Document:

EXHIBIT 4.1

                             FIXED RATE SENIOR NOTE

REGISTERED                                          REGISTERED
No. FXR                                             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.

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<PAGE>

                        MORGAN STANLEY DEAN WITTER & CO.
                    SENIOR GLOBAL MEDIUM-TERM NOTE, SERIES C
                                  (Fixed Rate)

                         STOCK PARTICIPATION ACCRETING
                 REDEMPTION QUARTERLY-PAY SECURITIES ("SPARQS")

                        % SPARQS DUE          , 200[ ]
                            MANDATORILY EXCHANGEABLE
                         FOR SHARES OF COMMON STOCK OF
                             QUALCOMM INCORPORATED

<TABLE>
<S>                        <C>                              <C>                                  <C>
ORIGINAL ISSUE DATE:       INITIAL REDEMPTION               INTEREST RATE:   %                   MATURITY DATE:
                               DATE: See "Morgan                per annum (equivalent                See "Maturity Date"
                               Stanley Call Right"              to $         per annum per           below.
                               below.                           SPARQS)

INTEREST ACCRUAL           INITIAL REDEMPTION               INTEREST PAYMENT                     OPTIONAL
    DATE:                      PERCENTAGE: See                  DATES:                               REPAYMENT
                               "Morgan Stanley Call                                                  DATE(S):  N/A
                               Right" and "Call Price"
                               below.

SPECIFIED CURRENCY:        ANNUAL REDEMPTION                INTEREST PAYMENT                     APPLICABILITY OF
    U.S. Dollars               PERCENTAGE                       PERIOD: Quarterly                    MODIFIED
                               REDUCTION: N/A                                                        PAYMENT UPON
                                                                                                     ACCELERATION: See
                                                                                                     "Alternate Exchange
                                                                                                     Calculation in Case of
                                                                                                     an Event of Default"
                                                                                                     below.

IF SPECIFIED               REDEMPTION NOTICE                APPLICABILITY OF                     If yes, state Issue Price:
    CURRENCY OTHER             PERIOD: At least 10              ANNUAL INTEREST                      N/A
    THAN U.S. DOLLARS,         days but no more than            PAYMENTS: N/A
    OPTION TO ELECT            30 days.  See "Morgan
    PAYMENT IN U.S.            Stanley Call Right" and
    DOLLARS: N/A               "Morgan Stanley Notice
                               Date" below.

EXCHANGE RATE              TAX REDEMPTION                                                        ORIGINAL YIELD TO
    AGENT: N/A                 AND PAYMENT OF                                                        MATURITY: N/A
                               ADDITIONAL
                               AMOUNTS: N/A

OTHER PROVISIONS:          If yes, state Initial Offering
    See below                  Date: N/A
</TABLE>

Issue Price................   $      per each $       principal amount of
                              this SPARQS

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Maturity Date..............         , 200[ ], subject to extension in accordance
                              with the following paragraph in the event of a
                              Market Disruption Event on               , 200[ ].

                              If the Final Call Notice Date is postponed due to
                              a Market Disruption Event or otherwise and the
                              Issuer exercises the Morgan Stanley Call Right,
                              the Maturity Date shall be postponed so that the
                              Maturity Date will be the tenth calendar day
                              following the Final Call Notice Date. See "Final
                              Call Notice Date" below.

                              In the event that the Final Call Notice 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 two Business Days following the
                              scheduled Final Call Notice Date, (i) to the
                              holder of this SPARQS 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 SPARQS receives
                              the notice. Notice of the date to which the
                              Maturity Date has been rescheduled as a result of
                              postponement of the Final Call Notice Date, if
                              applicable, shall be included in the Issuer's
                              notice of exercise of the Morgan Stanley Call
                              Right.

Record Dates...............   Notwithstanding the definition of "Record Date"
                              on page 18 hereof, the Record Date for each
                              Interest Payment Date, including the Interest
                              Payment Date scheduled to occur on the Maturity
                              Date, shall be the date 5 calendar days prior to
                              such Interest Payment Date, whether or not that
                              date is a Business Day; provided, however, that
                              in the event that the Issuer exercises the Morgan
                              Stanley Call Right, no Interest Payment Date
                              shall occur after the Morgan Stanley Notice Date,
                              except for any Interest Payment Date for which
                              the Morgan Stanley Notice Date falls on or after
                              the "ex-interest" date for the related

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                              interest payment, in which case the related
                              interest payment shall be made on such Interest
                              Payment Date; and provided, further, that accrued
                              but unpaid interest payable on the Call Date, if
                              any, shall be payable to the person to whom the
                              Call Price is payable. The "ex- interest" date
                              for any interest payment is the date on which
                              purchase transactions in the SPARQS no longer
                              carry the right to receive such interest payment.

                              In the event that the Issuer exercises the Morgan
                              Stanley Call Right and the Morgan Stanley Notice
                              Date falls before the "ex-interest" date for an
                              interest payment, so that as a result a scheduled
                              Interest Payment Date will not occur, the Issuer
                              shall cause the Calculation Agent to give notice
                              to the Trustee and to the Depositary, in each
                              case in the manner and at the time described in
                              the second and third paragraphs under "Morgan
                              Stanley Call Right" below, that no Interest
                              Payment Date will occur after such Morgan Stanley
                              Notice Date.

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

Morgan Stanley Call Right..   On any scheduled Trading Day on or after         ,
                              200[ ] or on the Maturity Date, the Issuer may
                              call the SPARQS, in whole but not in part, for
                              mandatory exchange for the Call Price paid in
                              cash (together with accrued but unpaid interest)
                              on the Call Date.

                              On the Morgan Stanley Notice Date, the Issuer
                              shall give notice of the Issuer's exercise of the
                              Morgan Stanley Call Right (i) to the holder of
                              this SPARQS by mailing notice of such exercise,
                              specifying the Call Date on which the Issuer
                              shall effect such exchange, 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 Depositary in accordance
                              with the applicable procedures set forth in the
                              Letter of Representations related to this SPARQS.
                              Any notice which is mailed in the manner herein
                              provided shall be conclusively presumed to have
                              been duly given, whether or not the holder of
                              this SPARQS receives the notice. Failure to give
                              notice by mail or any defect in the notice to the
                              holder of any SPARQS shall not affect the
                              validity

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<PAGE>

                              of the proceedings for the exercise of the Morgan
                              Stanley Call Right with respect to any other
                              SPARQS.

                              The notice of the Issuer's exercise of the Morgan
                              Stanley Call Right shall specify (i) the Call
                              Date, (ii) the Call Price payable per SPARQS,
                              (iii) the amount of accrued but unpaid interest
                              payable per SPARQS on the Call Date, (iv) whether
                              any subsequently scheduled Interest Payment Date
                              shall no longer be an Interest Payment Date as a
                              result of the exercise of the Morgan Stanley Call
                              Right, (v) the place or places of payment of such
                              Call Price, (vi) that such delivery will be made
                              upon presentation and surrender of this SPARQS,
                              (vii) that such exchange is pursuant to the
                              Morgan Stanley Call Right and (viii) if
                              applicable, the date to which the Maturity Date
                              has been extended due to a Market Disruption
                              Event as described under "Maturity Date" above.

                              The notice of the Issuer's exercise of the Morgan
                              Stanley Call Right shall be given by the Issuer
                              or, at the Issuer's request, by the Trustee in
                              the name and at the expense of the Issuer.

                              If this SPARQS is so called for mandatory
                              exchange by the Issuer, then the cash Call Price
                              and any accrued but unpaid interest on this
                              SPARQS to be delivered to the holder of this
                              SPARQS shall be delivered on the Call Date fixed
                              by the Issuer and set forth in its notice of its
                              exercise of the Morgan Stanley Call Right, upon
                              delivery of the SPARQS to the Trustee. The Issuer
                              shall, or shall cause the Calculation Agent to,
                              deliver such cash to the Trustee for delivery to
                              the holder of this SPARQS.

                              If this SPARQS is not surrendered for exchange on
                              the Call Date, it shall be deemed to be no longer
                              Outstanding under, and as defined in, the Senior
                              Indenture after the Call Date, except with
                              respect to the holder's right to receive cash due
                              in connection with the Morgan Stanley Call Right.

Morgan Stanley Notice Date.   The scheduled Trading Day on which the Issuer
                              issues its notice of mandatory exchange, which
                              must be at least 10 but not more than 30 days
                              prior to the Call Date.

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Final Call Notice Date.....            , 200[ ]; provided that if            ,
                              200[ ] is not a Trading Day or if a Market
                              Disruption Event occurs on such day, the Final
                              Call Notice Date will be the immediately
                              succeeding Trading Day on which no Market
                              Disruption Event occurs.

Call Date..................   The day specified in the Issuer's notice of
                              mandatory exchange, on which the Issuer shall
                              deliver cash to holders of SPARQS for mandatory
                              exchange, which day may be any scheduled Trading
                              Day on or after             , 200[ ] or the
                              Maturity Date (including the Maturity Date as it
                              may be extended and regardless of whether the
                              Maturity Date is a scheduled Trading Day). See
                              "Maturity Date" above.

Call Price.................   The Call Price with respect to any Call Date is an
                              amount of cash per each $         principal amount
                              of this SPARQS, as calculated by the Calculation
                              Agent, such that the sum of the present values of
                              all cash flows on each $           principal
                              amount of this SPARQS to and including the Call
                              Date (i.e., the Call Price and all of the interest
                              payments on each SPARQS), discounted to the
                              Original Issue Date from the applicable payment
                              date at the Yield to Call rate of   % per annum
                              computed on the basis of a 360-day year of twelve
                              30-day months, equals the Issue Price, as
                              determined by the Calculation Agent.

Exchange at Maturity.......   At maturity, subject to a prior call of this
                              SPARQS for cash in an amount equal to the Call
                              Price by the Issuer as described under "Morgan
                              Stanley Call Right" above, upon delivery of this
                              SPARQS to the Trustee, each $32.32 principal
                              amount of this SPARQS shall be applied by the
                              Issuer as payment for a number of shares of the
                              common stock of Qualcomm Incorporated ("Qualcomm
                              Stock") at the Exchange Ratio, and the Issuer
                              shall deliver with respect to each $     principal
                              amount of this SPARQS an amount of Qualcomm Stock
                              equal to the Exchange Ratio.

                              The amount of Qualcomm Stock to be delivered at
                              maturity shall be subject to any applicable
                              adjustments (i) to the Exchange Ratio and (ii) in
                              the Exchange Property, as defined in paragraph 5
                              under "Antidilution Adjustments" below, to be
                              delivered instead of, or in

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<PAGE>

                              addition to, such Qualcomm Stock as a result of
                              any corporate event described under "Antidilution
                              Adjustments" below, in each case, required to be
                              made through the close of business on the third
                              Trading Day prior to maturity.

                              The Issuer shall, or shall cause the Calculation
                              Agent to, provide written notice to the Trustee
                              at its New York Office and to the Depositary, on
                              which notice the Trustee and Depositary may
                              conclusively rely, on or prior to 10:30 a.m. on
                              the Trading Day immediately prior to maturity of
                              this SPARQS, of the amount of Qualcomm Stock (or
                              the amount of Exchange Property) to be delivered
                              with respect to each $        principal amount of
                              this SPARQS and of the amount of any cash to be
                              paid in lieu of any fractional share of Qualcomm
                              Stock (or of any other securities included in
                              Exchange Property, if applicable); provided that
                              if the maturity date of this SPARQS is
                              accelerated (x) because of the consummation of a
                              Reorganization Event (as defined in paragraph 5
                              of "Antidilution Adjustments" below) where the
                              Exchange Property consists only of cash or (y)
                              because of an event described under "Alternate
                              Exchange Calculation in Case of an Event of
                              Default" or otherwise, the Issuer shall give
                              notice of such acceleration as promptly as
                              possible, and in no case later than two Business
                              Days following such deemed maturity date, (i) to
                              the holder of this SPARQS by mailing notice of
                              such acceleration 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 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 SPARQS receives the notice. If the maturity
                              of this SPARQS is accelerated in the manner
                              described in the immediately preceding sentence,
                              no interest on the amounts payable with respect
                              to this SPARQS shall accrue for the period from
                              and after such accelerated maturity date;
                              provided that the Issuer has deposited with the
                              Trustee on such accelerated maturity date the
                              Qualcomm Stock, the Exchange

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                              Property or any cash due with respect to such
                              acceleration.

                              The Issuer shall, or shall cause the Calculation
                              Agent to, deliver any such shares of Qualcomm
                              Stock (or any Exchange Property) and cash in
                              respect of interest and any fractional share of
                              Qualcomm Stock (or any Exchange Property) and
                              cash otherwise due upon any acceleration
                              described above to the Trustee for delivery to
                              the holder. References to payment "per SPARQS"
                              refer to each $       principal amount of this
                              SPARQS.

                              If this SPARQS is not surrendered for exchange at
                              maturity, it shall be deemed to be no longer
                              Outstanding under, and as defined in, the Senior
                              Indenture, except with respect to the holder's
                              right to receive the Qualcomm Stock (and, if
                              applicable, any Exchange Property) due at
                              maturity.

No Fractional Shares.......   Upon delivery of this SPARQS to the Trustee at
                              maturity, the Issuer shall deliver the aggregate
                              number of shares of Qualcomm Stock due with
                              respect to this SPARQS, as described above, but
                              the Issuer shall pay cash in lieu of delivering
                              any fractional share of Qualcomm Stock in an
                              amount equal to the corresponding fractional
                              Market Price of such fraction of a share of
                              Qualcomm Stock as determined by the Calculation
                              Agent as of the second scheduled Trading Day
                              prior to maturity of this SPARQS.

Exchange Ratio.............   1.0, subject to adjustment for corporate events
                              relating to Qualcomm Incorporated ("Qualcomm")
                              described under "Antidilution Adjustments" below.

Market Price...............   If Qualcomm Stock (or any other security for
                              which a Market Price must be determined) is
                              listed on a national securities exchange, is a
                              security of the Nasdaq National Market or is
                              included in the OTC Bulletin Board Service ("OTC
                              Bulletin Board") operated by the National
                              Association of Securities Dealers, Inc. (the
                              "NASD"), the Market Price for one share of
                              Qualcomm Stock (or one unit of any such other
                              security) on any Trading Day means (i) the last
                              reported sale price, regular way, of the
                              principal trading session on such day on the
                              principal United States securities exchange
                              registered under the Securities Exchange Act of
                              1934, as amended (the

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                              "Exchange Act"), on which Qualcomm Stock (or any
                              such other security) is listed or admitted to
                              trading (which may be the Nasdaq National Market
                              if it is then a national securities exchange) or
                              (ii) if not listed or admitted to trading on any
                              such securities exchange or if such last reported
                              sale price is not obtainable (even if Qualcomm
                              Stock (or any such other security) is listed or
                              admitted to trading on such securities exchange),
                              the last reported sale price of the principal
                              trading session on the over-the- counter market
                              as reported on the Nasdaq National Market (if it
                              is not then a national securities exchange) or
                              OTC Bulletin Board on such day. If the last
                              reported sale price of the principal trading
                              session is not available pursuant to clause (i)
                              or (ii) of the preceding sentence because of a
                              Market Disruption Event or otherwise, the Market
                              Price for any Trading Day shall be the mean, as
                              determined by the Calculation Agent, of the bid
                              prices for Qualcomm Stock (or any such other
                              security) obtained from as many dealers in such
                              security, but not exceeding three, as will make
                              such bid prices available to the Calculation
                              Agent. Bids of Morgan Stanley & Co. Incorporated
                              ("MS & Co.") or any of its affiliates may be
                              included in the calculation of such mean, but
                              only to the extent that any such bid is the
                              highest of the bids obtained. A "security of the
                              Nasdaq National Market" shall include a security
                              included in any successor to such system, and the
                              term "OTC Bulletin Board Service" shall include
                              any successor service thereto.

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, 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.

Acceleration Event.........   If on any date the product of the Market Price
                              per share of Qualcomm Stock and the Exchange
                              Ratio is less than $      , as determined by the
                              Calculation Agent, the maturity date of this
                              SPARQS shall be deemed to be accelerated as of
                              such date, and each $     principal amount of this
                              SPARQS shall be applied by the Issuer as payment
                              for a number of shares of Qualcomm Stock at the
                              then current Exchange Ratio, and the Issuer shall

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                              deliver, on the third Business Day following the
                              date of acceleration, with respect to each $
                              principal amount of this SPARQS a number of
                              shares of Qualcomm Stock equal to the Exchange
                              Ratio, plus accrued but unpaid interest to but
                              excluding the date of acceleration. See also
                              "Antidilution Adjustments" below.

Calculation Agent..........   MS & Co. and its successors.

                              All calculations with respect to the Exchange
                              Ratio and Call Price for the SPARQS 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 the Call Price resulting from
                              such calculations shall be rounded to the nearest
                              ten- thousandth, with five one
                              hundred-thousandths rounded upward (e.g., .76545
                              would be rounded to .7655); and all dollar
                              amounts paid with respect to the Call Price on
                              the aggregate number of SPARQS shall be rounded
                              to the nearest cent, with one-half cent rounded
                              upward.

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

Antidilution Adjustments...   The Exchange Ratio shall be adjusted as follows:

                                   1. If Qualcomm Stock is subject to a stock
                              split or reverse stock split, then once such
                              split has become effective, the Exchange Ratio
                              shall be adjusted to equal the product of the
                              prior Exchange Ratio and the number of shares
                              issued in such stock split or reverse stock split
                              with respect to one share of Qualcomm Stock.

                                   2. If Qualcomm Stock is subject (i) to a
                              stock dividend (issuance of additional shares of
                              Qualcomm Stock) that is given ratably to all
                              holders of shares of Qualcomm Stock or (ii) to a
                              distribution of Qualcomm Stock as a result of the
                              triggering of any provision of the corporate
                              charter of Qualcomm, then once the dividend has
                              become effective and Qualcomm Stock is trading
                              ex-dividend, the Exchange Ratio shall be
                              adjusted so that the new Exchange Ratio shall
                              equal the prior Exchange Ratio

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                              plus the product of (i) the number of shares
                              issued with respect to one share of Qualcomm
                              Stock and (ii) the prior Exchange Ratio.

                                   3. There shall be no adjustments to the
                              Exchange Ratio to reflect cash dividends or other
                              distributions paid with respect to Qualcomm Stock
                              other than distributions described in clauses
                              (i), (iv) and (v) of paragraph 5 below and
                              Extraordinary Dividends as described below. A
                              cash dividend or other distribution with respect
                              to Qualcomm Stock shall be deemed to be an
                              "Extraordinary Dividend" if such dividend or
                              other distribution exceeds the immediately
                              preceding non-Extraordinary Dividend for Qualcomm
                              Stock by an amount equal to at least 10% of the
                              Market Price of Qualcomm Stock (as adjusted for
                              any subsequent corporate event requiring an
                              adjustment hereunder, such as a stock split or
                              reverse stock split) on the Trading Day preceding
                              the ex-dividend date for the payment of such
                              Extraordinary Dividend (the "ex- dividend date").
                              If an Extraordinary Dividend occurs with respect
                              to Qualcomm Stock, the Exchange Ratio with
                              respect to Qualcomm Stock shall be adjusted on
                              the ex-dividend date with respect to such
                              Extraordinary Dividend so that the new Exchange
                              Ratio shall equal the product of (i) the then
                              current Exchange Ratio and (ii) a fraction, the
                              numerator of which is the Market Price on the
                              Trading Day preceding the ex-dividend date, and
                              the denominator of which is the amount by which
                              the Market Price on the Trading Day preceding the
                              ex-dividend date exceeds the Extraordinary
                              Dividend Amount. The "Extraordinary Dividend
                              Amount" with respect to an Extraordinary Dividend
                              for Qualcomm Stock shall equal (i) in the case of
                              cash dividends or other distributions that
                              constitute regular dividends, the amount per
                              share of such Extraordinary Dividend minus the
                              amount per share of the immediately preceding
                              non-Extraordinary Dividend for Qualcomm Stock or
                              (ii) in the case of cash dividends or other
                              distributions that do not constitute regular
                              dividends, the amount per share of such
                              Extraordinary Dividend. To the extent an
                              Extraordinary Dividend is not paid in cash, the
                              value of the non-cash component shall be
                              determined by the Calculation Agent, whose
                              determination shall be conclusive. A distribution
                              on Qualcomm Stock described in clause (i), (iv)
                              or (v) of paragraph 5 below that also constitutes
                              an Extraordinary

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                              Dividend shall cause an adjustment to the
                              Exchange Ratio pursuant only to clause (i), (iv)
                              or (v) of paragraph 5, as applicable.

                                   4. If Qualcomm issues rights or warrants to
                              all holders of Qualcomm Stock to subscribe for or
                              purchase Qualcomm Stock at an exercise price per
                              share less than the Market Price of Qualcomm
                              Stock on both (i) the date the exercise price of
                              such rights or warrants is determined and (ii)
                              the expiration date of such rights or warrants,
                              and if the expiration date of such rights or
                              warrants precedes the maturity of this SPARQS,
                              then the Exchange Ratio shall be adjusted to
                              equal the product of the prior Exchange Ratio and
                              a fraction, the numerator of which shall be the
                              number of shares of Qualcomm Stock outstanding
                              immediately prior to the issuance of such rights
                              or warrants plus the number of additional shares
                              of Qualcomm Stock offered for subscription or
                              purchase pursuant to such rights or warrants and
                              the denominator of which shall be the number of
                              shares of Qualcomm Stock outstanding immediately
                              prior to the issuance of such rights or warrants
                              plus the number of additional shares of Qualcomm
                              Stock which the aggregate offering price of the
                              total number of shares of Qualcomm Stock so
                              offered for subscription or purchase pursuant to
                              such rights or warrants would purchase at the
                              Market Price on the expiration date of such
                              rights or warrants, which shall be determined by
                              multiplying such total number of shares offered
                              by the exercise price of such rights or warrants
                              and dividing the product so obtained by such
                              Market Price.

                                   5. If (i) there occurs any reclassification
                              or change of Qualcomm Stock, including, without
                              limitation, as a result of the issuance of any
                              tracking stock by Qualcomm, (ii) Qualcomm or any
                              surviving entity or subsequent surviving entity
                              of Qualcomm (a "Qualcomm Successor") has been
                              subject to a merger, combination or consolidation
                              and is not the surviving entity, (iii) any
                              statutory exchange of securities of Qualcomm or
                              any Qualcomm Successor with another corporation
                              occurs (other than pursuant to clause (ii)
                              above), (iv) Qualcomm is liquidated, (v) Qualcomm
                              issues to all of its shareholders equity
                              securities of an issuer other than Qualcomm
                              (other than in a transaction described in clause

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                              (ii), (iii) or (iv) above) (a "Spin-off Event")
                              or (vi) a tender or exchange offer or
                              going-private transaction is consummated for all
                              the outstanding shares of Qualcomm Stock (any
                              such event in clauses (i) through (vi), a
                              "Reorganization Event"), the method of
                              determining the amount payable upon exchange at
                              maturity for this SPARQS shall be adjusted to
                              provide that the holder of this SPARQS shall be
                              entitled to receive at maturity, in respect of
                              each $       principal amount of this SPARQS,
                              securities, cash or any other assets distributed
                              to holders of Qualcomm Stock in or as a result of
                              any such Reorganization Event, including (i) in
                              the case of the issuance of tracking stock, the
                              reclassified share of Qualcomm Stock, (ii) in the
                              case of a Spin-off Event, the share of Qualcomm
                              Stock with respect to which the spun- off
                              security was issued, and (iii) in the case of any
                              other Reorganization Event where Qualcomm Stock
                              continues to be held by the holders receiving
                              such distribution, the Qualcomm Stock
                              (collectively, the "Exchange Property"), in an
                              amount with a value equal to the amount of
                              Exchange Property delivered with respect to a
                              number of shares of Qualcomm Stock equal to the
                              Exchange Ratio at the time of the Reorganization
                              Event. Notwithstanding the above, if the Exchange
                              Property received in any such Reorganization
                              Event consists only of cash, the maturity date of
                              this SPARQS shall be deemed to be accelerated to
                              the date on which such cash is distributed to
                              holders of Qualcomm Stock and the holder of this
                              SPARQS shall receive in lieu of any Qualcomm
                              Stock and as liquidated damages in full
                              satisfaction of the Issuer's obligations under
                              this SPARQS the lesser of (i) the product of (x)
                              the amount of cash received per share of Qualcomm
                              Stock and (y) the then current Exchange Ratio and
                              (ii) the Call Price calculated as though the date
                              of acceleration were the Call Date (regardless of
                              whether the date of acceleration is a day which
                              occurs prior to         , 200[ ]). If Exchange
                              Property consists of more than one type of
                              property, the holder of this SPARQS shall receive
                              at maturity a pro rata share of each such type of
                              Exchange Property. If Exchange Property includes
                              a cash component, the holder of this SPARQS will
                              not receive any interest accrued on such cash
                              component. In the event Exchange Property
                              consists of securities, those securities shall,
                              in turn, be subject to the antidilution
                              adjustments set forth in paragraphs 1 through 5.

                                     A-13
<PAGE>

                              For purposes of paragraph 5 above, in the case of
                              a consummated tender or exchange offer or
                              going-private transaction involving Exchange
                              Property of a particular type, Exchange Property
                              shall be deemed to include the amount of cash or
                              other property paid by the offeror in the tender
                              or exchange offer with respect to such Exchange
                              Property (in an amount determined on the basis of
                              the rate of exchange in such tender or exchange
                              offer or going- private transaction). In the
                              event of a tender or exchange offer or a
                              going-private transaction with respect to
                              Exchange Property in which an offeree may elect
                              to receive cash or other property, Exchange
                              Property shall be deemed to include the kind and
                              amount of cash and other property received by
                              offerees who elect to receive cash.

                              No adjustment to the Exchange Ratio shall be
                              required unless such adjustment would require a
                              change of at least 0.1% in the Exchange Ratio
                              then in effect. The Exchange Ratio resulting from
                              any of the adjustments specified above will be
                              rounded to the nearest one hundred- thousandth,
                              with five one-millionths rounded upward. With
                              respect to the Maturity Date, adjustments to the
                              Exchange Ratio will be made up to the close of
                              business on the third Trading Day prior to the
                              Maturity Date.

                              No adjustments to the Exchange Ratio or method of
                              calculating the Exchange Ratio shall be made
                              other than those specified above. The adjustments
                              specified above do not cover all events that
                              could affect the Market Price of Qualcomm Stock,
                              including, without limitation, a partial tender
                              or exchange offer for Qualcomm Stock.

                              The Calculation Agent shall be solely responsible
                              for the determination and calculation of any
                              adjustments to the Exchange Ratio or method of
                              calculating the Exchange Ratio and of any related
                              determinations and calculations with respect to
                              any distributions of stock, other securities or
                              other property or assets (including cash) in
                              connection with any corporate event described in
                              paragraph 5 above, and its determinations and
                              calculations with respect thereto shall be
                              conclusive in the absence of manifest error.

                              The Calculation Agent shall provide information
                              as to any adjustments to the Exchange Ratio or to
                              the method of

                                     A-14
<PAGE>

                              calculating the amount payable upon exchange at
                              maturity of the SPARQS in accordance with
                              paragraph 5 above upon written request by any
                              holder of this SPARQS.

Market Disruption Event....   "Market Disruption Event" means, with respect to
                              Qualcomm Stock (and any other security that may
                              be included as Exchange Property):

                                (i) a suspension, absence or material
                                limitation of trading of Qualcomm Stock (or any
                                such other security) on the primary market for
                                Qualcomm Stock (or any such other security) for
                                more than two hours of trading or during the
                                one-half hour period preceding the close of the
                                principal trading session in such market; or a
                                breakdown or failure in the price and trade
                                reporting systems of the primary market for
                                Qualcomm Stock (or any such other security) as
                                a result of which the reported trading prices
                                for Qualcomm Stock (or any such other security)
                                during the last one-half hour preceding the
                                close of the principal trading session in such
                                market are materially inaccurate; or the
                                suspension, absence or material limitation of
                                trading on the primary market for trading in
                                options contracts related to Qualcomm Stock (or
                                any such other security), if available, during
                                the one- half hour period preceding the close
                                of the principal trading session in the
                                applicable market, in each case as determined
                                by the Calculation Agent in its sole
                                discretion; and

                                (ii) a determination by the Calculation Agent
                                in its sole discretion that any event described
                                in clause (i) above materially interfered with
                                the ability of the Issuer or any of its
                                affiliates to unwind or adjust all or a
                                material portion of the hedge with respect to
                                the SPARQS.

                              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, (2) a
                              decision to permanently discontinue trading in
                              the relevant options contract shall not
                              constitute a Market Disruption Event, (3)
                              limitations pursuant to NYSE Rule

                                     A-15
<PAGE>

                              80A (or any applicable rule or regulation enacted
                              or promulgated by the NYSE, any other
                              self-regulatory organization or the Securities
                              and Exchange Commission 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 options contracts on Qualcomm Stock
                              (or any such other security) by the primary
                              securities market trading in such options, if
                              available, by reason of (x) a price change
                              exceeding limits set by such securities exchange
                              or market, (y) an imbalance of orders relating to
                              such contracts or (z) a disparity in bid and ask
                              quotes relating to such contracts shall
                              constitute a suspension, absence or material
                              limitation of trading in options contracts
                              related to Qualcomm Stock (or any such other
                              security) and (5) a suspension, absence or
                              material limitation of trading on the primary
                              securities market on which options contracts
                              related to Qualcomm Stock (or any such other
                              security) are traded shall not include any time
                              when such securities market is itself closed for
                              trading under ordinary circumstances.

Alternate Exchange
Calculation in Case of an
Event of Default...........   In case an event of default with respect to the
                              SPARQS shall have occurred and be continuing, the
                              amount declared due and payable per each $
                              principal amount of this SPARQS upon any
                              acceleration of this SPARQS shall be determined
                              by the Calculation Agent and shall be an amount
                              in cash equal to the lesser of (i) the product of
                              (x) the Market Price of Qualcomm Stock (and any
                              Exchange Property) as of the date of such
                              acceleration and (y) the then current Exchange
                              Ratio and (ii) the Call Price calculated as
                              though the date of acceleration were the Call
                              Date (regardless of whether the date of
                              acceleration is a day which occurs prior to      ,
                              200[ ]), in each case plus accrued but unpaid
                              interest to but excluding the date of
                              acceleration; provided that if the Issuer has
                              called the SPARQS in accordance with the Morgan
                              Stanley Call Right, the amount declared due and
                              payable upon any such acceleration shall be an
                              amount in cash for each $        principal amount
                              of the SPARQS equal to the Call Price for the
                              Call Date specified in the Issuer's notice of
                              mandatory exchange, plus accrued but unpaid
                              interest to but excluding the date of
                              acceleration.

                                     A-16

<PAGE>

Treatment of SPARQS for
United States Federal
Income Tax Purposes........   The Issuer, by its sale of this SPARQS, and the
                              holder of this SPARQS (and any successor holder
                              of this SPARQS), by its respective purchase
                              hereof, agree (in the absence of an
                              administrative determination or judicial ruling
                              to the contrary) to characterize each $
                              principal amount of this SPARQS for all tax
                              purposes as an investment unit consisting of (A)
                              a terminable contract (the "Terminable Forward
                              Contract") that (i) requires the holder of this
                              SPARQS (subject to the Morgan Stanley Call Right)
                              to purchase, and the Issuer to sell, for an
                              amount equal to $           (the "Forward
                              Price"), Qualcomm Stock at maturity and (ii)
                              allows the Issuer, upon exercise of the Morgan
                              Stanley Call Right, to terminate the Terminable
                              Forward Contract by returning to such holder the
                              Deposit (as defined below) and paying to such
                              holder an amount of cash equal to the difference
                              between the Deposit and the Call Price and (B) a
                              deposit with the Issuer of a fixed amount of
                              cash, equal to the Issue Price per each
                              $           principal amount of this SPARQS, to
                              secure the holder's obligation to purchase
                              Qualcomm Stock pursuant to the Terminable Forward
                              Contract (the "Deposit"), which Deposit bears an
                              annual yield of   % per annum.

                                      A-17

<PAGE>

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

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

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

                                      A-18

<PAGE>

as such address shall appear in the Note register. A holder of U.S. $10,000,000
(or the equivalent in a Specified Currency) or more in aggregate principal
amount of Notes having the same Interest Payment Date, the interest on which is
payable in U.S. dollars, shall be entitled to receive payments of interest,
other than interest due at maturity or on any date of redemption or repayment,
by wire transfer of immediately available funds if appropriate wire transfer
instructions have been received by the Paying Agent in writing not less than 15
calendar days prior to the applicable Interest Payment Date.

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

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

                                      A-19

<PAGE>

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-20

<PAGE>

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

DATED:                                        MORGAN STANLEY DEAN WITTER & CO.

                                              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,
   as Trustee

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

                                     A-21

<PAGE>

                              REVERSE OF SECURITY

     This Note is one of a duly authorized issue of Senior Global Medium-Term
Notes, Series C, having maturities more than nine months from the date of issue
(the "Notes") of the Issuer. The Notes are issuable under an Amended and
Restated Senior Indenture, dated as of May 1, 1999, between the Issuer and
JPMorgan Chase Bank (formerly known as The Chase Manhattan 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 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 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

                                     A-22

<PAGE>

accrued and unpaid hereon to the date of repayment. For this Note to be repaid
at the option of the holder hereof, the Paying Agent must receive at its
corporate trust office in the Borough of Manhattan, The City of New York, at
least 15 but not more than 30 days prior to the date of repayment, (i) this
Note with the form entitled "Option to Elect Repayment" below duly completed or
(ii) a telegram, telex, facsimile transmission or a letter from a member of a
national securities exchange or the National Association of Securities Dealers,
Inc. or a commercial bank or a trust company in the United States setting forth
the name of the holder of this Note, the principal amount hereof, the
certificate number of this Note or a description of this Note's tenor and
terms, the principal amount hereof to be repaid, a statement that the option to
elect repayment is being exercised thereby and a guarantee that this Note,
together with the form entitled "Option to Elect Repayment" duly completed,
will be received by the Paying Agent not later than the fifth Business Day
after the date of such telegram, telex, facsimile transmission or letter;
provided, that such telegram, telex, facsimile transmission or letter shall
only be effective if this Note and form duly completed are received by the
Paying Agent by such fifth Business Day. Exercise of such repayment option by
the holder hereof shall be irrevocable. In the event of repayment of this Note
in part only, a new Note or Notes for the amount of the unpaid portion hereof
shall be issued in the name of the holder hereof upon the cancellation hereof.

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

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

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

     This Note, and any Note or Notes issued upon transfer or exchange hereof,
is issuable only in fully registered form, without coupons, and, if denominated
in U.S. dollars, unless otherwise stated above, is issuable only in
denominations of U.S. $1,000 and any integral multiple of U.S. $1,000 in excess
thereof. If this Note is denominated in a Specified Currency other than U.S.
dollars, then, unless a higher minimum denomination is required by applicable
law, it is issuable only in denominations of the equivalent of U.S. $1,000
(rounded to an integral multiple of 1,000 units of such Specified Currency), or
any amount in excess thereof which is an integral multiple of 1,000 units of
such Specified Currency, as determined by reference to the noon dollar buying
rate in The City of New York for cable transfers of such Specified Currency
published by the Federal

                                     A-23

<PAGE>

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
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
Trustee and executed by the registered holder in person or by the holder's
attorney duly authorized in writing. The date of registration of any Note
delivered upon any exchange or transfer of Notes shall be such that no gain or
loss of interest results from such exchange or transfer.

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

     The Senior Indenture provides that (a) if an Event of Default (as defined
in the Senior Indenture) due to the default in payment of principal of,
premium, if any, or interest on, any series of debt securities issued under the
Senior Indenture, including the series of Senior Medium-Term Notes of which
this Note forms a part, or due to the default in the performance or breach of
any other covenant or warranty of the Issuer applicable to the debt securities
of such series but not applicable to all outstanding debt securities issued
under the Senior Indenture shall have occurred and be continuing, either the
Trustee or the holders of not less than 25% in principal amount of the

                                     A-24

<PAGE>

debt securities of each affected series (voting as a single class) 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 or insolvency of the Issuer, shall have occurred and be continuing,
either the Trustee or the holders of not less than 25% in principal amount of
all debt securities issued under the Senior Indenture then outstanding (treated
as one class) 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 principal
amount of the debt securities of all affected series then outstanding.

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

     If the face hereof indicates that this Note is subject to "Tax Redemption
and Payment of Additional Amounts," this Note may be redeemed, as a whole, at
the option of the Issuer at any time prior to maturity, upon the giving of a
notice of redemption as described below, at a redemption price equal to 100% of
the principal amount hereof, together with accrued interest to the date fixed
for redemption (except that if this Note is subject to "Modified Payment upon
Acceleration or Redemption," such redemption price would be limited to the
aggregate principal amount hereof multiplied by the sum of the Issue Price
specified on the face hereof (expressed as a percentage of the aggregate
principal amount) plus the original issue discount amortized from the Interest
Accrual Date to the date of redemption, which amortization shall be calculated
using the "interest method" (computed in accordance with generally accepted
accounting principles in effect on the date of redemption) (the "Amortized
Amount")), if the Issuer determines that, as a result of any change in or
amendment to the laws (or any regulations or rulings promulgated thereunder) of
the United States or of any political subdivision or taxing authority thereof
or therein affecting taxation, or any change in official position regarding the
application or interpretation of such laws, regulations or rulings, which
change or amendment becomes effective on or after the Initial Offering Date
hereof, the Issuer has or will become obligated to pay Additional Amounts (as
defined below) with respect

                                      A-25

<PAGE>

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 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 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 days
prior to the date fixed for redemption or within the Redemption Notice Period
specified on 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 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, be required to make any payment of
Additional Amounts to any such holder for or on account of:

          (a) any such 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) and the United States and
     its possessions, 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 the holder of this Note
     for payment on a date more than 15 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 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;

                                      A-26

<PAGE>

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

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

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

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

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

nor shall Additional Amounts be paid 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.

     The Senior Indenture permits the Issuer and the Trustee, with the consent
of the holders of not less than a majority in aggregate principal amount of the
debt securities of all series issued under the Senior Indenture then
outstanding and affected (voting as one class), to execute supplemental
indentures adding any provisions to or changing in any manner the rights of the
holders of each series so affected; provided that the Issuer and the Trustee
may not, without the consent of the holder of each outstanding debt security
affected thereby, (a) extend the final maturity of any such debt security, or
reduce the principal amount thereof, or reduce the rate or extend the time of
payment of interest thereon, or reduce any amount payable on redemption or
repayment 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 (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
without the consent of the holder of each debt security so affected or (b)
reduce the aforesaid percentage in principal amount of debt securities the
consent of the holders of which is required for any such supplemental
indenture.

                                      A-27

<PAGE>

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

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

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

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

                                     A-28

<PAGE>

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

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

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

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

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

     As used herein, the term "United States Alien" means any person who, for
United States federal income tax purposes, is a foreign corporation, a
non-resident alien individual, a non-resident alien fiduciary of a foreign
estate or trust, or a foreign partnership one or more of the members of which
is a foreign corporation, a non-resident alien individual or a non-resident
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-29

<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-30

<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-31

<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-32<PAGE>
                                                                   Exhibit 10.20

                    AMENDMENT NO. 3 dated as of December 12, 2001 (this
               "Amendment"), to the Credit Agreement dated as of June 28, 1999,
               as amended and restated as of July 21, 1999 and as amended on
               December 23, 1999 and on April 10, 2000 (the "Credit Agreement"),
               among Knowles Electronics Inc., a Delaware corporation (the
               "Parent Borrower"); the financial institutions party thereto as
               Lenders (the "Lenders"); The Chase Manhattan Bank, as
               administrative agent (in such capacity, the "Administrative
               Agent") and Morgan Stanley Senior Funding, Inc., as Syndication
               Agent.

     A.   The Lenders and the Issuing Bank have extended credit to the Borrower,
and have agreed to extend credit to the Parent Borrower, in each case pursuant
to the terms and subject to the conditions set forth in the Credit Agreement.

     B.   The Parent Borrower has requested that the Credit Agreement be amended
as set forth herein. The Required Lenders are willing to amend the Credit
Agreement pursuant to the terms and subject to the conditions set forth herein.

     C.   Capitalized terms used but not defined herein have the meanings
assigned to them in the Credit Agreement as amended hereby.

     Accordingly, in consideration of the mutual agreements herein contained and
other good and valuable consideration, the sufficiency and receipt of which are
hereby acknowledged, the parties hereto agree as follows:

     SECTION 1. Amendment. The Credit Agreement is hereby amended as follows:

     (a)  The table in the definition of the term "Applicable Rate" in Section
1.01 of the Credit Agreement is replaced with the following table:

<Table>
<Caption>
-----------------------------------------------------------------------------------------------------------------
                                                   Eurodollar                          Eurodollar
                              ABR Revolving/       Revolving/       ABR Tranche B      Tranche B       Commitment
Leverage Ratios:             Tranche A Spread   Tranche A Spread       Spread           Spread          Fee Rate
-----------------------------------------------------------------------------------------------------------------
<S>                          <C>               <C>                 <C>               <C>              <C>
Category 1
Greater than or equal to
  4:50 to 1:00                   2.00%              3.00%              3.00%            4.00%            0.50%
-----------------------------------------------------------------------------------------------------------------
Category 2
Greater than or equal to
  3.75 to 1.00 and less than
  4.50 to 1.00                   1.75%              2.75%              3.00%            4.00%           0.375%
-----------------------------------------------------------------------------------------------------------------
Category 3
Greater than or equal to
  3.00 to 1.00 and less than
  3.75 to 1.00                   1.50%              2.50%              3.00%            4.00%           0.375%
-----------------------------------------------------------------------------------------------------------------
Category 4
Greater than or equal to
  2.25 to 1.00 and less than
  3.00 to 1.00                   1.25%              2.25%              3.00%            4.00%           0.375%
-----------------------------------------------------------------------------------------------------------------
Category 5
Less than 2.25 to 1.00           1.00%              2.00%              3.00%            4.00%           0.375%
-----------------------------------------------------------------------------------------------------------------
</Table>

<PAGE>
                                                                               2

          (b)  The definition of the term "Consolidated EBITDA" in Section 1.01
of the Credit Agreement is hereby amended by (i) deleting the word "and" at the
end of clause (a)(iii) thereof and substituting in lieu thereof a comma and
(ii) adding, following the words "for such period" appearing at the end of
clause (a)(iv) thereof, the following: "and (v) non-cash charges relating to the
sale of RufElectronics Gmbh,".

          (c)  The amount "$25,000,000" appearing in clause (i) of the proviso
of the definition of the term "Permitted Acquisition" in Section 1.01 of the
Credit Agreement is replaced with the following: "(x) on or prior to March 30,
2003, $5,000,000 or (y) on or after March 31, 2003, $25,000,000".

          (d)  Section 2.01 of the Credit Agreement is amended by (i) deleting
the comma at the end of clause (b) of the first sentence thereof and
substituting in lieu thereof the word "and" and (ii) deleting from the end of
the first sentence thereof the following:

     and (d) to make Multicurrency Revolving Loans to any Borrower from time to
     time during the Multicurrency Revolving Availability Period in an aggregate
     principal amount that will not result in such Lender's Multicurrency
     Revolving Exposure (determined base on Assigned Dollar Value, in the case
     of Alternative Currency Loans) exceeding such Lender's Multicurrency
     Revolving Commitment

          (e)  Clause (a) of Section 2.04 of the Credit Agreement is amended by
(i) deleting the number "(i)", (ii) deleting the letter "(A)" and substituting
in lieu thereof the number "(i)", (iii) deleting the letter "(B)" and
substituting in lieu thereof the number "(ii)" and (iv) deleting the following:

     and (ii) Multicurrency Swingline Loans to any Borrower from time to time
     during the Multicurrency Revolving Availability Period, in an aggregate
     principal amount at any time outstanding that will not result in (A) the
     aggregate principal amount of outstanding Multicurrency Swingline Loans
     exceeding $5,000,000 or (B) the sum of the total Multicurrency Revolving
     Exposures (determined based on Assigned Dollar Values, in the case of
     Alternative Currency Loans, Alternative Currency Letters of Credit and
     Alternative Currency LC Disbursements) exceeding the total Multicurrency
     Revolving Commitments

          (f)  Clause (a) of Section 2.05 of the Credit Agreement is amended by
(i) deleting the number "(i)", (ii) deleting the following:

     and (ii) each Borrower may request the issuance of Multicurrency Letters of
     Credit for its own account, in a form reasonably acceptable to the
     Administrative Agent and the Issuing Bank, at any time and from time to
     time during the Multicurrency Revolving Availability Period and prior to
     the date that is five Business Days prior to the Revolving Maturity Date

and (iii) deleting the following:

     Multicurrency Letters of Credit shall be denominated only in Dollars or an
     Alternative Currency.

          (g)  Clause (b) of Section 2.05 of the Credit Agreement is amended by
(i) deleting the following:

<PAGE>
     whether such Letter of Credit is a Domestic Letter of Credit or a
     Multicurrency Letter of Credit,

(ii), deleting the following:

     in the case of a Multicurrency Letter of Credit, whether such Multicurrency
     Letter of Credit is to be denominated in Dollars, Euro or Sterling,

and (iii) deleting the following:

     and (ii) in the case of the issuance, amendment, renewal or extension of a
     Multicurrency Letter of Credit, (A) the Multicurrency LC Exposure
     (determined based on Assigned Dollar Values, in the case of Alternative
     Currency Letters of Credit and Alternative Currency LC Disbursements) shall
     not exceed $5,000,000 and (B) the total Multicurrency Revolving Exposures
     (determined based on Assigned Dollar Values, in the case of Alternative
     Currency Loans, Alternative Currency Letters of Credit and Alternative
     Currency LC Disbursements) shall not exceed the total Multicurrency
     Revolving Commitments. In the case of an Alternative Currency Letter of
     Credit, (i) on the Denomination Date for such Letter of Credit, the Issuing
     Bank shall determine the Alternative Currency Equivalent of the Dollar
     amount of such Letter of Credit specified in the applicable notice
     requesting such Letter of Credit, (ii) the Issuing Bank shall notify the
     applicable Borrower and the Administrative Agent of the Alternative
     Currency Equivalent so determined and the Administrative Agent shall notify
     each Multicurrency Revolving Lender of its participation therein as
     denominated in the applicable Alternative Currency in accordance with
     paragraph (d) of this Section and (iii) such Letter of Credit shall be
     issued, amended, renewed or extended in the applicable Alternative Currency
     in a principal amount equal to the Alternative Currency Equivalent so
     determined.

          (h) Section 6.05 of the Credit Agreement is hereby amended by deleting
the words "this clause (c) shall not exceed $25,000,000 during any fiscal year
of the Parent Borrower or $50,000,000 in the aggregate during the term of this
Agreement;" appearing in clause (d) thereof and substituting in lieu thereof the
following:

     this clause (d) shall not exceed $10,000,000 during any fiscal year of the
     Parent Borrower or $35,000,000 in the aggregate during the term of this
     Agreement;

          (i) The table in Section 6.12 of the Credit Agreement is replaced
with the following table:

<Table>
<Caption>
          Period                                          Ratio
          ------                                          -----
<S>                                                    <C>
June 30, 2001 through December 30, 2001                1.60 to 1.00
December 31, 2001 through March 30, 2002               1.55 to 1.00
March 31, 2002 through June 29, 2002                   1.60 to 1.00
June 30, 2002 through September 29, 2002               1.65 to 1.00
September 30, 2002 through December 30, 2002           1.75 to 1.00
December 31, 2002 through March 30, 2003               1.85 to 1.00
</Table>
<PAGE>
                                                                               4

March 31, 2003 through September 29, 2003              2.25 to 1.00
September 30, 2003 through March 30, 2004              2.25 to 1.00
March 31, 2004 through March 30, 2005                  2.50 to 1.00
March 31, 2005 through March 30, 2006                  2.75 to 1.00
March 31, 2006 through March 30, 2007                  3.00 to 1.00
March 31, 2007 and thereafter                          3.25 to 1.00

           (j) The table in Section 6.13 of the Credit Agreement is replaced
with the following table:

             Period                                       Ratio
             ------                                       -----

June 30, 2001 through December 30, 2001                5.50 to 1.00
December 31, 2001 through March 30, 2002               6.20 to 1.00
March 31, 2002 through June 29, 2002                   6.10 to 1.00
June 30, 2002 through September 29, 2002               5.95 to 1.00
September 30, 2002 through December 30, 2002           5.75 to 1.00
December 31, 2002 through March 30, 2003               5.30 to 1.00
March 31, 2003 through September 29, 2003              4.00 to 1.00
September 30, 2003 through March 30, 2004              4.00 to 1.00
March 31, 2004 through March 30, 2006                  3.75 to 1.00
March 31, 2006 and thereafter                          3.50 to 1.00

           (k) Section 6.14 of the Credit Agreement is hereby amended by
(i) deleting the words "in any fiscal year of the Parent Borrower to exceed
$25,000,000" appearing in clause (a) thereof and substituting in lieu thereof
the following:

     (i) in any fiscal year of the Parent Borrower other than 2002 to exceed
     $25,000,000 and (ii) in 2002 to exceed $20,000,000

,(ii) adding, following the words "pursuant to paragraph (a) in any fiscal year"
appearing in paragraph (b) thereof, the following: "other than 2001", (iii)
deleting the word "and" appearing at the end of clause (i) appearing in clause
(b) thereof and substituting in lieu thereof a comma and (iv) adding before the
close parenthesis at the end of clause (b)(ii) thereof the following:

     and (iii) no amount may be carried forward from 2001 to 2002

           SECTION 2. Representations and Warranties.  The Parent Borrower
represents and warrants to the Administrative Agent and to each of the Lenders
that:

           (a) This Amendment has been duly authorized, executed and delivered
     by it and constitutes the legal, valid and binding obligation of the Parent
     Borrower, enforceable against the Parent Borrower in accordance with its
     terms subject to applicable bankruptcy, insolvency, reorganization,
     moratorium or other laws affecting creditors' rights generally and subject
     to general principles of equity, regardless of whether considered in a
     proceeding in equity or at law.

<PAGE>
                                                                               5

          (b)  On and as of the date of this Amendment, the representations and
     warranties set forth in Article III of the Credit Agreement are true and
     correct in all material respects with the same effect as if made on the
     date hereof, except to the extent such representations and warranties
     expressly relate to an earlier date.

          (c)  At the time of and immediately after giving effect to this
     Agreement, no Event of Default or Default has occurred and is continuing.

          SECTION 3. Conditions to Effectiveness. This Amendment shall become
effective as of the date (the "Effective Date") first above written when:

          (a)  The Administrative Agent shall have received counterparts of this
     Amendment that, when taken together, bear the signatures of the Parent
     Borrower and the Required Lenders.

          (b)  The representations and warranties set forth in Section 2 of this
     Amendment shall be true and correct.

          (c)  Each Lender that executes this Amendment on or before December
     21, 2001 shall have received an Amendment Fee equal to 0.25% of its Total
     Commitment under the Credit Agreement.

          (d)  The Borrowers shall have prepaid all Multicurrency Revolving
     Loans and Multicurrency Swingline Loans, if any, and all Multicurrency
     Letters of Credit, if any, shall have terminated or been cancelled.

          SECTION 4. Effect of Amendment. Except as expressly set forth herein,
this Amendment shall not by implication or otherwise limit, impair, constitute a
waiver of, or otherwise affect the rights or remedies of the Lenders under the
Credit Agreement or any other Loan Document, and shall not alter, modify, amend
or in any way affect any of the terms, conditions, obligations, covenants or
agreements contained in the Credit Agreement or any other Loan Document, all of
which are ratified and affirmed in all respects and shall continue in full force
and effect. Nothing herein shall be deemed to entitle the Parent Borrower to a
consent to, or a waiver, amendment, modification or other change of, any of the
terms, conditions, obligations, covenants or agreements contained in the Credit
Agreement or any other Loan Document in similar or different circumstances. This
Amendment shall apply and be effective only with respect to the provisions of
the Credit Agreement set forth herein. This Amendment shall constitute a Loan
Document for all purposes under the Credit Agreement.

          SECTION 5. APPLICABLE LAW. THIS AMENDMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.

          SECTION 6. Counterparts. This Amendment may be executed in two or more
counterparts, each of which shall constitute an original but all of which when
taken together shall constitute but one agreement. Delivery of an executed
signature page to this Amendment by facsimile shall be effective as delivery of
a manually executed counterpart hereof.

<PAGE>

                                                                               6

     SECTION 7. Expenses. The Parent Borrower agrees to reimburse the
Administrative Agent for its out-of-pocket expenses in connection with this
Amendment, including the reasonable fees, charges and disbursements of Cravath,
Swaine & Moore, counsel for the Administrative Agent.
<PAGE>
                                                                               7

     IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed by their respective authorized officers as of the day and year
first written above.

                                   KNOWLES ELECTRONICS, INC.,

                                     by
                                       ------------------------------------
                                       Name:
                                       Title:

                                   JPMORGAN CHASE BANK, individually and
                                   as Administrative Agent,

                                     by
                                       ------------------------------------
                                       Name:
                                       Title:

                                   MORGAN STANLEY SENIOR FUNDING,
                                   INC., individually and as Syndication Agent,

                                     by
                                       ------------------------------------
                                       Name:
                                       Title:

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