  

•   20% on February 16, 2011
	 	 Subject to cancellation until conversion under the following circumstances:

 

•     Violation of 90 day notice period, except for non-Cause or Good Reason
termination
  

•     Violation of Morgan Stanley non-compete, as defined for the 2004 annual EICP
awards made to members of the Management Committee
  

•     All other Morgan Stanley cancellation provisions applicable to 2004 annual
EICP awards made to members of the Management Committee will apply as provided in such awards, except for Cause as modified by Annex B

 Annex B 

“Cause” means: 
  

	 	i.	any act or omission which constitutes a material breach of your material obligations to the Firm or of the provisions of this letter, in either case of which you have
been made aware in writing, or your continued failure or refusal to perform substantially any material duties reasonably required of you, other than any such breach, failure or refusal resulting from incapacity due to physical or mental illness,
which breach (if susceptible to cure), failure or refusal is not corrected (other than failure to correct by reason of your incapacity due to physical or mental illness) within ten (10) business days after written notification thereof to you by
the Firm; provided, however, that this clause (i) will not constitute “Cause” for purposes of your Replacement Equity and New Hire Stock Units (or their cash equivalents) upon your termination of employment; 

 

	 	ii.	your willful commission of any illegal, dishonest or fraudulent act which is materially and demonstrably injurious to the interest or business reputation of the Firm;

  

	 	iii.	your conviction of a felony or your guilty or nolo contedere plea by you with respect thereto; and 

 

	 	iv.	your material violation of any securities, commodities or banking laws, any rules or regulations issued pursuant to such laws, or rules or regulations of any securities
or commodities exchange or association of which the Firm is a member or of any policy of the Firm relating to compliance with any of the foregoing. 

For purposes of this provision, no act or failure to act on your part will be considered “willful” unless done, or omitted to be done, by you
in bad faith or without reasonable belief that your action or omission was in the best interests of Morgan Stanley or was done or omitted to be done with reckless disregard of the consequences. Any act, or failure to act, based upon authority given
pursuant to a resolution duly adopted by the Board of Directors of Morgan Stanley (the “Board”) or the Management Committee or upon instructions of the Chairman and Chief Executive Officer of Morgan Stanley or based upon advice of counsel
for Morgan Stanley shall be conclusively presumed to be done, or omitted to be done, by you in good faith and in the best interests of Morgan Stanley. 

“Good Reason” means a voluntary termination by you following: 
  

	 	i.	removal from the Management Committee or from the position of President & Chief Operating Officer of Individual Investor Group; 

 

	 	ii.	a change in your reporting relationship such that you are no longer reporting to the President of Morgan Stanley; 

 

	 	iii.	a material diminution of your duties and responsibilities as the President & Chief Operating Officer of Individual Investor Group that is not agreed to by the
parties or the assignment to you of duties materially inconsistent with your position (including status, offices, titles and reporting requirements), duties or responsibilities as contemplated herein, or any other material action by Morgan Stanley
which is materially inconsistent or materially reduces such position, duties or responsibilities; 

  

	 	iv.	any material breach by Morgan Stanley of its material obligations to provide payments or benefits as required in this agreement or the failure of the Committee to
approve the New Hire Stock Units or Replacement Equity; 

	 	v.	Morgan Stanley’s requiring your principal office to be based at any office or location other than (a) the office or location designated as Morgan
Stanley’s principal corporate offices for its Individual Investor Group Division or (b) the office or location designated as Morgan Stanley’s principal executive offices (i.e., where the principal office of the Chief Executive of
Morgan Stanley is located); 

  

	 	vi.	any purported termination by Morgan Stanley of your employment otherwise than as expressly permitted by this letter; or 

 

	 	vii.	a failure by Morgan Stanley to require any successor (whether direct or indirect, by purchase, merger, consolidation, spin-off or otherwise) to all or substantially all
of the business and/or assets of Morgan Stanley to assume expressly and agree to perform the terms herein as if no such succession had taken place. 

It is further provided that you shall not be entitled to terminate your employment for Good Reason unless you have given the Chief Executive Officer
written notification of your intention to terminate your employment for Good Reason describing the factual basis for such “Good Reason” and the event giving rise to “Good Reason” is not cured by the Firm within thirty
(30) business days after the receipt of such notice by the Chief Executive Officer. 
 “Disability” means your becoming disabled
such that you are prevented from performing your usual duties and services hereunder for a period of one hundred and twenty (120) consecutive days or for shorter periods aggregating one hundred and twenty (120) days in any twelve
(12) month period. 

 December 17, 2008 

Dear James, 
 This letter
confirms the understanding between you and Morgan Stanley (the “Company”) regarding certain amendments to be made to your offer letter with the Company dated August 16, 2005 (the “Offer Letter”)
to comply with Section 409A of the Internal Revenue Code of 1986, as amended (“Section 409A”). As we have discussed, Section 409A is a provision of the US tax code that restricts the timing of payments and benefits
constituting nonqualified deferred compensation. Regulations issued under Section 409A require documentary compliance for all nonqualified deferred compensation arrangements by December 31, 2008. 

 

	 	•	 	 In the event your employment is involuntarily terminated by the Company other than for Cause, you resign for Good Reason or your employment terminates
as a result of your Disability, in each case, after the date hereof, the stock units forming part of your Replacement Equity and New Hire Stock Units granted to you in connection with your commencement of employment with the Company will vest on
your termination and be paid out on their scheduled conversion dates, provided that, following such employment termination, such stock units will not be subject to cancellation. 

 

	 	•	 	 Notwithstanding anything to the contrary in your Offer Letter or the award certificate for your New Hire Stock Units, the tranche of your New Hire
Stock Units scheduled to convert on February 16, 2009 will convert on such date. 

  

	 	•	 	 Notwithstanding anything to the contrary in your Offer Letter, any payment relating to any stock unit award that is granted to you (other than your
Replacement Equity) that is scheduled to be paid when you are an executive officer of Morgan Stanley and is not deemed to be granted pursuant to performance criteria and therefore not deductible to the Firm, may be deferred until and paid upon your
“Separation from Service”. For purposes of your Offer Letter, Separation from Service shall mean a “separation from service” as determined under Section 409A using the default provisions thereunder.

  

	 	•	 	 Notwithstanding anything to the contrary in your Offer Letter, in the event that you are a “specified employee” at the time of your
“Separation from Service”, to the extent required to comply with Section 409A, payments relating to your stock units described above and any other payments to which you are entitled upon a termination of your employment, shall be
deferred until the earlier of the first business day following the date that is six months after your Separation from Service and the date of your death. “Specified Employee” shall mean a “specified employee” as defined in
Section 409A of the Code and determined in accordance with Firm policy. 

  

 1 

	 	•	 	 Any Gross-Up Payment or other tax reimbursement payment to which you are entitled under your Offer Letter, shall be paid to you as soon as practicable
after you pay the related Excise Tax or tax payment, as applicable, and in no event later than the end of the calendar year following the calendar year in which you remit such Excise Tax or tax payment, as applicable. 

Any capitalized terms not defined herein shall have the meaning assigned to them in your Offer Letter. For the avoidance of doubt, none
of the foregoing will constitute Good Reason and all other terms of your Offer Letter, Replacement Equity and New Hire Stock Units shall remain in full force and effect. 

We ask that you confirm your acceptance of the foregoing by signing and dating this letter in the area designated below and returning this letter to me.

  

			
		
	 	 	/S/    KAREN C. JAMESLEY
	By:	 	Karen C. Jamesley
	Title:	 	Global Head of Human Resources
	
	Confirmed and Agreed to:
		
	 	 	/S/    JAMES P. GORMAN
	By:	 	James P. Gorman
	Title: 	 	Co-President
	Date:	 	Dec. 17, 2008

  

 2Agreement between Morgan Stanley and Kenneth M. deRegt, dated February 14, 2008

 EXHIBIT 10.3 

February 14, 2008 
 Mr. Kenneth
deRegt 
 [Address redacted] 
 Dear
Ken: 
 I am pleased to extend to you an offer of employment at Morgan Stanley (collectively with Morgan Stanley’s subsidiaries and
affiliates, “Morgan Stanley” or the “Firm”). You will be employed by Morgan Stanley & Co. Incorporated. Your position will be that of Managing Director in the Office of the Chairman and you will serve as a member of the
Firm’s Operating Committee. 
 For fiscal 2008, beginning December 1, 2007, your Total Reward will consist of an annual base salary of
$300,000, pro-rated from the date you commence employment, paid in semi-monthly installments plus a year-end bonus that is payable partially in cash and, as determined by a committee of the Board of Directors (the “Committee”), partially
in the form of long-term incentive compensation, which may consist of an equity-based award (such as Morgan Stanley restricted stock units or other equity-based awards in effect at the time) under one of the Firm’s compensation plans and will
be consistent with awards to other Operating Committee members. All components of your Total Reward are contingent upon satisfactory performance and conduct and that you remain employed through, and not give or receive notice of termination of your
employment prior to, November 30, 2008. Payment of your Total Reward is contingent upon your execution of the Firm’s standard sign-on agreement (the “Sign-On Agreement”), which is attached to this letter (see description
below). All payments are subject to applicable withholdings and deductions. 
 In addition, the Firm will grant you a one-time award of Morgan
Stanley restricted stock units (“the Sign-on Award”) with a value of $1,000,000 which will be granted effective as of your employment commencement date. The number of Morgan Stanley restricted stock units you receive will be determined by
dividing the value of your Morgan Stanley restricted stock unit award by the volume weighted average price of Morgan Stanley common stock on your employment commencement date. Subject to satisfactory and continued employment, your restricted stock
units will vest and convert to shares on the following schedule: 50% will vest and convert to shares on the second anniversary of your start date and 50% on the third anniversary of your start date. The attached term sheet sets forth the terms,
including settlement schedule and any provision for accelerated settlement, of your Morgan Stanley restricted stock units. This Sign-on Award will not constitute part of your Total Reward. 

The foregoing awards and their terms are subject to approval by the Committee and are subject to the same cancellation provisions, sales restrictions and
other terms (except as specifically provided herein) as are in effect at the time for similar equity-based awards (for example, your equity award, even if vested, is subject to cancellation under specified circumstances). The foregoing awards and
their terms are also subject to the terms and conditions of the award certificate and the equity compensation plan under which the awards are issued. The Management Committee Equity Ownership Commitment will apply to any Morgan Stanley common stock
you own and any equity-based award that may be granted to you. This Commitment requires that you retain 75% of common stock and equity awards (net of tax and exercise cost) held when you become subject to the commitment and subsequently awarded to
you. 

 Since you had achieved Full Career Retirement status during your prior employment with the Firm, you will be
provided Full Career Retirement for purposes of any annual long-term incentive award granted to you during your employment at Morgan Stanley, provided that such award otherwise contains provisions for Full Career Retirement. Full Career Retirement
status currently provides that so long as you do not engage in any conduct that constitutes a cancellation event under the relevant long-term incentive award, such long-term incentive award will vest upon your termination of employment. Transfer
restrictions on shares and cancellation provisions will lift, and the long-term incentive award will be settled, on schedule. The award will remain subject to all terms and conditions approved by the Committee for such award, including without
limitation, the cancellation of the award under certain specified circumstances stated in the applicable award agreement. 
 The foregoing
awards are offered by the Firm and are accepted by you as fully satisfying any loss that you may suffer, including as a result of any former employer forfeiting or otherwise cancelling, as a result of your termination of employment from your former
employer, any stock, stock units, stock options (including the loss of any time value in stock options) or other long-term incentive awards or other investment right (contingent or actual) that you may currently enjoy by reason of that employment.

 In addition, if any provision of this agreement fails to comply with Section 409A of the Internal Revenue Code or any regulations or
Treasury guidance promulgated thereunder, or would result in your recognizing income for United States federal income tax purposes with respect to any amount payable under this agreement before the date of payment, or to incur interest or additional
tax pursuant to Section 409A, the Firm reserves the right to reform such provision without seeking or obtaining your consent; provided that the Firm shall maintain, to the maximum extent practicable, the original intent of the applicable
provision without violating the provisions of Section 409A. 
 Each calendar year you work for Morgan Stanley you will be eligible for 6
weeks of vacation. 
 Included in your package is a summary of the Firm’s benefit plans. We will provide you with an extensive overview of
the Benefits Enrollment Package and assist you in the enrollment process. Health and welfare benefits (medical, dental, vision, life, accident and disability insurance) are generally available retroactive to the date you commence employment and must
be elected within your 31-day enrollment period, as indicated on your Enrollment package. 
 If you wish, you may review your options and enroll
in coverage on the Benefit Center website [website address redacted] approximately three days following your hire date. To log on you will need your Social Security Number and Personal Identification Number (“PIN”). Your initial PIN is
[redacted]. If you do not contact the Benefit Center within your 31-day enrollment period, you will receive the health and welfare coverage as indicated in the Enrollment Guide and on your Summary Chart on the Benefit Center website. 

Generally, your prior service with Morgan Stanley is considered in determining your service under the Morgan Stanley benefit plans including the Excess
and SERP retirement plans. Also, upon your date of hire you will be eligible to contribute to the Morgan Stanley 401(k) Plan and receive a Company Match. 

As a Managing Director with the Firm, you will be uniquely positioned to advance the Firm’s business interests. As a result, the Firm requires
certain commitments of you in the event your employment with the Firm terminates, so that the Firm can protect those business interests and ensure an orderly transition of business, responsibilities, and business relationships for the benefit of the
Firm, our clients and customers and our other employees. In summary, these commitments include that you: (i) give the Firm 

 
advance written notice of your intention to terminate your employment of at least (a)180 days if you are a member of the Morgan Stanley Operating Committee (or a successor or equivalent
committee) at the time of notice of resignation, (b) 90 days if you are a Managing Director (or equivalent title) at the time of notice of resignation or (c) 60 days if you are an Executive Director (or equivalent title) at the time of
notice of resignation; (ii) refrain from soliciting or hiring certain Firm employees for 180 days after the termination of your employment and from soliciting certain clients and customers for 90 days after the termination of your employment
(180 days member of the Morgan Stanley Operating Committee at the time of your notice of termination); and (iii) abide by the obligations of confidentiality as set forth in the Firm’s Code of Conduct, as amended from time to time (the
“Code of Conduct”). These provisions are more fully set forth in the attached Sign-On Agreement and the Code of Conduct, both of which you will be required to acknowledge in connection with commencing
employment. The Sign-On Agreement constitutes a material part of the Firm’s offer of employment to you, which will not be deemed accepted unless and until you return an executed original of the Sign-On Agreement to us. Therefore, this offer of
employment, including payment of your Total Reward and your receipt of any benefits described herein, is contingent upon your execution of the attached Sign-On Agreement. In addition, we remind you that this offer is contingent upon a number of
additional steps in the employment process including, but not limited to, background and reference checking. Enclosed is a new hire kit that contains forms that you will be required to complete. 

You are also required to show appropriate proof of authorization to commence work in the United States. We ask that you complete Part 1 of the Form I-9,
on or before your first day of work (see, in the attached packet, a list of the type of documentation we will need.). This is a requirement of the Immigration Reform and Control Act of 1986. If you are not legally able to work for the Firm in the
United States in the position offered you, or if any part of the screening process proves unsatisfactory to the Firm or you are unable to complete Part 1 of the Form I-9, the Firm reserves the right to rescind any outstanding offer of employment or
terminate your employment without notice or severance benefits and rescind any long-term incentive or equity-based awards described herein. Further, this offer is contingent on your obtaining and retaining all licenses and registrations from the
NASD, exchanges, state securities commissions and other regulatory bodies as Morgan Stanley shall determine necessary for your position. You must also bring with you a government-issued photo identification, in a form acceptable to Morgan Stanley
(such as a valid passport or a driver’s license.) Also in the enclosed packet, please find personnel forms that need to be completed and brought with you on your first day of work. 

You acknowledge that in the course of your employment with the Firm, you are not permitted to make any unauthorized use of documents or other information
that are the confidential, trade secret or proprietary information of another individual or company (“Confidential Information”). Likewise, you may not bring onto Firm premises any Confidential Information, whether documents or other
tangible forms, relating to your prior employers’ business. 
 You understand and agree that as a condition of employment, you
must, upon the commencement of employment, transfer any outside brokerage/securities accounts to Morgan Stanley unless you are granted a waiver in writing by the Compliance Department. Nothing in this letter should be
construed as a guarantee of any particular level of benefits, of your participation in any benefit plan, or of continued employment for any period of time. You should understand that your employment will be “at will,” which means that the
Firm may terminate your employment for any reason, with or without cause, and at any time (subject to the Sign-On Agreement). During your employment, subject to applicable law and in accordance with Morgan Stanley’s Drug, Alcohol and
Controlled Substance Usage Policy, you may be subject to drug testing, including for reasonable suspicion of use of controlled 

 
substances. Morgan Stanley reserves the right to amend, modify or terminate, in its sole discretion, all benefit and compensation plans in effect from time to time. This offer letter and the
Sign-On Agreement constitute the entire understanding and contain a complete statement of all agreements between you and Morgan Stanley and supersede all prior or contemporaneous verbal or written agreements, understandings or communications
(including, without limitation, any term sheet or other summary writing relating to your employment). You acknowledge that you have not relied on any assurance or representation not expressly stated in this offer letter. If there is any conflict
with the benefit information included in this letter or any verbal representation and the Plan documents or insurance contracts, the Plan documents or insurance documents control. 

With the formalities covered, we are looking forward to you joining Morgan Stanley. As stated, we will meet with you to walk through your benefits in
more detail and to walk through any remaining new hire paperwork. If you have any questions, please feel free to call Karen Jamesley at [redacted]. 

We ask that you confirm your acceptance by signing and dating this offer letter in the area designated below and returning this letter to Karen Jamesley
at [redacted]. Your signature below confirms that you are subject to no contractual or other restriction or obligation that is inconsistent with your accepting this offer of employment and performing your duties. Please also sign, date and return
the attached Sign-On Agreement to Karen Jamesley in the Human Resources Department. Please retain the additional copy of this offer letter and an additional signed copy of the Sign-On Agreement for your reference. 

Very truly yours, 
  

	
	/s/ John J. Mack
	John J. Mack
	Chairman of the Board and Chief Executive Officer

 Offer
Accepted and Agreed To: 
  

			
	Signed: 	 	 /s/ Kenneth deRegt

	Date:	 	February 25, 2008

 Name: Kenneth deRegt 

Title: Managing Director in the Office of the Chairman 

DISCRETIONARY NEW HIRE AWARD TERM SHEET 

 
  

			
	STOCK UNIT     =	 	A NOTIONAL SHARE THAT CONSTITUTES AN UNSECURED PROMISE TO PAY ONE SHARE OF MORGAN STANLEY COMMON STOCK IN THE FUTURE SUBJECT TO THE SATISFACTION OF CERTAIN
CONDITIONS.

  

			
	INITIAL VALUE OF AWARD	 	 =       $1,000,000

		
	NUMBER OF STOCK UNITS AWARDED	 	 =       To be determined by dividing the initial value of the award by the market value

		
	MARKET VALUE	 	 =       The volume weighted average price of Morgan Stanley common stock on the employment
commencement date

 The following is an abbreviated general description of the terms and conditions of the 2008 award
granted to you under the Employee Equity Accumulation Plan. This summary does not address all 2008 award features. Your 2008 Award Certificate provides a full explanation of the terms and conditions of your 2008 award, which may differ from the
description in this summary. Unless otherwise defined herein, all capitalized terms shall have the meaning set forth in your 2008 Award Certificate. If there is any conflict between the terms of this summary and those in your 2008 Award Certificate,
the latter will control. You will also be provided with a prospectus and tax supplement that contains important information about these awards. 
  

	
	 Morgan Stanley reserves the right to modify the terms of awards to the extent
necessary or advisable in order to comply with Section 409A of the Internal Revenue Code (“Section 409A”), including, without limitation, the payment provisions applicable to stock
units.

 TERMS OF NEW HIRE STOCK UNIT AWARD 

 

	 Earning Award 
	You have no right to your 2008 award until it is “earned”. Generally, to earn your award, you must not engage in any activity that constitutes a cancellation event. The cancellation
events are summarized below. 

  

	 Date of the Award 
	Employment commencement date 

  

	 Scheduled Vesting Date(s) 
	Stock units will vest on the following schedule: 50% on the second anniversary of your employment commencement date (“First Scheduled Vesting Date”) and 50% on the third anniversary of
your employment commencement date (“Second Scheduled Vesting Date”). 

	 Scheduled Conversion Date(s) (stock units convert to shares) 
	Stock units will convert to shares of Morgan Stanley common stock on the following schedule: 50% on the second anniversary of your employment commencement date and 50% on the third anniversary
of your employment commencement date. Each such date is a “Scheduled Conversion Date.” 

 Until
conversion, stock units constitute a contingent and unsecured promise of the Firm to pay the unit holder shares of Morgan Stanley common stock. 

Notwithstanding the other provisions of the award, the conversion of your vested stock units will be deferred if, at the time scheduled
for conversion, Morgan Stanley considers you to be one of its executive officers and your compensation may not be fully deductible by virtue of Section 162(m) of the Internal Revenue Code. This deferral will continue until your “Separation from
Service” under Section 409A, and your vested stock units will convert into Morgan Stanley common stock upon your Separation from Service. If, however, Morgan Stanley considers you to be one of its “specified employees” as defined in
Section 409A at the time of your Separation from Service, conversion of your stock units will be delayed until the first business day following the date that is six months after your Separation from Service (subject to earlier conversion in the
event of your death or your employment at a Governmental Employer under the circumstances described below). 
  

	 Transfer Restrictions 
	You may not sell, pledge or otherwise transfer stock units for any reason. Shares received from stock unit conversions may be sold, pledged or transferred, subject to compliance with U.S.
securities laws and Firm policies. 

  

	 Dividends and Dividend Equivalents 
	When Morgan Stanley pays a regular or ordinary dividend on its common stock, dividend equivalents are generally paid in cash through payroll until conversion of stock units to shares. Shares
received from stock unit conversions will receive dividends in the same manner as shares held by other shareholders. 

  

	 Termination of Employment 
	If your Employment terminates under circumstances not involving a cancellation event (other than due to death, Disability, Governmental Service Termination or Qualifying Termination), the
provisions described below for Full Career Retirement will apply to your stock units. 

 The special provisions
that apply if your Employment terminates for death, Disability, Full Career Retirement, Governmental Service Termination or Qualifying Termination, are described below. 

	 Death 
	If you die while Employed, unvested stock units will vest. Stock units will convert and be paid to your beneficiary or estate upon your death, provided that your estate or beneficiary notifies
the Firm of your death within 60 days following your death. 

 If you die after your termination of Employment
but prior to the applicable Scheduled Conversion Date, vested stock units that you held as of the date of your death will convert and be paid to your beneficiary or estate upon your death, provided that your estate or beneficiary notifies the Firm
of your death within 60 days following your death. 
  

	 Disability 
	If your Employment terminates due to Disability, then, subject to the cancellation provisions described below: (1) unvested stock units will vest on your termination date, and (2) stock
units will convert, and cancellation provisions will lift, on the applicable Scheduled Conversion Date. Disability is defined in accordance with the Firm’s long-term disability plan applicable to you. 

 

	 Full Career Retirement 
	If you Full Career Retire, then, subject to the cancellation provisions described below: (1) unvested stock units will vest on your termination date; and (2) stock units will convert, and
cancellation provisions will lift, on the applicable Scheduled Conversion Date. 

 Full Career Retirement is
defined as a termination not involving any cancellation event (and other than due to death, Disability, Governmental Service Termination or Qualifying Termination). 
  

	 Governmental Service 
	If your Employment terminates in a Governmental Service Termination and not involving a cancellation event, then, provided that you sign an agreement satisfactory to the Firm relating to your
repayment obligations summarized below, unvested stock units will vest, and stock units will convert, on the date of your Governmental Service Termination. 

If your Employment terminates other than in a Governmental Service Termination and not involving a cancellation event and, following
your termination of Employment, you accept employment with a Governmental Employer, then, provided that you sign an agreement satisfactory to the Firm relating to your repayment obligations summarized below, your outstanding vested stock units will
convert to shares upon your commencement of such employment, provided you present the Firm with satisfactory evidence that the divestiture of your continued interest in Morgan Stanley equity awards or continued ownership of Morgan Stanley common
stock is reasonably necessary to avoid the violation of U.S. federal, state or local or foreign ethics law or conflicts of interest law applicable to you at such Governmental Employer. 

	 	If your stock units convert due to this provision and you engage in any activity constituting a cancellation event within the period of time that would have resulted in cancellation of all or a
portion of your stock units, you will be required to pay to Morgan Stanley an amount equal to the number of stock units that would have been canceled upon the occurrence of such cancellation event, multiplied by the fair market value of Morgan
Stanley common stock on the date your stock units converted plus interest on such amount. 

“Governmental Service Termination” means the termination of your Employment and your commencement of employment at a
Governmental Employer; provided that you have presented the Firm with satisfactory evidence demonstrating that as a result of such new employment, the divestiture of your continued interest in Morgan Stanley equity awards or continued ownership of
Morgan Stanley common stock is reasonably necessary to avoid the violation of U.S. federal, state or local or foreign ethics law or conflicts of interest law applicable to you at such Governmental Employer. 

“Governmental Employer” means a governmental department or agency, self-regulatory agency or other public service
employer. 
  

	 Qualifying Termination 
	If your employment terminates in a Qualifying Termination, unvested stock units will vest and will be paid upon your Qualifying Termination. If, however, Morgan Stanley considers you to be one
of its “specified employees” as defined in Section 409A at the time of your Qualifying Termination, conversion of your stock units will be delayed until the first business day following the date that is six months after your Qualifying
Termination (subject to earlier conversion in the event of your death or your employment at a Governmental Employer under the circumstances described above). 

“Qualifying Termination” means your termination of Employment within eighteen (18) months following a Change in
Control, under either of the following circumstances: (a) the Firm terminates your employment under circumstances not involving any cancellation event; or (b) you resign from the Firm due to (i) a materially adverse alteration in your position or in
the nature or status of your responsibilities from those in effect immediately prior to the Change in Control or (ii) the Firm requiring your principal place of employment to be located more than 75 miles from the location where you were principally
employed at the time of the Change in Control (except for required travel on the Firm’s business to an extent substantially consistent with your business travel obligations in the ordinary course of business prior to the Change in Control).

	 Cancellation for Competitive Activity 
	If you voluntarily terminate Employment and you engage in Competitive Activity: 

  

	 	(1)	Prior to the First Scheduled Vesting Date, all stock units will be canceled; 

 

	 	(2)	On or after the First Scheduled Vesting Date but before the Second Scheduled Vesting Date, the stock units that remain outstanding after the First Scheduled Conversion
Date will be canceled. 

  

	 	You will be deemed to have engaged in “Competitive Activity” if you (a) become, or enter into any arrangement as, an employee, officer, partner, member, proprietor,
director, independent contractor, consultant, advisor, representative or agent of, or serve in any similar position or capacity with, a Competitor, where you will be responsible for providing, or managing or supervising others who are providing,
services (i) that are similar or substantially related to the services that you provided to the Firm, or (ii) that you had direct or indirect managerial or supervisory responsibility for at the Firm, or (iii) that call for the application of the
same or similar specialized knowledge or skills as those utilized by you in your services for the Firm, in each such case, at any time during the year preceding your termination of employment with the Firm; or (b) either alone or in concert with
others, form, or acquire a 5% or greater equity ownership, voting interest or profit participation in, a Competitor. 

  

	 	A “Competitor” means any corporation, partnership or other entity that is engaged in any activity, or that owns a significant interest in any corporation, partnership or
other entity, that competes with any business activity the Firm engages in, or that you reasonably knew or should have known that the Firm was planning to engage in, at the time of the termination of your Employment. 

 

	 Cancellation for Other Events 
	All vested and unvested stock units will be subject to cancellation until the applicable Scheduled Conversion Date for: 

 

	 	(a)	misuse of Proprietary Information or failure to comply with your obligations under the Firm’s Code of Conduct or otherwise with respect to Proprietary Information;

  

	 	(b)	resignation of employment with the Firm without giving the Firm prior written notice of at least: 

 

	 	i.	180 days if you are a member of the Morgan Stanley Management Committee (or successor or equivalent committee) at the time of notice of resignation;

  

	 	ii.	90 days if you are a Managing Director (or equivalent title) at the time of notice of resignation; 

	 	iii.	60 days if you are an Executive Director (or equivalent title) at the time of notice of resignation; and 

 

	 	iv.	30 days for all other participants; 

  

	 	(c)	making Unauthorized Comments; or 

  

	 	(d)	termination for Cause (or a later determination that you could have been terminated for Cause). 

In addition all vested and unvested stock units will be subject to cancellation if, without the consent of the Firm: 

 

	 	(a)	while Employed, including during any notice period applicable to you in connection with your termination of Employment, or within 180 days after termination of
Employment, you directly or indirectly in any capacity (including through any person, corporation, partnership or other business entity of any kind) hire or solicit, recruit, induce, entice, influence or encourage any Firm employee to leave the Firm
or become hired or engaged by another firm; provided, however, that this clause applies only to employees with whom you worked or had professional or business contact, or who worked in or with your business unit, during any notice
period applicable to you in connection with your termination of Employment or during the 180 days preceding the notice of your termination of Employment; or 

 

	 	(b)	while Employed, including during any notice period applicable to you in connection with your termination of Employment, or within 90 days after termination of
Employment (180 days if you are a Management Committee member at the time of notice of termination), you directly or indirectly in any capacity (including through any person, corporation, partnership or other business entity of any kind) solicit or
entice away or in any manner attempt to persuade any client or customer, or prospective client or customer, of the Firm (i) to discontinue or diminish his, her or its relationship or prospective relationship with the Firm or (ii) to otherwise
provide his, her or its business to any person, corporation, partnership or other business entity which engages in any line of business in which the Firm is engaged (other than the Firm); provided, however, that this clause applies
only to clients or customers, or prospective clients or customers, that you worked for on an actual or prospective project or assignment during any notice period applicable to you in connection with your termination of Employment or during the 180
days preceding the notice of your termination of Employment. 

 “Proprietary Information”
means any information that may have intrinsic value to the Firm, the Firm’s clients or other parties with which the Firm has a relationship, or that may provide the Firm with a competitive advantage, including,

 
without limitation, any trade secrets; inventions (whether or not patentable); formulas; flow charts; computer programs; access codes or other systems information; algorithms; technology and
business processes; business, product, or marketing plans; sales and other forecasts; financial information; client lists or other intellectual property; information relating to compensation and benefits; and public information that becomes
proprietary as a result of the Firm’s compilation of that information for use in its business; provided that such Proprietary Information does not include any information which is available for use by the general public or is generally
available for use within the relevant business or industry other than as a result of your action. Proprietary Information may be in any medium or form, including, without limitation, physical documents, computer files or discs, videotapes,
audiotapes, and oral communications. 
 You will be deemed to have made “Unauthorized Comments” about
the Firm if you, while Employed or following termination of Employment make, directly or indirectly, any negative, derogatory or disparaging comment, whether written, oral or in electronic format, to any reporter, author, producer or similar person
or entity or to any general public media in any form (including, without limitation, books, articles or writings of any other kind, as well as film, videotape, audio tape, computer/Internet format or any other medium) that concerns directly or
indirectly the Firm, its business or operations, or any of its current or former agents, employees, officers, directors, customers or clients. 

“Cause” means: 
  

	 	(x)	any act or omission which constitutes a breach by you of your obligations to the Firm (including, without limitation, your failure to comply with any notice or
non-solicitation restrictions that may be applicable to you) or your failure or refusal to perform satisfactorily any duties reasonably required of you, which breach, failure or refusal (if susceptible to cure) is not corrected (other than failure
to correct by reason of your incapacity due to physical or mental illness) within ten (10) business days after written notification thereof to you by the Firm; or 

 

	 	(y)	your commission of any dishonest or fraudulent act, or any other act or omission, which has caused or may reasonably be expected to cause injury to the interest or
business reputation of the Firm; or 

  

	 	(z)	a violation of any securities, commodities or banking laws, any rules or regulations issued pursuant to such laws, or rules and regulations of any securities or
commodities exchange or association of which the Firm is a member or of any policy of the Firm relating to compliance with any of the foregoing. 

	 Certification 
	You may be required to provide Morgan Stanley with a written certification or other evidence that it deems appropriate, in its sole discretion, to confirm that no cancellation event has
occurred. If you fail to submit a timely certification or evidence, Morgan Stanley will cancel your award. 

  

	 Tax Withholding 
	You may elect to satisfy the tax or other withholding obligations arising upon conversion of your stock units by having Morgan Stanley withhold shares in an amount sufficient to satisfy such
withholding obligations. 

  

	 Award Modification 
	Morgan Stanley generally has the right to modify or amend the terms of your award without your consent. However, Morgan Stanley may not make a modification that would materially impair your
rights in such award without your consent unless such modification is necessary or advisable (i) to comply with any law, regulation, ruling, judicial decision, accounting standard or similar pronouncement or (ii) to ensure that awards are not
subject to federal, state or local income tax prior to payment. 

  

	 Timing of Conversion 
	With respect to any provision for vested stock units to convert to shares of common stock on a specified event or date, such conversion will be considered to have been timely made as long as
conversion is made by December 31 of the year in which occurs the specified event or date or, if later, by the 15th day of the third calendar month following such specified event or date. 

 

	 U.S. Taxation 
	In general, when your stock units convert to shares, the then current market value of shares will be taxed as ordinary income. FICA and Medicare tax apply at the time that stock units vest.
Please refer to the Tax Supplement for a fuller discussion of these tax consequences. 

  

	 Non-U.S. Taxation 
	Taxation on grant, vesting and stock unit conversion depends on tax laws and regulations in your jurisdiction. 

 

	 Governing Law 
	New York law. 

 Please refer to your award certificate for
definitions of terms used herein 
  

	
	 
	
IF YOU HAVE QUESTIONS, CALL THE EXECUTIVE COMPENSATION DEPT. AT [REDACTED] OR YOUR COVERAGE OFFICER.

 
 ___________________

 
 THIS SUMMARY IS AN ABBREVIATED DESCRIPTION OF THE AWARD AND DOES NOT
ADDRESS ALL AWARD FEATURES, INCLUDING, BUT NOT LIMITED TO, TERMS WHICH MAY VARY IN CERTAIN NON-U.S. JURISDICTIONS. THE PLAN DOCUMENTS AND AWARD CERTIFICATE THAT WILL BE FURNISHED TO YOU UPON APPROVAL OF THE AWARD BY THE COMPENSATION, MANAGEMENT
DEVELOPMENT AND SUCCESSION COMMITTEE OF MORGAN STANLEY’S BOARD OF DIRECTORS OR ITS DELEGATE WILL PROVIDE THE COMPLETE GOVERNING EXPLANATION OF THE TERMS AND CONDITIONS OF THE DISCRETIONARY AWARD, WHICH MAY DIFFER FROM THE DESCRIPTION IN THIS
SUMMARY.
  
 NOTHING IN THIS SUMMARY OR IN ANY CORRESPONDENCE RELATED
TO THIS DISCRETIONARY AWARD SHOULD BE CONSTRUED AS A GUARANTEE OF A DISCRETIONARY BONUS OR ANY PARTICULAR LEVEL OF COMPENSATION, BONUS, OR BENEFITS. THE FIRM DOES NOT COMMIT TO GRANTING ANY DISCRETIONARY AWARD IN THE FUTURE. THIS AWARD DOES NOT
CREATE A CONTRACT OR GUARANTEE OF EMPLOYMENT, OR MODIFY ANY AGREEMENT ENTERED INTO BY MORGAN STANLEY AND YOU. THIS SUMMARY IS NOT INTENDED TO BE USED, AND CANNOT BE USED, BY YOU OR ANY OTHER PERSON FOR THE PURPOSE OF AVOIDING U.S. FEDERAL TAX
PENALTIES THAT MAY BE IMPOSED ON YOU OR SUCH OTHER PERSON.

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