Document:

Exhibit 4.1 

FORM OF FIXED RATE SENIOR NOTE

	
REGISTERED		 		
REGISTERED	
	
No. FXR-1		 		
U.S. $	
	 		 		
CUSIP: 61750V493	

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

	
MORGAN STANLEY
	
	
SENIOR GLOBAL MEDIUM-TERM NOTE, SERIES F
	
	 

	
	
PERFORMANCE LEVERAGED UPSIDE SECURITIES (“PLUS”)
	
	 

	
	
PLUS DUE APRIL 20, 2008
	
	
MANDATORILY EXCHANGEABLE
	
	
FOR AN AMOUNT PAYABLE IN U.S. DOLLARS
	
	
BASED ON THE VALUE OF THE PHLX SEMICONDUCTOR SECTORSM INDEX
	

	
ORIGINAL ISSUE DATE:		
INITIAL REDEMPTION	

   DATE: N/A 	
INTEREST RATE: None		
MATURITY DATE: See	

   “Maturity Date” below. 
	
INTEREST ACCRUAL	

   DATE: N/A 	
INITIAL REDEMPTION	

   PERCENTAGE: N/A 	
INTEREST PAYMENT	

   DATE(S): N/A 	
OPTIONAL

   REPAYMENT

   DATE(S): N/A
	
SPECIFIED CURRENCY:	

   U.S. dollars 	
ANNUAL REDEMPTION	

   PERCENTAGE 

   REDUCTION: N/A 	
INTEREST PAYMENT	

   PERIOD: N/A 	
APPLICABILITY OF	

   MODIFIED 

   PAYMENT UPON 

   ACCELERATION OR 

   REDEMPTION: See 

   “Alternate Exchange 

   Calculation in the Case 

   of an Event of Default”

   below. 
	
IF SPECIFIED	

   CURRENCY OTHER 

   THAN U.S. DOLLARS, 

   OPTION TO ELECT 

   PAYMENT IN U.S. 

   DOLLARS: N/A 
	
REDEMPTION NOTICE	

   PERIOD: N/A 	
APPLICABILITY OF	

   ANNUAL INTEREST 

   PAYMENTS: N/A 	
If yes, state Issue Price:	

   N/A 
	
EXCHANGE RATE	

   AGENT: N/A 	
TAX REDEMPTION	

   AND PAYMENT OF 

   ADDITIONAL 

   AMOUNTS: NO 	
PRICE APPLICABLE	

   UPON OPTIONAL 

   REPAYMENT: N/A 	
ORIGINAL YIELD TO	

   MATURITY: N/A 
	
OTHER PROVISIONS:	

   See below	
IF YES, STATE INITIAL	

   OFFERING DATE: N/A 	 		 	

	Stated Principal Amount	 	$10
	 	 	 
	Underlying Index	 	The PHLX Semiconductor Sectorsm Index
	 	 	 
	Underlying Index Publisher 	 	Philadelphia Stock Exchange, Inc.
	 	 	 
	Initial Index Value 	 	 
	 	 	 
	Pricing Date	 	 
	 	 	 
	Denominations	 	$10 and integral multiples thereof
	 	 	 
	Bull Market or Bear Market PLUS

	 		Bull Market PLUS

2

	
Maximum Payment at Maturity
		 
		
$           per Stated Principal Amount
	
	 

	
	
Minimum Payment at Maturity
		 
		 

	
	
   if Bear Market PLUS
		 
		
N/A
	
	 

	
	Leverage Factor

Index Valuation Date(s)

		 
		          %

April 17, 2008.

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

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

	
	 

	
	Maturity Date

		 
		April 20, 2008, subject to extension if the scheduled Index Valuation Date or Final Index Valuation Date, as applicable, is postponed in accordance with the definition thereof. If the scheduled Index
Valuation Date or Final Index Valuation Date, as applicable, is postponed so that it falls less than two scheduled

	

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		Trading Days prior to the scheduled Maturity Date, the Maturity Date shall be the second scheduled Trading Day following the Index Valuation Date or Final Index Valuation Date, as applicable, as
postponed. See “Index Valuation Date(s).”

In the event that the Maturity Date of the PLUS is postponed due to postponement of the Index Valuation Date or the Final Index Valuation Date, as applicable, as described in the immediately preceding paragraph, the Issuer
shall give notice of such postponement and, once it has been determined, of the date to which the Maturity Date has been rescheduled (i) to the holder of this PLUS by mailing notice of such postponement by first class mail, postage prepaid, to the
holder’s last address as it shall appear upon the registry books, (ii) to the Trustee by telephone or facsimile confirmed by mailing such notice to the Trustee by first class mail, postage prepaid, at its New York office and (iii) to The
Depository Trust Company (the “Depositary”) by telephone or facsimile confirmed by mailing such notice to the Depositary by first class mail, postage prepaid. Any notice that is mailed in the manner herein provided shall be conclusively
presumed to have been duly given, whether or not the holder of this PLUS receives the notice. The Issuer shall give such notice as promptly as possible, and in no case later than (i) with respect to notice of postponement of the Maturity Date, the
Business Day immediately following the scheduled Index Valuation Date or Final Index Valuation Date, as applicable, and (ii) with respect to notice of the date to which the Maturity Date has been rescheduled, the Business Day immediately following
the actual Index Valuation Date or Final Index Valuation Date, as applicable, for determining the Final Index Value (as defined below) or Final Average Index Value (as defined below), as applicable.

	
	 

	
	Payment at Maturity

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

1. For a Bull Market PLUS, (i) if the Final Index Value, or Final Average Index Value, as applicable, is greater than the Initial Index Value, the lesser of (a) the
Stated Principal Amount plus the Leveraged Upside

	

4

	
		 
		Payment and (b) the Maximum Payment at Maturity or (ii) if the Final Index Value or Final Average Index Value, as applicable, is less than or equal to the Initial Index Value, the Stated Principal
Amount times the Index Performance Factor.

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

The Issuer shall, or shall cause the Calculation Agent to, (i) provide written notice to the Trustee and to the Depositary of the amount of cash to be delivered with respect to each Stated Principal Amount of this PLUS, on or
prior to 10:30 a.m. on the Trading Day preceding the Maturity Date (but if such Trading Day is not a Business Day, prior to the close of business on the Business Day preceding the Maturity Date), and (ii) deliver the aggregate cash amount due with
respect to this PLUS to the Trustee for delivery to the holder of this PLUS on the Maturity Date.

	
	 

		 	 
	
Applicable only for BULL MARKET PLUS
		 	 
	 

		 	 
	
	  Leveraged Upside Payment

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

	
	 

		 	 
	
	  Index Performance Factor

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

	
	 

		 	 
	
Applicable only for BEAR MARKET PLUS
		 	 
	 

		 	 
	
	  Enhanced Downside Payment

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

	
	 

		 	 
	
	  Upside Reduction Amount

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

	

5

	
	  Index Percent Decrease

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

	
	 

	
	Applicable for all PLUS
	 
		 
	 

	
	Index Percent Increase	 	A fraction, the numerator of which
      shall be the Final Index Value or Final Average Index Value, as applicable,
      minus the Initial Index Value and the denominator of which shall be the
    Initial Index Value.
	 	 	 
	Final Index Value
		 
		For PLUS with a single Index Valuation Date, the Index Closing Value of the Underlying Index on the Index Valuation Date, as determined by the Calculation Agent; and

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

	
	 

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

	
	 

	
	Price Source
		 
		Bloomberg page “SOX,” which shall be used by the Calculation Agent to determine the Index Closing Value of the Underlying Index.

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

	

6

	Trading Day

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

	
	 

	
	Index Business Day

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

	
	 

	
	Relevant Exchange

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

	
	 

	
	Calculation Agent

		 
		Morgan Stanley & Co. Incorporated and its successors (“MS & Co.”).

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

All calculations with respect to the Payment at Maturity shall be rounded to the nearest one billionth, with five ten-billionths rounded upward (e.g., .9876543215
would be rounded to .987654322); all dollar amounts related to determination of the amount of cash payable for each Stated Principal Amount of this PLUS shall be rounded to the nearest ten- thousandth, with five one hundred-thousandths
rounded upward (e.g., .76545 would be rounded up to .7655); and all dollar amounts paid on the aggregate number of PLUS shall be rounded to the nearest cent, with one-half cent rounded
upward.

	

7

	Market Disruption Event

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

(i)(a) a suspension, absence or material limitation of trading of stocks then constituting 20 percent or more of the value of the Underlying Index (or the Successor Index) on the Relevant Exchanges for such securities for more
than two hours of trading or during the one- half hour period preceding the close of the principal trading session on such Relevant Exchange; or

(b) a breakdown or failure in the price and trade reporting systems of any Relevant Exchange as a result of which the reported trading prices for stocks then constituting 20 percent or more of the value of the Underlying Index
(or the Successor Index) during the last one-half hour preceding the close of the principal trading session on such Relevant Exchange are materially inaccurate; or

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

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

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

	

8

			 
		each case immediately before that suspension or limitation.

For the purpose of determining whether a Market Disruption Event has occurred: (1) a limitation on the hours or number of days of trading shall not constitute a Market Disruption Event if it results from an announced change in
the regular business hours of the Relevant Exchange or market, (2) a decision to permanently discontinue trading in the relevant futures or options contract or exchange traded fund shall not constitute a Market Disruption Event, (3) limitations
pursuant to the rules of any Relevant Exchange similar to NYSE Rule 80A (or any applicable rule or regulation enacted or promulgated by any other self- regulatory organization or any government agency of scope similar to NYSE Rule 80A as
determined by the Calculation Agent) on trading during significant market fluctuations shall constitute a suspension, absence or material limitation of trading, (4) a suspension of trading in futures or options contracts or exchange traded funds on
the Underlying Index by the primary securities market trading in such contracts or funds by reason of (a) a price change exceeding limits set by such securities exchange or market, (b) an imbalance of orders relating to such contracts or funds, or
(c) a disparity in bid and ask quotes relating to such contracts or funds shall constitute a suspension, absence or material limitation of trading in futures or options contracts or exchange traded funds related to the Underlying Index and (5) a
“suspension, absence or material limitation of trading” on any Relevant Exchange or on the primary market on which futures or options contracts or exchange traded funds related to the Underlying Index are traded shall not include any time
when such securities market is itself closed for trading under ordinary circumstances.

	
	 

	
	Alternate Exchange Calculation	 	 
	  in the Case of an Event of Default

	 
		In case an event of default with respect to the PLUS shall have occurred and be continuing, the amount declared due and payable for each Stated Principal Amount of this PLUS upon any acceleration of
this PLUS shall be determined by the Calculation Agent and shall be an amount in cash equal to the Payment at Maturity calculated using the Index Closing Value as of the date of such acceleration as the Final Index

	

9

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

If the maturity of the PLUS is accelerated because of an event of default as described above, the Issuer shall, or shall cause the Calculation Agent to, provide written notice to the Trustee at its New York office, on which
notice the Trustee may conclusively rely, and to the Depositary of the cash amount due with respect to each Stated Principal Amount of this PLUS as promptly as possible and in no event later than two Business Days after the date of
acceleration.

	
	 

	
	 	 	 
	Discontinuance of the Underlying Index; 	 	 
	  Alteration of Method of Calculation

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

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

If the Underlying Index Publisher discontinues publication of the Underlying Index prior to, and such discontinuance is continuing on, any Index Valuation Date or the date of acceleration and the Calculation Agent determines,
in its sole discretion, that no Successor Index is available at such time, then the Calculation Agent shall determine the Index Closing Value for such Index Valuation Date or date of acceleration. The Index Closing Value shall be computed by the
Calculation Agent in accordance with

	

10

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

If at any time the method of calculating the Underlying Index or a Successor Index, or the value thereof, is changed in a material respect, or if the Underlying Index or a Successor Index is in any other way modified so that
such index does not, in the opinion of the Calculation Agent, fairly represent the value of such index had such changes or modifications not been made, then, from and after such time, the Calculation Agent shall, at the close of business in New York
City on each date on which the Index Closing Value is to be determined, make such calculations and adjustments as, in the good faith judgment of the Calculation Agent, may be necessary in order to arrive at a value of a stock index comparable to the
Underlying Index or such Successor Index, as the case may be, as if such changes or modifications had not been made, and the Calculation Agent shall calculate the Final Index Value or Final Average Index Value, as applicable, with reference to the
Underlying Index or such Successor Index, as adjusted. Accordingly, if the method of calculating the Underlying Index or a Successor Index is modified so that the value of such index is a fraction of what it would have been if it had not been
modified (e.g., due to a split in the index), then the Calculation Agent shall adjust such index in order to arrive at a value of the Underlying Index or such Successor Index as if it had not been modified (e.g., as if such split had not
occurred).

	

11

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

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

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

12

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

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

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

     If the holder elects to receive all or a portion of payments of principal of, premium, if any, and interest on this Note, if denominated in a Specified Currency other than U.S. dollars, in U.S.
dollars, the Exchange Rate Agent (as defined on the reverse hereof) will convert such payments into U.S. dollars. In the event of such an election, payment in respect of this Note will be based upon the exchange rate as determined by the Exchange
Rate Agent based on the highest bid quotation in The City of New York received by such Exchange Rate Agent at approximately 11:00 a.m., New York City time, on the second Business Day preceding the applicable payment date from three recognized
foreign exchange dealers (one of which may be the Exchange Rate Agent unless such Exchange Rate Agent is an affiliate of the Issuer) for the purchase by the quoting dealer of the Specified Currency for U.S. dollars for settlement on such payment
date in the amount of the Specified Currency payable in the absence of such an election to such holder and at which the applicable dealer commits to execute a contract. If such bid quotations are not

13

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.

14

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

DATED:

  	   
	 	 	 
	By:	  
	 	

	 	 	 
	 	 	 

  	 TRUSTEE’S CERTIFICATE 
	         OF AUTHENTICATION 
	 
	This is one of the Notes referred 
	           to
      in the within-mentioned 
	             Senior
      Indenture. 
	 	 	 
	 THE BANK OF NEW YORK, as 
	         Trustee
	 	 	 
	By:	  
	 	

	 	 Authorized Signatory 

 

15

REVERSE OF SECURITY

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

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

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

16

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

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

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

17

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

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

     The Trustee has been appointed registrar for the Notes, and the Trustee will maintain at its office in The City of New York a register for the registration and transfer of Notes. This Note may be
transferred at the aforesaid office of the Trustee by surrendering this Note for cancellation, accompanied by a written instrument of transfer in form satisfactory to the Issuer and the Trustee and duly executed by the registered holder hereof in
person or by the holder’s attorney duly authorized in writing, and thereupon the Trustee shall issue in the name of the transferee or transferees, in exchange herefor, a new Note or Notes having identical terms and provisions and having a like
aggregate principal amount in authorized denominations, subject to the terms and conditions set forth herein; provided, however, that the Trustee will not be required (i) to register the
transfer of or exchange any Note that has been called for redemption in whole or in part, except the unredeemed portion of Notes being redeemed in part, (ii) to register the transfer of or exchange any Note if the holder thereof has exercised his
right, if any, to require the Issuer to repurchase such Note in whole or in part, except the portion of such Note not required to be repurchased, or (iii) to register the transfer of or exchange Notes to the extent and during the period so provided
in the Senior Indenture with respect to the redemption of Notes. Notes are exchangeable at said office for other Notes of other authorized denominations of equal aggregate principal amount having identical terms and provisions.  All such exchanges
and transfers of Notes will be free of charge, but the Issuer may require payment of a sum sufficient to cover any tax or other governmental charge in connection therewith. All Notes surrendered for exchange shall be accompanied by a written
instrument of transfer in form satisfactory to the Issuer and the Trustee and executed by the registered holder in person or by the holder’s attorney duly authorized in writing. The date of registration of any Note delivered upon any exchange
or 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

18

premises) shall be delivered to the Trustee, the Issuer in its discretion may execute a new Note of like tenor in exchange for this Note, but, if this Note is destroyed, lost or stolen, only upon receipt of evidence satisfactory
to the Trustee and the Issuer that this Note was destroyed or lost or stolen and, if required, upon receipt also of indemnity satisfactory to each of them.  All expenses and reasonable charges associated with procuring such indemnity and with the
preparation, authentication and delivery of a new Note shall be borne by the owner of the Note mutilated, defaced, destroyed, lost or stolen.

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

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

19

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

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

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

     If the face hereof indicates that this Note is subject to “Tax Redemption and Payment of Additional Amounts,” the Issuer will, subject to certain exceptions and limitations set forth below,
pay such additional amounts (the “Additional Amounts”) to the holder of this Note who is a U.S. Alien as may be necessary in order that every net payment of the principal of and
interest on this Note and any other amounts payable on this Note, after withholding or deduction

20

for or on account of any present or future tax, assessment or governmental charge imposed upon or as a result of such payment by the United States, or any political subdivision or taxing authority thereof or therein, will not be
less than the amount provided for in this Note to be then due and payable. The Issuer will not, however, make any payment of Additional Amounts to any such holder who is a U.S. Alien for or on account of:

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

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

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

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

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

     (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

21

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

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

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

     Except as set forth below, if the principal of, premium, if any, or interest on this Note is payable in a Specified Currency other than U.S. dollars and such Specified Currency is not available to the
Issuer for making payments hereon due to the imposition of exchange controls or other circumstances beyond the control of the Issuer or is no longer used by the government of the country issuing such currency or for the settlement of transactions by
public institutions within the international banking community, then the Issuer will be entitled to satisfy its obligations to the holder of this Note by making such payments in U.S. dollars on the basis of the Market Exchange Rate on the date of
such payment or, if the Market Exchange Rate is not available on such date, as of the most recent practicable date; provided, however, that if the euro has been substituted for such Specified Currency, the Issuer may at its option (or shall, if so required by applicable law) without the consent of the holder of this Note effect the payment of principal of, premium,
if any, or interest on any Note denominated in such Specified Currency in euro in lieu of such Specified Currency in conformity with legally applicable measures taken pursuant to, or by virtue of, the Treaty establishing the European Community, as
amended. Any

22

payment made under such circumstances in U.S. dollars or euro where the required payment is in an unavailable Specified Currency will not constitute an Event of Default.  If such Market Exchange Rate is not then available to the
Issuer or is not published for a particular Specified Currency, the Market Exchange Rate will be based on the highest bid quotation in The City of New York received by the Exchange Rate Agent at approximately 11:00 a.m., New York City time, on the
second Business Day preceding the date of such payment from three recognized foreign exchange dealers (the “Exchange Dealers”) for the purchase by the quoting Exchange Dealer of
the Specified Currency for U.S. dollars for settlement on the payment date, in the aggregate amount of the Specified Currency payable to those holders or beneficial owners of Notes and at which the applicable Exchange Dealer commits to execute a
contract. One of the Exchange Dealers providing quotations may be the Exchange Rate Agent unless the Exchange Rate Agent is an affiliate of the Issuer. If those bid quotations are not available, the Exchange Rate Agent shall determine the market
exchange rate at its sole discretion.

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

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

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

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

23

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

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

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

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

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

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

24

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.
	 	 
	 	 	 
	 

25

  

     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.

26

  

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.

26EXHIBIT
    4.1

	FORM OF FIXED RATE SENIOR
    NOTE
	 		 		 
	
	REGISTERED 

    No. FXR-1
		 		REGISTERED 

	  U.S. $ 

	  CUSIP: 61750V485
	

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

MORGAN STANLEY

SENIOR GLOBAL MEDIUM-TERM NOTE, SERIES F

(Fixed Rate)

HIGH INCOME TRIGGER SECURITIES

% HITS DUE APRIL 20, 2008

BASED ON 

ALLEGHENY TECHNOLOGIES INCORPORATED COMMON SHARES (the “HITS”)

 

	 ORIGINAL
    ISSUE DATE:
	 INITIAL
    REDEMPTION 

    DATE: N/A
	 INTEREST
    RATE:     %

    per annum
	 MATURITY
    DATE: See

    “Maturity
    Date” below. 

	 INTEREST
    ACCRUAL 

    DATE:
	 INITIAL
    REDEMPTION PERCENTAGE: N/A
	INTEREST
    PAYMENT 

    DATE(S): See “Interest 

    Payment Dates” below.
	 OPTIONAL
    REPAYMENT DATE(S): N/A

	 SPECIFIED
    CURRENCY: 

    U.S. dollars
	 ANNUAL
    REDEMPTION PERCENTAGE

    REDUCTION:
    N/A
	INTEREST
    PAYMENT 

    PERIOD: Monthly
	 APPLICABILITY
            OF MODIFIEDPAYMENT
          UPON ACCELERATION OR REDEMPTION: See “Alternate Exchange Calculation
    in Case of an Event of Default” below.

	 IF
          SPECIFIED CURRENCY OTHER THAN U.S. DOLLARS, OPTION TO ELECT PAYMENT
    IN U.S. DOLLARS: N/A
	 REDEMPTION
    NOTICE PERIOD: N/A
	 APPLICABILITY
    OF ANNUAL INTEREST PAYMENTS: N/A
	 If
    yes, state Issue Price: N/A

	 EXCHANGE
    RATE AGENT: N/A
	 TAX
    REDEMPTION AND PAYMENT OF 

    ADDITIONAL 

    AMOUNTS: NO
	 PRICE
    APPLICABLE UPON OPTIONAL

    REPAYMENT: N/A 
	 ORIGINAL
    YIELD TO 

    MATURITY: N/A

	 OTHER
    PROVISIONS: See 

    below.
	 IF
    YES, STATE INITIAL OFFERING DATE: N/A
	 	 

	
      Stated Principal Amount		 	
      $10	per
    HITS
	 	 	 
	
      Underlying Company		 		
      Allegheny Technologies Incorporated (“ATI”)	
	 	 	 
	
      Underlying Stock		 		
      The common shares of ATI	
	 	 	 
	
      Pricing Date		 		 	
	 	 	 
	
      Denominations		 	
       $10 and
    integral multiples thereof	

  2

	Initial Share Price	 	$
	 	 	 
	Trigger Level	 	%
	 	 	 
	Trigger Price	 	$
	 	 	 
	Acceleration Trigger Price	 	$
	 	 	 
	Exchange Ratio
	 		          , which is equal to the Stated Principal Amount divided by the Initial Share Price

	 	 	 
	Exchange Factor
		 		1.0, subject to adjustment upon
	      the occurrence of certain extraordinary dividends and corporate events
	      affecting the Underlying Stock through and including the Determination
	      Date, as described under
“Antidilution Adjustments” below.
	
	 	 	 
	Interest Payment Dates
		 		July 20, 2007, October 20, 2007, January 20, 2008 and the Maturity Date.

If the scheduled Maturity Date is postponed due to a Market Disruption Event or otherwise, the Issuer shall pay interest on the Maturity Date as postponed rather than on the scheduled Maturity Date, but no interest shall accrue
on this HITS or on such payment during the period from or after the scheduled Maturity Date.
	
	 	 	 
	Maturity Date
		 		April 20, 2008, subject to acceleration
	      as described below in “Price Event Acceleration” and “Alternate Exchange Calculation in Case of an Event of Default” and
	      subject to extension if the Determination Date is postponed in accordance
	      with the following paragraph.

If the Determination Date is postponed due to a Market Disruption Event or otherwise, the Maturity Date shall be postponed so that the Maturity Date shall be the second Trading Day following the Determination Date.
	
	 	 	 
	Determination Date
		 		April 17, 2008; provided that if such date is not a Trading Day or if a Market Disruption Event occurs on such day, the Determination Date
shall be the immediately succeeding Trading Day on which no Market Disruption Event occurs.
	

  3

	 		 		In the event that the Determination
	      Date and Maturity Date are postponed as described in the two immediately
	      preceding paragraphs, the Issuer shall, or shall cause the Calculation
	      Agent to, give notice of such postponement and, once it has been determined,
	      of the date to which the Maturity Date has been rescheduled, as promptly
	      as possible, and in no case later than 10:30 a.m. on the Trading Day immediately
	      prior to the Maturity Date (but if such Trading Day is not a Business
	      Day, prior to the close of business on the Business Day preceding the
	      Maturity Date) (i) to the holder of this HITS 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 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 HITS receives
	      the notice.
	
	 	 	 
	Record Date
		 		Notwithstanding the definition
	      of “Record Date” on page 20 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 scheduled Interest Payment Date, whether or not that date is a Business
	      Day.
	
	 	 	 
	Payment at Maturity
		 		Unless the maturity of the HITS has been accelerated, on the Maturity Date, upon delivery of this HITS to the Trustee, each Stated Principal Amount of this HITS shall be applied by the Issuer as payment
for, and the Issuer shall deliver, either:

(i) if the Trading Price of the Underlying Stock has not decreased to or below the Trigger Price at any time on any Trading Day from and including the Pricing Date to and including the Determination Date, an amount in cash
equal to the Stated Principal Amount per HITS, or
	

  4

			 		(ii) if the Trading Price of the
	      Underlying Stock has decreased to or below the Trigger Price at any time
	      on any Trading Day from and including the Pricing Date to and including
	      the Determination Date, a number of shares of the Underlying Stock equal
	      to the product of the Exchange Ratio and the Exchange Factor, each determined
	      as of the Determination Date by the Calculation Agent. See “Exchange Factor” above and “Antidilution
Adjustments” below.

The number of any shares of the Underlying Stock
    to be delivered at maturity shall be subject to any applicable adjustments
    (i) to the Exchange Factor and (ii) in the Exchange Property, as defined
    in paragraph 5 under
“Antidilution Adjustments” below, to be delivered instead of, or in addition to, such Underlying Stock as a result of any corporate event described under “Antidilution Adjustments” below,
in each case, required to be made up to the close of business on the Determination
Date.

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 the Maturity Date (but if such Trading Day is not a Business Day, prior to the close of business on the Business Day preceding the Maturity Date), of the amount of cash or Underlying Stock (or the
amount of Exchange Property), as applicable, to be delivered with respect to each Stated Principal Amount of this HITS and, in the event of a delivery of the Underlying Stock, of the amount of any cash to be paid in lieu of any fractional share of
the Underlying Stock (or of any other securities included in Exchange Property, if applicable); provided that,
if the Maturity Date of this HITS is accelerated because of a Price Event Acceleration
(as defined below) or because of an Event of Default Acceleration (as defined
in “Alternate Exchange Calculation in Case of an Event of Default” below),
the Issuer shall, or shall cause the Calculation Agent to, give notice of such
acceleration and of the amount of cash or Underlying Stock (or any Exchange
	

  5

			 		Property) payable in connection
	      therewith as promptly as possible and in no event later than (A) in the
	      case of an Event of Default Acceleration, two Trading Days after the date
	      of such acceleration (but if such second Trading Day is not a Business
	      Day, prior to the close of business on the Business Day preceding such
	      second Trading Day) and (B) in the case of a Price Event Acceleration,
	      10:30 a.m. on the Trading Day immediately prior to the date of acceleration
	      (but if such Trading Day is not a Business Day, prior to the close of
	      business on the Business Day preceding the date of acceleration), (i)
	      to the holder of this HITS 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, and (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 HITS receives the notice. If
	      the maturity of this HITS is accelerated in the manner described above,
	      no interest on the amounts payable with respect to this HITS shall accrue
	      for the period from and after such accelerated maturity date; provided that the Issuer has deposited with the Trustee the Underlying Stock, the Exchange Property or any cash due with respect to such acceleration by
such accelerated maturity date.

The Issuer shall, or shall cause the Calculation Agent to, deliver any such cash or shares of Underlying Stock (or any Exchange Property), as applicable, and cash in respect of interest and any fractional shares of Underlying
Stock (or any Exchange Property) and cash otherwise due upon any acceleration described above to the Trustee for delivery to the holder of this HITS. The Calculation Agent shall determine the Exchange Factor applicable at the maturity of this
HITS.
	

  6

			 		If this HITS is not surrendered
	      for exchange at maturity or upon acceleration, 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 Underlying
	      Stock (and, if applicable, any Exchange Property) and any cash in respect
	      of interest and any fractional shares of Underlying Stock (or any Exchange
	      Property) and any other cash due at maturity as described in the preceding
	      paragraph under this heading.

References to payment “per HITS” refer
    to each Stated Principal Amount of this HITS.
	
	 	 	 
	Price Event Acceleration
		 		If on any two consecutive Trading
	      Days during the period prior to and ending on the third Business Day immediately
	      preceding the Maturity Date, the product of the Closing Price per share
	      of Underlying Stock, as determined by the Calculation Agent, and the Exchange
	      Factor is less than the Acceleration Trigger Price, the Maturity Date
	      of this HITS shall be deemed to be accelerated to the third Business Day
	      immediately following such second Trading Day (the “date of acceleration”).
	      Upon such acceleration, the holder of this HITS shall receive per Stated
	      Principal Amount of this HITS on the date of acceleration:
	

		 	 	 
			 		 	(i) a number of shares of Underlying Stock equal to the product of the Exchange Ratio and the Exchange Factor, as of such date of acceleration; and

(ii) accrued but unpaid interest to but excluding the date of acceleration plus an amount of cash, as determined by the Calculation Agent, equal to the sum of the present values of the remaining scheduled payments of interest
on this HITS (excluding any portion of such payments of interest accrued to the date of acceleration) discounted to the date of acceleration based on the comparable yield that the Issuer would pay on a non-interest bearing, senior unsecured debt
obligation of the Issuer having a maturity equal to the term of each such remaining scheduled payment, as determined by the Calculation Agent.
	

  7

	 		 		The holder of this HITS shall not be entitled to receive the return of each Stated Principal Amount of this HITS upon a Price Event Acceleration.
	
	 	 	 
	No Fractional Shares
		 		Upon delivery of this HITS to the Trustee at maturity (including as a result of acceleration other than an acceleration resulting from an Event of Default), and if applicable, the Issuer shall deliver
the aggregate number of shares of Underlying Stock due with respect to this HITS, as described above, but the Issuer shall pay cash in lieu of delivering any fractional share of Underlying Stock in an amount equal to the corresponding fractional
Closing Price of such fraction of a share of Underlying Stock as determined by the Calculation Agent as of the Determination Date.
	
	 	 	 
	Closing Price
		 		The Closing Price for one share of the Underlying Stock (or one unit of any other security for which a Closing Price must be determined) on any Trading Day means:
	

	 	 	• 	if the Underlying Stock (or any
        such other security) is listed or
        admitted to trading on a national securities
        exchange (other than The NASDAQ

        Stock Market LLC (the “NASDAQ”)), the lastreported
        sale price, regular way, of the principaltrading session on such day
        on the principalnational securities exchange registered under theSecurities
        Exchange Act of 1934, as amended (the“Exchange Act”), on which
        the Underlying Stock(or any such other security) is listed or admitted
    totrading,
	 	 	 	 
	 	 	• 	if the Underlying Stock (or
        any such other security) is a security
        of the NASDAQ, the official closing price
    published by the NASDAQ on such day, or
	 	 	 	 
	 	 	• 	if the Underlying
        Stock (or any such other security) is
        not listed or admitted to trading on any national securities
        exchange but is included in the OTC

        Bulletin Board Service (the “OTC Bulletin Board”)operated
        by the National Association of SecuritiesDealers, Inc., the last reported
        sale price of theprincipal trading session on the OTC BulletinBoard on
    such day.

  8
  

  

  

	 		 		If the Underlying Stock (or any
	      such other security) is listed or admitted to trading on any national
	      securities exchange but the last reported sale price or the official closing
	      price published by NASDAQ, as applicable, is not available pursuant to
	      the preceding sentence, then the Closing Price for one share of the Underlying
	      Stock (or one unit of any such other security) on any Trading Day shall
	      mean the last reported sale price of the principal trading session on
	      the over-the-counter market as reported on the NASDAQ or the OTC Bulletin
	      Board on such day. If a Market Disruption Event occurs with respect to
	      the Underlying Stock (or any such other security) or the last reported
	      sale price or the official closing price published by NASDAQ, as applicable,
	      for the Underlying Stock (or any such other security) is not available
	      pursuant to either of the two preceding sentences, then the Closing Price
	      for any Trading Day shall be the mean, as determined by the Calculation
	      Agent, of the bid prices for the Underlying Stock (or any such other security)
	      for such Trading Day obtained from as many recognized dealers in such
	      security, but not exceeding three, as shall make such bid prices available
	      to the Calculation Agent. Bids of 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. The term “OTC Bulletin Board
Service” shall include any successor service thereto.

	 	 	 	 
	Intraday Price	 	The Intraday Price for one share of the Underlying
      Stock (or one unit of any other security for which an Intraday Price must
      be determined) at any time during any Trading Day (including at the close)
    means:
	 	 	 	 
	 
		 		 	(i) if the Underlying Stock (or any such other security) is listed or admitted to trading on a national securities exchange (other than NASDAQ), the most recently reported sale price, regular way, at such time during the
principal trading session on such day on the principal national securities exchange registered under the Exchange Act on which the Underlying Stock (or any such other security) is listed or admitted to trading,

  9

			 		 	(ii) if the Underlying Stock (or any such other security) is a security of NASDAQ, the most recently reported sale price, regular way, at such time during the principal trading session on such day
quoted by NASDAQ, or

(iii) if the Underlying Stock (or any such other security) is not listed or admitted to trading on any national securities exchange but is included in the OTC Bulletin Board, the most recently reported sale price at such time
during the principal trading session on the OTC Bulletin Board on such day.
	
	 	 	 	 
	Trading Price
		 		Trading Price means the product of (i) the Intraday Price of one share of the Underlying Stock and (ii) the Exchange Factor, each as determined by the Calculation Agent at any time on any Trading
    Day.

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

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

	  All determinations made by the Calculation Agent shall be at the sole discretion of the Calculation Agent and shall, in the absence of manifest error, be conclusive for all purposes and binding on the holder of this HITS, the
      Trustee and the Issuer.
	  All calculations with respect to the Exchange Ratio and the Exchange Factor for this HITS shall be made by the Calculation Agent and shall be rounded to the nearest one hundred-thousandth, with five one- millionths rounded
	    upward (e.g., .876545 would be rounded to .87655), and all dollar amounts paid to the holder of this HITS in the aggregate related to interest payments or the payment at maturity resulting
    from

  10

	 		 		such calculations shall be rounded to the nearest cent with one-half cent rounded upward.
	
	 	 	 
	Antidilution Adjustments
		 		The Exchange Factor shall be adjusted as follows:

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

2. If the Underlying Stock is subject (i) to a stock dividend (issuance of additional shares of the Underlying Stock) that is given ratably to all holders of shares of the Underlying Stock or (ii) to a distribution of the
Underlying Stock as a result of the triggering of any provision of the corporate charter of the Underlying Company, then once the dividend has become effective and the Underlying Stock is trading ex-dividend, the Exchange Factor shall be adjusted so
that the new Exchange Factor shall equal the prior Exchange Factor plus the product of (i) the number of shares issued with respect to one share of the Underlying Stock and (ii) the prior Exchange Factor.

3. If the Underlying Company issues rights or warrants to all holders of the Underlying Stock to subscribe for or purchase the Underlying Stock at an exercise price per share less than the Closing Price of the Underlying 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 HITS, then the Exchange
Factor shall be adjusted to equal the product of the prior Exchange Factor and a fraction, the numerator of which shall be the number of shares of the Underlying Stock outstanding immediately prior to the issuance of such rights or warrants plus the
number of additional shares of the Underlying Stock offered for subscription or purchase pursuant to such rights or warrants and the denominator of which shall be the number of shares of the Underlying Stock outstanding immediately prior
to
	

  11

			 		the issuance of such rights or warrants plus the number of additional shares of the Underlying Stock which the aggregate offering price of the total number of shares of the Underlying Stock so offered
for subscription or purchase pursuant to such rights or warrants would purchase at the Closing 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 Closing Price.

4. There shall be no adjustments to the Exchange
    Factor to reflect cash dividends or other distributions paid with respect
    to the Underlying Stock other than distributions described in paragraph 2,
    paragraph 3 and clauses (i), (iv) and (v) of paragraph 5 below and Extraordinary
    Dividends as described below. A cash dividend or other distribution with
    respect to the Underlying Stock shall be deemed to be an “Extraordinary Dividend” if
    such cash dividend or distribution exceeds the immediately preceding non-
    Extraordinary Dividend for the Underlying Stock by an amount equal to at
    least 10% of the Closing Price of the Underlying 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 (that is, the day on and after which transactions in the Underlying
    Stock on the primary U.S. organized securities exchange or trading system
    on which the Underlying Stock is traded or trading system no longer carry
    the right to receive that cash dividend or that cash distribution) for the
    payment of such Extraordinary Dividend. If an Extraordinary Dividend occurs
    with respect to the Underlying Stock, the Exchange Factor with respect to
    the Underlying Stock shall be adjusted on the ex-dividend date with respect
    to such Extraordinary Dividend so that the new Exchange Factor shall equal
    the product of (i) the then current Exchange Factor and (ii) a fraction,
    the numerator of which is the Closing Price on the Trading Day preceding
    the ex-dividend date, and the denominator of which is the amount by which
    the Closing Price on the Trading Day preceding the ex-
	

  12

			 		dividend date exceeds
	      the Extraordinary Dividend Amount. The “Extraordinary Dividend Amount” with
	      respect to an Extraordinary Dividend for the Underlying 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 the Underlying 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 the Underlying Stock described in clause (i), (iv) or
	      (v) of paragraph 5 below that also constitutes an Extraordinary Dividend
	      shall cause an adjustment to the Exchange Factor pursuant only to clause
	      (i), (iv) or (v) of paragraph 5, as applicable.

5. If (i) there occurs any reclassification or
    change of the Underlying Stock, including, without limitation, as a result
    of the issuance of any tracking stock by the Underlying Company, (ii) the
    Underlying Company or any surviving entity or subsequent surviving entity
    of the Underlying Company (an “Underlying Company Successor”) has been subject to a merger, combination or consolidation and is not the surviving entity, (iii) any statutory exchange of
securities of the Underlying Company or any Underlying Company Successor with another corporation occurs (other than pursuant to clause (ii) above), (iv) the Underlying Company is liquidated, (v) the Underlying Company issues to all of its
shareholders equity securities of an issuer other than the Underlying Company (other than in a transaction described in clause (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 the Underlying Stock (any such event in clauses (i) through (vi), a “Reorganization Event”),
the method of determining the amount payable upon exchange at maturity for each
HITS shall
	

  13

		 	be adjusted to provide that holders shall be
      entitled to receive at maturity, in respect of the stated principal amount
    of each HITS either:
		 	 	 
			 		 	(a) if (x) the trading price of the Underlying Stock at any time on any Trading Day from and including the Pricing Date to and including the effective date of the Reorganization Event, or (y) the Exchange Property Value (as
defined below) at any time on any Trading Day from and including the effective date of the Reorganization Event to and including the Determination Date has not decreased to or below the Trigger Price, and amount of cash equal to the stated principal
amount of each HITS, or

(b) if (x) the trading price of the Underlying
    Stock at any time on any Trading Day from and including the Pricing Date
    to and including the effective date of the Reorganization Event, or (y) the
    Exchange Property Value (as defined below) at any time on any Trading Day
    from and including the effective date of the Reorganization Event to and
    including the Determination Date has decreased to or below the Trigger Price,
    securities, cash or any other assets distributed to holders of the Underlying
    Stock in or as a result of any such Reorganization Event, including (A) in
    the case of the issuance of tracking stock, the reclassified share of the
    Underlying Stock, (B) in the case of a Spin-off Event, the share of the Underlying
    Stock with respect to which the spun-off security was issued, and (C) in
    the case of any other Reorganization Event where the Underlying Stock continues
    to be held by the holders receiving such distribution, the Underlying Stock
    (collectively, the “Exchange Property”), in an amount equal to
    the amount of Exchange Property delivered with respect to a number of shares
    of the Underlying Stock equal to the Exchange Ratio times the Exchange Factor
    each determined at the time of the Reorganization Event.
	

  14

			 		If Exchange Property consists of more than one type of property, the Issuer shall deliver to the Depositary, as holder of the HITS, at maturity a pro rata share of each such type of Exchange Property.
If Exchange Property includes a cash component, holders shall not receive any interest accrued on such cash component. In the event Exchange Property consists of securities, such securities shall, in turn, be subject to the antidilution adjustments
set forth in paragraphs 1 through 5.

For purposes of determining whether or not the
    Exchange Property Value has decreased to or below the Trigger Level at any
    time on any Trading Day from and including the time of the Reorganization
    Event to and including the Determination Date, “Exchange Property Value” means
    (i) for any cash received in any Reorganization Event, the value, as determined
    by the Calculation Agent, as of the date of receipt, of such cash received
    for one share of the Underlying Stock, as adjusted by the Exchange Factor
    as the time of such Reorganization Event, (ii) for any property other than
    cash or securities received in any such Reorganization Event, the market
    value, as determined by the Calculation Agent in its sole discretion, as
    of the date of receipt, of such Exchange Property received for one share
    of the Underlying Stock, as adjusted by the Exchange Factor at the time of
    such Reorganization Event and (iii) for any security received in any such
    Reorganization Event, an amount equal to the Intraday Price, as of the time
    at which the Exchange Property Value is determined, per share of such security
    multiplied by the quantity of such security received for each share of the
    Underlying Stock, as adjusted by the Exchange Factor at the time of such
    Reorganization Event.

For purposes of paragraph 5 above, in the case of a consummated tender or exchange offer or going- private transaction involving consideration of particular types, Exchange Property shall be deemed to include the amount of cash
or other property delivered by the offeror in the tender or exchange offer (in an amount determined on the basis of the rate of exchange in such tender or exchange offer or going-private
	

  15

			 		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.

Following the occurrence of any Reorganization
    Event referred to in paragraph 5 above, (i) references to the “Underlying Stock” under “No Fractional Shares,” “Price Event Acceleration” and
“Alternate Exchange Calculation in Case of an Event of Default” shall be deemed to also refer to any other security received by holders of the Underlying Stock in any such Reorganization Event, and (ii) all other references in this HITS to
“Underlying Stock” shall be deemed to refer to the Exchange Property into which this HITS is thereafter exchangeable and references to a “share” or “shares” of
the Underlying Stock shall be deemed to refer to the applicable unit or units
of such Exchange Property, unless the context otherwise requires.

No adjustment to the Exchange Factor shall be required unless such adjustment would require a change of at least 0.1% in the Exchange Factor then in effect. The Exchange Factor resulting from any of the adjustments specified
above shall be rounded to the nearest one hundred-thousandth, with five one- millionths rounded upward. Adjustments to the Exchange Factor shall be made up to the close of business on the Determination Date.

No adjustments to the Exchange Factor or method of calculating the Exchange Factor shall be required other than as specified above.

The Calculation Agent shall be solely responsible for the determination and calculation of any adjustments to the Exchange Factor or method of calculating the Exchange Factor 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 paragraphs 1 through 5 above, and its
	

  16

	 		 	
      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 Factor or to the method of calculating the amount payable
          at maturity of this HITS made pursuant to paragraph 5 above upon written
      request by any holder of this HITS.

	 		 	 
	
      Market Disruption Event		 	
      Market Disruption Event means, with respect
      to the Underlying
    Stock: 
	 		 	 

	 	 	 	(i) a suspension,
          absence or material limitation of trading of the Underlying Stock on
          the primary market for the Underlying Stock 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
          the Underlying Stock as a result of which the reported trading prices
          for the Underlying Stock 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 the
          Underlying Stock, 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 HITS.

	 	 	 	 
	 	 	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

17

	 		 		primary market, (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 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 the Underlying Stock 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 the Underlying Stock and (5) a suspension, absence or material limitation of trading on the primary securities market on which options contracts related to the
Underlying Stock 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 HITS shall have occurred and be continuing, the amount
	      declared due and payable per each Stated Principal Amount of this HITS
	      upon any acceleration of this HITS (an “Event of Default Acceleration”)
	      shall be determined by the Calculation Agent and shall be an amount in
	      cash equal to either (i) the Stated Principal Amount of this HITS plus
	      accrued but unpaid interest to but excluding the date of such acceleration
	      or (ii) if the Trading Price of the Underlying Stock has decreased to
	      or below the Trigger Price at any time on any Trading Day from and including
	      the Pricing Date to and including the date of such acceleration, (x) the
	      value, as determined based on the Closing Price of the Underlying Stock
	      on the date of such acceleration, of a number of shares of the Underlying
	      Stock at the
	

  18

	 		 		Exchange Ratio multiplied by the Exchange Factor as of the date of acceleration and (y) accrued but unpaid interest to but excluding the date of such acceleration.
	

  19

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

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

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

  20

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

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

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

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

  21

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

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

       Unless the certificate of authentication hereon has been executed by the Trustee referred to on the reverse hereof by manual signature, this Note shall not be entitled to any benefit under the Senior
Indenture, as defined on the reverse hereof, or be valid or obligatory for any purpose.

  22

  

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

	DATED: 	 	 
	 	 	 	 	 
	 	 	By:	 
	 	 	 	

	 	 	 	 	 
	 	 	 	 	 

TRUSTEE’S CERTIFICATE

    OF
AUTHENTICATION

 This is one of the
    Notes referred

      to
  in the within-mentioned

      Senior
  Indenture.

  	THE BANK OF
      NEW YORK,  
	      as
          Trustee 
	 	 	 
	By:	 
	 	

	 	Authorized Signatory

 

  23

  REVERSE OF SECURITY

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

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

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

  24

  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 $10 or, if
  this Note is denominated in a Specified Currency other than U.S. dollars, in
  increments of 1,000 units of such Specified Currency (provided that any remaining
  principal amount hereof shall not be less than the minimum authorized denomination
  hereof) at the option of the holder hereof at a price equal to 100% of the
  principal amount to be repaid, together with interest accrued and unpaid hereon
  to the date of repayment, provided that if the face hereof indicates
  that this Note is subject to “Modified Payment upon Acceleration or Redemption”, the amount
of principal payable upon repayment will be limited to the aggregate principal amount hereof multiplied by the sum of the Issue Price specified on the face hereof (expressed as a percentage of the aggregate principal amount) plus the original issue
discount accrued from the Interest Accrual Date to the date of repayment (expressed as a percentage of the aggregate principal amount), with the amount of original issue discount accrued being calculated using a constant yield method (as described
below). For this Note to be repaid at the option of the holder hereof, the Paying Agent must receive at its corporate trust office in the Borough of Manhattan, The City of New York, at least 15 but not more than 30 calendar days prior to the date of
repayment, (i) this Note with the form entitled “Option to Elect Repayment” below duly completed or (ii) a telegram, telex, facsimile transmission or a letter from a member of a national securities exchange or the National Association of
Securities Dealers, Inc. or a commercial bank or a trust company in the United States setting forth the name of the holder of this Note, the principal amount hereof, the certificate number of this Note or a description of this Note’s tenor and
terms, the principal amount hereof to be repaid, a statement that the option to elect repayment is being exercised thereby and a guarantee that this Note, together with the form entitled “Option to Elect Repayment” duly
completed, will be received by the Paying Agent not later than the fifth Business
Day after the date of such telegram, telex, facsimile transmission or letter; provided, that such telegram, telex, facsimile
transmission or letter shall only be effective if this Note and form duly completed are received by the Paying Agent by such fifth Business Day. Exercise of such repayment option by the holder hereof shall be irrevocable. In the event of repayment
of this Note in part only, a new Note or Notes for the amount of the unpaid portion hereof shall be issued in the name of the holder hereof upon the cancellation hereof.

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

       In the case where the Interest Payment Date or the Maturity Date (or any redemption or repayment date) does not fall on a Business Day, payment of interest, premium, if any, or principal otherwise
payable on such date need not be made on such date, but may be made on the

  25

  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. $10 and any integral multiple of U.S. $10 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. $10
(rounded to an integral multiple of 1,000 units of such Specified Currency),
or any amount in excess thereof which is an integral multiple of 1,000 units
of such Specified Currency, as determined by reference to the noon dollar buying
rate in The City of New York for cable transfers of such Specified Currency published
by the Federal Reserve Bank of New York (the “Market Exchange Rate”)
on the Business Day immediately preceding the date of issuance.

       The Trustee
  has been appointed registrar for the Notes, and the Trustee will maintain at
  its office in The City of New York a register for the registration and transfer
  of Notes. This Note may be transferred at the aforesaid office of the Trustee
  by surrendering this Note for cancellation, accompanied by a written instrument
  of transfer in form satisfactory to the Issuer and the Trustee and duly executed
  by the registered holder hereof in person or by the holder’s attorney
  duly authorized in writing, and thereupon the Trustee shall issue in the name
  of the transferee or transferees, in exchange herefor, a new Note or Notes
  having identical terms and provisions and having a like aggregate principal
  amount in authorized denominations, subject to the terms and conditions set
  forth herein; provided, however, that the Trustee will not be required (i) to register the
transfer of or exchange any Note that has been called for redemption in whole or in part, except the unredeemed portion of Notes being redeemed in part, (ii) to register the transfer of or exchange any Note if the holder thereof has exercised his
right, if any, to require the Issuer to repurchase such Note in whole or in part, except the portion of such Note not required to be repurchased, or (iii) to register the transfer of or exchange Notes to the extent and during the period so provided
in the Senior Indenture with respect to the redemption of Notes. Notes are exchangeable at said office for other Notes of other authorized denominations of equal aggregate principal amount having identical terms and provisions.  All such exchanges
and transfers of Notes will be free of charge, but the Issuer may require payment of a sum sufficient to cover any tax or other governmental charge in connection therewith. All Notes surrendered for exchange shall be accompanied by a written
instrument of transfer in form satisfactory to the

  26

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

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

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

       If the face
  hereof indicates that this Note is subject to “Modified Payment upon Acceleration or Redemption,” then
  (i) if the principal hereof is declared to be due and payable as described
  in the preceding paragraph, the amount of principal due and payable with respect
  to this Note shall be limited to the aggregate principal amount hereof multiplied
by the sum of the 

  27

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

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

       If the face
  hereof indicates that this Note is subject to “Tax Redemption and Payment of Additional Amounts,” this Note may be redeemed, as a whole, at the option of the Issuer at any time
prior to maturity, upon the giving of a notice of redemption as described below, at a redemption price equal to 100% of the principal amount hereof, together with accrued interest to the date fixed for redemption (except that if this Note is subject
to “Modified Payment upon Acceleration or Redemption,” the amount of
principal so payable will be limited to the aggregate principal amount hereof
multiplied by the sum of the Issue Price specified on the face hereof (expressed
as a percentage of the aggregate principal amount) plus the original issue discount
accrued from the Interest Accrual Date to the date of redemption (expressed as
a percentage of the aggregate principal amount), with the amount of original
issue discount accrued being calculated using a constant yield method (as described
above)), if the Issuer determines that, as a result of any change in or amendment
to the laws (including a holding, judgment or as ordered by a court of competent
jurisdiction), or any regulations or rulings promulgated thereunder, of the United
States or of any political subdivision or taxing authority thereof or therein
affecting taxation, or any change in official position regarding the application
or interpretation of such laws, regulations or rulings, which change or amendment
occurs, becomes effective or, in the case of a change in official position, is
announced on or after the Initial Offering Date hereof, the Issuer has or will
become obligated to pay Additional Amounts, as defined below, with respect to
this Note as described below. Prior to the giving of any notice of redemption
pursuant to this paragraph, the Issuer shall deliver to the Trustee (i) a certificate
stating that the Issuer is entitled to effect such redemption and setting forth
a statement of facts showing that the conditions precedent to the right of the
Issuer to so redeem have occurred, and (ii) an opinion of 

  28

  independent legal counsel satisfactory to the Trustee to such effect based on such statement of facts; provided that no such notice of redemption shall be given earlier
than 60 calendar days prior to the earliest date on which the Issuer would be obligated to pay such Additional Amounts if a payment in respect of this Note were then due.

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

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

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

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

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

  29

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

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

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

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

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

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

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

  30

  conversion or exchange of the debt security for securities of the Issuer or other entities or for other property or the cash value of the property (other than as provided in the antidilution provisions or other similar adjustment
provisions of the debt securities or otherwise in accordance with the terms thereof), or impair or affect the rights of any holder to institute suit for the payment thereof or (b) reduce the aforesaid percentage in principal amount of debt
securities the consent of the holders of which is required for any such supplemental indenture.

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

  31

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

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

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

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

       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.

  32

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

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

  33

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.

	 	 	 	 
	 	 	 
	 
				

34

 

    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.

35

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.

 36

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