<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
August 1, 1995
MORGAN STANLEY GROUP INC.
(Exact name of registrant as specified in its charter)
DELAWARE 1-9085 13-2838811
(State or other jurisdiction (Commission File (I.R.S. Employer
of incorporation) Number) Identification Number)
1251 AVENUE OF THE AMERICAS, NEW YORK, NEW YORK 10020
(Address of principal executive offices including zip code)
(212) 703-4000
(Registrant's telephone number
including area code)
<PAGE>
2
ITEM 5. OTHER EVENTS
- ------- ------------
Attached and incorporated herein by reference as Exhibit 4 is the Capital
Unit Agreement, dated as of August 1, 1995 (the "Capital Unit Agreement"), among
Morgan Stanley Group Inc. (the "Company"), Morgan Stanley Finance plc ("MS
plc"), Chemical Bank, as Agent and Book-Entry Unit Depositary under the Capital
Unit Agreement and as Trustee under the Indenture, dated as of November 15,
1993, and the holders from time to time of the Capital Units described therein.
ITEM 7(C). EXHIBITS
- ---------- --------
4. Capital Unit Agreement, dated as of August 1, 1995, among the Company,
MS plc, Chemical Bank and the holders from time to time of the Capital Units
described therein.
23.1 Consent of Shearman & Sterling.
23.2 Consent of Linklaters & Paines.
<PAGE>
3
SIGNATURES
----------
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
MORGAN STANLEY GROUP INC.
(Registrant)
Date: August 1, 1995 By: /s/ Ralph L.Pellecchio
____________________________
Ralph L.Pellecchio
Assistant Secretary
<PAGE>
EXHIBIT INDEX
Exhibit
Number Description
- ------ -----------
4 Capital Unit Agreement, dated as of August 1, 1995, among the Company,
MS plc, Chemical Bank and the holders from time to time of the Capital
Units described therein.
23.1 Consent of Shearman & Sterling.
23.2 Consent of Linklaters & Paines.
<PAGE>
Exhibit 4
================================================================================
MORGAN STANLEY FINANCE PLC,
MORGAN STANLEY GROUP INC.,
CHEMICAL BANK,
as Agent, as Book-Entry Unit Depositary,
and as Trustee under the Indenture referred to herein
AND
THE HOLDERS FROM TIME TO TIME OF
THE CAPITAL UNITS DESCRIBED HEREIN
---------------
CAPITAL UNIT AGREEMENT
---------------
Dated as of August 1, 1995
================================================================================
<PAGE>
TABLE OF CONTENTS*
-----------------
RECITALS OF MORGAN STANLEY FINANCE PLC ............ 1
RECITALS OF MORGAN STANLEY GROUP INC............... 1
ARTICLE ONE
Definitions and Other Provisions
of General Application ................... 2
Section 101. Definitions. ........................... 2
Accelerated Purchase Date ........................... 2
Acceleration Notice .................................. 2
Act .................................................. 2
Additional Amounts ................................... 2
Affiliate ............................................ 2
Agent ................................................ 2
Agreement ............................................ 3
Authenticating Agent ................................. 3
Bankruptcy Event ..................................... 3
Board of Directors ................................... 3
Board Resolution ..................................... 3
Book-Entry Capital Unit .............................. 3
Book-Entry Unit Depositary ........................... 3
Book-Entry Unit Register ............................. 3
Business Day ......................................... 4
Cancellation Condition ............................... 4
Cancellation Event ................................... 4
Capital Unit ......................................... 4
Capital Unit Certificate ............................. 4
Cash Settlement ...................................... 4
Closed Purchase Contract ............................. 4
Corporate Trust Office ............................... 4
Corporation .......................................... 4
Debenture Settlement ................................. 4
Debentures ........................................... 5
Default .............................................. 5
Definitive Capital Unit .............................. 5
Definitive Debenture Register ........................ 5
Deposit Agreement .................................... 5
_______________
* Note: This table of contents shall not, for any purpose, be deemed to be a
part of this Agreement
<PAGE>
ii
Depositary ........................................... 5
Depositary Receipt ................................... 5
Depositary Share ..................................... 5
DTC .................................................. 5
Event of Default ..................................... 5
Global Debenture ..................................... 5
Global Purchase Contract ............................. 5
Guarantee ............................................ 5
Holder ............................................... 6
Indenture ............................................ 6
Interest Payment Date ................................ 6
Investment Grade ..................................... 6
Issuer Order ......................................... 6
Letter of Representations ............................ 6
Long-Term Senior Debt ................................ 6
Moody's .............................................. 6
MS plc ............................................... 6
Officer's Certificate ................................ 6
Opinion of Counsel ................................... 6
Optional Definitive Capital Unit Request ............ 7
Outstanding .......................................... 7
Paying Agent ......................................... 8
Person ............................................... 8
Predecessor Capital Unit Certificate ................. 8
Preferred Stock ...................................... 8
Preferred Stock Depositary ........................... 8
Prospectus Supplement ................................ 8
Purchase Contract Default ............................ 8
Purchase Contract Register ........................... 8
Purchase Contracts ................................... 9
Purchase Date ........................................ 9
Purchase Price ....................................... 9
Rating Agency ........................................ 9
Reference Rate ....................................... 9
Reference Treasury Bond .............................. 9
Registered Definitive Debenture ...................... 9
Registered Purchase Contract ......................... 9
Regular Record Date .................................. 9
Responsible Officer .................................. 9
S&P .................................................. 9
Second Global Debenture Register ..................... 10
Stated Purchase Date ................................. 10
Tax Redemption ....................................... 10
Termination Event .................................... 10
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iii
Trustee ............................................. 10
Underwriting Agreement .............................. 10
Unsettled Purchase Contract ......................... 10
ARTICLE TWO
Capital Unit Certificate Forms ................ 10
Section 201. Forms of Capital Unit Certificates Generally. 10
Section 202. Form of Certificate of Authentication and
Countersignature ............................ 11
ARTICLE THREE
The Capital Units ...................... 11
Section 301. Denominations. .............................. 11
Section 302. Rights and Obligations Evidenced by the
Capital Units. .............................. 11
Section 303. Execution, Authentication, Delivery and
Dating ...................................... 12
Section 304. Temporary Capital Unit Certificates. ........ 12
Section 305. Registration of Transfer and Exchange. ...... 13
Section 306. Mutilated, Destroyed, Lost and Stolen Capital
Unit Certificates. .......................... 15
Section 307. Persons Deemed Owners. ...................... 17
Section 308. Cancellation. ............................... 17
Section 309. Capital Units Not Separable. ................ 18
Section 310. Book-Entry Capital Units. ................... 18
Section 311. Exchange of Book-Entry Capital Units and
Definitive Capital Units. ................... 18
Section 312. Additional Amounts. ......................... 19
ARTICLE FOUR
The Purchase Contracts .................... 20
Section 401. Execution and Delivery of Purchase Contracts. 20
Section 402. Further Provisions Relating to Issuance of
Purchase Contracts. ......................... 20
Section 403. Purchase of Depositary Shares; Acceleration
of Purchase Obligations. .................... 21
Section 404. Payment of Purchase Price. .................. 22
Section 405. Issuance of Depositary Shares and Depositary
Receipts. ................................... 25
Section 406. Merger, Consolidation and Sales of Assets. .. 26
Section 407. Charges and Taxes. .......................... 26
Section 408. Termination of Purchase Contracts. .......... 26
<PAGE>
iv
ARTICLE FIVE
Remedies ............................ 27
Section 501. Limitation on Proceedings by Holders. ........ 27
Section 502. Restoration of Rights and Remedies. .......... 27
Section 503. Rights and Remedies Cumulative. .............. 28
Section 504. Delay or Omission Not Waiver. ................ 28
Section 505. Waiver of Past Defaults. ..................... 28
Section 506. Undertaking for Costs. ....................... 28
Section 507. Waiver of Stay or Extension Laws. ............ 29
Section 508. Agent May File Proofs of Claim. .............. 29
Section 509. Suits for Enforcement. ....................... 30
Section 510. Control by Holders. .......................... 30
ARTICLE SIX
The Agent ........................... 31
Section 601. Certain Duties and Responsibilities. ......... 31
Section 602. Notice of Default. ........................... 32
Section 603. Certain Rights of Agent. ..................... 32
Section 604. Not Responsible for Recitals or Issuance of
Capital Units. ............................... 33
Section 605. May Hold Capital Units. ...................... 33
Section 606. Money Held in Trust. ......................... 34
Section 607. Compensation and Reimbursement. .............. 34
Section 608. Corporate Agent Required; Eligibility. ....... 35
Section 609. Resignation and Removal; Appointment of
Successor. ................................... 35
Section 610. Acceptance of Appointment by Successor. ...... 36
Section 611. Merger, Conversion, Consolidation or
Succession to Business. ...................... 37
Section 612. Appointment of Authenticating Agent. ......... 37
Section 613. MS plc and the Corporation to Furnish Agent
Names and Addresses of Holders. .............. 39
Section 614. Preservation of Information; Communications
to Holders. .................................. 40
Section 615. No Obligation of Holder. ..................... 41
Section 616. Tax Compliance. .............................. 41
ARTICLE SEVEN
Supplemental Agreements .................... 42
Section 701. Supplemental Agreements Affecting Purchase
Contracts Without Consent of Holders. ........ 42
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v
Section 702. Supplemental Agreements Affecting
Purchase Contracts with Consent of Holders. .. 43
Section 703. Execution of Supplemental Agreements. ........ 44
Section 704. Effect of Supplemental Agreements. ........... 44
Section 705. Reference to Supplemental Agreements. ........ 44
ARTICLE EIGHT
Consolidation, Merger, Sale or Conveyance ........... 45
Section 801. Covenant Not to Merge, Consolidate,
Sell or Convey Property Except Under Certain
Conditions. .................................. 45
Section 802. Rights and Duties of Successor Corporation. .. 45
Section 803. Opinion of Counsel to Agent
and the Book-Entry Unit Depositary. .......... 46
ARTICLE NINE
Covenants ........................... 46
Section 901. Performance Under Purchase Contracts. ........ 46
Section 902. Maintenance of Office or Agency. ............. 46
Section 903. Money for Payments to Be Held in Trust. ...... 47
Section 904. Rating Agencies. ............................. 48
Section 905. Corporation to Reserve Preferred Stock. ...... 49
Section 906. Covenants as to Preferred Stock. ............. 49
Section 907. Statements of Officers of MS plc
and the Corporation as to Default. ........... 49
ARTICLE TEN
Redemption of the Purchase Contracts .............. 50
Section 1001. Optional Redemption of Purchase Contracts. ... 50
Section 1002. Notice of Redemption; Partial Redemptions. ... 50
Section 1003. Payment of Purchase
Contracts Called for Redemption. ............. 51
Section 1004. Exclusion of Certain Purchase Contracts
from Eligibility for Selection for Redemption. 52
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vi
ARTICLE ELEVEN
Book-Entry Capital Units .................... 52
Section 1101. Deposit of Global Purchase
Contract and Global Debenture. ............... 52
Section 1102. Book-Entry System. ........................... 53
Section 1103. Transfer of Interests in Book-Entry
Capital Units and Global Debentures. ......... 53
Section 1104. Issuance and Exchange of Definitive Capital
Units and Registered Definitive Debentures. .. 54
Section 1105. Transfer of the Global
Purchase Contract and Global Debenture. ...... 55
Section 1106. Mutilated, Destroyed, Lost and Stolen Global
Debentures and Global Purchase Contracts. .... 56
Section 1107. Cancellation. ................................ 57
Section 1108. Payments in Respect of Book-Entry
Capital Units and Global Debenture. .......... 58
Section 1109. Redemption or Settlement. .................... 59
Section 1110. Record Date. ................................. 59
Section 1111. Action in Respect of the Book-Entry
Capital Units or Global Debenture. ........... 60
Section 1112. Changes Affecting the Global
Purchase Contract or Global Debenture. ....... 60
Section 1113. Surrender of Global Purchase
Contract and Global Debenture. ............... 61
Section 1114. Reports. ..................................... 61
Section 1115. Termination of Certain
Provisions of This Agreement. ................ 61
ARTICLE TWELVE
The Book-Entry Unit Depositary ................ 61
Section 1201. Certain Duties and Responsibilities. ......... 61
Section 1202. Notice of Default. ........................... 63
Section 1203. Certain Rights of Book-Entry Unit Depositary.. 63
Section 1204. Not Responsible for Recitals
or Issuance of Capital Units. ................ 64
Section 1205. Money Held in Trust. ......................... 64
Section 1206. Compensation and Reimbursement. .............. 65
Section 1207. Book-Entry Unit
Depositary Required; Eligibility. ............ 65
Section 1208. Resignation and Removal; Appointment of
Successor. ................................... 66
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vii
Section 1209. Acceptance of Appointment by Successor. ...... 67
Section 1210. Merger, Conversion,
Consolidation or Succession to Business. ..... 68
Section 1211. Taxes. ....................................... 69
ARTICLE THIRTEEN
Miscellaneous Provisions ................... 69
Section 1301. Incorporators, Stockholders,
Officers and Directors of MS plc
and the Corporation Immune from Liability. ... 69
Section 1302. Compliance Certificates and Opinions. ........ 69
Section 1303. Form of Documents Delivered to Agent. ........ 70
Section 1304. Acts of Holders. ............................. 71
Section 1305. Notices, Etc. ................................ 72
Section 1306. Notice to Holders; Waiver. ................... 72
Section 1307. Effect of Headings and Table of Contents. .... 73
Section 1308. Successors and Assigns. ...................... 73
Section 1309. Separability Clause. ......................... 73
Section 1310. Benefits of Agreement. ....................... 73
Section 1311. Governing Law. ............................... 74
Section 1312. Legal Holidays. .............................. 74
Section 1313. Counterparts. ................................ 74
Section 1314. Inspection of Agreement. ..................... 74
Section 1315. Satisfaction and Discharge. .................. 74
Section 1316. Appointment of Agent for Service. ............ 75
EXHIBIT A -- Form of Capital Unit Certificate
<PAGE>
CAPITAL UNIT AGREEMENT, dated as of August 1, 1995, by and among
MORGAN STANLEY FINANCE PLC, a company duly incorporated and existing under the
laws of England and Wales ("MS plc"), MORGAN STANLEY GROUP INC., a Delaware
------
corporation (the "Corporation"), CHEMICAL BANK, a New York banking corporation,
-----------
acting solely as capital unit agent and book-entry unit depositary (in its
capacity as capital unit agent, the "Agent," and, in its capacity as book-entry
-----
unit depositary, the "Book-Entry Unit Depositary"), except to the extent that
--------------------------
this Agreement specifically states that the Agent and Book-Entry Unit Depositary
is acting in another capacity, and Chemical Bank, a New York banking
corporation, as trustee under the Indenture described below (in its capacity as
trustee under the Indenture, the "Trustee") and the holders from time to time of
-------
the Capital Units described herein.
RECITALS OF MORGAN STANLEY FINANCE PLC
MS plc has duly authorized the issuance of its 8.40%
Subordinated Debentures due August 30, 2015 (the "Debentures"), of substantially
----------
the tenor hereinafter set forth, in an aggregate principal amount of
$175,000,000 (subject to an increase up to a maximum of $201,250,000 pursuant to
the Underwriting Agreement described herein) as provided in this Agreement and
in that certain Subordinated Indenture, dated as of November 15, 1993, by and
among MS plc, the Corporation and the Trustee (as the same may be amended or
supplemented from time to time, the "Indenture"), and to provide therefor MS plc
---------
has duly authorized the execution and delivery of this Agreement, the Indenture
and the Debentures.
All acts and things necessary to make the Debentures, when
executed by MS plc and authenticated and delivered by the Trustee, as provided
in this Agreement and in the Indenture, the valid obligations of MS plc, have
been done.
RECITALS OF MORGAN STANLEY GROUP INC.
The Corporation has duly authorized the Guarantee with respect
to payments on the Debentures, as provided for in the Indenture (the
"Guarantee") and the issuance of 7,000,000 (subject to an increase up to a
---------
maximum of 8,050,000 pursuant to the Underwriting Agreement) of its preferred
stock purchase contracts (the "Purchase Contracts"), of substantially the tenor
------------------
hereinafter set forth, and to provide therefor the Corporation has duly
authorized the execution and delivery of this Agreement, the Indenture and the
Purchase Contracts.
All acts and things necessary to make the Guarantee, when the
Indenture has been executed by the Corporation and MS plc and the Debentures
have been executed by MS plc and authenticated and delivered by the Trustee, as
provided in the Indenture, and the Purchase Contracts, when executed by the
Corporation and countersigned, executed on behalf of the Holders and delivered
by the Agent, as provided in this Agreement, the valid obligations of the
Corporation, have been done.
<PAGE>
2
ARTICLE ONE
Definitions and Other Provisions
of General Application
Section 101. Definitions.
-----------
For all purposes of this Agreement, except as otherwise
expressly provided or unless the context otherwise requires:
(1) the terms defined in this Article have the meanings assigned
to them in this Article and include the plural as well as the singular;
(2) all accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with generally accepted accounting
principles in the United States in effect at the time of any computation; and
(3) the words "herein," "hereof" and "hereunder" and other words
of similar import refer to this Agreement as a whole and not to any particular
Article, Section or other subdivision.
"Accelerated Purchase Date" with respect to a Purchase Contract,
-------------------------
means any Interest Payment Date to which the Corporation accelerates the
obligation of the Holder of the Capital Unit of which such Purchase Contract is
a part to purchase, and the Corporation to sell, a Depositary Share pursuant to
such Purchase Contract in accordance with Article Four.
"Acceleration Notice" has the meaning set forth in Section 403.
-------------------
"Act," with respect to any Holder, has the meaning specified in
---
Section 1304.
"Additional Amounts" has the meaning set forth in the Indenture.
------------------
"Affiliate" of any specified Person means any other Person
---------
directly or indirectly controlling or controlled by or under direct or indirect
common control with such specified Person. For the purposes of this definition,
"control," with respect to any specified Person, means the power to direct the
management and policies of such Person, directly or indirectly, whether through
the ownership of voting securities, by contract or otherwise; and the terms
"controlling" and "controlled" have meanings correlative to the foregoing.
"Agent" means the Person named as the "Agent" in the first
-----
paragraph of this Agreement until a successor Agent shall have become such
pursuant to the applicable provisions of this Agreement, and thereafter "Agent"
shall mean such successor Person.
<PAGE>
3
"Agreement" means this instrument as originally executed or as
---------
it may from time to time be supplemented or amended by one or more agreements
supplemental hereto entered into pursuant to the applicable provisions hereof.
"Authenticating Agent" means the Agent and/or any Person
--------------------
authorized by the Agent to act on behalf of the Agent to countersign and execute
Purchase Contracts.
"Bankruptcy Event" means any of the following events: (i) a
----------------
court having jurisdiction in the premises shall enter a decree or order for
relief with respect to the Corporation in an involuntary case under any
applicable bankruptcy, insolvency or other similar law now or hereafter in
effect, or appointing a receiver, liquidator, assignee, custodian, trustee,
sequestrator (or similar official) of the Corporation or for any substantial
part of its property or ordering the winding up or liquidation of its affairs,
and such decree or order shall remain unstayed and in effect for a period of 60
consecutive days; or (ii) the Corporation shall commence a voluntary case under
any applicable bankruptcy, insolvency or other similar law now or hereafter in
effect, or consent to the entry of an order for relief in an involuntary case
under any such law, or consent to the appointment of or taking possession by a
receiver, liquidator, assignee, custodian, trustee, sequestrator (or similar
official) of the Corporation or for any substantial part of its property, or
make any general assignment for the benefit of creditors.
"Board of Directors," with respect to MS plc or the Corporation,
------------------
as applicable, means the board of directors or any other committee duly
authorized to act on its behalf.
"Board Resolution," with respect to MS plc or the Corporation,
----------------
as applicable, means one or more resolutions, certified by the Secretary or an
Assistant Secretary of MS plc or the Corporation, as applicable, to have been
duly adopted or consented to by the Board of Directors and to be in full force
and effect on the date of such certification and delivered to the Agent.
"Book-Entry Capital Unit" means any Capital Unit that is
-----------------------
comprised of a Global Debenture and a Global Purchase Contract and represented
by certificateless depositary interests issued to DTC or its nominee by the
Book-Entry Unit Depositary.
"Book-Entry Unit Depositary" means the Person named as the
--------------------------
"Book-Entry Unit Depositary" in the first paragraph of this Agreement until a
successor Book-Entry Unit Depositary shall have become such pursuant to the
applicable provisions of this Agreement, and thereafter "Book-Entry Unit
Depositary" shall mean such successor Person.
"Book-Entry Unit Register" has the meaning specified in Section
------------------------
1103.
<PAGE>
4
"Business Day" means any day that is not a Saturday or Sunday or
------------
a day on which banking institutions in The City of New York are authorized or
required by law, regulation or executive order to be closed.
"Cancellation Condition," with respect to an Accelerated
----------------------
Purchase Date, means any of the following conditions: (i) the Corporation has
outstanding Long-Term Senior Debt that is not rated Investment Grade by either
Moody's or S&P; (ii) the market yield-to-maturity of the Reference Treasury Bond
exceeds the Reference Rate; or (iii) the Corporation has outstanding any shares
of any class of stock of the Corporation ranking prior to the Preferred Stock as
to dividends or upon liquidation, unless the Holders of not less than 66 2/3% of
the Capital Units Outstanding at the time of the issuance of such shares
consented to such issuance.
"Cancellation Event," with respect to an Accelerated Purchase
------------------
Date, means the existence of a Cancellation Condition at 5:00 P.M. New York City
time on the date that is five Business Days prior to such Accelerated Purchase
Date.
"Capital Unit" means the collective rights and obligations of MS
------------
plc, the Corporation and a Holder with respect to a Debenture in the principal
amount of $25.00, a Guarantee and a Purchase Contract.
"Capital Unit Certificate" means a certificate evidencing the
------------------------
rights and obligations of MS plc, the Corporation and a Holder with respect to
the number of Definitive Capital Units specified on such certificate.
"Cash Settlement" has the meaning set forth in Section
---------------
404(a)(1).
"Closed Purchase Contract" means any Purchase Contract with
------------------------
respect to which a purchase of a Depositary Share has occurred pursuant to
Article Four or that has been redeemed or is otherwise not Outstanding.
"Corporate Trust Office" means the office of the Agent or the
----------------------
Book-Entry Unit Depositary, as applicable, in the Borough of Manhattan, The City
of New York, at which at any particular time its corporate trust business shall
be principally administered, which office at the date hereof is located at 450
West 33rd Street, 15th Floor, New York, New York 10001.
"Corporation" means the Person named as the "Corporation" in the
-----------
first paragraph of this Agreement until a successor Person shall have become
such pursuant to the applicable provisions of this Agreement, and thereafter the
"Corporation" shall mean such successor Person.
"Debenture Settlement" has the meaning set forth in Section
--------------------
404(a)(2).
<PAGE>
5
"Debentures" has the meaning stated in the first recital of MS
----------
plc in this Agreement and more particularly means any Debentures originally
issued as part of a Capital Unit.
"Default" means an Event of Default under the Indenture or a
-------
Purchase Contract Default.
"Definitive Capital Unit" means any Capital Unit represented by
-----------------------
a Capital Unit Certificate and comprised of a Registered Definitive Debenture, a
Guarantee and a Registered Purchase Contract.
"Definitive Debenture Register" means the security register of
-----------------------------
MS plc maintained by the Trustee pursuant to the Indenture.
"Deposit Agreement" means the Deposit Agreement, dated as of
-----------------
August 1, 1995, by and among the Corporation, the Preferred Stock Depositary and
the holders from time to time of the Depositary Receipts issued thereunder.
"Depositary" means DTC, or any successor, as the Holder of the
----------
certificateless depositary interests representing Book-Entry Capital Units.
"Depositary Receipt" means any one of the receipts evidencing an
------------------
interest in the Depositary Shares issued under the Deposit Agreement.
"Depositary Share" means any one of the depositary shares, each
----------------
evidencing a 1/8 interest in a share of Preferred Stock, held by the Preferred
Stock Depositary under the Deposit Agreement and evidenced by a Depositary
Receipt.
"DTC" means The Depository Trust Company or its nominee.
---
"Event of Default," with respect to the Debentures, has the
----------------
meaning set forth in the Indenture.
"Global Debenture" means a global Debenture in bearer form
----------------
deposited with the Book-Entry Unit Depositary and to be held by the Book-Entry
Unit Depositary on behalf of the Holder of Book-Entry Capital Units.
"Global Purchase Contract" means a global Purchase Contract
------------------------
registered in the name of the Book-Entry Unit Depositary and deposited with the
Book-Entry Unit Depositary to be held by the Book-Entry Unit Depositary on
behalf of the Holder of the Book-Entry Capital Units.
"Guarantee" means the Corporation's unconditional guarantee, on
---------
a subordinated basis, of payments with respect to the Debentures, as provided in
the Indenture.
<PAGE>
6
"Holder," means (i) in the case of any Definitive Capital Unit,
------
a Person in whose name the Debenture and the Purchase Contract constituting a
part of such Capital Unit are registered on the Definitive Debenture Register
and the Purchase Contract Register, respectively, and (ii) in the case of any
Book-Entry Capital Unit, the Depositary.
"Indenture" has the meaning set forth in the recitals of MS plc
---------
hereof.
"Interest Payment Date," with respect to any Debenture, has the
---------------------
meaning set forth in the Indenture or in any document executed pursuant to the
terms of the Indenture.
"Investment Grade" means a rating of Baa3 or above by Moody's,
----------------
BBB or above by S&P or an equivalent of such ratings (including any "implied"
rating) by Moody's or S&P or by any other Rating Agency selected by the
Corporation pursuant to Article Nine.
"Issuer Order" or "Issuer Request," with respect to MS plc or
------------ --------------
the Corporation, as applicable, means a written order or request signed in the
name of MS plc or the Corporation, as applicable, by the Chairman or Vice
Chairman of the Board of Directors, the President, General Counsel, Chief
Financial Officer, Treasurer, Secretary, Assistant Secretary or any Managing
Director of MS plc or the Corporation, as applicable, and delivered to the
Agent.
"Letter of Representations" means the Letter of Representations
-------------------------
to DTC dated August 1, 1995 from the Book-Entry Unit Depositary, relating to the
Capital Units covered by this Agreement.
"Long-Term Senior Debt" means publicly held long-term senior
---------------------
unsecured debt obligations of the Corporation that are registered under the
Securities Act of 1933.
"Moody's" means Moody's Investors Service, Inc., and any
-------
successor thereto.
"MS plc" means the Person named as "MS plc" in the first
------
paragraph of this Agreement until a successor Person shall have become such
pursuant to the applicable provisions of this Agreement, and thereafter "MS plc"
shall mean such successor Person.
"Officer's Certificate," when used with respect to MS plc or the
---------------------
Corporation, as applicable, means a certificate signed by the Chairman or Vice
Chairman of the Board of Directors, the President, General Counsel, Chief
Financial Officer, Treasurer, Secretary, Assistant Secretary or any Managing
Director of MS plc or the Corporation, as applicable, and delivered to the
Agent.
"Opinion of Counsel" means an opinion in writing signed by legal
------------------
counsel, who may be an employee of or counsel to MS plc or the Corporation and
who shall otherwise be satisfactory to the Agent.
<PAGE>
7
"Optional Definitive Capital Unit Request" has the meaning set
----------------------------------------
forth in Section 311.
"Outstanding," with respect to any Capital Unit, Debenture or
-----------
Purchase Contract means, as of the date of determination, all Capital Units,
Debentures or Purchase Contracts, as the case may be, evidenced by Definitive
Capital Units theretofore authenticated, countersigned, executed and delivered
under this Agreement or by Book-Entry Capital Units, except:
(i) Capital Units, Debentures or Purchase Contracts theretofore deemed
cancelled, cancelled by the Agent or Trustee, as the case may be, or
delivered to the Agent or Trustee, as the case may be, for cancellation, in
each case pursuant to the provisions of this Agreement or the Indenture;
(ii) Closed Purchase Contracts;
(iii) If a Termination Event has occurred, all Purchase Contracts; and
(iv) Capital Units, Debentures or Purchase Contracts evidenced by
Capital Unit Certificates in exchange for or in lieu of which other Capital
Unit Certificates have been authenticated, countersigned, executed and
delivered pursuant to this Agreement, other than any such Capital Units,
Debentures or Purchase Contracts, as the case may be, evidenced by a
Capital Unit Certificate in respect of which there shall have been
presented to the Agent proof satisfactory to it that such Capital Unit
Certificate is held by a bona fide purchaser in whose hands the Capital
Units, Debentures or Purchase Contracts, as the case may be, evidenced by
such Capital Unit Certificate are valid obligations of MS plc (with respect
to the Debentures constituting a part of the Capital Units evidenced
thereby) and the Corporation (with respect to the Guarantee and the
Purchase Contracts constituting a part of the Capital Units evidenced
thereby);
provided, however, that in determining whether the Holders
of the requisite number of Outstanding Capital Units, Debentures or Purchase
Contracts, as the case may be, have given any request, demand, authorization,
direction, notice, consent or waiver hereunder, Capital Units, Debentures and
Purchase Contracts owned by MS plc or the Corporation or any Affiliate of MS plc
or the Corporation shall be disregarded and deemed not to be Outstanding, except
that, in determining whether the Agent shall be protected in relying upon any
such request, demand, authorization, direction, notice, consent or waiver, only
Capital Units, Debentures and Purchase Contracts which the Agent knows to be so
owned shall be so disregarded. Capital Units, Debentures and Purchase Contracts
that are so owned but that have been pledged in good faith may be regarded as
Outstanding if the pledgee establishes to the satisfaction of the Agent the
pledgee's right so to act with respect to such Capital Units, Debentures and
Purchase Contracts and that the pledgee is not MS plc, the Corporation or any
Affiliate of MS plc or the Corporation.
<PAGE>
8
"Paying Agent" means any Person authorized by the Corporation to
------------
pay the redemption price for any Purchase Contracts to be redeemed; provided
that such Person shall be a bank or trust company organized and in good standing
under the laws of the United States or any state in the United States, having
(together with its parent) capital, surplus and undivided profits aggregating at
least $50,000,000, and, subject to the foregoing, may be an Affiliate of the
Corporation.
"Person" means any individual, corporation, partnership, limited
------
liability company, joint venture, association, joint-stock company, trust,
unincorporated organization or government or any agency or political subdivision
thereof.
"Predecessor Capital Unit Certificate" of any particular Capital
------------------------------------
Unit Certificate means every previous Capital Unit Certificate evidencing all or
a portion of the rights and obligations of MS plc, the Corporation and the
Holder under the Capital Units evidenced thereby; and, for the purposes of this
definition, any Capital Unit Certificate authenticated, countersigned and
delivered under Section 306 in exchange for or in lieu of a mutilated,
destroyed, lost or stolen Capital Unit Certificate shall be deemed to evidence
the same rights and obligations of MS plc, the Corporation and the Holder as the
mutilated, destroyed, lost or stolen Capital Unit Certificate.
"Preferred Stock" means the 8.40% Cumulative Preferred Stock,
---------------
without par value, stated value $200.00 per share, of the Corporation issuable
pursuant to the Purchase Contracts.
"Preferred Stock Depositary" means The Bank of New York, or any
--------------------------
successor thereto under the Deposit Agreement.
"Prospectus Supplement" means the prospectus supplement, dated
---------------------
July 27, 1995, relating to the Capital Units covered by this Agreement.
"Purchase Contract Default" means the occurrence of any of the
-------------------------
following events: (i) unless a Termination Event or a Cancellation Event shall
have occurred or notice of acceleration of the Stated Purchase Date shall have
been cancelled as provided in this Agreement, failure of the Corporation to
issue and deliver the Preferred Stock against tender of payment by the Agent
therefor on any Purchase Date or (ii) failure on the part of the Corporation
duly to observe or perform any other of the covenants or agreements on its part
in the Purchase Contracts or in this Agreement with respect to the Purchase
Contracts and continuance of such failure for a period of 30 days after the date
on which written notice of such failure, requiring the Corporation to remedy the
same, shall have been given to the Corporation and the Agent by Holders of at
least 25% of the Capital Units at the time Outstanding.
"Purchase Contract Register" and "Purchase Contract Registrar"
-------------------------- ---------------------------
have the respective meanings specified in Section 305.
<PAGE>
9
"Purchase Contracts" has the meaning stated in the first recital
------------------
of the Corporation in this Agreement and more particularly means any Purchase
Contracts constituting a part of the Capital Units countersigned, executed and
delivered under this Agreement.
"Purchase Date" means the Stated Purchase Date and any
-------------
Accelerated Purchase Date.
"Purchase Price" has the meaning specified in Section 403(a).
--------------
"Rating Agency" means Moody's or S&P or, if Moody's or S&P, or
-------------
both, shall not make publicly available a rating (including, without limitation,
any "implied" rating) of the Corporation's Long-Term Senior Debt, a nationally
recognized statistical rating organization or organizations, as the case may be,
selected by the Corporation to be substituted for Moody's or
S&P, or both, as the case may be.
"Reference Rate" means 14%.
--------------
"Reference Treasury Bond," with respect to a given date, means
-----------------------
the U.S. Treasury Bond due as close as practicable to but not later than 30
years after such date.
"Registered Definitive Debenture" means any Debenture registered
-------------------------------
on the Definitive Debenture Register.
"Registered Purchase Contract" means any Purchase Contract
----------------------------
registered on the Purchase Contract Register.
"Regular Record Date" means the 15th day prior to the date on
-------------------
which an Interest Payment Date occurs, whether or not such date is a Business
Day.
"Responsible Officer," with respect to the Agent or the Book-
-------------------
Entry Unit Depositary, means the chairman or vice-chairman of the board of
directors, the chairman or vice-chairman of the executive committee of the board
of directors, the president, any vice president, the secretary, any assistant
secretary, the treasurer, any assistant treasurer, the cashier, any assistant
cashier, any trust officer or assistant trust officer, the controller and any
assistant controller or any other officer of the Agent or the Book-Entry Unit
Depositary customarily performing functions similar to those performed by any of
the above-designated officers and also means, with respect to a particular
corporate trust or agency matter, any other officer to whom such matter is
referred because of his knowledge and familiarity with the particular subject.
"S&P" means Standard & Poor's Corporation, and its successors.
---
<PAGE>
10
"Second Global Debenture Register" has the meaning specified in
--------------------------------
Section 1103.
"Stated Purchase Date" means February 28, 2015.
--------------------
"Tax Redemption" has the meaning set forth in the Prospectus
--------------
Supplement.
"Termination Event," with respect to a Purchase Contract, means
-----------------
(i) the occurrence of a Bankruptcy Event at any time on or prior to the Stated
Purchase Date or (ii) the existence of a Cancellation Condition at 5:00 P.M. New
York City time on the date that is five Business Days prior to the Stated
Purchase Date.
"Trustee" means the Person acting as Trustee under the Indenture
-------
until a successor Trustee shall have become such pursuant to the applicable
provisions of the Indenture, and thereafter "Trustee" shall mean such successor
Trustee.
"Underwriting Agreement" means the underwriting agreement dated
----------------------
July 27, 1995 among MS plc, the Corporation, Morgan Stanley & Co. Incorporated,
Bear, Stearns & Co. Inc., Dean Witter Reynolds Inc., Donaldson, Lufkin &
Jenrette Securities Corporation, PaineWebber Incorporated, Prudential Securities
Incorporated and Smith Barney Inc., as representatives of the underwriters named
therein.
"Unsettled Purchase Contract" means any Purchase Contract that
---------------------------
has not been redeemed or terminated or with respect to which a purchase of a
Depositary Share has not occurred pursuant to Article Four.
ARTICLE TWO
Capital Unit Certificate Forms
Section 201. Forms of Capital Unit Certificates Generally.
--------------------------------------------
The Capital Unit Certificates shall be in substantially the form
set forth in Exhibit A hereto, with such letters, numbers or other marks of
identification or designation and such legends or endorsements printed,
lithographed or engraved thereon as may be required by the rules of any
securities exchange on which the Capital Units are listed or as may, consistent
herewith, be determined with respect to the portion of the Capital Unit
Certificates evidencing the Debentures by the officers of MS plc executing such
Debentures and with respect to the portion of the Capital Unit Certificates
evidencing the Purchase Contracts by the officers of the Corporation executing
the Purchase Contracts, in each case as evidenced by their execution of the
Debentures and Purchase Contracts evidenced by such Capital Unit Certificates.
Each Capital Unit Certificate may evidence one or more Definitive Capital Units.
<PAGE>
11
The Capital Units will consist of Debentures, Guarantees and
Purchase Contracts and will be issued in the form of Book-Entry Capital Units in
accordance with the terms of Article Eleven hereof, unless a Holder requests
that Capital Units be issued to or upon the order of such Holder in the form of
Definitive Capital Units represented by one or more Capital Unit Certificates,
either upon the original issuance thereof or pursuant to Section 311, and except
as otherwise set forth in Section 311.
The definitive Capital Unit Certificates shall be printed,
lithographed or engraved on steel engraved borders or may be produced in any
other manner, all as determined with respect to the portion of the Capital Unit
Certificates evidencing the Debentures by the officers of MS plc executing such
Debentures and with respect to the portion of the Capital Unit Certificates
evidencing the Purchase Contracts by the officers of the Corporation executing
the Purchase Contracts, consistent with the provisions of this Agreement, as
evidenced by their execution thereof.
Section 202. Form of Certificate of Authentication and Countersignature.
----------------------------------------------------------
The form of the Trustee's certificate of authentication of the
Debentures, and the form of the Agent's countersignature of the Purchase
Contracts, each constituting a part of the Capital Units evidenced by the
Capital Unit Certificates, shall be in substantially the form set forth on the
applicable form of the Capital Unit Certificates.
ARTICLE THREE
The Capital Units
Section 301. Denominations.
-------------
Capital Units shall be issuable only in denominations of a
single Capital Unit and any integral multiple thereof.
Section 302. Rights and Obligations Evidenced by the Capital Units.
-----------------------------------------------------
Capital Units shall evidence the ownership by the Holder thereof
of the principal amount of the number of Debentures specified on the face of a
Capital Unit Certificate representing Definitive Capital Units or in Schedule A
attached to the Global Debenture relating to Book-Entry Capital Units, the
benefits of the Guarantee with respect to such Debentures and the rights and
obligations of the Corporation and the Holder under the number of Purchase
Contracts specified on the face of a Capital Unit Certificate representing
Definitive Capital Units or in Schedule I attached to the Global Purchase
Contract relating to Book-Entry Capital Units. Prior to the purchase, if any, of
Depositary Shares under the Purchase Contracts, the Capital Units shall not
entitle the Holders to any of the rights of a holder of Depositary Shares,
Preferred Stock or any other shares of capital
<PAGE>
12
stock of the Corporation, including, without limitation, the right to vote or
receive any dividends or other payments or to consent or to receive notice as
shareholders with respect to the meetings of shareholders or for the election of
directors of the Corporation or for any other matter, or any other rights
whatsoever as shareholders of the Corporation, except to the extent expressly
provided in Article Four. The rights and obligations of MS plc, the Corporation
and the Holders with respect to the Debentures and the Guarantee are specified
under the Indenture.
Section 303. Execution, Authentication, Delivery and Dating.
----------------------------------------------
Upon the execution and delivery of this Agreement, and at any
time and from time to time thereafter, MS plc and the Corporation may deliver,
subject to any limitation on the aggregate principal amount of Debentures
represented thereby, an unlimited number of Capital Unit Certificates executed
by MS plc (with respect to the Debentures constituting a part of the Capital
Units evidenced thereby) and the Corporation (with respect to the Purchase
Contracts constituting a part of the Capital Units evidenced thereby) to the
Trustee and the Agent for authentication, countersignature and execution, as the
case may be, together with their respective Issuer Orders for authentication,
countersignature and execution of such Capital Unit Certificates, and the
Trustee in accordance with the Indenture and the Issuer Order of MS plc shall
authenticate the Debentures constituting a part of the Capital Units evidenced
by such Capital Unit Certificates, and the Agent in accordance with this
Agreement and the Issuer Order of the Corporation shall countersign and execute
on behalf of the Holder the Purchase Contracts forming a part of the Capital
Units evidenced by such Capital Unit Certificates, and deliver such Capital Unit
Certificates upon the order of MS plc and the Corporation.
The Debentures constituting a part of the Capital Units shall be
executed on behalf of MS plc and shall be authenticated by the Trustee in
accordance with the terms of the Indenture. The Purchase Contracts constituting
a part of the Capital Units shall be executed on behalf of the Corporation in
accordance with Section 401.
Section 304. Temporary Capital Unit Certificates.
-----------------------------------
Pending the preparation of definitive Capital Unit Certificates,
MS plc (with respect to the Debentures constituting a part of the Capital Units
evidenced thereby) and the Corporation (with respect to the Purchase Contracts
constituting a part of the Capital Units evidenced thereby) shall execute and
deliver to the Trustee and the Agent, and the Trustee and the Agent shall
authenticate, countersign, execute on behalf of the Holder and deliver, as
appropriate, in lieu of such definitive Capital Unit Certificates, temporary
Capital Unit Certificates that are in substantially the form set forth in
Exhibit A hereto, with such letters, numbers or other marks of identification or
designation and such legends or endorsements printed, lithographed or engraved
thereon as may be required by the rules of any securities exchange on which the
Capital Units are listed or as may, consistent herewith, be determined with
respect to the portion of the Capital Unit Certificates evidencing the
Debentures by the
<PAGE>
13
officers of MS plc executing such Debentures and with respect to the portion of
the Capital Unit Certificates evidencing the Purchase Contracts by the officers
of the Corporation executing the Purchase Contracts, in each case as evidenced
by their execution of the Debentures and Purchase Contracts evidenced by such
Capital Unit Certificates.
If temporary Capital Unit Certificates are issued, MS plc and
the Corporation will cause definitive Capital Unit Certificates to be prepared
without unreasonable delay. After the preparation of definitive Capital Unit
Certificates, the temporary Capital Unit Certificates shall be exchangeable for
definitive Capital Unit Certificates upon surrender of the temporary Capital
Unit Certificates at the Corporate Trust Office, at the expense of MS plc and
the Corporation and without charge to any Holder. Upon surrender for
cancellation of any one or more temporary Capital Unit Certificates, MS plc
(with respect to the Debentures constituting a part of the Capital Units
evidenced thereby) and the Corporation (with respect to the Purchase Contracts
constituting a part of the Capital Units evidenced thereby) shall execute and
deliver to the Trustee and the Agent, and the Trustee and the Agent shall
authenticate, countersign, execute on behalf of the Holder and deliver, as
appropriate, in exchange therefor definitive Capital Unit Certificates of like
tenor of authorized denominations and evidencing a like number of Capital Units
as the temporary Capital Unit Certificate or Certificates so surrendered. Until
so exchanged, the temporary Capital Unit Certificates shall in all respects
evidence the same benefits and the same obligations under the Debentures, the
Guarantee, the Purchase Contracts, the Indenture and this Agreement as
definitive Capital Unit Certificates.
Section 305. Registration of Transfer and Exchange.
-------------------------------------
The Agent shall keep at its Corporate Trust Office a register
(the register maintained in such office being herein referred to as the
"Purchase Contract Register") in which, subject to such reasonable regulations
--------------------------
as it may prescribe, the Agent shall provide for the registration of Purchase
Contracts and of transfers of Purchase Contracts (the Agent, in such capacity,
the "Purchase Contract Registrar").
---------------------------
Upon surrender for registration of transfer of any Capital Unit
Certificate at the Corporate Trust Offices of the Trustee and the Agent, MS plc
(with respect to the Debentures constituting a part of the Definitive Capital
Units evidenced thereby) and the Corporation (with respect to the Purchase
Contracts constituting a part of the Definitive Capital Units evidenced thereby)
shall execute and deliver to the Trustee and the Agent, and the Trustee and the
Agent shall authenticate, countersign, execute on behalf of the designated
transferee or transferees and deliver, as appropriate, in the name of the
designated transferee or transferees, one or more new Capital Unit Certificates
of any authorized denominations, of like tenor, and evidencing a like number of
Definitive Capital Units.
At the option of the Holder or as otherwise set forth in Section
311, (a) Definitive Capital Units may be transferred or exchanged for Definitive
Capital Units of any authorized denominations and for interests in Book-Entry
Capital Units and (b) interests in
<PAGE>
14
Book-Entry Capital Units may be transferred or exchanged for Definitive Capital
Units of any authorized denominations, in each case evidencing the number of
Capital Units transferred or exchanged, upon surrender of the Capital Unit
Certificates to be so transferred or exchanged at the Corporate Trust Office of
the Agent or upon receipt by the Book-Entry Unit Depositary of written
instructions from the Depositary. Whenever any Capital Unit Certificates are so
surrendered for transfer or exchange or any request is so received in accordance
with Section 1104 to exchange Definitive Capital Units and Book-Entry Capital
Units, MS plc (with respect to the Debentures constituting a part of the
Definitive Capital Units evidenced thereby) and the Corporation (with respect to
the Purchase Contracts constituting a part of the Definitive Capital Units
evidenced thereby) shall execute and deliver to the Trustee and the Agent, and
the Trustee and the Agent shall authenticate, countersign, execute on behalf of
the Holder and deliver, as appropriate, the Capital Unit Certificates that the
Holders making the exchange or the transferees are entitled to receive. Whenever
Book-Entry Capital Units are exchanged for Definitive Capital Units or whenever
Definitive Capital Units are exchanged for Book-Entry Capital Units, the Book-
Entry Unit Depositary shall cause (i) Schedule A of the Global Debenture to be
endorsed to reflect any increase or decrease, as the case may be, in the
principal amount of Debentures that comprise Book-Entry Capital Units evidenced
thereby as a result of such exchange, and (ii) Schedule I of the Global Purchase
Contract to be endorsed to reflect any increase or decrease, as the case may be,
in the number of Purchase Contracts that comprise Book-Entry Capital Units
evidenced thereby as a result of such exchange, whereupon such number of Book-
Entry Capital Units shall be decreased or increased for all purposes by the
number so exchanged, as noted.
All Capital Unit Certificates authenticated, countersigned and
executed upon any registration of transfer or exchange of a Capital Unit
Certificate shall evidence the ownership of the principal amount of the number
of Debentures specified on the face thereof, the benefits of the Guarantee with
respect to such Debentures and the rights and obligations of the Holder and the
Corporation under the number of Purchase Contracts specified on the face thereof
and shall be entitled to the same benefits, and be subject to the same
obligations, under the Indenture and this Agreement as the Definitive Capital
Units evidenced by the Capital Unit Certificate surrendered upon such
registration of transfer or exchange.
Every Capital Unit Certificate presented or surrendered for
registration of transfer or for exchange shall (if so required by MS plc, the
Corporation or the Agent) be duly endorsed, or be accompanied by a written
instrument of transfer in form satisfactory to MS plc, the Corporation and the
Agent, duly executed by the Holder thereof or his attorney duly authorized in
writing.
No service charge shall be made for any transfer or exchange of
a Capital Unit, but MS plc, the Corporation and the Agent may require payment
from the Holder of a sum sufficient to cover any tax or other governmental
charge that may be imposed in connection with any registration of transfer or
exchange of Capital Units, other than any exchanges pursuant to Section 306 not
involving any transfer.
<PAGE>
15
Notwithstanding the foregoing, and subject to Section 2.8 of the
Indenture, MS plc (with respect to the Debentures constituting a part of the
Capital Units evidenced thereby) and the Corporation (with respect to the
Purchase Contracts constituting a part of the Capital Units evidenced thereby)
shall not be obligated to execute and deliver to the Trustee or the Agent, and
neither the Trustee, under the terms of the Indenture, nor the Agent shall be
obligated to authenticate, countersign and execute on behalf of the Holder any
Capital Unit Certificate presented or surrendered for registration of transfer
or for exchange of the Debentures and Purchase Contracts evidenced thereby or
any Capital Unit Certificate to be issued in exchange for interests in Book-
Entry Capital Units or to reflect any increase or decrease in a Global Debenture
or Global Purchase Contract (i) during the period beginning any time on or after
the opening of business 15 days before the day of mailing of a notice of
redemption or acceleration of Purchase Contracts and ending at the close of
business on the day of the giving of such notice, (ii) that evidences or would
evidence Purchase Contracts selected or called for redemption or acceleration or
(iii) at any given date, if such date is on or after any date that is after the
Purchase Date or the date of redemption, as applicable, with respect to the
Purchase Contracts evidenced or to be evidenced by such Capital Unit
Certificate, except with respect to any Debentures that remain or will remain
Outstanding following such Purchase Date or date of redemption.
Section 306. Mutilated, Destroyed, Lost and Stolen Capital Unit Certificates.
---------------------------------------------------------------
If any mutilated Capital Unit Certificate is surrendered to the
Agent, MS plc (with respect to the Debentures constituting a part of the Capital
Units evidenced thereby) and the Corporation (with respect to the Purchase
Contracts constituting a part of the Capital Units evidenced thereby) shall
execute and deliver to the Trustee and the Agent, and the Trustee and the Agent
shall authenticate, countersign, execute on behalf of the Holder and deliver, as
appropriate, in exchange therefor a new Capital Unit Certificate of like tenor,
evidencing the same number of Capital Units and bearing a number not
contemporaneously outstanding.
If there shall be delivered to MS plc, the Corporation, the
Trustee and the Agent (i) evidence to their satisfaction of the destruction,
loss or theft of any Capital Unit Certificate and (ii) such security or
indemnity as may be required by them to hold each of them and any agent of any
of them harmless, then, in the absence of notice to MS plc, the Corporation, the
Trustee or the Agent that such Capital Unit Certificate has been acquired by a
bona fide purchaser, MS plc (with respect to the Debentures constituting a part
of the Capital Units evidenced thereby) and the Corporation (with respect to the
Purchase Contracts constituting a part of the Capital Units evidenced thereby)
shall execute and deliver to the Trustee and the Agent, and the Trustee (in
accordance with the provisions of the Indenture) and the Agent shall
authenticate, countersign, execute on behalf of the Holder and deliver to the
Holder, as appropriate, in lieu of any such destroyed, lost or stolen Capital
Unit Certificate, a new Capital Unit Certificate of like tenor, evidencing the
same number of Capital Units and bearing a number not contemporaneously
outstanding.
<PAGE>
16
Notwithstanding the foregoing, MS plc (with respect to the
Debentures constituting a part of the Capital Units evidenced thereby) and the
Corporation (with respect to the Purchase Contracts constituting a part of the
Capital Units evidenced thereby) shall not be obligated to execute and deliver
to the Trustee or the Agent, and neither the Trustee, under the Indenture, nor
the Agent shall be obligated to authenticate, countersign and execute on behalf
of the Holder, or deliver to the Holder, a new Capital Unit Certificate (i)
during the period beginning any time on or after the opening of business 15 days
before the day of mailing of a notice of redemption or acceleration of the
Purchase Contracts evidenced by such Capital Unit Certificate and ending at the
close of business on the day of the giving of such notice, (ii) that evidences
Purchase Contracts selected or called for redemption or acceleration or (iii) at
any given date, if such date is on or after the Purchase Date or date of
redemption, as applicable, with respect to the Purchase Contracts evidenced by
such Capital Unit Certificate, except with respect to any Registered Definitive
Debentures that remain or will remain Outstanding following such Purchase Date
or date of redemption. In lieu of delivery of a new Capital Unit Certificate,
upon satisfaction of the applicable conditions specified in clauses (i) and (ii)
of the preceding paragraph, the Agent shall deliver or cause to be delivered on
the applicable Purchase Date or redemption date (i) in respect of Purchase
Contracts constituting a part of the Capital Units evidenced by such Capital
Unit Certificate that are selected or called for redemption, the redemption
price of such Purchase Contracts or (ii) in respect of Purchase Contracts
constituting a part of the Capital Units evidenced by such Capital Unit
Certificate with respect to which a Cash Settlement or Debenture Settlement has
taken place, (x) the Depositary Shares issuable with respect to such Purchase
Contracts (and, in the case of an effective Cash Settlement, the related
Registered Definitive Debentures) or (y) if a Termination Event shall have
occurred or a Purchase Contract Default has occurred by virtue of the
Corporation's having failed to issue the Preferred Stock against tender by the
Agent of payment for the Depositary Shares evidencing such Preferred Stock, the
payment, if any, received by the Agent from the Holder in respect of the
Purchase Price of such Purchase Contracts or in respect of principal with
respect to the related Debentures received by the Agent, as the case may be, in
each case as provided in Section 405, Section 903 and Article Ten, as
applicable.
Upon the issuance of any new Capital Unit Certificate under this
Section, MS plc, the Corporation and the Agent may require the payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
relation thereto and any other expenses (including the fees and expenses of the
Agent) connected therewith.
Every new Capital Unit Certificate executed pursuant to this
Section in lieu of any destroyed, lost or stolen Capital Unit Certificate shall
constitute an original additional contractual obligation of MS plc (with respect
to the Debentures constituting a part of the Capital Units evidenced thereby)
and the Corporation (with respect to the Guarantee and the Purchase Contracts
constituting a part of the Capital Units evidenced thereby) and of the Holder
(with respect to the Purchase Contracts constituting a part of the Capital Units
evidenced thereby), whether or not the destroyed, lost or stolen Capital Unit
Certificate (and the Debentures, the Guarantee and the Purchase Contracts
evidenced thereby) shall be at any
<PAGE>
17
time enforceable by anyone, and shall be entitled to all the benefits of this
Agreement equally and proportionately with any and all other Capital Unit
Certificates delivered hereunder.
The provisions of this Section are exclusive and shall preclude
(to the extent lawful) all other rights and remedies with respect to the
replacement or payment of mutilated, destroyed, lost or stolen Capital Unit
Certificates.
Section 307. Persons Deemed Owners.
---------------------
Prior to due presentment of a Capital Unit Certificate for
registration of transfer, MS plc, the Corporation, the Trustee and the Agent,
and any agent of MS plc, the Corporation, the Trustee or the Agent, may treat
the Person in whose name the Debentures and Purchase Contracts evidenced by such
Capital Unit Certificate are registered and, with respect to the Book-Entry
Capital Units, the Book-Entry Unit Depositary, as the owner of the Capital Units
evidenced thereby, for the purpose of receiving payments on the Debentures
constituting a part of the Capital Units evidenced thereby, payment of any
redemption price on the Debentures or Purchase Contracts constituting a part of
the Capital Units evidenced thereby, performance of the Purchase Contracts
constituting a part of the Capital Units evidenced thereby and for all other
purposes whatsoever, whether or not payment with respect to such Debentures or
Purchase Contracts shall be overdue and notwithstanding any notice to the
contrary, and none of MS plc, the Corporation, the Trustee, the Agent nor any
agent of MS plc, the Corporation, the Trustee or the Agent shall be affected by
notice to the contrary. Notwithstanding the foregoing, the Book-Entry Unit
Depositary shall not be personally liable for any failure to perform a Purchase
Contract.
Section 308. Cancellation.
------------
All Capital Unit Certificates surrendered for payment, and all
Capital Unit Certificates surrendered for redemption of the Debentures or the
Purchase Contracts evidenced thereby, termination of the Purchase Contracts
evidenced thereby, delivery of Depositary Shares or registration of transfer or
exchange shall, if surrendered to any Person other than the Trustee or the
Agent, be delivered to the Trustee or the Agent, as appropriate, and, if not
already cancelled, the Debentures and Purchase Contracts evidenced by such
Capital Units shall be promptly cancelled by the Trustee or the Agent, as
appropriate; provided, however, that a Holder or any transferee shall be
entitled to receive (i) a certificate evidencing the ownership of a Registered
Definitive Debenture or (ii) an interest in a Global Debenture, in each case
relating to a Closed Purchase Contract for which a Cash Settlement has been
effected. MS plc or the Corporation may at any time deliver to the Trustee or
the Agent for cancellation any Capital Unit Certificates previously
authenticated, countersigned, executed and delivered hereunder and under the
Indenture which MS plc or the Corporation may have acquired in any manner
whatsoever, and all Capital Unit Certificates so delivered shall, upon Issuer
Order of each of MS plc and the Corporation, be promptly cancelled by the
Trustee and the Agent. No Capital Unit Certificates shall be authenticated,
countersigned and executed in lieu of or in exchange for any Capital Unit
Certificates cancelled as provided
<PAGE>
18
in this section, except as permitted by this Agreement. All cancelled Capital
Unit Certificates held by the Agent shall be disposed of in accordance with its
customary procedures and a certificate of their disposition shall be delivered
by the Agent to MS plc and the Corporation, unless by Issuer Order either MS plc
or the Corporation shall direct that cancelled Capital Unit Certificates be
returned to it.
If MS plc, the Corporation or any Affiliate of MS plc or the
Corporation shall acquire any Capital Unit Certificate, such acquisition shall
not operate as a cancellation of such Capital Unit Certificate unless and until
such Capital Unit Certificate is delivered to the Trustee or the Agent cancelled
or for cancellation.
Section 309. Capital Units Not Separable.
---------------------------
Notwithstanding anything to the contrary contained herein, in
the Indenture, the Debentures, the Guarantees or the Purchase Contracts
constituting the Capital Units, the Capital Units shall not be separable into
their constituent parts, and the rights and obligations of the Holders with
respect to the Debentures, the Guarantees and the Purchase Contracts may be
acquired, and may be transferred and exchanged, only as Capital Units, and no
Holder, or any transferee thereof, shall be entitled to receive a certificate
evidencing the ownership of a Debenture, the benefits of the Guarantee or the
rights and obligations of the Holder and the Corporation under a Purchase
Contract, unless such Debenture, Guarantee and Purchase Contract are evidenced
by a Capital Unit Certificate, as provided in this Agreement; provided, however,
that a Holder or any transferee thereof shall be entitled to receive (i) a
certificate evidencing the ownership of a Registered Definitive Debenture or
(ii) an interest in a Global Debenture, in each case relating to a Closed
Purchase Contract for which a Cash Settlement has been effected.
Section 310. Book-Entry Capital Units.
------------------------
Book-Entry Capital Units shall only be issued by the Book-Entry
Unit Depositary as certificateless depositary interests in accordance with
Section 1101.
Section 311. Exchange of Book-Entry Capital Units and Definitive Capital
-----------------------------------------------------------
Units.
-----
Holders of Book-Entry Capital Units shall receive Definitive
Capital Units in exchange for interests in Book-Entry Capital Units if DTC
notifies MS plc and the Corporation that it is unwilling or unable to continue
as Depositary with respect to the certificateless depositary interests
representing Book-Entry Capital Units or if at any time it ceases to be a
clearing agency under the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), and a successor Depositary registered as a clearing agency
------------
under the Exchange Act is not appointed by MS plc and the Corporation within 90
days.
Definitive Capital Units shall be authenticated, countersigned
and executed in exchange for interests in Book-Entry Capital Units if (i) the
Book-Entry Unit Depositary
<PAGE>
19
notifies MS plc, the Corporation and the Agent that it is unwilling or unable to
continue as Book-Entry Unit Depositary, and no successor Book-Entry Unit
Depositary is appointed within 90 days, (ii) an Event of Default with respect to
the Debentures occurs or (iii) at any time MS plc and the Corporation, in their
sole discretion, determine that Capital Units shall not be represented by Book-
Entry Capital Units.
Interests in Book-Entry Capital Units may also be transferred or
exchanged for Definitive Capital Units upon the request of the Holder of the
Book-Entry Capital Units if the Book-Entry Unit Depositary on behalf of, and
based on the instructions of, the Depositary requests the Trustee and the Agent
to authenticate, countersign and execute, as the case may be, Capital Unit
Certificates representing Definitive Capital Units (such request being referred
to herein as an "Optional Definitive Capital Unit Request").
----------------------------------------
Definitive Capital Units exchanged for interests in Book-Entry
Capital Units shall be denominated in the amounts and registered in the name of
such Person or Persons as the Book-Entry Unit Depositary, on behalf of, and
based on the instructions of, the Depositary, shall instruct the Agent and the
Trustee.
Holders of Definitive Capital Units may transfer or exchange
such Definitive Capital Units for interests in Book-Entry Capital Units by
depositing the Capital Unit Certificates evidencing such Definitive Capital
Units with the Agent and requesting the Agent and the Trustee to effect such
exchange. The Book-Entry Unit Depositary and the Agent shall notify the
Depositary of any such exchange and, upon delivery to the Agent and the Trustee
of the Capital Unit Certificates evidencing the Definitive Capital Units to be
so transferred or exchanged, the Book-Entry Unit Depositary shall take all
actions required in accordance with Section 1104 with respect to the Global
Debenture and the Global Purchase Contract evidencing such Book-Entry Capital
Units and Capital Unit Certificates evidencing the remaining Definitive Capital
Units, if any, will be issued in accordance with Section 305.
Section 312. Additional Amounts.
------------------
Neither MS plc nor the Corporation shall be obligated to pay any
Additional Amounts with respect to the Debentures constituting a part of
Definitive Capital Units that are delivered pursuant to (i) an Optional
Definitive Capital Unit Request or (ii) the request of a Holder upon the
original delivery of such Capital Units.
<PAGE>
20
ARTICLE FOUR
The Purchase Contracts
Section 401. Execution and Delivery of Purchase Contracts.
--------------------------------------------
Purchase Contracts, whenever issued by the Corporation, may be
issued in definitive or global registered form, shall be dated the date of
countersignature and execution thereof by the Agent and (a) if a Purchase
Contract forms part of a Definitive Capital Unit, shall be printed on the form
of the form of the Capital Unit Certificate evidencing such Definitive Capital
Unit or (b) if a Purchase Contract forms part of a Book-Entry Capital Unit,
shall be represented by a Global Purchase Contract relating to such Book-Entry
Capital Unit in the form set forth in Exhibit A hereto. The Purchase Contracts
shall be executed on behalf of the Corporation by the Chairman or Vice Chairman
of its Board of Directors, its President, General Counsel, Chief Financial
Officer, Treasurer, Secretary, Assistant Secretary or any Managing Director, and
may, but need not, be attested. The signatures of any of these officers may be
manual or facsimile.
No Purchase Contract shall be valid until it has been
countersigned by the manual signature of the Agent and executed on behalf of the
Holder by the manual or facsimile signature of the Agent. Such countersignature
by the Agent upon, and execution by the Agent of, any Purchase Contract executed
by the Corporation shall be conclusive evidence, and the only evidence, that the
Purchase Contract so countersigned and executed has been duly issued and
delivered hereunder.
In case any officer of the Corporation who shall have signed any
of the Purchase Contracts either manually or by facsimile signature shall cease
to be such officer before any Purchase Contract so signed shall have been
countersigned, executed on behalf of the Holder and delivered by the Agent or,
if applicable, before the Debenture that is part of the same Capital Unit shall
have been authenticated by the Trustee, such Purchase Contracts nevertheless may
be countersigned and delivered as though the person who signed such Purchase
Contracts had not ceased to be such officer of the Corporation; and any Purchase
Contract may be signed on behalf of the Corporation by such persons as, at the
actual date of the execution thereof, shall be the proper officers of the
Corporation, although at the date of the execution of this Agreement any such
person was not such an officer.
Section 402. Further Provisions Relating to Issuance of Purchase Contracts.
-------------------------------------------------------------
Purchase Contracts relating to the purchase of an aggregate of
not more than 7,000,000 Depositary Shares (subject to increase up to a maximum
of 8,050,000 Depositary Shares pursuant to the Underwriting Agreement), may be
executed by the Corporation and delivered to the Agent upon the execution of
this Agreement or from time to time thereafter in connection with exchanges,
substitutions and transfers of Capital Units. Prior to the original issuance of
the Purchase Contracts, the Agent shall have received an Issuer Order of
<PAGE>
21
the Corporation directing the countersignature, execution on behalf of the
Holder and delivery thereof to or upon the order of the Corporation of the
Purchase Contracts to be evidenced by Capital Unit Certificates to be registered
in the names of the Holders (with respect to Definitive Capital Units) and a
Global Purchase Contract registered in the name of the Book-Entry Unit
Depositary (with respect to Book-Entry Capital Units). Subsequent to such
original issuance of the Purchase Contracts, the Agent shall, subject to the
conditions set forth in this Article and Article Three, countersign and execute
on behalf of the Holder Purchase Contracts issued in exchange or substitution
for or upon transfer of Capital Unit Certificates evidencing one or more
previously countersigned and executed Unsettled Purchase Contracts evidenced by
the Capital Unit Certificates to be exchanged, substituted for or transferred.
Section 403. Purchase of Depositary Shares; Acceleration of Purchase
-------------------------------------------------------
Obligations.
-----------
(a) Each Unsettled Purchase Contract shall obligate the Holder
of the related Capital Unit to purchase, and the Corporation to sell, on the
Stated Purchase Date, one Depositary Share, at a price of $25.00 per Depositary
Share (the "Purchase Price"), unless a Termination Event shall have occurred.
--------------
(b) Subject to paragraph (c) of this Section, the Corporation
may, at its sole option and in its sole discretion, at any time or from time to
time on not less than 30 nor more than 60 days' written notice (an "Acceleration
------------
Notice") to the Agent and the Holders, in the manner provided in Section 1305
- ------
and Section 1306, accelerate the obligations of the Holders of at least
2,000,000 Unsettled Purchase Contracts to purchase, and of the Corporation to
sell, on the next succeeding Interest Payment Date (provided that such Interest
Payment Date may not be prior to August 30, 1996), one Depositary Share per
Unsettled Purchase Contract subject to such acceleration; provided that no such
acceleration with respect to fewer than all Unsettled Purchase Contracts shall
result in fewer than 2,000,000 Unsettled Purchase Contracts remaining
Outstanding after such Purchase Date; and provided further that the Corporation
shall have the right, in its sole discretion, on or before the 10th day prior to
such Interest Payment Date, to rescind any Acceleration Notice by written notice
to the Agent and the Holders (whereupon all rights and obligations of the
Corporation and the Holders that would have arisen as a result of such
Acceleration Notice shall be of no force and effect), without prejudice to the
rights of the Corporation, including without limitation its rights to deliver an
Acceleration Notice in the future. If fewer than all Unsettled Purchase
Contracts are to be accelerated to a particular Accelerated Purchase Date, the
Agent shall select from among the Unsettled Purchase Contracts such number
thereof as are being accelerated on a pro rata basis, with appropriate
adjustment being made to prevent the fractional acceleration of Purchase
Contracts, such that Purchase Contracts are accelerated only in whole and not in
part.
(c) No Accelerated Purchase Date may occur if a Cancellation
Event has occurred with respect to such Accelerated Purchase Date, and any
Acceleration Notice with respect to such Accelerated Purchase Date shall
automatically be deemed rescinded and of no
<PAGE>
22
further force and effect, without prejudice to the rights of the Corporation,
including without limitation its right to provide an Acceleration Notice at any
time or from time to time thereafter. If a Cancellation Event has occurred,
prior to the opening of business on an Accelerated Purchase Date, the
Corporation shall deliver to the Agent an Officer's Certificate certifying that
a Cancellation Event has occurred. In the event that the Agent receives such
notice, the Agent shall, as promptly thereafter as is practicable, give notice
thereof to the Holders, in the manner provided in Section 1306.
(d) Except as expressly provided herein, no Holder shall have
the right or obligation to purchase Depositary Shares prior to the Stated
Purchase Date or from and after the date on which a Termination Event has
occurred.
(e) Each Holder of a Capital Unit, by his acceptance thereof,
authorizes and directs the Agent to enter into, deliver and perform the Purchase
Contracts that are part of such Capital Unit on his behalf, agrees to be bound
by the terms and provisions thereof, covenants and agrees to perform its
obligations under the Purchase Contracts evidenced by such Capital Unit, and
consents and agrees to the provisions hereof. Each Holder of a Capital Unit, by
his acceptance thereof, further covenants and agrees that, to the extent such
Holder is deemed to have elected to satisfy its obligations under the Purchase
Contracts by effecting a Debenture Settlement as provided in Section 404, and
subject to the terms thereof, redemption payments with respect to principal of
the Debentures that are part of such Capital Unit shall be applied by the Agent
in satisfaction of such Holder's obligations under such Purchase Contract on the
applicable Purchase Date.
(f) Upon registration of transfer of a Purchase Contract, the
transferee shall be bound (without the necessity of any other action on the part
of such transferee, except as may be required by the Agent pursuant to this
Article Four) under the terms of this Agreement and such Purchase Contract, and
the transferor shall be released from the obligations under the Purchase
Contract so transferred.
(g) Each Holder of a Capital Unit, by his acceptance thereof,
authorizes the Agent to execute the Purchase Contracts evidenced by such Capital
Unit on his behalf, authorizes and directs the Agent on his behalf to take such
other action, and covenants and agrees to take such other action as may be
necessary or appropriate, or as may be required by the Agent, to effect the
provisions of this Agreement, the Capital Units and the Purchase Contracts and
appoints the Agent as his attorney-in-fact for any and all such purposes.
Section 404. Payment of Purchase Price.
-------------------------
(a) Subject to paragraph (b) of this Section, the Purchase Price
for the Depositary Share purchased pursuant to a Purchase Contract shall be
payable at the Corporate Trust Office of the Agent:
<PAGE>
23
(1) at the option of the Holder of the Capital Unit evidencing
such Purchase Contract, after receipt by the Agent of written notice from
the Holder or from the Book-Entry Unit Depositary on behalf of the Holder
of Book-Entry Capital Units not less than 10 days nor more than 20 days
prior to the applicable Purchase Date, by delivery by such Holder or by the
Book-Entry Unit Depositary on behalf of the Holder of Book-Entry Capital
Units not later than 12:00 Noon New York City time on the Business Day
immediately preceding the Purchase Date of the Purchase Price (a "Cash
----
Settlement") to the Agent in immediately available funds payable to or upon
----------
the order of the Corporation; or
(2) by application of any payment received by the Agent with
respect to the principal of the Debenture included in the Capital Unit of
which such Purchase Contract constitutes a part, as provided in paragraph
(f) of this Section (a "Debenture Settlement").
--------------------
A Holder who fails to provide notice to the Agent as provided above that it will
make a Cash Settlement with respect to the settlement of a Purchase Contract, or
a Holder who provides such notice but does not effect a Cash Settlement in
accordance with the terms of this Section 404, will be deemed to have elected to
have the Purchase Price for the Depositary Share paid pursuant to a Debenture
Settlement.
(b) Notwithstanding paragraph (a) of this Section, the
Corporation shall not be entitled to sell a Depositary Share, or receive any
payment of the Purchase Price therefor, if the Corporation fails to issue the
Preferred Stock against tender by the Agent of payment therefor.
(c) To be effective, payment pursuant to a Cash Settlement must
be deposited with the Agent by 12:00 Noon New York City time on the Business Day
immediately preceding the Purchase Date and must be made with respect to all
(and not fewer than all) of the Purchase Contracts (i) included in the
Definitive Capital Units with respect to which a closing is being held that are
registered in the name of such Holder in the Purchase Contract Register or (ii)
included in the Book-Entry Capital Units with respect to which a closing is
being held that are beneficially owned by a single Person, as specified in the
records of the direct and indirect participants of the Depositary and as
certified in writing by such Person, which certification shall be collected on
behalf of such Person by the direct and indirect participants in DTC through
which such Person holds interests in the Book-Entry Capital Units and will be
provided to the Agent by DTC or any direct participant of DTC, at the time
payment pursuant to a Cash Settlement is deposited with the Agent. Any attempted
Cash Settlement other than in accordance with this Section 404 shall be deemed
to have not been made and any payments made to the Agent by a Holder not
complying with this Section 404 shall be returned by the Agent to such Holder.
(d) The Corporation shall not be obligated to issue any shares
of Preferred Stock with respect to a Purchase Contract or deliver any
certificates therefor to the Preferred
<PAGE>
24
Stock Depositary unless it shall have received payment in full of the Purchase
Price for the Depositary Share to be purchased thereunder in the manner herein
set forth.
(e) Each Acceleration Notice shall request Holders to provide
registration instructions to the Agent with respect to the Depositary Receipts
to be delivered in respect of the Depositary Shares. An Acceleration Notice
shall also request that any Holder to which Section 362 of the United States
Bankruptcy Code applies to so notify the Agent and shall be ineffective with
respect to any Holder subject to the automatic stay provisions of the United
States Bankruptcy Code. In addition, unless a Termination Event has occurred,
the Agent shall request registration instructions from each Holder, by written
request mailed to such Holder in accordance with Section 1306, with respect to
the Depositary Receipts to be delivered in respect of Depositary Shares no later
than the Regular Record Date next preceding the Stated Purchase Date. Upon
receipt by the Agent of such registration instructions, the Agent shall deliver
such instructions to the Corporation, for delivery to the Preferred Stock
Depositary pursuant to the Deposit Agreement. If no registration instructions
are received by the Agent by the second Business Day preceding the Purchase
Date, the Agent shall cause the Depositary Shares deliverable in respect of the
Purchase Contracts to be registered (i) in the case of Definitive Capital Units,
in the name of the Holder of such Capital Units as set forth in the Purchase
Contract Register or (ii) in the case of Book-Entry Capital Units, in the name
of the Depositary.
(f) Unless a Cancellation Event with respect to an Accelerated
Purchase Date or a Termination Event has occurred, or a Holder of a Capital Unit
has effected a Cash Settlement in satisfaction of his obligations under the
Purchase Contracts evidenced by such Capital Unit, any payment with respect to
principal of a Debenture that is received by the Agent (whether in its capacity
as Agent or as Trustee) shall be paid by the Agent to the Corporation in
satisfaction of the Holder's obligations under the Global Purchase Contract or
Purchase Contracts constituting a part of Definitive Capital Units. Any payment
that is received by the Agent (whether in its capacity as Agent or as Trustee)
with respect to interest on a Debenture related to a Purchase Contract that has
been settled in accordance with this Section 404 shall be distributed to the
Holders of Definitive Capital Units upon surrender of the appropriate Capital
Unit Certificate or in the case of Book-Entry Capital Units, to the Holder of
the Book-Entry Capital Units.
(g) Except as described in Section 404(a)(1), all payments to be
made by the Holders or by the Agent (whether in its capacity as Agent or
Trustee) shall be made in lawful money of the United States of America, by
certified check or wire transfer in immediately available funds in accordance
with such regulations as the Agent may reasonably establish consistent with the
provisions of this Agreement.
(h) Any payment deposited by a Holder hereunder with respect to
a Purchase Contract shall be held by the Agent in custody for the benefit of the
Holder and applied in satisfaction of such Holder's obligations under the
Purchase Contract, or released
<PAGE>
25
and delivered to the Holder upon the termination of the Purchase Contract or
failure of the Corporation to issue the Preferred Stock against tender by the
Agent of payment therefor.
Section 405. Issuance of Depositary Shares and Depositary Receipts.
-----------------------------------------------------
Upon its receipt of payment in full of the Purchase Price for
the Depositary Shares purchased by any Holder pursuant to the foregoing
provisions of this Article, and subject to the provisions of Section 406, the
Corporation shall then cause to be delivered to the Preferred Stock Depositary a
certificate for the validly issued, fully paid and nonassessable shares of
Preferred Stock to be evidenced by the Depositary Shares so purchased,
registered in the name of the Preferred Stock Depositary in accordance with the
Deposit Agreement, together with instructions to the Preferred Stock Depositary
to register the Depositary Receipts issuable by the Preferred Stock Depositary
in the names of the Holders or such Holders' designees provided by the Holders
to the Agent and delivered to the Corporation by the Agent pursuant to Section
404. Upon the issuance of the Depositary Receipts evidencing such Depositary
Shares, registered as requested, the Agent shall then cause to be delivered such
Depositary Shares to such Holder or its designee; provided that in the case of
the settlement of a Purchase Contract constituting part of a Definitive Capital
Unit, such delivery shall be made only upon delivery to the Agent of the related
Capital Unit Certificate. The certificate evidencing such shares of Preferred
Stock shall be deemed to have been issued and the Preferred Stock Depositary
shall be deemed to have become a holder of record of such Preferred Stock as of
the close of business on the day on which payment in full under the Purchase
Contracts shall have been tendered to the Corporation by the Agent.
In the case of Definitive Capital Units, so long as the Agent
has not received a Capital Unit Certificate relating to such Depositary Shares
as required by the preceding paragraph, the Agent shall not deliver such
Depositary Shares to the Holder of such Capital Unit. Upon receipt of any
Capital Unit Certificate, the Agent shall cancel such Capital Unit Certificate
in accordance with Section 308 as a result of such issuance of Depositary
Receipts. If any Debentures and related Guarantees relating to Closed Purchase
Contracts constituting a part of Capital Units remain Outstanding, MS plc shall
execute and the Trustee shall authenticate and deliver (i) in the case of
Definitive Capital Units, to the Holder thereof, in accordance with the terms of
the Indenture, a new certificate or certificates representing solely the
principal amount of Debentures still Outstanding and the related Guarantee or
(ii) in the case of Book-Entry Capital Units, if a Global Debenture not
constituting part of a Book-Entry Capital Unit has not previously been issued by
MS plc to the Book-Entry Unit Depositary, a second Global Debenture representing
Debentures still Outstanding that are not part of Capital Units. If a second
Global Debenture referred to in clause (ii) of the immediately preceding
sentence has already been issued to the Book-Entry Unit Depositary, the Book-
Entry Unit Depositary shall note thereon an appropriate increase in the number
of Debentures represented by such Global Debenture.
<PAGE>
26
Notwithstanding the foregoing provisions of this Section to the
contrary, the Corporation shall not be required to deliver to the Preferred
Stock Depositary certificates for fractional shares of Preferred Stock.
Section 406. Merger, Consolidation and Sales of Assets.
-----------------------------------------
In the case of any consolidation of the Corporation with, or
merger of the Corporation with or into, any other Person, any merger of another
Person into the Corporation (other than a consolidation or merger that would not
result in any change in the terms of the Preferred Stock, if the Preferred Stock
were then outstanding) or any sale, transfer or lease of all or substantially
all of the assets of the Corporation, the Person formed by such consolidation or
resulting from such merger or that acquires such assets, as the case may be,
shall (unless the Corporation's rights and obligations under the Purchase
Contracts have been terminated) execute and deliver to the Agent an amendment of
this Agreement providing that the Holder of each Capital Unit then Outstanding
shall have the right and obligation on the Purchase Date to purchase the number
of shares, property or other assets which a holder of the number of shares of
Preferred Stock to which a Purchase Contract related was entitled to receive in
connection with such consolidation, merger, sale, transfer or lease.
Section 407. Charges and Taxes.
-----------------
The Corporation will pay all taxes attributable to the initial
issuance and delivery of the shares of Preferred Stock, the Depositary Shares
and the Depositary Receipts; provided, however, that the Corporation shall not
be required to pay any tax or taxes that may be payable with respect to any
exchange of or substitution for a Capital Unit Certificate or any issuance of a
Depositary Share in a name other than that of the registered Holder of a
Purchase Contract and the Corporation shall not be required to issue or deliver
such share certificates, Capital Unit Certificates or such Purchase Contracts
unless or until the person or persons requesting the transfer or issuance
thereof shall have paid to the Corporation the amount of such tax or shall have
established to the satisfaction of the Corporation that such tax has been paid.
The Agent shall be under no obligation to pay any such tax.
Section 408. Termination of Purchase Contracts.
---------------------------------
The Purchase Contracts and the obligations and rights of the
Corporation and the Holders thereunder shall terminate if a Termination Event
occurs.
<PAGE>
27
ARTICLE FIVE
Remedies
Section 501. Limitation on Proceedings by Holders.
------------------------------------
No Holder of any Capital Unit shall have any right by virtue of
or by availing itself of any provision of this Agreement to institute any action
or proceeding at law or in equity or in bankruptcy or otherwise upon or under or
with respect to this Agreement, or for the appointment of a trustee, receiver,
liquidator, custodian or other similar official or for any other remedy
hereunder, unless such Holder previously shall have given written notice to the
Agent, MS plc and the Corporation of Default and of the continuance thereof and,
(i) in the case of an Event of Default under the Debentures or the Indenture,
the procedures (including notice to the Trustee, MS plc and the Corporation)
described in Article Five of the Indenture have been complied with and (ii) in
the case of a Purchase Contract Default specified in clause (ii) of the
definition thereof, unless the Holders of not less than 25% of the Capital Units
then Outstanding shall have made written request upon the Agent to institute
such action or proceedings in its own name as Agent hereunder and shall have
offered to the Agent such reasonable indemnity as it may require pursuant to
Article Six, and the Agent for 60 days after its receipt of such notice, request
and offer of indemnity shall have failed to institute such action or proceedings
and no direction inconsistent with such request shall have been given to the
Agent in writing by holders of a majority of the Outstanding Capital Units, any
Holder of a Capital Unit may then (but only then) seek to enforce the
performance of the covenant or agreement with respect to which such Purchase
Contract Default exists; it being intended and expressly covenanted by the
Holder of each Capital Unit with every other Holder and the Agent that no Holder
shall have any right by virtue of or by availing itself of any provision of this
Agreement to affect, disturb or prejudice the rights of any other Holder, or to
obtain or seek to obtain priority over or preference to any other Holder, or to
enforce any right under this Agreement, except in accordance with this Section
or the Indenture and for the equal, ratable and common benefit of all Holders.
For the protection and enforcement of the provisions of this Section, each and
every Holder of a Capital Unit and the Agent shall be entitled to such relief as
can be given either at law or in equity.
Section 502. Restoration of Rights and Remedies.
----------------------------------
If any Holder of Capital Units has instituted any proceeding to
enforce any right or remedy under this Agreement and such proceeding has been
discontinued or abandoned for any reason, or has been determined adversely to
such Holder, then and in every such case, subject to any determination in such
proceeding, MS plc, the Corporation, the Agent, the Trustee and such Holder
shall be restored severally and respectively to their former positions hereunder
and thereafter all rights and remedies of MS plc, the Corporation, the Agent,
the Trustee and such Holder shall continue as though no such proceeding had been
instituted.
<PAGE>
28
Section 503. Rights and Remedies Cumulative.
------------------------------
Subject to Section 501, and except as otherwise provided with
respect to the replacement or payment of mutilated, destroyed, lost or stolen
(i) Capital Unit Certificates in the last paragraph of Section 306 and (ii)
Global Debentures and Global Purchase Contracts in the last paragraph of Section
1106, no right or remedy herein conferred upon or reserved to the Holders of
Capital Units is intended to be exclusive of any other right or remedy, and
every right and remedy shall, to the extent permitted by law, be cumulative and
in addition to every other right and remedy given hereunder or now or hereafter
existing at law or in equity or otherwise. The assertion or employment of any
right or remedy hereunder, or otherwise, shall not prevent the concurrent
assertion or employment of any other appropriate right or remedy.
Section 504. Delay or Omission Not Waiver.
----------------------------
No delay or omission of any Holder to exercise any right or
remedy accruing upon any Default shall impair any such right or remedy or
constitute a waiver of any such Default or an acquiescence therein. Every right
and remedy given by this Article or by law to the Holders may be exercised from
time to time, and as often as may be deemed expedient, by such Holders.
Section 505. Waiver of Past Defaults.
-----------------------
The Holders of not less than a majority of the Outstanding
Capital Units may on behalf of the Holders of all of the Capital Units waive any
past Purchase Contract Default hereunder and its consequences, except, unless
theretofore cured, a Purchase Contract Default resulting from the failure of the
Corporation to issue and deliver the Preferred Stock against tender of payment
therefor or a Purchase Contract Default with respect to a covenant or provision
hereof which under Article Seven cannot be modified or amended without approval
of the Holder of each Outstanding Capital Unit affected. In the case of any such
waiver, the Holders, the Agent, the Book-Entry Unit Depositary, MS plc and the
Corporation shall be restored to their former positions and rights hereunder,
respectively.
Upon any such waiver, such Purchase Contract Default shall cease
to exist, for every purpose of this Agreement, but no such waiver shall extend
to any subsequent or other Purchase Contract Default or impair any right
consequent thereon unless so expressly therein provided.
Section 506. Undertaking for Costs.
---------------------
All parties to this Agreement agree, and each Holder of any
Capital Unit by his acceptance thereof shall be deemed to have agreed, that any
court may in its discretion require, in any suit for the enforcement of any
right or remedy under this Agreement, or in any suit against either of the Agent
or Book-Entry Unit Depositary for any action taken,
<PAGE>
29
suffered or omitted by it as Agent or Book-Entry Unit Depositary, as applicable,
the filing by any party litigant in such suit of an undertaking to pay the costs
of such suit, and that such court may in its discretion assess reasonable costs,
including reasonable attorneys' fees, against any party litigant in such suit,
having due regard to the merits and good faith of the claims or defenses made by
such party litigant; provided that the provisions of this Section shall not
apply to any suit instituted by the Agent or the Book-Entry Unit Depositary, to
any suit instituted by any Holder of Capital Units, or group of Holders, holding
in the aggregate more than 10% of the Outstanding Capital Units, or to any suit
instituted by any Holder for enforcement of the right to purchase Depositary
Shares under the Purchase Contracts constituting a part of the Capital Units
held by such Holder.
Section 507. Waiver of Stay or Extension Laws.
--------------------------------
Each of MS plc and the Corporation covenants (to the extent that
it may lawfully do so) that it will not at any time insist upon, or plead, or in
any manner whatsoever claim or take the benefit or advantage of, any stay or
extension law wherever enacted, now or at any time hereafter in force, that may
affect the covenants or the performance of this Agreement; and MS plc and the
Corporation (to the extent that it may lawfully do so) each hereby expressly
waives all benefit or advantage of any such law and covenants that it will not
hinder, delay or impede the execution of any power herein granted to the Agent,
the Book-Entry Unit Depositary, or the Holders, but will suffer and permit the
execution of every such power as though no such law had been enacted.
Section 508. Agent May File Proofs of Claim.
------------------------------
In case of the pendency of any receivership, insolvency,
liquidation, bankruptcy or other judicial proceeding relating to MS plc or the
Corporation or the property of MS plc or the Corporation or its creditors, the
Agent shall be entitled and empowered, by intervention in such proceeding or
otherwise,
(1) to file and prove a claim and to file such other papers or
documents as may be necessary or advisable in order to have the
claims of the Agent (including any claim for the reasonable
compensation, expenses, disbursements and advances of the Agent,
its agents and counsel) and of the Holders allowed in such
judicial proceeding; and
(2) to collect and receive any moneys or other property payable
or deliverable on any such claims and to distribute the same;
and any receiver, assignee, trustee, liquidator or other similar official in any
such proceeding is hereby authorized by each Holder to make such payments to the
Agent, and in the event that the Agent shall consent to the making of such
payments directly to the Holders, to pay to such Holder any amount due to it
hereunder.
<PAGE>
30
Section 509. Suits for Enforcement.
---------------------
In case a Purchase Contract Default has occurred, has not been
waived and is continuing, and subject to receipt by the Agent of the request
referred to in Section 501 or the direction referred to in Section 510 and the
security or indemnity referred to in Section 603(f), the Agent shall have the
right to enforce, on behalf of the Holders, the Purchase Contracts and the
covenants and agreements of the Corporation contained in the Purchase Contracts
and in this Agreement with respect to the Purchase Contracts and to proceed to
protect and enforce such rights by appropriate judicial proceedings to protect
and enforce any of such rights, either at law or in equity or in bankruptcy or
otherwise, whether for the specific enforcement of any such covenant or
agreement contained in this Agreement or in the Purchase Contracts or in aid of
the exercise of any power granted in this Agreement or to enforce any other
legal or equitable right vested in the Agent by this Agreement or by law.
Section 510. Control by Holders.
------------------
The Holders of a majority of Outstanding Capital Units shall
have the right to direct the time, method, and place of conducting any
proceeding for any remedy available to the Agent, or exercising any power
conferred on the Agent with respect to the Purchase Contracts by this Agreement;
provided that such direction shall not be otherwise than in accordance with law
and the provisions of this Agreement and provided further that (subject to the
provisions of Section 601) the Agent shall have the right to decline to follow
any such direction if the Agent, being advised by counsel, shall determine that
the action or proceeding so directed may not lawfully be taken or if the Agent
in good faith by its board of directors or the executive committee, shall
determine that the action or proceedings so directed could involve the Agent in
personal liability or if the Agent in good faith shall so determine that the
actions or forebearances specified in or pursuant to such direction would be
unduly prejudicial to the interests of Holders of Capital Units not joining in
the giving of said direction, it being understood that (subject to Section 601)
the Agent shall have no duty to ascertain whether or not such actions or
forebearances are unduly prejudicial to such Holders.
Nothing in this Agreement shall impair the right of the Agent in
its discretion (but subject to Section 509) to take any action deemed proper by
the Agent and which is not inconsistent with such direction or directions by
Holders.
<PAGE>
31
ARTICLE SIX
The Agent
Section 601. Certain Duties and Responsibilities.
-----------------------------------
(a) The Agent undertakes to perform such duties and only such
duties as are specifically set forth in this Agreement.
(b) No provision of this Agreement shall be construed to relieve
the Agent from liability for its own negligent action, its own negligent
failure to act, or its own wilful misconduct, except that
(1) the duties and obligations of the Agent with respect to the
Capital Units shall be determined solely by the express provisions of this
Agreement and the Agent shall not be liable except for the performance of
such duties and obligations as are specifically set forth in this
Agreement, and no implied covenants or obligations shall be read into this
Agreement against the Agent; and
(2) in the absence of bad faith on its part, the Agent may
conclusively rely, as to the truth of the statements and the correctness of
the opinions expressed therein, upon any statements, certificates or
opinions furnished to the Agent and conforming to the requirements of this
Agreement, but in the case of any such statements, certificates or opinions
that by any provision hereof are specifically required to be furnished to
the Agent, the Agent shall be under a duty to examine the same to determine
whether or not they conform to the requirements of this Agreement.
(c) The Agent shall not be liable for any error of judgment made
in good faith by a Responsible Officer of the Agent, unless it shall be
proved that the Agent was negligent in ascertaining the pertinent facts.
(d) The Agent shall not be liable with respect to any action
taken or omitted to be taken by it in good faith in accordance with the
direction of the Holders of a majority in number of Outstanding Capital
Units relating to the time, method and place of conducting any proceeding
for any remedy available to the Agent, or exercising any power conferred
upon the Agent, under this Agreement.
(e) No provision of this Agreement shall require the Agent to
expend or risk its own funds or otherwise incur any financial liability in
the performance of any of its duties hereunder, or in the exercise of any
of its rights or powers, if it shall have reasonable grounds for believing
that repayment of such funds or adequate indemnity against such risk or
liability is not reasonably assured to it.
<PAGE>
32
(f) Whether or not therein expressly so provided, every
provision of this Agreement relating to the conduct or affecting the
liability of or affording protection to the Agent shall be subject to the
provisions of this Section.
(g) The Agent is acting solely as agent for MS plc and the
Corporation hereunder and owes no fiduciary duties to any person by virtue
of this Agreement.
Section 602. Notice of Default.
-----------------
Within 90 days after the occurrence of any Purchase Contract
Default of which a Responsible Officer of the Agent assigned to its Corporate
Trustee Administration Department has actual knowledge, and except with respect
to a Purchase Contract Default under the Purchase Contracts existing on the
Purchase Date, in which event, as promptly as practicable thereafter, the Agent
shall transmit by mail to all Holders of Capital Units, in the manner provided
in Section 1306, notice of such Purchase Contract Default hereunder, unless such
Purchase Contract Default shall have been cured or waived.
Section 603. Certain Rights of Agent.
-----------------------
Subject to the provisions of Section 601:
(a) the Agent may rely and shall be protected in acting or
refraining from acting upon any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order,
bond, debenture, note, coupon, security or other paper or document believed
by it to be genuine and to have been signed or presented by the proper
party or parties;
(b) any request, direction, order or demand of MS plc or the
Corporation mentioned herein shall be sufficiently evidenced by an
Officer's Certificate, Issuer Order or Issuer Request, and any resolution
of the Board of Directors of MS plc or the Corporation, as the case may be,
may be sufficiently evidenced by a Board Resolution;
(c) the Agent may consult with counsel and the written advice of
such counsel or any Opinion of Counsel shall be full and complete
authorization and protection with respect to any action taken, suffered or
omitted by it hereunder in good faith and in reliance thereon in accordance
with such advice or Opinion of Counsel;
(d) the Agent shall not be bound to make any investigation into
the facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, consent, order, approval,
appraisal, bond, debenture, note, coupon, security or other paper or
document, but the Agent, in its discretion, may make reasonable further
inquiry or investigation into such facts or matters related to the
<PAGE>
33
issuance of the Debentures and the Guarantee and the execution, delivery
and performance of the Purchase Contracts as it may see fit, and, if the
Agent shall determine to make such further inquiry or investigation, it
shall be entitled to examine the books, records and premises of MS plc and
the Corporation, at reasonable times during normal business hours,
personally or by agent or attorney;
(e) the Agent may execute any of the powers hereunder or perform
any duties hereunder either directly or by or through agents or attorneys
and the Agent shall not be responsible for any misconduct or negligence on
the part of any such agent or attorney appointed with due care by it
hereunder;
(f) the Agent shall be under no obligation to exercise any of
the rights or powers vested in it by this Agreement at the request, order
or direction of any of the Holders pursuant to this Agreement, unless such
Holders shall have offered to the Agent reasonable security or indemnity
against the costs, expenses and liabilities that might be incurred by it in
compliance with such request or direction;
(g) the Agent shall not be liable for any action taken or
omitted by it in good faith and believed by it to be authorized or within
the discretion, rights or powers conferred upon it by this Agreement; and
(h) the Agent shall not be charged with notice or knowledge of a
Cancellation Condition or a Purchase Contract Default unless a Responsible
Officer of the Agent assigned to its Corporate Trustee Administration
Department shall have actual knowledge thereof.
Section 604. Not Responsible for Recitals or Issuance of Capital Units.
---------------------------------------------------------
The recitals contained herein, in the Indenture and in the
Capital Units, except the Trustee's and Agent's certificates of authentication,
shall be taken as the statements of MS plc or the Corporation, as the case may
be, and neither the Agent nor any Authenticating Agent assumes any
responsibility for their correctness. The Agent makes no representations as to
the validity or sufficiency of this Agreement or of the Capital Units. Neither
the Agent nor any Authenticating Agent shall be accountable for the use or
application by MS plc or the Corporation of the proceeds with respect to Capital
Units or be responsible for exercising any remedy hereunder on behalf of the
Holders, except as expressly provided in this Agreement.
Section 605. May Hold Capital Units.
----------------------
The Agent, the Trustee, any Authenticating Agent, any Purchase
Contract Registrar or any other agent of MS plc, the Corporation, the Trustee or
the Agent, in its individual or any other capacity, may become the owner or
pledgee of Capital Units and may otherwise deal with MS plc and the Corporation
and receive, collect, hold and retain
<PAGE>
34
collections from MS plc and the Corporation with the same rights it would have
if it were not Authenticating Agent, Purchase Contract Registrar or such other
agent, the Trustee or the Agent.
Section 606. Money Held in Trust.
-------------------
Money held by the Agent in trust hereunder need not be
segregated from other funds held by the Agent, except to the extent required by
law. The Agent shall be under no obligation to invest or pay interest on any
money received by it hereunder, except as otherwise agreed with MS plc and the
Corporation. Any interest accrued on funds deposited with the Agent or any
Paying Agent under this Agreement shall be paid to MS plc and the Corporation
from time to time and the Holders of Capital Units (whether or not any Purchase
Contracts are to be redeemed with such funds) shall have no claim to any such
interest.
Section 607. Compensation and Reimbursement.
------------------------------
MS plc and the Corporation agree:
(a) to pay to the Agent from time to time reasonable
compensation for all services rendered by it hereunder (which compensation
shall not be limited by any provision of law with regard to the
compensation of a trustee of an express trust),
(b) except as otherwise expressly provided herein, to reimburse
the Agent and any predecessor Agent upon its request for all reasonable
expenses, disbursements and advances incurred or made by the Agent in
accordance with any provision of this Agreement (including the reasonable
compensation and the expenses and disbursements of its agents and counsel),
except any such expense, disbursement or advance as may be attributable to
its negligence or bad faith; and
(c) to indemnify the Agent and any predecessor Agent for, and to
hold it harmless against, any loss, liability or expense incurred without
negligence or bad faith on its part, arising out of or in connection with
the acceptance or administration of this Agreement and its duties
hereunder, including the costs and expenses of defending itself against or
investigating any claim of liability in connection with the exercise or
performance of any of its powers or duties hereunder.
The obligations of MS plc and the Corporation under this Section
to compensate and indemnify the Agent and any predecessor Agent and to pay or
reimburse the Agent and any predecessor Agent for expenses, disbursements and
advances shall constitute additional indebtedness hereunder and shall survive
the satisfaction and discharge of this Agreement. Such additional indebtedness
shall be a senior claim to that of the Capital Units upon all property and funds
held or collected by the Agent as such, except funds held in trust for the
benefit of the Holders of Capital Units, and the Capital Units are hereby
subordinated to such senior claim.
<PAGE>
35
Section 608. Corporate Agent Required; Eligibility.
-------------------------------------
There shall at all times be an Agent hereunder which shall be a
corporation organized and doing business under the laws of the United States of
America, any State thereof or the District of Columbia, having, together with
its parent, a combined capital and surplus of at least $50,000,000, subject to
supervision or examination by Federal, State or District of Columbia authority
and willing to act on reasonable terms. Such corporation shall have its
principal place of business in the Borough of Manhattan, The City of New York,
if there be such a corporation in such location willing to act upon reasonable
and customary terms and conditions. If such corporation, or its parent,
publishes reports of condition at least annually, pursuant to law or to the
requirements of the aforesaid supervising or examining authority, then for the
purposes of this Section, the combined capital and surplus of such corporation
shall be deemed to be its combined capital and surplus as set forth in its most
recent report of condition so published. The Agent hereunder shall at all times
be the Book-Entry Unit Depositary hereunder and the Trustee under the Indenture,
subject to receipt of an Opinion of Counsel that the same Person is precluded by
law from acting in such capacities. If at any time the Agent shall cease to be
eligible in accordance with the provisions of this Section, it shall resign
immediately in the manner and with the effect hereinafter specified in this
Article.
Section 609. Resignation and Removal; Appointment of Successor.
-------------------------------------------------
(a) No resignation or removal of the Agent and no appointment of
a successor Agent pursuant to this Article shall become effective until the
acceptance of appointment by the successor Agent in accordance with the
applicable requirements of Section 610.
(b) The Agent may resign by giving written notice thereof to MS
plc and the Corporation and the Holders, in accordance with Section 1305
and Section 1306, 60 days prior to the effective date of such resignation.
The Agent may be removed at any time upon 60 days' notice by the filing
with it of an instrument in writing signed on behalf of MS plc and the
Corporation and specifying such removal and the date when it is intended to
become effective. If the instrument of acceptance by a successor Agent
required by Section 610 shall not have been delivered to the Agent within
30 days after the giving of such notice of resignation, the resigning Agent
may petition any court of competent jurisdiction for the appointment of a
successor Agent.
(c) If at any time
(1) the Agent shall cease to be eligible under Section 608, or
shall cease to be eligible as Book-Entry Unit Depositary hereunder or as
Trustee under the Indenture, and shall fail to resign after written request
therefor by MS plc, the Corporation or by any Holder, or
<PAGE>
36
(2) the Agent shall become incapable of acting with respect to
the Capital Units or shall be adjudged a bankrupt or insolvent, or a
receiver or liquidator of the Agent or of its property shall be appointed
or any public officer shall take charge or control of the Agent or of its
property or affairs for the purpose of rehabilitation, conservation or
liquidation,
then, in any such case, (i) MS plc or the Corporation, by Board Resolution, may
remove the Agent and appoint a successor Agent, or (ii) any Holder who has been
a bona fide Holder of a Capital Unit for at least six months may, on behalf of
himself and all others similarly situated, petition any court of competent
jurisdiction for the removal of the Agent and the appointment of a successor
Agent or Agents. Such court may thereupon, after such notice, if any, as it may
deem proper and prescribe, remove the Agent and appoint a successor Agent.
(d) If the Agent shall resign, be removed or become incapable of
acting, or if a vacancy shall occur in the office of Agent for any cause,
with respect to the Capital Units, MS plc and the Corporation, by Board
Resolution, shall promptly appoint a successor Agent or Agents (other than
the Corporation or MS plc) and shall comply with the applicable
requirements of Section 610. If no successor Agent shall have been so
appointed by MS plc and the Corporation and accepted appointment in the
manner required by Section 610, any Holder who has been a bona fide Holder
of a Capital Unit for at least six months may, on behalf of himself and all
others similarly situated, petition any court of competent jurisdiction for
the appointment of a successor Agent.
(e) MS plc and the Corporation shall give, or shall cause
such successor Agent to give, notice of each resignation and each removal
of the Agent and each appointment of a successor Agent to all Holders of
Capital Units in accordance with Section 1306. Each notice shall include
the name of the successor Agent and the address of its Corporate Trust
Office.
Section 610. Acceptance of Appointment by Successor.
--------------------------------------
(a) In case of the appointment hereunder of a successor Agent,
every such successor Agent so appointed shall execute, acknowledge and
deliver to MS plc and the Corporation and to the retiring Agent an
instrument accepting such appointment, and thereupon the resignation or
removal of the retiring Agent shall become effective and such successor
Agent, without any further act, deed or conveyance, shall become vested
with all the rights, powers, agencies and duties of the retiring Agent,
with like effect as if originally named as Agent hereunder; but, on the
request of MS plc, the Corporation or the successor Agent, such retiring
Agent shall, upon payment of all amounts due and payable to it pursuant to
Section 607, execute and deliver an instrument transferring to such
successor Agent all the rights and powers of the retiring Agent and shall
duly assign, transfer and deliver to such successor Agent all property and
money held by such retiring Agent hereunder. Any retiring Agent shall,
<PAGE>
37
nonetheless, retain a prior claim upon all property or funds held or
collected by such Agent to secure any amounts then due it pursuant to
Section 607.
(b) Upon request of any such successor Agent, MS plc and the
Corporation shall execute any and all instruments for more fully and
certainly vesting in and confirming to such successor Agent all such
rights, powers and agencies referred to in paragraph (a) of this Section.
(c) No successor Agent shall accept its appointment unless at
the time of such acceptance such successor Agent shall be eligible under
this Article.
(d) Upon acceptance of appointment by any successor Agent as
provided in this Section, MS plc and the Corporation shall give notice
thereof to the Holders of Capital Units in accordance with Section 1306. If
the acceptance of appointment is substantially contemporaneous with the
resignation of the Agent, then the notice called for by the preceding
sentence may be combined with the notice called for by Section 609. If MS
plc and the Corporation fail to give such notice within ten days after
acceptance of appointment by the successor Agent, the successor Agent shall
cause such notice to be given at the expense of MS plc and the Corporation.
Section 611. Merger, Conversion, Consolidation or Succession to Business.
-----------------------------------------------------------
Any corporation into which the Agent may be merged or converted
or with which it may be consolidated, or any corporation resulting from any
merger, conversion or consolidation to which the Agent shall be a party, or any
corporation succeeding to all or substantially all the agency business of the
Agent, shall be the successor of the Agent hereunder, without the execution or
filing of any paper or any further act on the part of any of the parties hereto,
provided that such corporation shall be otherwise eligible under this Article.
In case any Capital Unit Certificates shall have been countersigned and
executed, but not delivered, by the Agent then in office, any successor by
merger, conversion or consolidation to such Agent may adopt such
countersignature and execution and deliver the Capital Unit Certificates so
countersigned and executed with the same effect as if such successor Agent had
itself countersigned and executed such Capital Units.
Section 612. Appointment of Authenticating Agent.
-----------------------------------
At any time when any of the Capital Units remain Outstanding the
Agent may, by an instrument in writing, appoint an Authenticating Agent or
Agents with respect to the Purchase Contracts that may be authorized to act on
behalf of the Agent to countersign, execute and deliver the Purchase Contracts
issued upon exchange, registration of transfer or pursuant to Section 306 and
Purchase Contracts so countersigned, executed and delivered shall be entitled to
the benefits of this Agreement and shall be valid and obligatory for all
purposes as if countersigned by the Agent hereunder. Wherever reference is made
in this Agreement to the countersignature, execution and delivery of Purchase
Contracts by the
<PAGE>
38
Agent or the Agent's countersignature, such references shall be deemed to
include countersignature, execution and delivery on behalf of the Agent by an
Authenticating Agent and a countersignature and execution executed on behalf of
the Agent by an Authenticating Agent. Each Authenticating Agent shall be
acceptable to MS plc and the Corporation and shall at all times be a corporation
organized and doing business under the laws of the United States of America, any
State thereof or the District of Columbia, authorized under such laws to act as
Authenticating Agent, subject to supervision or examination by Federal or State
or District of Columbia authority and having, together with its parent, a
combined capital and surplus of not less than $50,000,000. If such
Authenticating Agent, or its parent, publishes reports of condition at least
annually, pursuant to law or to the requirements of the aforesaid supervising or
examining authority, then for the purposes of this Section, the combined capital
and surplus of such Authenticating Agent shall be deemed to be its combined
capital and surplus as set forth in its most recent report of condition so
published. If at any time an Authenticating Agent shall cease to be eligible in
accordance with the provisions of this Section, such Authenticating Agent shall
resign immediately in the manner and with the effect specified in this Section.
Any corporation into which an Authenticating Agent may be merged
or converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which such Authenticating Agent
shall be a party, or any corporation succeeding to all or substantially all the
agency business of an Authenticating Agent, shall continue to be an
Authenticating Agent, without the execution or filing of any paper or any
further act on the part of the Agent or the Authenticating Agent, provided that
such corporation shall be otherwise eligible under this Section.
An Authenticating Agent may resign at any time by giving written
notice thereof to the Agent and to MS plc and the Corporation. The Agent may at
any time terminate the agency of an Authenticating Agent by giving written
notice thereof to such Authenticating Agent and to MS plc and the Corporation.
Upon receiving such a notice of resignation or upon such a termination, or in
case at any time such Authenticating Agent shall cease to be eligible in
accordance with the provisions of this Section, the Agent may appoint a
successor Authenticating Agent which shall be acceptable to MS plc and the
Corporation and shall provide written notice of such appointment to all Holders
of Capital Units in the manner and to the extent provided in Section 1306. Any
successor Authenticating Agent upon acceptance of its appointment hereunder
shall become vested with all the rights, powers and duties of its predecessor
hereunder, with like effect as if originally named as an Authenticating Agent.
No successor Authenticating Agent shall be appointed unless eligible under the
provisions of this Section. No Authenticating Agent shall have any
responsibility or liability for any action taken by it as such at the direction
of the Agent.
The provisions of Sections 307, 604 and 605 shall be applicable
to each Authenticating Agent.
<PAGE>
39
Pursuant to each appointment made under this Section, the
Capital Unit Certificates covered by such appointment may have endorsed thereon,
in addition to the form of Agent's countersignature and execution of the
Purchase Contracts evidenced thereby, an alternative countersignature and
execution in the following forms:
CHEMICAL BANK, as Agent,
as attorney-in-fact of the
Holder hereof
By [NAME OF AUTHENTICATING AGENT],
as Authenticating Agent
By_____________________________________
[Authorized Officer]
Countersigned:
CHEMICAL BANK,
as Agent
By [NAME OF AUTHENTICATING AGENT],
as Authenticating Agent
By_____________________________________
[Authorized Officer]
Section 613. MS plc and the Corporation to Furnish Agent Names and
Addresses of Holders.
-----------------------------------------------------
MS plc and the Corporation will furnish or cause to be furnished
to the Agent
(a) not later than 15 days after each Regular Record Date in
each year, a list, in such form as the Agent may reasonably require, of the
names and addresses of the Holders as of such Regular Record Date, and
(b) at such other times as the Agent may request in writing,
within 30 days after the receipt by MS plc and the Corporation of any such
request, a list of similar form and content as of a date not more than 15
days prior to the time such list is furnished;
<PAGE>
40
provided that no such list need be furnished if the Agent shall be the Purchase
Contract Registrar and the registrar under the Indenture.
Section 614. Preservation of Information; Communications to Holders.
------------------------------------------------------
(a) The Agent shall preserve, in as current a form as is
reasonably practicable, the names and addresses of Holders contained in the
most recent list furnished to the Agent as provided in Section 613 and the
names and addresses of Holders received by the Agent in its capacity as
Purchase Contract Registrar and the registrar under the Indenture. The
Agent may destroy any list furnished to it as provided in Section 613 upon
receipt of a new list so furnished.
(b) If three or more Holders (herein referred to as
"applicants") apply in writing to the Agent, and furnish to the Agent
----------
reasonable proof that each such applicant has owned a Capital Unit for a
period of at least six months preceding the date of such application, and
such application states that the applicants desire to communicate with
other Holders with respect to their rights under this Agreement or under
the Capital Units and is accompanied by a copy of the form of proxy or
other communication that such applicants propose to transmit, then the
Agent shall, within five Business Days after the receipt of such
application, at its election either (i) afford such applicants access to
the information preserved at the time by the Agent in accordance with
Section 614(a) or (ii) inform such applicants as to the approximate number
of Holders whose names and addresses appear in the information preserved at
the time by the Agent, and as to the approximate cost of mailing to such
Holders the form of proxy or other communication, if any, specified in such
application.
If the Agent shall elect not to afford such applicants access to
such information, the Agent shall, upon the written request of such
applicants, mail to each Holder whose name and address appears in the
information preserved at the time by the Agent, a copy of the form of proxy
or other communication that is specified in such application, with
reasonable promptness after a tender to the Agent of the material to be
mailed and of payment, or provision for payment, of the reasonable expenses
of mailing, unless within five days after such tender, the Agent shall mail
to such applicants a written statement to the effect that in the opinion of
the Agent, such mailing would be contrary to the best interests of the
Holders or would be in violation of applicable law. Thereafter, the Agent
shall be relieved of any obligation or duty to such applicants with respect
to their application.
(c) Every Holder of Capital Units, by his acceptance thereof,
agrees with MS plc, the Corporation and the Agent that none of MS plc, the
Corporation, the Agent nor any agent of any of them shall be held
accountable by reason of the disclosure of any such information as to the
names and addresses of the Holders in accordance with Section 614(b),
regardless of the source from which such information
<PAGE>
41
was derived, and that the Agent shall not be held accountable by reason of
mailing any material pursuant to a request made under Section 614(b).
Section 615. No Obligation of Holder.
-----------------------
Except to the extent otherwise provided in this Agreement, the
Agent assumes no obligations and shall not be subject to any liability under
this Agreement or any Purchase Contract with respect to the obligations of the
Holder of a Capital Unit thereunder. Each of MS plc and the Corporation agrees,
and each Holder of a Capital Unit Certificate, by his acceptance thereof, shall
be deemed to have agreed, that the Agent's execution of the Purchase Contracts
evidenced by the Capital Unit Certificates shall be solely as agent and
attorney-in-fact for the Holders, and that the Agent shall have no obligation to
perform such Purchase Contracts on behalf of the Holders, except to the extent
provided in this Article.
Section 616. Tax Compliance.
--------------
(a) The Agent, on its own behalf and on behalf of MS plc and the
Corporation, will comply with all applicable certification, information
reporting and withholding (including "backup" withholding) requirements
imposed by applicable United States, federal and New York State tax laws,
regulations or administrative practice with respect to (i) the Debentures,
the Purchase Contracts, the Depositary Receipts or the Depositary Shares or
(ii) the issuance, delivery, holding, transfer, redemption or exercise of
rights under the Debentures, the Purchase Contracts, the Depositary
Receipts or the Depositary Shares. Such compliance shall include, without
limitation, the preparation and timely filing of required returns and the
timely payment of all amounts required to be withheld to the appropriate
taxing authority or its designated agent. MS plc and the Corporation will
provide to the Agent such information as it may reasonably request in order
to comply with this Section.
(b) The Agent shall comply with any direction received from MS
plc or the Corporation with respect to the application of such requirements
to particular payments or holders or in other particular circumstances, and
may for purposes of this Agreement rely on any such direction in accordance
with the provisions of Section 601(b)(2) hereof.
(c) The Agent shall maintain all appropriate records documenting
compliance with such requirements, and shall make such records available on
request at reasonable times during normal business hours to MS plc and the
Corporation or to their authorized representatives duly authorized in
writing.
(d) The portion of the purchase price of the Capital Units
allocable to the Debentures shall equal the amount payable at maturity of
the Debenture. MS plc and the Holders agree not to file any tax returns, or
take a position with any tax authority,
<PAGE>
42
that is inconsistent with such allocation or that is inconsistent with the
characterization of the Debentures as debt.
ARTICLE SEVEN
Supplemental Agreements
Section 701. Supplemental Agreements Affecting Purchase
Contracts Without Consent of Holders.
------------------------------------------
Without the consent of any Holders, MS plc and the Corporation,
each when authorized by a Board Resolution or Officer's Certificate, and the
Agent and the Book-Entry Unit Depositary, at any time and from time to time, may
enter into one or more agreements supplemental hereto, in form satisfactory to
the Agent and the Book-Entry Unit Depositary, for any of the following purposes:
(1) to evidence the succession of another Person to the
Corporation or MS plc and the assumption by any such successor of the
covenants of the Corporation or MS plc herein, in the case of the
Corporation, with respect to and affecting the Purchase Contracts and in
the Purchase Contracts, and in the case of MS plc and the Corporation, with
respect to the covenants and conditions of this Agreement to be performed
by MS plc or the Corporation; or
(2) to evidence and provide for the acceptance of appointment
hereunder by a successor Agent or Book-Entry Unit Depositary, as
applicable, with respect to the Capital Units; or
(3) to add to the covenants of MS plc, the Corporation, the
Agent or the Book-Entry Unit Depositary such further covenants,
restrictions, conditions or provisions as MS plc, the Corporation, the
Agent and the Book-Entry Unit Depositary shall consider to be for the
protection of the Holders, and to make the occurrence, or the occurrence
and continuance, of a default in any such additional covenants,
restrictions, conditions or provisions of the Corporation a Purchase
Contract Default permitting the enforcement of all or any of the several
remedies provided in this Agreement as herein set forth; provided that in
respect of any such additional covenant, restriction, condition or
provision such supplemental agreement may provide for a particular period
of grace after default (which period may be shorter or longer than that
allowed in the case of other defaults) or may provide for an immediate
enforcement upon such a Purchase Contract Default or may limit the remedies
available to the Holders upon such a Purchase Contract Default or may limit
the right of the Holders to waive such Purchase Default; or
<PAGE>
43
(4) to comply with the Securities Act of 1933, as amended, the
Exchange Act or the Investment Company Act as of 1940, as amended; or
(5) to cure any ambiguity, to correct or supplement any
provision herein with respect to and affecting the Purchase Contracts that
may be inconsistent with any other provision herein, or to modify, alter,
amend or supplement any other provisions with respect to matters or
questions arising under this Agreement with respect to and affecting the
Purchase Contracts; provided that such action shall not adversely affect
the interests of the Holders in any material respect.
Section 702. Supplemental Agreements Affecting
Purchase Contracts with Consent of Holders.
------------------------------------------
With the consent of the Holders of not less than a majority of
the Outstanding Capital Units, by Act of said Holders delivered to the
Corporation and the Agent, the Corporation and MS plc, each when authorized by a
Board Resolution or Officer's Certificate, and the Agent and the Book-Entry Unit
Depositary may enter into an agreement or agreements supplemental hereto for the
purpose of modifying in any manner the terms of the Purchase Contracts or this
Agreement with respect to the Purchase Contracts or the rights of the Holders of
Capital Units with respect to the Purchase Contracts; provided, however, that no
such supplemental agreement shall, without the consent of the Holder of each
Outstanding Capital Unit affected thereby,
(1) impair the right to institute suit for the enforcement of
any Purchase Contract, or
(2) reduce the percentage of the Outstanding Capital Units, the
consent of whose Holders is required for any modification or amendment of
the provisions of this Agreement relating to the Purchase Contracts or for
any waiver of any Purchase Contract Defaults hereunder and their
consequences provided for in this Agreement relating to the Purchase
Contracts, or
(3) modify or affect (in any manner materially adverse to the
Holders) the Holders' rights and obligations under the Purchase Contracts,
or
(4) modify or affect (in any manner materially adverse to the
holders) the terms of the Preferred Stock or the Depositary Shares
(determined as if the Preferred Stock and Depositary Shares were
outstanding);
provided that the Holders of not less than 66-2/3% of the Capital Units
Outstanding at the time of an issuance of shares of a class of stock that ranks
prior to the Preferred Stock as to dividends or upon liquidation may consent to
such an issuance, and such issuance, if so consented to, will not result in a
Cancellation Condition and will not affect the rights of Holders under the
Purchase Contracts.
<PAGE>
44
It shall not be necessary for any Act of Holders under this
Section to approve the particular form of any proposed supplemental agreement,
but it shall be sufficient if such Act shall approve the substance thereof.
Section 703. Execution of Supplemental Agreements.
------------------------------------
In executing, or accepting the additional agencies or duties
created by, any supplemental agreement permitted by this Article or the
modifications thereby of the agencies or duties created by this Agreement, each
of the Agent and the Book-Entry Unit Depositary shall be entitled to receive and
(subject to Sections 601 and 1201, respectively) shall be fully protected in
relying upon, an Opinion of Counsel stating that the execution of such
supplemental agreement is authorized or permitted by this Agreement. Each of the
Agent and the Book-Entry Unit Depositary may, but shall not be obligated to,
enter into any such supplemental agreement that affects the Agent's or the Book-
Entry Unit Depositary's respective rights, duties or immunities under this
Agreement or otherwise.
Section 704. Effect of Supplemental Agreements.
---------------------------------
Upon the execution of any supplemental agreement under this
Article, this Agreement shall be modified in accordance therewith, and such
supplemental agreement shall form a part of this Agreement for all purposes; and
every Holder of Capital Unit Certificates, or Book-Entry Capital Units
represented by Global Debentures and Global Purchase Contracts, theretofore or
thereafter authenticated, countersigned, executed and delivered hereunder and
under the Indenture shall be bound thereby.
Section 705. Reference to Supplemental Agreements.
------------------------------------
Capital Unit Certificates, Debentures and Purchase Contracts
authenticated, countersigned, executed and delivered after the execution of any
supplemental agreement pursuant to this Article may, and shall if required by
the Agent, bear a notation in form approved by the Agent as to any matter
provided for in such supplemental agreement. If MS plc or the Corporation shall
so determine, new Capital Unit Certificates, Debentures and Purchase Contracts
so modified as to conform, in the opinion of the Agent, MS plc and the
Corporation, to any such supplemental agreement may be prepared and executed by
MS plc and the Corporation and authenticated, executed, countersigned and
delivered by the Trustee and the Agent, as applicable, in exchange for
Outstanding Capital Unit Certificates, Debentures and Purchase Contracts.
<PAGE>
45
ARTICLE EIGHT
Consolidation, Merger, Sale or Conveyance
Section 801. Covenant Not to Merge, Consolidate,
Sell or Convey Property Except Under Certain Conditions.
-------------------------------------------------------
Each of MS plc and the Corporation covenants that it will not
merge or consolidate with any other corporation or sell, convey or lease all or
substantially all of its assets to any Person, firm or corporation, except that
MS plc or the Corporation may merge or consolidate with, or sell, convey or
lease all or substantially all of its assets to, any other corporation, provided
that (i) either MS plc or the Corporation, as the case may be, shall be the
continuing corporation, or the successor corporation (if other than MS plc or
the Corporation, as the case may be) shall be a corporation organized and
existing under the laws of the United States of America or a state thereof or
the District of Columbia (with respect to the Corporation) or England and Wales
(with respect to MS plc) and such corporation shall (a) in the case of the
Corporation, execute and deliver to the Agent an amendment to this Agreement
with respect to the Purchase Contracts, as provided in Section 406 hereof, and
(b) in the case of both MS plc and the Corporation, assume the due and punctual
performance and observance of all of the covenants and conditions of this
Agreement to be performed by MS plc or the Corporation, as the case may be, by
supplemental agreement in form satisfactory to the Agent and the Book-Entry Unit
Depositary, executed and delivered to the Agent and the Book-Entry Unit
Depositary by such corporation, and (ii) none of MS plc, the Corporation or such
successor corporation, as the case may be, immediately after such merger or
consolidation, or such sale or conveyance, shall be in default in the
performance of any such covenant or condition.
Section 802. Rights and Duties of Successor Corporation.
------------------------------------------
In case of any such consolidation, merger, sale or conveyance
and upon any such assumption by the successor corporation, such successor
corporation shall succeed to and be substituted for MS plc or the Corporation,
as the case may be, with the same effect as if it had been named herein as MS
plc or the Corporation, as the case may be. Such successor corporation thereupon
may cause to be signed, and may issue (subject to the provisions of the
Indenture) either in its own name or in the name of Morgan Stanley Finance plc
(in the case of MS plc) or Morgan Stanley Group Inc. (in the case of the
Corporation) any or all of the Capital Unit Certificates, Debentures and
Purchase Contracts issuable hereunder which theretofore shall not have been
signed by MS plc (with respect to the Debentures constituting part of such
Capital Units) or the Corporation (with respect to the Purchase Contracts
constituting part of such Capital Units), as the case may be, and delivered to
the Agent or the Book-Entry Unit Depositary; and, upon the order of such
successor corporation, instead of MS plc or the Corporation, as the case may be,
and subject to all the terms, conditions and limitations in this Agreement
prescribed, the Trustee and the Agent shall authenticate, countersign, execute
and deliver, as applicable, any Capital Unit
<PAGE>
46
Certificates, Debentures and Purchase Contracts that previously shall have been
signed and delivered by the officers of MS plc (with respect to the Debentures
constituting part of such Capital Units) or the Corporation (with respect to
Purchase Contracts constituting part of such Capital Units), as the case may be,
to the Trustee and the Agent for authentication, execution and countersignature,
and any Capital Unit Certificate, Debenture and Purchase Contract evidencing
Capital Units which such successor corporation thereafter shall cause to be
signed and delivered to the Trustee and the Agent for such purpose. All the
Purchase Contracts so issued shall in all respects have the same legal rank and
benefit under this Agreement as the Purchase Contracts theretofore or thereafter
issued in accordance with the terms of this Agreement as though all of such
Purchase Contracts had been issued at the date of the execution hereof.
In case of any such consolidation, merger, sale or conveyance
such change in phraseology and form (but not in substance) may be made in the
Capital Unit Certificates and Purchase Contracts thereafter to be issued as may
be appropriate.
Section 803. Opinion of Counsel to Agent
and the Book-Entry Unit Depositary.
----------------------------------
The Agent and the Book-Entry Unit Depositary, subject to
Sections 601 and 603 and Sections 1201 and 1203, respectively, may receive an
Opinion of Counsel as conclusive evidence that any such consolidation, merger,
sale or conveyance, and any such assumption, complies with the provisions of
this Article.
ARTICLE NINE
Covenants
Section 901. Performance Under Purchase Contracts.
------------------------------------
The Corporation covenants and agrees for the benefit of the
Holders of the Capital Units that it will duly and punctually perform its
obligations under the Purchase Contracts in accordance with the terms of the
Purchase Contracts and this Agreement.
Section 902. Maintenance of Office or Agency.
-------------------------------
MS plc and the Corporation will maintain in the Borough of
Manhattan, The City of New York, an office or agency where Capital Unit
Certificates may be presented or surrendered for payment or acquisition of
Depositary Shares, where Capital Unit Certificates may be surrendered for
registration of transfer or exchange and where notices and demands to or upon MS
plc and the Corporation in respect of the Capital Units and this Agreement may
be served; provided, however, that with respect to Book-Entry Capital Units, MS
plc or the Corporation will maintain in the place of payment of the Global
Debenture constituting a
<PAGE>
47
part of such Book-Entry Capital Units an office or agency where such Global
Debenture may be presented or surrendered for payment, in accordance with the
provisions of the Indenture. MS plc and the Corporation hereby initially appoint
the Agent its office or agency in the Borough of Manhattan, The City of New York
for each of said purposes. MS plc and the Corporation will give prompt written
notice to the Agent of the location, and any change in the location, of such
office or agency. If at any time MS plc or the Corporation shall fail to
maintain any such required office or agency or shall fail to furnish the Agent
with the name and address thereof, such presentations, surrenders, notices and
demands may be made or served at the Corporate Trust Office of the Agent, and MS
plc and the Corporation hereby appoint the Agent as its agent to receive all
such presentations, surrenders, notices and demands.
MS plc and the Corporation may also from time to time designate
one or more other offices or agencies where Debentures, Purchase Contracts and
Capital Unit Certificates may be presented or surrendered for any or all such
purposes and may from time to time rescind such designations; provided, however,
that no such designation or rescission shall in any manner relieve MS plc or the
Corporation of their respective obligations to maintain an office or agency in
the Borough of Manhattan, The City of New York, for such purposes. MS plc and
the Corporation will give prompt written notice to the Agent of any such
designation or rescission and of any change in the location of any such other
office or agency. MS plc and the Corporation hereby designate as the place of
payment for the Debentures, Purchase Contracts and Capital Unit Certificates the
Corporate Trust Office of the Agent and appoint the Agent at its Corporate Trust
Office as paying agent in such city.
Section 903. Money for Payments to Be Held in Trust.
--------------------------------------
Any money deposited with the Agent, in trust for payment with
respect to any Capital Unit, remaining unclaimed for two years after such
payment has become due and payable shall be paid to MS plc or the Corporation on
request of MS plc or the Corporation, as the case may be, pursuant to an
Officer's Certificate; and the Holder of such Capital Unit shall thereafter, as
an unsecured general creditor, look only to MS plc or the Corporation, as the
case may be, for payment thereof, and all liability of the Agent with respect to
such trust money shall thereupon cease.
In the event that (i) a Termination Event has not occurred, (ii)
the Corporation has issued Preferred Stock against tender of payment for the
Depositary Shares evidencing such Preferred Stock and (iii) a Holder of a
Capital Unit Certificate fails to present and surrender the appropriate Capital
Unit Certificate to the Agent, the Depositary Receipts issuable in respect of
the Depositary Shares to be purchased pursuant to the Purchase Contracts
evidenced by such Capital Unit Certificate, together with any distributions
thereon (and, if an effective Cash Settlement with respect to the obligations
under such Purchase Contracts has been made, payments in respect of principal of
the Debentures that are part of such Capital Units), shall be held by the Agent,
in trust, for the benefit of such Holder, until such Capital Unit Certificate is
presented and surrendered or such Holder delivers to the
<PAGE>
48
Agent, the Trustee, MS plc and the Corporation (i) evidence to their
satisfaction that such certificate has been destroyed, lost or stolen and (ii)
such security or indemnity as may be required by them to hold each of them and
any agent of any of them harmless. In the event such Capital Unit Certificate is
not presented and surrendered or such Holder does not satisfy the applicable
conditions specified in the preceding sentence on or prior to the date two years
after the date of settlement of the related Purchase Contract, any distributions
received by the Agent with respect to the Depositary Receipts representing the
Depositary Shares issued in respect of the Capital Unit Certificates shall be
paid to the Corporation, on the request of the Corporation pursuant to an
Officer's Certificate, and the Holders of such Capital Unit shall thereafter, as
unsecured general creditors, look only to the Corporation for payment thereof
and all liability of the Agent with respect to such trust assets shall
thereafter cease. Any cash held by the Agent in respect of the principal of the
Debentures shall be distributed by the Agent in accordance with the provisions
of the succeeding paragraph.
In the event (i) a Termination Event has occurred, (ii) the
Corporation fails to issue Preferred Stock against tender of payment for the
Depositary Shares evidencing such Preferred Stock or (iii) a Holder of a Capital
Unit has properly effected a Cash Settlement on the Purchase Date, any money
deposited with the Agent or Trustee for payment of principal and interest, if
any, on any Debenture evidenced by such Capital Unit shall be held by the Agent,
in trust, for the benefit of such Holder, until a Capital Unit Certificate is
presented and surrendered or such Holder delivers to the Agent, the Trustee, MS
plc and the Corporation (i) evidence to their satisfaction that such certificate
has been destroyed, lost or stolen and (ii) such security or indemnity as may be
required by them to hold each of them and any agent of any of them harmless. In
the event such Capital Unit Certificate is not presented and surrendered or such
Holder does not satisfy the applicable conditions specified in the preceding
sentence on or prior to the date two years after the repayment of the principal
of the Debentures, any money deposited with the Agent for payment of principal
on such Debenture evidenced by such Capital Unit Certificate shall be paid to MS
plc (or the Corporation, if the Corporation deposited such money pursuant to the
Guarantee) upon the request of MS plc or the Corporation, as the case may be,
pursuant to an Officer's Certificate and the Holders of such Debentures shall
thereafter, as unsecured general creditors, look only to MS plc or the
Corporation, as the case may be, for payment thereof and all liability of the
Agent with respect to such trust money shall thereupon cease.
Section 904. Rating Agencies.
---------------
The Corporation shall cause to be done all things necessary to
obtain publicly available ratings (including any "implied" rating) of its Long-
Term Senior Debt from Moody's and S&P at the close of business on the day that
is five Business Days prior to each Purchase Date and at the opening of business
on the Stated Purchase Date or, if such day is not a Business Day, at the close
of business on the next preceding Business Day, including, without limitation,
if Moody's or S&P, or both, no longer rates the Long-Term Senior Debt or ceases
to exist, selecting a substitute Rating Agency for such purpose.
<PAGE>
49
Section 905. Corporation to Reserve Preferred Stock.
--------------------------------------
The Corporation shall at all times prior to the Purchase Date
reserve and keep available, free from preemptive rights, out of its authorized
but unissued series of preferred stock the full number of shares of Preferred
Stock issuable against tender of payment for the Depositary Shares relating to
such shares of Preferred Stock with respect to all Purchase Contracts
constituting a part of the Outstanding Capital Units.
Section 906. Covenants as to Preferred Stock.
-------------------------------
The Corporation covenants that all shares of Preferred Stock
that may be issued against tender of payment for the Depositary Shares relating
to such shares of Preferred Stock in respect of any Outstanding Purchase
Contract will, upon issuance, be duly authorized and validly issued and fully
paid and nonassessable. The Corporation further covenants and agrees not to take
any action that will cause any Preferred Stock to be issued prior to a Purchase
Date or to file any amendment to the Certificate of Designation designating the
Preferred Stock, or to take any other action that would change the terms of the
Preferred Stock or the Depositary Shares relating to such Preferred Stock,
except as permitted by this Agreement.
Section 907. Statements of Officers of MS plc
and the Corporation as to Default.
---------------------------------
Each of the Corporation and MS plc will deliver to the Agent,
within 120 days after the end of each fiscal year of the Corporation or MS plc,
as the case may be, ending after the date hereof, an Officer's Certificate
stating whether or not to the best knowledge of the signers thereof the
Corporation or MS plc, as the case may be, is in default in the performance and
observance of any of the terms, provisions and conditions hereof, and, if the
Corporation or MS plc shall be in default, specifying all such defaults and the
nature and status thereof of which they may have knowledge.
<PAGE>
50
ARTICLE TEN
Redemption of the Purchase Contracts
Section 1001. Optional Redemption of Purchase Contracts.
-----------------------------------------
Any or all of the Purchase Contracts may be redeemed at the
option of the Corporation, or from time to time in part, on any Interest Payment
Date on or after August 30, 2000, at a redemption price equal to $.025 per
Purchase Contract; provided that no redemption shall result in there being more
than zero but fewer than 2,000,000 Unsettled Purchase Contracts remaining
Outstanding after such redemption.
In the event that MS plc shall redeem a Debenture constituting
part of a Capital Unit pursuant to the provisions of the Indenture, the
Corporation shall redeem the Purchase Contract constituting part of the same
Capital Unit on the redemption date of such related Debenture. In the event that
MS plc shall redeem all Debentures constituting part of Capital Units pursuant
to a Tax Redemption, the Corporation shall redeem all Purchase Contracts then
Outstanding on the redemption date of the Debentures.
Section 1002. Notice of Redemption; Partial Redemptions.
-----------------------------------------
The Corporation or, upon Issuer Request by the Corporation, the
Agent in the name and at the expense of the Corporation, shall give notice of
redemption to the Holders of Purchase Contracts in the manner and to the extent
provided in Section 1306, at least 30 days and not more than 60 days prior to
the date fixed for redemption. Any notice which is mailed in the manner herein
provided shall be conclusively presumed to have been duly given, whether or not
the Holder receives the notice. Failure to give notice by mail, or any defect in
the notice to the Holder of any Purchase Contract, shall not affect the validity
of the proceedings for the redemption of any other Purchase Contract.
The notice of redemption to each such Holder shall specify the
number of Purchase Contracts held by such Holder to be redeemed, the date fixed
for redemption, the redemption price, the place or places of payment and that
payment will be made upon presentation and surrender of Capital Unit
Certificates with respect to such Purchase Contracts evidenced by Capital Unit
Certificates.
The Corporation's obligation to provide funds for redemption
shall be deemed fulfilled if, on or before 12:00 noon New York City time on the
redemption date specified in the notice of redemption given as provided in this
Section, the Corporation shall deposit with the Agent or with one or more paying
agents an amount of money sufficient to redeem on the redemption date all the
Purchase Contracts called for redemption at the appropriate redemption price,
together with irrevocable instructions and authorization that such funds be
applied to the redemption of the Purchase Contracts called for redemption upon
surrender of
<PAGE>
51
Capital Unit Certificates representing such Purchase Contracts, properly
endorsed and assigned for transfer, in accordance with this Article.
The Corporation will deliver to the Agent at least 15 days prior
to the mailing of the notice of redemption an Officer's Certificate stating the
aggregate number of Purchase Contracts to be redeemed on such date and that the
Corporation has complied with the provisions of Section 1001.
If fewer than all the Purchase Contracts are to be redeemed, the
Agent, at least 15 days prior to the mailing of the redemption notice, shall
select the Purchase Contracts to be redeemed on a pro rata basis. Purchase
Contracts may be redeemed in multiples equal to the minimum authorized
denomination for Purchase Contracts or any multiple thereof. Appropriate
adjustment shall be made to prevent the fractional redemption of Purchase
Contracts, such that Purchase Contracts are redeemed only in whole and not in
part.
The Agent shall promptly notify the Corporation in writing of
the Purchase Contracts so selected for redemption.
Section 1003. Payment of Purchase
Contracts Called for Redemption.
-------------------------------
If notice of redemption has been given as above provided, (i)
the Purchase Contracts specified in such notice shall become due and payable on
the date and at the place stated in such notice at the applicable redemption
price, and (ii) on and after the date fixed for redemption (unless the
Corporation shall default in the payment of such Purchase Contracts at the
redemption price) such Purchase Contracts shall cease from and after the date
fixed for redemption to be entitled to any benefit under this Agreement, the
Holders thereof shall have no right or obligation in respect of such Purchase
Contracts except the right to receive the redemption price thereof and the
Purchase Contracts shall terminate and shall no longer be deemed to be
Outstanding.
On presentation and surrender of Capital Unit Certificates
representing such Purchase Contracts, properly endorsed and assigned for
transfer, at a place of payment specified in said notice, said Purchase
Contracts shall be paid and redeemed by the Corporation at the applicable
redemption price. Following such redemption, the Capital Unit Certificates
evidencing such Closed Purchase Contracts shall be cancelled in accordance with
Section 308 or the Global Purchase Contract and Global Debenture shall be
endorsed to reflect the decrease in the number of Book-Entry Capital Units
evidenced thereby as a result of such redemption in accordance with Section 1109
(and shall be deemed to be cancelled with respect to the Purchase Contracts no
longer evidenced by such Global Purchase Contract as a result of such
redemption). In the case of (i) Definitive Capital Units, certificates
evidencing any Outstanding Debentures relating to such redeemed Purchase
Contracts shall be executed, authenticated and delivered in accordance with the
terms of the Indenture or (ii)
<PAGE>
52
Book-Entry Capital Units, if a Global Debenture not constituting part of a Book-
Entry Capital Unit has not previously been issued by MS plc, a second Global
Debenture evidencing any Outstanding Debentures relating to such redeemed
Purchase Contracts shall be executed, authenticated and delivered in accordance
with the Indenture. If a second Global Debenture referred to in clause (ii) of
the immediately preceding sentence has already been issued to the Book-Entry
Unit Depositary, the Book-Entry Unit Depositary shall note thereon an
appropriate increase in the number of Debentures represented by such Global
Debenture.
Any interest accrued on funds deposited with the Agent or any
Paying Agent in connection with this Article Ten shall be paid to the
Corporation from time to time and the Holders of Purchase Contracts (whether or
not such Purchase Contracts are to be redeemed with such funds) shall have no
claim to any such interest. Any funds deposited and unclaimed at the end of two
years from any redemption date shall be repaid or released to the Corporation,
after which the Holder(s) of Purchase Contracts so called for redemption shall
look only to the Corporation for payment of the redemption price, without any
interest thereon.
Section 1004. Exclusion of Certain Purchase Contracts
from Eligibility for Selection for Redemption.
---------------------------------------------
Purchase Contracts shall be excluded from eligibility for
selection for a partial redemption if they are identified by registration and
certificate number in an Officer's Certificate delivered by the Corporation to
the Agent at least 10 days prior to the date of the mailing of a notice of
redemption as being owned of record and beneficially by, and not pledged or
hypothecated by (a) the Corporation or (b) an Affiliate of the Corporation.
Purchase Contracts shall also be excluded from eligibility for selection for a
partial redemption if they are the subject of an Acceleration Notice.
ARTICLE ELEVEN
Book-Entry Capital Units
Section 1101. Deposit of Global Purchase
Contract and Global Debenture.
-----------------------------
The Book-Entry Unit Depositary hereby accepts custody of the
Global Purchase Contract and any Global Debenture from the Agent and the Trustee
and shall act as Book-Entry Unit Depositary in accordance with the terms of this
Agreement. The Book-Entry Unit Depositary shall hold the Global Purchase
Contract and Global Debentures at its Corporate Trust Office in the Borough of
Manhattan or at such place or places as it shall determine with the consent of
MS plc and the Corporation and shall issue the Book-Entry Capital Units in
accordance with the Letter of Representations.
<PAGE>
53
Section 1102. Book-Entry System.
-----------------
(a) Upon acceptance by DTC of Book-Entry Capital Units for entry
into its book-entry settlement system in accordance with the terms of the Letter
of Representations, interests in Book-Entry Capital Units will be traded through
DTC's book-entry system, and ownership of beneficial interests in such Book-
Entry Capital Units shall be shown in, and the transfer of such ownership shall
be effected only through, records maintained by (i) DTC or its successors or
(ii) institutions that have accounts with DTC or its successors. Interests in
the Book-Entry Capital Units shall be transferable only as units representing
whole Capital Units.
(b) Certificateless depositary interests in Book-Entry Capital
Units or a second Global Debenture issued in accordance with Section 405 or
Section 1003 shall be issuable only to DTC, its nominee or successors of DTC and
its nominee. No owner of beneficial interests in such Book-Entry Capital Units
shall be entitled to receive a Purchase Contract or a Debenture, as the case may
be, on account of such beneficial interest, and such beneficial owner's interest
therein shall be shown only in accordance with the procedures of DTC as set
forth in the Letter of Representations.
Section 1103. Transfer of Interests in Book-Entry
Capital Units and Global Debentures.
-----------------------------------
The Corporation and MS plc appoint the Book-Entry Unit
Depositary as their agent to maintain at its Corporate Trust Office a register
(the "Book-Entry Unit Register") in which the Book-Entry Unit Depositary shall
------------------------
(i) record the right of the Holder of Book-Entry Capital Units to receive
payment of principal and interest on the Global Debenture and (ii) record the
registration and transfer of interests in the Global Debenture and Global
Purchase Contract. Interests in such Global Debenture and Global Purchase
Contract relating to the Book-Entry Capital Units cannot be transferred unless
such transfer is recorded on the Book-Entry Unit Register. MS plc also appoints
the Book-Entry Unit Depositary as its agent to maintain at its Corporate Trust
Office a register (the "Second Global Debenture Register") in which, if a second
--------------------------------
Global Debenture representing Outstanding Debentures that are not part of
Capital Units is issued pursuant to Section 405 or Section 1003, the Book-Entry
Unit Depositary shall (i) record the right of the Depositary to receive payment
of principal and interest on such second Global Debenture and (ii) record the
registration and transfer of interests in such second Global Debenture.
Interests in such second Global Debenture cannot be transferred unless such
transfer is recorded on the Second Global Debenture Register.
The foregoing paragraph shall not (i) impose an obligation on
the Book-Entry Unit Depositary to record the interests in or transfers of
interests in Book-Entry Capital Units or the second Global Debenture held by
institutions that have accounts with DTC or its successors or Persons that may
hold interests in Book-Entry Capital Units or the second Global Debenture
through such institutions and (ii) restrict transfers of such interests held by
such institutions or persons. The person in whose name the Book-Entry Capital
Units are
<PAGE>
54
registered on the Book-Entry Unit Register shall be the "Holder" of such Book-
Entry Capital Units for the purposes of this Agreement. So long as the Global
Debentures and the Global Purchase Contract are registered in the Book-Entry
Unit Register or the Second Global Debenture Register in the name of DTC or its
nominee, the Book-Entry Unit Depositary shall treat DTC as the absolute owner
thereof for all purposes whatsoever and shall not be bound or affected by any
notice to the contrary, other than an order of a court having jurisdiction over
the Book-Entry Unit Depositary.
Section 1104. Issuance and Exchange of Definitive Capital
Units and Registered Definitive Debentures.
------------------------------------------
(a) Upon receipt by the Book-Entry Unit Depositary at its
Corporate Trust Office of written instructions from the Holder of Book-
Entry Capital Units requesting the issuance of Definitive Capital Units in
respect of a portion of the Book-Entry Capital Units or the issuance of
Registered Definitive Debentures in respect of a portion of a Global
Debenture, the Book-Entry Unit Depositary shall request in accordance with
Section 311 hereof or Section 2.8 of the Indenture, as applicable, that
Definitive Capital Units or Registered Definitive Debentures, as the case
may be, be issued in the amounts and registered in the names specified in
such request.
(b) The Book-Entry Unit Depositary shall promptly notify the
Agent, with respect to Purchase Contracts, or the Trustee, with respect to
Debentures, of any request by the Holder of Book-Entry Capital Units for
the issuance of Definitive Capital Units or Registered Definitive
Debentures. In connection with any request for the issuance of Registered
Definitive Debentures or Definitive Capital Units as contemplated by this
Section, the Book-Entry Unit Depositary shall promptly (i) reduce the
Global Purchase Contract by the number of Definitive Capital Units to be
countersigned, executed and delivered pursuant to such request, and (ii)
reduce the aggregate principal amount of the Global Debenture by the
principal amount of the Debentures to be represented by such Definitive
Capital Units or the principal amount of the Registered Definitive
Debentures to be issued pursuant to such request, as the case may be, and
shall promptly notify the Agent of such reductions. Upon the issuance of
Registered Definitive Debentures or Definitive Capital Units as set forth
above, the Book-Entry Unit Depositary will make such notations in the Book-
Entry Unit Register as will be necessary to reflect such reduction.
(c) If the Agent shall notify the Book-Entry Unit Depositary of
any request by a Holder of Definitive Capital Units to transfer or exchange
such Definitive Capital Units for interests in the Book-Entry Capital
Units, the Book-Entry Unit Depositary shall promptly note the increase in
the number of Purchase Contracts or aggregate principal amount of
Debentures, as the case may be, constituting the Book-Entry Capital Units
issued pursuant to such request on the Global Purchase Contract and the
Global Debenture, respectively. If the Trustee shall notify the Book-Entry
Unit Depositary of any request by a holder of Registered Definitive
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55
Debentures to transfer or exchange such Registered Definitive Debentures for
interests in the second Global Debenture, the Book-Entry Unit Depositary shall
promptly note the increase in the principal amount of such second Global
Debenture. In order to evidence the issuance of the Book-Entry Capital Units as
set forth above, the Book-Entry Unit Depositary shall make such notations in the
Book-Entry Unit Register as will be necessary to reflect such increase.
(d) Requests by the Holder for the issuance of Registered
Definitive Debentures and Definitive Capital Units and requests by Holders of
Definitive Capital Units for interests in the Book-Entry Capital Units may be
made only with respect to whole Capital Units and interests in the Global
Purchase Contract may only be transferred as part of whole Capital Units.
Notwithstanding the foregoing, this Section 1104 shall be
subject to the provisions of the last paragraph of Section 305.
Section 1105. Transfer of the Global
Purchase Contract and Global Debenture.
--------------------------------------
The Book-Entry Unit Depositary shall hold the Global Purchase
Contract and the Global Debentures in custody for the benefit of the Depositary.
The Book-Entry Unit Depositary shall not transfer or lend the Global Purchase
Contract or the Global Debentures or any interest therein except that the Book-
Entry Unit Depositary may transfer the Global Purchase Contract and the Global
Debentures to a successor Book-Entry Unit Depositary with the consent of MS plc
and the Corporation. Notwithstanding the foregoing, the Depositary may not under
any circumstances request the Book-Entry Unit Depositary to surrender or deliver
any Global Debenture or Global Purchase Contract to the Depositary. If (i) the
Book-Entry Unit Depositary notifies MS plc, the Corporation, the Agent and the
Trustee under Section 1208 hereof that it desires to resign as Book-Entry Unit
Depositary and no successor Book-Entry Unit Depositary has been appointed by MS
plc and the Corporation within 90 days of such notification, (ii) if an Event of
Default with respect to the Debentures occurs or (iii) if DTC notifies MS plc
and the Corporation that it is unwilling or unable to continue as Depositary
with respect to the certificateless depositary interests representing Book-Entry
Capital Units or if at any time it ceases to be a clearing agency under the
Exchange Act and a successor Depositary registered as a clearing agency under
the Exchange Act is not appointed by MS plc and the Corporation within 90 days,
then the Book-Entry Unit Depositary will promptly notify the Agent and the
Trustee and request the Agent and the Trustee, as applicable, to issue
Registered Definitive Debentures and Definitive Capital Units in such names and
denominations as the Holder shall specify in accordance with Section 2.8 of the
Indenture or Section 311 of this Agreement, as the case may be, and the Book-
Entry Unit Depositary agrees that in such event it will promptly surrender the
Global Purchase Contract to the Agent and the Global Debentures to the Trustee
in connection with such exchange and that such Global Purchase Contract and
Global
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56
Debentures will be cancelled upon issuance of such Definitive Capital Units and
Registered Definitive Debentures, respectively.
Section 1106. Mutilated, Destroyed, Lost and Stolen Global
Debentures and Global Purchase Contracts.
----------------------------------------
If any mutilated Global Debenture or Global Purchase Contract is
surrendered to the Trustee or the Agent, MS plc (with respect to the Global
Debenture) or the Corporation (with respect to the Global Purchase Contracts)
shall execute and deliver to the Trustee or the Agent, as the case may be, and
the Trustee or the Agent, as the case may be, shall authenticate, countersign,
execute and deliver, as appropriate, in exchange therefor a new Global Debenture
or Global Purchase Contract of like tenor, evidencing the same number of
Debentures or Purchase Contracts and bearing a number not contemporaneously
outstanding.
If there shall be delivered to MS plc, the Corporation, the
Trustee and the Agent (i) evidence to their satisfaction of the destruction,
loss or theft of any Global Debenture or Global Purchase Contract and (ii) such
security or indemnity as may be required by them to hold each of them and any
agent of any of them harmless, then, in the absence of notice to MS plc, the
Corporation, the Trustee or the Agent that such Global Debenture or Global
Purchase Contract has been acquired by a bona fide purchaser, MS plc (with
respect to the Global Debenture) and the Corporation (with respect to the Global
Purchase Contract) shall execute and deliver to the Trustee or the Agent, as the
case may be, and the Trustee (in accordance with the provisions of the
Indenture) and the Agent shall authenticate, countersign, execute and deliver to
the Book-Entry Unit Depositary, as appropriate, in lieu of any such destroyed,
lost or stolen Global Debenture or Global Purchase Contract, as the case may be,
a new Global Debenture or Global Purchase Contract, as the case may be, of like
tenor, evidencing the same number of Debentures or Purchase Contracts and
bearing a number not contemporaneously outstanding.
Notwithstanding the foregoing, MS plc (with respect to the
Global Debentures) and the Corporation (with respect to the Global Purchase
Contracts) shall not be obligated to execute and deliver to the Trustee or the
Agent, and neither the Trustee under the Indenture nor the Agent shall be
obligated to authenticate, countersign and execute or deliver to the Book-Entry
Unit Depositary, a new Global Debenture or Global Purchase Contract (i) during
the period beginning any time on or after the opening of business 15 days before
the day of mailing of a notice of redemption or acceleration of the Purchase
Contracts evidenced by such Global Purchase Contract and ending at the close of
business on the day of the giving of such notice, (ii) that evidences Purchase
Contracts selected or called for redemption or acceleration or (iii) at any
given date, if such date is on or after the Purchase Date or date of redemption,
as applicable, with respect to the Purchase Contracts evidenced by such Global
Purchase Contract, except with respect to any Debentures and Purchase Contracts
constituting part of Book-Entry Capital Units that remain or will remain
Outstanding following such Purchase Date or date of redemption. Upon
satisfaction of the applicable
<PAGE>
57
conditions specified in clauses (i) and (ii) of the preceding paragraph, the
Agent shall deliver or cause to be delivered (i) in respect of Purchase
Contracts constituting a part of the Book-Entry Capital Units that are selected
or called for redemption, the redemption price of such Purchase Contracts or
(ii) in respect of Purchase Contracts constituting a part of the Book-Entry
Capital Units with respect to which a Cash Settlement or Debenture Settlement
has taken place, (x) the Depositary Shares issuable with respect to such
Purchase Contracts (and, in the case of an effective Cash Settlement, the
related Debentures) or (y) if a Termination Event shall have occurred or a
Purchase Contract Default has occurred by virtue of the Corporation's having
failed to issue the Preferred Stock against tender by the Agent of payment for
the Depositary Shares evidencing such Preferred Stock, the payment, if any,
received by the Agent in respect of the Purchase Price of such Purchase
Contracts or in respect of principal with respect to the related Debentures
received by the Agent, as the case may be, in each case as provided in Section
405, Section 903 and Article Ten, as applicable.
Upon the issuance of any new Global Debentures or Global
Purchase Contracts under this Section, MS plc, the Corporation and the Agent may
require the payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in relation thereto and any other expenses (including
the fees and expenses of the Agent) connected therewith.
Every new Global Debenture or Global Purchase Contract issued
pursuant to this Section in lieu of any destroyed, lost or stolen Global
Debenture or Global Purchase Contract shall constitute an original additional
contractual obligation of MS plc (with respect to the Global Debentures) and the
Corporation (with respect to the Guarantee and the Global Purchase Contracts)
and of the Holder (with respect to the Book-Entry Capital Units evidenced
thereby), whether or not the destroyed, lost or stolen Global Debenture or
Global Purchase Contract shall be at any time enforceable by anyone, and shall
be entitled to all the benefits of this Agreement equally and proportionately
with any and all other Global Debentures or Global Purchase Contracts delivered
hereunder.
The provisions of this Section are exclusive and shall preclude
(to the extent lawful) all other rights and remedies with respect to the
replacement or payment of mutilated, destroyed, lost or stolen Global Debentures
or Global Purchase Contracts.
Section 1107. Cancellation.
------------
All Global Purchase Contracts and Global Debentures surrendered
for payment, and all Global Purchase Contracts and Global Debentures surrendered
for redemption of the Debentures or the Purchase Contracts evidenced thereby,
termination of the Purchase Contracts evidenced thereby, delivery of Depositary
Shares or registration of transfer or exchange shall, if surrendered to any
Person other than the Agent or the Trustee, be delivered to the Agent or the
Trustee, as appropriate, and, if not already cancelled, the Global Purchase
Contracts and Global Debentures shall be promptly cancelled by the Agent or the
Trustee. MS plc or the Corporation may at any time deliver to the Agent or the
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58
Trustee for cancellation any Global Purchase Contracts and Global Debentures
previously authenticated, countersigned, executed and delivered hereunder and
under the Indenture which MS plc or the Corporation may have acquired in any
manner whatsoever, and all Global Purchase Contracts and Global Debentures so
delivered shall, upon Issuer Order of each of MS plc and the Corporation, be
promptly cancelled by the Agent or the Trustee. No Global Purchase Contracts and
Global Debentures shall be authenticated, countersigned and executed in lieu of
or in exchange for any Global Purchase Contracts and Global Debentures cancelled
as provided in this Section, except as permitted by this Agreement or the
Indenture. All cancelled Global Purchase Contracts and Global Debentures held by
the Agent or the Trustee shall be disposed of in accordance with their customary
procedures and a certificate of their disposition shall be delivered by the
Agent or the Trustee to MS plc and the Corporation, unless by Issuer Order
either MS plc or the Corporation shall direct that cancelled Global Purchase
Contracts and Global Debentures be returned to it.
If MS plc, the Corporation or any Affiliate of MS plc or the
Corporation shall acquire any Global Purchase Contracts or Global Debentures,
such acquisition shall not operate as a cancellation of such Global Purchase
Contracts or Global Debentures unless and until such Global Purchase Contracts
or Global Debentures are delivered to the Agent or the Trustee cancelled or for
cancellation.
Section 1108. Payments in Respect of Book-Entry
Capital Units and Global Debenture.
----------------------------------
(a) Whenever the Book-Entry Unit Depositary shall receive from
the Agent or the Trustee (or other paying agent under the Indenture) any
payment on the Book-Entry Capital Units or second Global Debenture, such
payments shall be forwarded promptly upon receipt of such amounts in its
capacity as collecting agent with respect to the Book-Entry Capital Units
or the second Global Debenture from the Agent or the Trustee (or other
paying agent under the Indenture), to the Holder on the payment date for
such Book-Entry Capital Units or Global Debenture. So long as DTC is the
Holder, such payments shall be made in accordance with the Letter of
Representations.
(b) The Book-Entry Unit Depositary will forward to MS plc or the
Corporation or their agents such information from its records as MS plc or
the Corporation may reasonably request to enable MS plc, the Corporation or
their agents to file necessary reports with governmental agencies, and the
Book-Entry Unit Depositary, MS plc, the Corporation or their agents may
(but shall not be required to) file any such reports necessary to obtain
benefits under any applicable tax treaties for the Holder of, or beneficial
owners of interests in, the Book-Entry Capital Units.
<PAGE>
59
Section 1109. Redemption or Settlement.
------------------------
(a) In the event that MS plc exercises any right of redemption
in respect of any Debentures constituting a part of a Global Debenture, the
Book-Entry Unit Depositary shall promptly upon receipt of the redemption
price reduce the principal amount of such Global Debenture representing the
principal amount of the Debentures so redeemed. The redemption price in
connection with the redemption of a portion of such Global Debenture shall
be equal to the amount received by the Book-Entry Unit Depositary in
respect of the aggregate principal amount of the Debentures so redeemed.
(b) In the event that the Corporation exercises any right of
redemption in respect of any Purchase Contracts constituting a part of the
Global Purchase Contract, the Book-Entry Unit Depositary shall promptly
upon receipt of the redemption price note the reduction in the number of
Purchase Contracts representing a portion of the Global Purchase Contract
that represents the portion of the Purchase Contracts so redeemed. The
redemption price in connection with the redemption of a portion of the
Global Purchase Contract shall be equal to the amount received by the Book-
Entry Unit Depositary in respect of the number of Purchase Contracts so
redeemed.
(c) In connection with the settlement of any Purchase Contracts
constituting a part of the Global Purchase Contract pursuant to Section
404, the Book-Entry Unit Depositary, shall promptly note (i) in the event
of a Debenture Settlement, on the Global Purchase Contract, the decrease in
the number of Outstanding Purchase Contracts corresponding to the number of
such settled Purchase Contracts and on the Global Debenture the decrease in
the related Debentures and (ii) in the event of a Cash Settlement, (x) on
the Global Purchase Contract the decrease in the number of Outstanding
Purchase Contracts corresponding to the number of such settled Purchase
Contracts, and (y) on the second Global Debenture representing Debentures
still Outstanding that are not part of Capital Units, the increase in the
aggregate principal amount of the Debentures that remain Outstanding
following the acceleration thereof. If a second Global Debenture referred
to in clause (y) of the immediately preceding sentence has not previously
been issued by MS plc, MS plc shall execute and the Trustee shall
authenticate and deliver a second Global Debenture representing the
aggregate principal amount of Debentures still Outstanding following
settlement of the related Purchase Contracts and that are not part of
Capital Units.
Section 1110. Record Date.
-----------
Whenever any payment is to be made in respect of the Global
Purchase Contract or a Global Debenture, or the Book-Entry Unit Depositary shall
receive notice of any action to be taken by the Holder of the Book-Entry Capital
Units or a Global Debenture, or whenever the Book-Entry Unit Depositary
otherwise deems it appropriate in respect of any other matter, the Book-Entry
Unit Depositary shall fix a record date for the determination of
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60
the Holder of the applicable Global Debenture or Book-Entry Capital Units who
shall be entitled to receive such payment or to take any such action or to act
in respect of any such matter. Subject to the provisions of this Agreement, only
the Holder of a Global Debenture or Book-Entry Capital Units who is registered
on the Book-Entry Unit Register at the close of business on such record date
shall be entitled to receive any such payment, to give instructions as to such
action or to act in respect of any such matter.
Section 1111. Action in Respect of the Book-Entry
Capital Units or Global Debenture.
---------------------------------
As soon as practicable after receipt by the Book-Entry Unit
Depositary of notice of any solicitation of consents or request for a waiver or
other action by the Holder of the Book-Entry Capital Units or a Global Debenture
under this Agreement or the Indenture, the Book-Entry Unit Depositary shall mail
to the Holder a notice containing (a) such information as is contained in such
notice, (b) a statement that the Holder at the close of business on a specified
record date (established in accordance with Section 1110) will be entitled,
subject to the provisions of or governing the Book-Entry Capital Units or Global
Debenture, as the case may be, to instruct the Book-Entry Unit Depositary as to
the consent, waiver or other action, if any, pertaining to the Book-Entry
Capital Units or Global Debenture, as the case may be, and (c) a statement as to
the manner in which such instructions may be given. Upon the written request of
the Holder, received on or before the date established by the Book-Entry Unit
Depositary for such purpose, the Book-Entry Unit Depositary shall endeavor
insofar as practicable and permitted under the provisions of or governing the
Book-Entry Capital Units or Global Debenture, as the case may be, to take such
action regarding the requested consent, waiver or other action in respect of the
Book-Entry Capital Units or Global Debenture, as the case may be, in accordance
with any instructions set forth in such request. The Book-Entry Unit Depositary
shall not itself exercise any discretion in the granting of consents or waivers
or the taking of any other action in respect of the Book-Entry Capital Units or
Global Debenture.
Section 1112. Changes Affecting the Global
Purchase Contract or Global Debenture.
-------------------------------------
Upon any reclassification of the Global Purchase Contract or a
Global Debenture, or upon any recapitalization, reorganization, merger or
consolidation or sale of assets affecting MS plc or the Corporation or to which
either is a party, any securities that shall be received by the Book-Entry Unit
Depositary in exchange for or in conversion of or in respect of the Global
Purchase Contract or Global Debenture shall be treated as a new Global Purchase
Contract or Global Debenture, as the case may be, under this Agreement and any
corresponding Book-Entry Capital Units shall thenceforth represent such new
securities so received.
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61
Section 1113. Surrender of Global Purchase
Contract and Global Debenture.
-----------------------------
In the event of the redemption in full of all the Purchase
Contracts represented by the Global Purchase Contract or of all the Debentures
represented by the Global Debenture, then the applicable Global Debenture and
Global Purchase Contract shall become void and the Book-Entry Unit Depositary
shall surrender such Global Debenture and Global Purchase Contract to the Agent
and the Trustee, as applicable, for cancellation.
Section 1114. Reports.
-------
The Book-Entry Unit Depositary shall immediately send to the
Holder any notices, reports and other communications received from MS plc or the
Corporation that are both (a) received by the Book-Entry Unit Depositary as
Holder of the Global Purchase Contract and Global Debenture and (b) made
generally available to Holders of Purchase Contracts or Debentures by MS plc and
the Corporation.
Section 1115. Termination of Certain
Provisions of This Agreement.
----------------------------
The Book-Entry Unit Depositary will at any time at the direction
of the Corporation or MS plc, as applicable, terminate the Book-Entry Capital
Unit provisions of this Agreement by mailing a notice of such termination to the
Corporation, MS plc, the Trustee and the Agent and requesting that the Trustee
and the Agent, as applicable, authenticate, countersign, execute and deliver
Definitive Capital Units in replacement of Book-Entry Capital Units to such
Persons and in the amounts as specified by the Depositary. Upon the
authentication, countersignature, execution and delivery of such Definitive
Capital Units, the Book-Entry Capital Unit provisions of this Agreement will
terminate. The Book-Entry Capital Unit provisions of this Agreement may also be
terminated upon the resignation of the Book-Entry Unit Depositary if no
successor Book-Entry Unit Depositary is appointed with 90 days in accordance
with Section 311 and Section 1105.
ARTICLE TWELVE
The Book-Entry Unit Depositary
Section 1201. Certain Duties and Responsibilities.
-----------------------------------
(a) The Book-Entry Unit Depositary undertakes to perform such
duties and only such duties as are specifically set forth in this
Agreement.
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62
(b) No provision of this Agreement shall be construed to relieve
the Book-Entry Unit Depositary from liability for its own negligent action, its
own negligent failure to act, or its own wilful misconduct, except that
(1) the duties and obligations of the Book-Entry Unit Depositary
with respect to the Book-Entry Capital Units, Global Debentures and the Global
Purchase Contract shall be determined solely by the express provisions of this
Agreement and the Book-Entry Unit Depositary shall not be liable except for the
performance of such duties and obligations as are specifically set forth in this
Agreement, and no implied covenants or obligations shall be read into this
Agreement against the Book-Entry Unit Depositary; and
(2) In the absence of bad faith on its part, the Book-Entry Unit
Depositary may conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon any statements, certificates
or opinions furnished to the Book-Entry Unit Depositary and conforming to the
requirements of this Agreement, but in the case of any such statements,
certificates or opinions that by any provision hereof are specifically required
to be furnished to the Book-Entry Unit Depositary, the Book-Entry Unit
Depositary shall be under a duty to examine the same to determine whether or not
they conform to the requirements of this Agreement.
(c) The Book-Entry Unit Depositary shall not be liable for any
error of judgment made in good faith by a Responsible Officer of the Book-Entry
Unit Depositary, unless it shall be proved that the Book-Entry Unit Depositary
was negligent in ascertaining the pertinent facts.
(d) The Book-Entry Unit Depositary shall not be liable with
respect to any action taken or omitted to be taken by it in good faith in
accordance with the direction of the Holder or the beneficial holders of a
majority in number of Outstanding Book-Entry Capital Units relating to the time,
method and place of conducting any proceeding for any remedy available to the
Book-Entry Unit Depositary, or exercising any power conferred upon the Book-
Entry Unit Depositary, under this Agreement.
(e) No provision of this Agreement shall require the Book-Entry
Unit Depositary to expend or risk its own funds or otherwise incur any financial
liability in the performance of any of its duties hereunder, or in the exercise
of any of its rights or powers, if it shall have reasonable grounds for
believing that repayment of such funds or adequate indemnity against such risk
or liability is not reasonably assured to it.
(f) Whether or not therein expressly so provided, every
provision of this Agreement relating to the conduct or affecting the liability
of or affording protection to the Book-Entry Unit Depositary shall be subject to
the provisions of this Section.
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63
(g) The Book-Entry Unit Depositary is acting solely as agent for
MS plc and the Corporation hereunder and owes no fiduciary duties to any
person by virtue of this Agreement.
Section 1202. Notice of Default.
-----------------
Within 90 days after the occurrence of any Event of Default with
respect to a Global Debenture (a "Debenture Default") or any Purchase Contract
-----------------
Default of which a Responsible Officer of the Book-Entry Unit Depositary
assigned to its Corporate Trustee Administration Department has actual
knowledge, and except with respect to a Purchase Contract Default under the
Purchase Contracts existing on the Purchase Date, in which event, as promptly as
practicable thereafter, the Book-Entry Unit Depositary shall transmit by mail to
the Holder of the Book-Entry Capital Units or to DTC with respect to the second
Global Debenture, in the manner provided in Section 1306, notice of such
Debenture Default or Purchase Contract Default, unless such Debenture Default or
Purchase Contract Default shall have been cured or waived.
Section 1203. Certain Rights of Book-Entry Unit Depositary.
--------------------------------------------
Subject to the provisions of Section 1201:
(a) the Book-Entry Unit Depositary may rely and shall be
protected in acting or refraining from acting upon any resolution,
certificate, statement, instrument, opinion, report, notice, request,
direction, consent, order, bond, debenture, note, coupon, security or other
paper or document believed by it to be genuine and to have been signed or
presented by the proper party or parties;
(b) any request, direction, order or demand of MS plc or the
Corporation mentioned herein shall be sufficiently evidenced by an
Officer's Certificate, Issuer Order or Issuer Request, and any resolution
of the Board of Directors of MS plc or the Corporation, as the case may be,
may be sufficiently evidenced by a Board Resolution;
(c) the Book-Entry Unit Depositary may consult with counsel and
the written advice of such counsel or any Opinion of Counsel shall be full
and complete authorization and protection with respect to any action taken,
suffered or omitted by it hereunder in good faith and in reliance thereon
in accordance with such advice or Opinion of Counsel;
(d) the Book-Entry Unit Depositary shall not be bound to make
any investigation into the facts or matters stated in any resolution,
certificate, statement, instrument, opinion, report, notice, request,
consent, order, approval, appraisal, bond, debenture, note, coupon,
security or other paper or document, but the Book-Entry Unit Depositary, in
its discretion, may make reasonable further inquiry or investigation into
such facts or matters related to the issuance of a Global Debenture and the
execution, delivery and performance of the Global Purchase Contract as it
may see fit, and, if the Book-Entry Unit Depositary shall determine to make
such further inquiry or
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64
investigation, it shall be entitled to examine the books, records and
premises of MS plc and the Corporation, at reasonable times during normal
business hours, personally or by agent or attorney;
(e) the Book-Entry Unit Depositary may execute any of the powers
hereunder or perform any duties hereunder either directly or by or through
agents or attorneys and the Book-Entry Unit Depositary shall not be
responsible for any misconduct or negligence on the part of any such agent
or attorney appointed with due care by it hereunder;
(f) the Book-Entry Unit Depositary shall be under no obligation
to exercise any of the rights or powers vested in it by this Agreement at
the request, order or direction of any of the Holders pursuant to this
Agreement, unless such Holders shall have offered to the Book-Entry Unit
Depositary reasonable security or indemnity against the costs, expenses and
liabilities that might be incurred by it in compliance with such request or
direction, provided that such request, order or direction shall not expose
the Book-Entry Unit Depositary to personal liability; and
(g) the Book-Entry Unit Depositary shall not be liable for any
action taken or omitted by it in good faith and believed by it to be
authorized or within the discretion, rights or powers conferred upon it by
this Agreement.
Section 1204. Not Responsible for Recitals
or Issuance of Capital Units.
----------------------------
The recitals contained herein, in the Indenture and in the
Capital Units, except the Trustee's and the Agent's certificates of
authentication, shall be taken as the statements of MS plc or the Corporation,
as the case may be, and the Book-Entry Unit Depositary assumes no responsibility
for their correctness. The Book-Entry Unit Depositary makes no representations
as to the validity or sufficiency of this Agreement or of the Capital Units. The
Book-Entry Unit Depositary shall not be accountable for the use or application
by MS plc or the Corporation of the proceeds with respect to Capital Units.
Section 1205. Money Held in Trust.
-------------------
Money held by the Book-Entry Unit Depositary in trust hereunder
need not be segregated from other funds held by the Book-Entry Unit Depositary,
except to the extent required by law. The Book-Entry Unit Depositary shall be
under no obligation to invest or pay interest on any money received by it
hereunder, except as otherwise agreed with MS plc and the Corporation. Any
interest accrued on funds deposited with the Book-Entry Unit Depositary under
this Agreement shall be paid to MS plc and the Corporation from time to
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65
time and the Holder of Book-Entry Capital Units (whether or not any Purchase
Contracts are to be redeemed with such funds) shall have no claim to any such
interest.
Section 1206. Compensation and Reimbursement.
------------------------------
MS plc and the Corporation agree:
(a) to pay to the Book-Entry Unit Depositary from time to time
reasonable compensation for all services rendered by it hereunder (which
compensation shall not be limited by any provision of law with regard to
the compensation of a trustee of an express trust);
(b) except as otherwise expressly provided herein, to reimburse
the Book-Entry Unit Depositary and any predecessor Book-Entry Unit
Depositary upon its request for all reasonable expenses, disbursements and
advances incurred or made by the Book-Entry Unit Depositary in accordance
with any provision of this Agreement (including the reasonable compensation
and the expenses and disbursements of its agents and counsel), except any
such expense, disbursement or advance as may be attributable to its
negligence or bad faith; and
(c) to indemnify the Book-Entry Unit Depositary and any
predecessor Book-Entry Unit Depositary for, and to hold it harmless
against, any loss, liability or expense incurred without negligence or bad
faith on its part, arising out of or in connection with the acceptance or
administration of this Agreement and its duties hereunder, including the
costs and expenses of defending itself against or investigating any claim
of liability in connection with the exercise or performance of any of its
powers or duties hereunder.
The obligations of MS plc and the Corporation under this Section
to compensate and indemnify the Book-Entry Unit Depositary and any predecessor
Book-Entry Unit Depositary and to pay or reimburse the Book-Entry Unit
Depositary and any predecessor Book-Entry Unit Depositary for expenses,
disbursements and advances shall constitute additional indebtedness hereunder
and shall survive the satisfaction and discharge of this Agreement. Such
additional indebtedness shall be a senior claim to that of the Capital Units
upon all property and funds held or collected by the Book-Entry Unit Depositary
as such, except funds held in trust for the benefit of the Holders of Capital
Units, and the Capital Units are hereby subordinated to such senior claim.
Section 1207. Book-Entry Unit
Depositary Required; Eligibility.
--------------------------------
At all times when there is a Book-Entry Unit Depositary
hereunder, such Book-Entry Unit Depositary shall be a corporation organized and
doing business under the laws of the United States of America, any State thereof
or the District of Columbia, having,
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66
together with its parent, a combined capital and surplus of at least
$50,000,000, subject to supervision or examination by Federal, State or District
of Columbia authority, willing to act on reasonable terms. Such corporation
shall have its principal place of business in the Borough of Manhattan, The City
of New York, if there be such a corporation in such location willing to act upon
reasonable and customary terms and conditions. If such corporation, or its
parent, publishes reports of condition at least annually, pursuant to law or to
the requirements of the aforesaid supervising or examining authority, then for
the purposes of this Section, the combined capital and surplus of such
corporation shall be deemed to be its combined capital and surplus as set forth
in its most recent report of condition so published. The Book-Entry Unit
Depositary hereunder shall at all times be the Agent hereunder and the Trustee
under the Indenture, subject to receipt of an Opinion of Counsel that the same
Person is precluded by law from acting in such capacities. If at any time the
Book-Entry Unit Depositary shall cease to be eligible in accordance with the
provisions of this Section, it shall resign immediately in the manner and with
the effect hereinafter specified in this Article.
Section 1208. Resignation and Removal; Appointment of Successor.
-------------------------------------------------
(a) No resignation or removal of the Book-Entry Unit Depositary
and no appointment of a successor Book-Entry Unit Depositary pursuant to
this Article shall become effective until (i) the acceptance of appointment
by the successor Book-Entry Unit Depositary in accordance with the
applicable requirements of Section 1209 or (ii) the issuance of Capital
Unit Certificates in accordance with Section 311.
(b) The Book-Entry Unit Depositary may resign with respect to
the Capital Units by giving written notice thereof to MS plc and the
Corporation and the Holders, in accordance with Section 1305 and Section
1306, 60 days prior to the effective date of such resignation. The Book-
Entry Unit Depositary may be removed at any time upon 60 days' notice by
the filing with it of an instrument in writing signed on behalf of MS plc
and the Corporation and specifying such removal and the date when it is
intended to become effective. If the instrument of acceptance by a
successor Book-Entry Unit Depositary required by Section 1209 shall not
have been delivered to the Book-Entry Unit Depositary within 30 days after
the giving of such notice of resignation, the resigning Book-Entry Unit
Depositary may petition any court of competent jurisdiction for the
appointment of a successor Book-Entry Unit Depositary.
(c) If at any time
(1) the Book-Entry Unit Depositary shall cease to be eligible
under Section 1207, or shall cease to be eligible as Agent hereunder or as
Trustee under the Indenture, and shall fail to resign after written request
therefor by MS plc, the Corporation or by any Holder, or
<PAGE>
67
(2) the Book-Entry Unit Depositary shall become incapable of
acting with respect to the Book-Entry Capital Units or shall be adjudged a
bankrupt or insolvent, or a receiver or liquidator of the Book-Entry Unit
Depositary or of its property shall be appointed or any public officer
shall take charge or control of the Book-Entry Unit Depositary or of its
property or affairs for the purpose of rehabilitation, conservation or
liquidation,
then, in any such case, (i) MS plc or the Corporation, by Board Resolution, may
remove the Book-Entry Unit Depositary and appoint a successor Book-Entry Unit
Depositary, or (ii) any Holder who has been a bona fide Holder of a Book-Entry
Capital Unit for at least six months may, on behalf of himself and all others
similarly situated, petition any court of competent jurisdiction for the removal
of the Book-Entry Unit Depositary and the appointment of a successor Book-Entry
Unit Depositary or Book-Entry Unit Depositaries, unless Capital Unit
Certificates have been issued in accordance with Section 311. Such court may
thereupon, after such notice, if any, as it may deem proper and prescribe,
remove the Book-Entry Unit Depositary and appoint a successor Book-Entry Unit
Depositary.
(d) If the Book-Entry Unit Depositary shall resign, be removed
or become incapable of acting, or if a vacancy shall occur in the office of
Book-Entry Unit Depositary for any cause, MS plc and the Corporation, by
Board Resolution, shall promptly appoint a successor Book-Entry Unit
Depositary (other than the Corporation or MS plc) and shall comply with the
applicable requirements of Section 1209 or shall comply with Section 311.
If no successor Book-Entry Unit Depositary with respect to the Capital
Units shall have been so appointed by MS plc and the Corporation and
accepted appointment in the manner required by Section 1209, any Holder who
has been a bona fide Holder of a Capital Unit for at least six months may,
on behalf of himself and all others similarly situated, petition any court
of competent jurisdiction for the appointment of a successor Book-Entry
Unit Depositary, unless Capital Unit Certificates have been issued in
accordance with Section 311.
(e) MS plc and the Corporation shall give, or shall cause such
successor Book-Entry Unit Depositary to give, notice of each resignation
and each removal of the Book-Entry Unit Depositary and each appointment of
a successor Book-Entry Unit Depositary to all Holders of Capital Units in
accordance with Section 1306. Each notice shall include the name of the
successor Book-Entry Unit Depositary and the address of its Corporate Trust
Office.
Section 1209. Acceptance of Appointment by Successor.
--------------------------------------
(a) In case of the appointment hereunder of a successor Book-
Entry Unit Depositary, every such successor Book-Entry Unit Depositary so
appointed shall execute, acknowledge and deliver to MS plc and the Corporation
and to the retiring Book-Entry Unit Depositary an instrument accepting such
appointment, and thereupon the resignation or removal of the retiring Book-Entry
Unit Depositary shall become effective and such
<PAGE>
68
successor Book-Entry Unit Depositary, without any further act, deed or
conveyance, shall become vested with all the rights, powers, agencies and duties
of the retiring Book-Entry Unit Depositary, with like effect as if originally
named as Book-Entry Unit Depositary hereunder; but, on the request of MS plc,
the Corporation or the successor Book-Entry Unit Depositary, such retiring Book-
Entry Unit Depositary shall, upon payment of all amounts due and payable to it
pursuant to Section 1206, execute and deliver an instrument transferring to such
successor Book-Entry Unit Depositary all the rights and powers of the retiring
Book-Entry Unit Depositary and shall duly assign, transfer and deliver to such
successor Book-Entry Unit Depositary all property and money held by such
retiring Book-Entry Unit Depositary hereunder. Any retiring Book-Entry Unit
Depositary shall, nonetheless, retain a prior claim upon all property or funds
held or collected by such Book-Entry Unit Depositary to secure any amounts then
due it pursuant to Section 1206.
(b) Upon request of any such successor Book-Entry Unit
Depositary, MS plc and the Corporation shall execute any and all instruments for
more fully and certainly vesting in and confirming to such successor Book-Entry
Unit Depositary all such rights, powers and agencies referred to in paragraph
(a) of this Section.
(c) No successor Book-Entry Unit Depositary shall accept its
appointment unless at the time of such acceptance such successor Book-Entry Unit
Depositary shall be eligible under this Article.
(d) Upon acceptance of appointment by any successor Book-Entry
Unit Depositary as provided in this Section, MS plc and the Corporation shall
give notice thereof to the Holder of Book-Entry Capital Units in accordance with
Section 1306. If the acceptance of appointment is substantially contemporaneous
with the resignation of the Book-Entry Unit Depositary, then the notice called
for by the preceding sentence may be combined with the notice called for by
Section 1208. If MS plc and the Corporation fail to give such notice within ten
days after acceptance of appointment by the successor Book-Entry Unit
Depositary, the successor Book-Entry Unit Depositary shall cause such notice to
be given at the expense of MS plc and the Corporation.
Section 1210. Merger, Conversion,
Consolidation or Succession to Business.
---------------------------------------
Any corporation into which the Book-Entry Unit Depositary may be
merged or converted or with which it may be consolidated, or any corporation
resulting from any merger, conversion or consolidation to which the Book-Entry
Unit Depositary shall be a party, or any corporation succeeding to all or
substantially all the agency business of the Book-Entry Unit Depositary, shall
be the successor of the Book-Entry Unit Depositary hereunder, without the
execution or filing of any paper or any further act on the part of any of the
parties hereto, provided that such corporation shall be otherwise eligible under
this Article.
<PAGE>
69
Section 1211. Taxes.
-----
If any tax or other governmental charge shall be required to be
deducted or withheld from any distribution in respect of the Global Debentures
or Global Purchase Contracts, MS plc and the Corporation shall pay or cause to
be paid such Additional Amounts as may be necessary in order that the net
amounts received by the Holder, after such deduction or withholding, shall equal
the net amounts that would otherwise be payable to the Holder in respect of the
Global Purchase Contract or the Global Debenture, as the case may be, in the
absence of any such deduction or withholding.
ARTICLE THIRTEEN
Miscellaneous Provisions
Section 1301. Incorporators, Stockholders,
Officers and Directors of MS plc
and the Corporation Immune from Liability.
-----------------------------------------
No recourse under or upon any obligation, covenant or agreement
contained in this Agreement, or in any Debenture or any Purchase Contract, or
because of any indebtedness evidenced thereby, shall be had against any
incorporator, or against any past, present or future stockholder, officer,
attorney-in-fact or director, as such, of MS plc or the Corporation or of any
successor corporation of either of them, either directly or through MS plc or
the Corporation or any successor corporation of either of them, under any rule
of law, statute or constitutional provision or by the enforcement of any
assessment or penalty or by any legal or equitable proceeding or otherwise, all
such liability being expressly waived and released by the acceptance of the
Capital Units by the Holders thereof and as part of the consideration for the
issue thereof, provided that nothing in this Article shall impair the
obligations, covenants and agreements of MS plc and the Corporation contained in
this Agreement and in the Debentures and the Purchase Contracts.
Section 1302. Compliance Certificates and Opinions.
------------------------------------
Except as otherwise expressly provided by this Agreement, upon
any application or request by MS plc or the Corporation to the Agent to take any
action under any provision of this Agreement, MS plc or the Corporation, as
applicable, shall furnish to the Agent an Officer's Certificate stating that all
conditions precedent, if any, provided for in this Agreement relating to the
proposed action have been complied with and an Opinion of Counsel stating that,
in the opinion of such counsel, all such conditions precedent, if any, have been
complied with, except that in the case of any such application or request as to
which the furnishing of such documents is specifically required by any provision
of this Agreement relating to such particular application or request, no
additional certificate or opinion need be furnished.
<PAGE>
70
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Agreement shall include:
(1) a statement that each individual signing such certificate or
opinion has read such covenant or condition and the definitions herein
relating thereto;
(2) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;
(3) a statement that, in the opinion of each such individual, he
has made such examination or investigation as is necessary to enable him to
express an informed opinion as to whether or not such covenant or condition
has been complied with; and
(4) a statement as to whether, in the opinion of each such
individual, such condition or covenant has been complied with.
Section 1303. Form of Documents Delivered to Agent.
------------------------------------
In any case where several matters are required to be certified
by, or covered by an opinion of, any specified Person, it is not necessary that
all such matters be certified by, or covered by the opinion of, only one such
Person, or that they be so certified or covered by only one document, but one
such Person may certify or give an opinion with respect to some matters and one
or more other such Persons as to other matters, and any such Person may certify
or give an opinion as to such matters in one or several documents.
Any certificate, statement or opinion of an officer or counsel
of or for MS plc or the Corporation may be based, insofar as it relates to legal
matters, upon a certificate or opinion of, or representations by, counsel,
unless such officer knows, or in the exercise of reasonable care should know,
that the certificate or opinion or representations with respect to the matters
upon which his certificate, statement or opinion is based are erroneous. Any
such certificate, statement or opinion may be based, insofar as it relates to
factual matters, upon a certificate, statement or opinion of, or representations
by, an officer or officers of MS plc or the Corporation, as applicable, stating
that the information with respect to such factual matters is in the possession
of MS plc or the Corporation, as applicable, unless such counsel knows, or in
the exercise of reasonable care should know, that the certificate or opinion or
representations with respect to such matters are erroneous.
Where any Person is required to make, give or execute two or
more applications, requests, consents, certificates, statements, opinions or
other instruments under this Agreement, they may, but need not, be consolidated
and form one instrument.
<PAGE>
71
Section 1304. Acts of Holders.
---------------
(a) Any request, demand, authorization, direction, notice,
consent, waiver or other action provided by this Agreement to be given or taken
by Holders may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Holders in person or by an agent duly
appointed in writing and, except as herein otherwise expressly provided, such
action shall become effective when such instrument or instruments are delivered
to the Agent or the Book-Entry Unit Depositary, as applicable, and, where it is
hereby expressly required, to MS plc or the Corporation, as applicable. Such
instrument or instruments (and the action embodied therein and evidenced
thereby) are herein sometimes referred to as the "Act" of the Holders signing
such instrument or instruments. Proof of execution of any such instrument or of
a writing appointing any such agent shall be sufficient for any purpose of this
Agreement and (subject to Section 601 and Section 1201) conclusive in favor of
the Agent, the Book-Entry Unit Depositary, MS plc and the Corporation, if made
in the manner provided in this Section.
(b) The fact and date of the execution by any Person of any such
instrument or writing may be proved in any manner that the Agent or the Book-
Entry Unit Depositary, as applicable, deems sufficient.
(c) The ownership (i) of Definitive Capital Units shall be
proved by the Purchase Contract Register, with respect to the Purchase Contracts
constituting a part of such Definitive Capital Units, and the Definitive
Debenture Register, with respect to the Debentures constituting a part of such
Definitive Capital Units, and (ii) of Book-Entry Capital Units shall be proved
by the Book-Entry Unit Register.
(d) Any request, demand, authorization, direction, notice,
consent, waiver or other Act of the Holder of any Capital Unit Certificate shall
bind every future Holder of the same Capital Unit Certificate and the Holder of
every Capital Unit Certificate issued upon the registration of transfer thereof
or in exchange therefor or in lieu thereof with respect to anything done,
omitted or suffered to be done by the Agent, MS plc or the Corporation in
reliance thereon, whether or not notation of such action is made upon such
Capital Unit Certificate.
(e) MS plc and the Corporation may set a record date for
purposes of determining the identity of Holders of Capital Units entitled to
consent to any action by consent authorized or permitted hereby. Such record
date shall be the later of 30 days prior to the first solicitation of such
consent or the date of the most recent list of Holders of Capital Units
furnished to the Agent, pursuant hereto.
<PAGE>
72
Section 1305. Notices, Etc.
------------
Any request, demand, authorization, direction, notice, consent,
waiver or Act of Holders or other document provided or permitted by this
Agreement to be made upon, given or furnished to, or filed with,
(a) the Agent by any Holder, by the Book-Entry Unit Depositary
or by MS plc or the Corporation shall be sufficient for every purpose
hereunder (unless otherwise herein expressly provided) if made, given,
furnished or filed in writing and personally delivered or mailed, first-
class postage prepaid, to the Agent at its Corporate Trust Office,
Attention: Corporate Trustee Administration Department, or at any other
address previously furnished in writing by the Agent to the Holders, the
Book-Entry Unit Depositary, MS plc and the Corporation, or
(b) the Book-Entry Unit Depositary by any Holder, by the Agent
or by MS plc or the Corporation shall be sufficient for every purpose
hereunder (unless otherwise herein expressly provided) if made, given,
furnished or filed in writing and personally delivered or mailed, first-
class postage prepaid, to the Book-Entry Unit Depositary at its Corporate
Trust Office, Attention: Corporate Trustee Administration Department, or at
any other address previously furnished in writing by the Book-Entry Unit
Depositary to the Holders, the Agent, MS plc and the Corporation, or
(c) MS plc or the Corporation by the Agent, by the Book-Entry
Unit Depositary or by any Holder shall be sufficient for every purpose
hereunder (unless otherwise herein expressly provided) if made, given,
furnished or filed in writing and personally delivered or mailed, first-
class postage prepaid, in the case of MS plc, addressed to MS plc at 25
Cabot Square, Canary Wharf, London, E14 4QA England, Attention: Company
Secretary, and in the case of the Corporation, addressed to the Corporation
at 1251 Avenue of the Americas, New York, New York 10020, Attention:
Patricia A. Kurtz, or at any other address previously furnished in writing
to the Agent and the Book-Entry Unit Depositary by MS plc or the
Corporation.
Section 1306. Notice to Holders; Waiver.
-------------------------
Where this Agreement provides for notice to Holders of any
event, such notice shall be sufficiently given (unless otherwise herein
expressly provided or as provided in the Letter of Representations) if in
writing and mailed, first-class postage prepaid, to each Holder affected by such
event, (i) with respect to a Holder of a Definitive Capital Unit, at his address
as it appears in the Purchase Contract Register and the Definitive Debenture
Register, respectively, with respect to the Purchase Contract and the Debenture
and Guarantee constituting such Capital Unit, and (ii) with respect to a Holder
of a Book-Entry Capital Unit, to the Book-Entry Unit Depositary at the address
notified to the Agent, in each case not later than the latest date, and not
earlier than the earliest date, prescribed for the
<PAGE>
73
giving of such notice. In any case where notice to Holders is given by mail,
neither the failure to mail such notice, nor any defect in any notice so mailed
to any particular Holder shall affect the sufficiency of such notice with
respect to other Holders. Where this Agreement provides for notice in any
manner, such notice may be waived in writing by the Person entitled to receive
such notice, either before or after the event, and such waiver shall be the
equivalent of such notice. Waivers of notice by Holders shall be filed with the
Agent, but such filing shall not be a condition precedent to the validity of any
action taken in reliance upon such waiver.
In case by reason of the suspension of regular mail service or
by reason of any other cause it shall be impracticable to give such notice by
mail, then such notification as shall be made with the approval of the Agent
shall constitute a sufficient notification for every purpose hereunder.
Section 1307. Effect of Headings and Table of Contents.
----------------------------------------
The Article and Section headings herein and the Table of
Contents are for convenience only and shall not affect the construction hereof.
Section 1308. Successors and Assigns.
----------------------
All covenants and agreements in this Agreement, the Capital
Units, the Purchase Contracts and the Capital Unit Certificates by MS plc or by
the Corporation shall bind its successors and assigns, whether so expressed or
not.
Section 1309. Separability Clause.
-------------------
In case any provision in this Agreement or in the Capital Units,
Capital Unit Certificates or the Purchase Contracts shall be invalid, illegal or
unenforceable, the validity, legality and enforceability of the remaining
provisions hereof and thereof shall not in any way be affected or impaired
thereby.
Section 1310. Benefits of Agreement.
---------------------
Nothing in this Agreement or in the Capital Units, Capital Unit
Certificates, the Indenture, the Debentures or the Purchase Contracts, express
or implied, shall give to any Person, other than the parties hereto and their
successors hereunder, any benefits or any legal or equitable right, remedy or
claim under this Agreement. The Holders from time to time shall be parties to
this Agreement and shall be bound by all of the terms and conditions hereof and
of the Indenture, the Capital Units, the Debentures, the Guarantee and the
Purchase Contracts evidenced by the Capital Units, by their acceptance of
delivery of such Capital Units.
<PAGE>
74
Section 1311. Governing Law.
-------------
This Agreement, the Capital Units and the Purchase Contracts
shall be governed and construed in accordance with the laws of the State of New
York.
Section 1312. Legal Holidays.
--------------
In any case where any Purchase Date shall not be a Business Day,
then (notwithstanding any other provisions of this Agreement or the Purchase
Contracts) the Purchase Contracts shall not be performed on such date, but shall
be performed on the next succeeding Business Day with the same force and effect
as if performed on such Purchase Date; provided that no interest or other
amounts shall accrue or be payable by the Corporation or any Holder for the
period from and after any such Purchase Date.
Section 1313. Counterparts.
------------
This Agreement may be executed in any number of counterparts by
the parties hereto on separate counterparts, each of which, when so executed and
delivered, shall be deemed an original, but all such counterparts shall together
constitute one and the same instrument.
Section 1314. Inspection of Agreement.
-----------------------
A copy of this Agreement shall be available at all reasonable
times during nominal business hours at the Corporate Trust Offices of the Agent
and the Book-Entry Unit Depositary for inspection by any Holder.
Section 1315. Satisfaction and Discharge.
--------------------------
This Agreement upon Issuer Request shall cease to be of further
effect, and the Agent and the Book-Entry Unit Depositary, at the expense of MS
plc and the Corporation, shall execute proper instruments acknowledging
satisfaction and discharge of this Agreement, when (i) the Indenture has been
satisfied and discharged pursuant to Article Ten thereof, (ii) the obligations
of the Corporation, the Holders, the Agent and the Book-Entry Unit Depositary
relating to the Purchase Contracts have been satisfied, (iii) MS plc and the
Corporation have paid or caused to be paid all sums payable hereunder by MS plc
and the Corporation and (iv) each of MS plc and the Corporation has delivered to
each of the Agent and the Book-Entry Unit Depositary an Officer's Certificate
and an Opinion of Counsel, each stating that all conditions precedent herein
provided relating to the satisfaction and discharge of this Agreement have been
complied with.
<PAGE>
75
Section 1316. Appointment of Agent for Service.
--------------------------------
By the execution and delivery of this Agreement, MS plc hereby
designates the Corporation as its authorized agent upon which process may be
served in any legal action or proceeding that may be instituted in any federal
or state court in the Borough of Manhattan, The City of New York, State of New
York, arising out of or relating to the Debentures, the Capital Units or this
Agreement, but for that purpose only. Service of process upon such agent at the
office of such agent at 1251 Avenue of the Americas, New York, New York 10020,
Attention: General Counsel, and written notice of said service to MS plc by the
person serving the same, addressed as provided in Section 1305, shall be deemed
in every respect effective service of process upon MS plc in any such legal
action or proceeding, and MS plc hereby submits (for the purposes of any such
legal action or proceeding) to the nonexclusive jurisdiction of any such court
in which any such legal action or proceeding is so instituted and waives, to the
extent it may effectively do so, any objection it may have now or hereafter to
the laying of the venue of any such legal action or proceeding. Such appointment
shall be irrevocable so long as the Holders of Capital Units shall have any
rights pursuant to the terms thereof or of this Agreement until the appointment
of a successor by MS plc and such successor's acceptance of such appointment.
Upon such acceptance, MS plc shall notify the Agent of the name and address of
such successor. MS plc further agrees to take any and all action, including the
execution and filing of any and all such documents and instruments, as may be
necessary to continue such designation and appointment of such agent or
successor for so long as Holders of Capital Units shall have any rights pursuant
to the terms thereof or of this Agreement. The Agent shall not be obligated and
shall have no responsibility with respect to any failure by MS plc to take any
such action.
<PAGE>
76
IN WITNESS WHEREOF, MS plc, the Corporation, the Agent, the
Trustee and the Book-Entry Unit Depositary have duly executed this Agreement as
of the day and year first above set forth, and all Holders of Capital Units
shall become parties hereto by and upon acceptance by them of delivery of
Capital Units issued in accordance with the terms hereof.
The Common Seal of
MORGAN STANLEY FINANCE PLC
was hereunto affixed in
the presence of
____________________________
____________________________
MORGAN STANLEY GROUP INC.
By _________________________
Name: Charles B. Hintz
Title: Treasurer
CHEMICAL BANK, as Agent
By _________________________
CHEMICAL BANK, as
Book-Entry Unit
Depositary
By _________________________
<PAGE>
77
CHEMICAL BANK, as
Trustee under the
Indenture
By _________________________
<PAGE>
EXHIBIT A
---------
[[FORM OF DEFINITIVE CAPITAL UNIT CERTIFICATE]
[FACE]
CAPITAL UNIT CERTIFICATE
(issuable in integral multiples of whole Capital Units)
Evidencing the Ownership of the Number of
8.40% Subordinated Debentures Due August 30, 2015
of MORGAN STANLEY FINANCE PLC
Specified Below and the Benefits of
the Guarantee of Payment of such Debentures
by MORGAN STANLEY GROUP INC.
and
the Rights and Obligations
of the Holder Under the Number of
Purchase Contracts Specified Below
____ Capital Unit(s) (Consisting of
____ Debenture(s), each in a principal
amount of U.S. $25.00 and
____ Purchase Contract(s))
No. R-_____
Dated _____
This Capital Unit Certificate certifies that ________________,
or registered assigns, is the owner of the number of Capital Units set forth
above.]/1/
[FORM OF DEBENTURE]
MORGAN STANLEY FINANCE PLC
8.40% SUBORDINATED DEBENTURE(S) DUE AUGUST 30, 2015
- ----------------
/1/ Applicable to Definitive Capital Units only.
<PAGE>
2
MORGAN STANLEY FINANCE PLC, a company duly organized and
existing under the laws of England and Wales (together with its successors and
assigns "MS plc"), for value received, hereby promises to pay to [_________ or
registered assigns]/1/[bearer]/2/ the principal amount hereof (equal to [the
product of U.S.$25.00 and the number of Debentures indicated in the upper
portion of the face hereof]/1/[Schedule A hereto]/2/ ) on August 30, 2015 (the
"Maturity Date"), and to pay interest thereon at the rate of 8.40% per annum
[(including in each case any Additional Amounts)]/3/, from August 1, 1995, until
the principal hereof is paid or made available for payment, quarterly in arrears
on February 28, May 30, August 30 and November 30 in each year (each such date
an "Interest Payment Date"), commencing on November 30, 1995, and on the
Maturity Date.
Reference is hereby made to the further provisions of this certificate set
forth on the succeeding pages hereof, which further provisions shall for
all purposes have the same effect as if set forth at this place.
- ---------------
/1/ Applicable to Definitive Capital Units only.
/2/ Applicable to Global Debenture only.
/3/ Not applicable to Definitive Capital Units Issued pursuant to an Optional
Definitive Capital Unit Request or pursuant to the request of a Holder upon
original issuance thereof.
<PAGE>
3
IN WITNESS WHEREOF, Morgan Stanley Finance plc has caused this
Debenture to be duly executed.
DATED: MORGAN STANLEY FINANCE PLC
By _________________________
Title:
Attest _________________________
Title:
TRUSTEE'S CERTIFICATE
OF AUTHENTICATION
This is one of the Securities referred to in the within-mentioned Indenture.
CHEMICAL BANK, as Trustee
By _________________________
Authorized Officer
Interest on this Debenture (as described below) will accrue from
the most recent Interest Payment Date to which interest has been paid or duly
provided for, or, if no interest has been paid or duly provided for, from August
1, 1995, until the principal hereof has been paid or duly made available for
payment. The interest so payable on any Interest Payment Date will be paid to
the [bearer of]/1/[person in whose name]/2/ this Debenture (or one or more
predecessor Debentures) [is registered at the close of business on the fifteenth
day of the month in which such Interest Payment Date occurs (whether or not a
Business Day) (each such date a "Record Date")]./2/
Payment of the principal of this Debenture will be made upon
surrender of this Debenture at the office or agency of MS plc maintained for
that purpose in the Borough of Manhattan, The City of New York, or at such other
paying agency as MS plc may determine. Payment of the principal of and interest
on this Debenture will be made in such
__________________
/1/ Applicable to Global Debenture only.
/2/ Applicable to Definitive Capital Unit only.
<PAGE>
4
coin or currency of the United States of America as at the time of payment is
legal tender for payment of public and private debts.
This Debenture is one of the duly authorized debt securities of
MS plc (the "Securities" and, individually, a "Security") issued or to be issued
under and pursuant to a Subordinated Indenture dated as of November 15, 1993,
(the "Indenture"), between MS plc, Morgan Stanley Group Inc., as Guarantor (the
"Guarantor" or the "Corporation") and Chemical Bank, as Trustee (the "Trustee",
which term includes any successor trustee under the Indenture), to which
Indenture and all indentures supplemental thereto reference is hereby made for a
statement of the respective rights, limitations of rights, duties and immunities
of MS plc, the Guarantor, the Trustee and Holders of the Securities and the
terms upon which the Securities are, and are to be, authenticated and delivered.
The terms of the Indenture are hereby incorporated by reference herein. The
Securities may be issued in one or more series, which different series may be
issued in various aggregate principal amounts, may mature at different times,
may bear interest (if any) at different rates, may be subject to different
redemption or repayment provisions (if any), may be subject to different
sinking, purchase or analogous funds (if any) and may otherwise vary as provided
in the Indenture. This security is one of a series of Securities designated as
the 8.40% Subordinated Debentures Due August 30, 2015 of MS plc (the
"Debentures"), in an aggregate principal amount of U.S.$175,000,000 (subject to
increase as provided in the Capital Unit Agreement referred to below up to a
maximum of U.S.$201,250,000).
The Debentures will not be subject to any sinking fund and will
be repayable at the option of the Holder prior to maturity upon the election of
the Holder to effect a Debenture Settlement (as defined in the Capital Unit
Agreement) upon the acceleration of the related Purchase Contracts as set forth
in the Capital Unit Agreement dated August 1, 1995, among MS plc, the
Corporation, Chemical Bank and holders from time to time of Capital Units (the
"Capital Unit Agreement"). The Debentures will be redeemable, at MS plc's
option, in whole or in part, at any time on or after August 30, 2000 and prior
to maturity, upon not less than 30 nor more than 60 days' prior notice at a
redemption price equal to 100% of the principal amount of this Debenture, plus
accrued and unpaid interest to the redemption date; provided, however, that
Debentures shall be redeemable only (i) upon the redemption by the Corporation
of the related Purchase Contracts on or prior to the redemption date for such
Debentures or (ii) if the related Purchase Contracts have been settled at least
six months prior to the redemption date of such Debentures. In addition, if a
Holder properly effects a Cash Settlement (as defined in the Capital Unit
Agreement) with respect to a Purchase Contract, the related Debenture may be
redeemed at MS plc's option at the redemption price specified in the preceding
sentence, plus accrued and unpaid interest to the redemption date, on any
Interest Payment Date that is no earlier than six months after the settlement of
such Purchase Contract.
The Debentures may also be redeemed at MS plc's option at any
time, prior to maturity in whole and not in part, upon not less than 30 nor more
than 60 days' prior notice at a redemption price equal to 100% of the principal
amount of this Debenture, plus accrued
<PAGE>
5
and unpaid interest to the redemption date, if MS plc shall determine that, as a
result of any change in or amendment to the laws or regulations or rulings
promulgated thereunder of the United Kingdom ("U.K.") or of any political
subdivision or taxing authority thereof or therein or any change in the official
application or interpretation of such laws, regulations or rulings, or any
change in the official application or interpretation of, or any execution of or
amendment to, any treaty or treaties affecting taxation to which the U.K. or
such political subdivision or taxing authority is a party, which change or
amendment becomes effective on or after the date of original issuance of
Debentures, (a) in making payments in respect of principal or interest on
Debentures that are part of Book-Entry Capital Units (as defined in the Capital
Unit Agreement) it would become obligated to pay Additional Amounts with respect
thereto as a result of any withholding taxes or similar charges imposed by or
for the account of the U.K. or any political subdivision or taxing authority
thereof or therein or (b) the payment of interest on the Debentures would be
treated as a "distribution" within the meaning of section 209 of the Income and
Corporation Taxes Act 1988 of the U.K. (or any statutory modification or re-
enactment thereof for the time being).
[The Trustee has been appointed registrar for the Debentures,
and the Trustee will maintain at its office in the Borough of Manhattan, The
City of New York, a register for the registration and transfer of Debentures.
Subject to the limitations, terms and conditions set forth herein and in the
Indenture, this Debenture may be transferred at the aforesaid office of the
Trustee by surrendering this Debenture for cancellation and thereupon MS plc
shall execute and the Trustee shall authenticate and deliver in the name of the
transferee or transferees, in exchange herefor, a new Debenture or Debentures
having identical terms and provisions and having a like aggregate principal
amount in authorized denomination.
All Debentures surrendered for transfer or exchange shall be
duly endorsed by, or be accompanied by a written instrument or instruments of
transfer in form satisfactory to, MS plc and the Trustee and executed by the
Holder or by the Holder's attorney duly authorized in writing. The Issuer may
require payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in connection with any such exchange or registration
of transfer.]/1/
In case an Event of Default with respect to the Debentures shall
have occurred and be continuing, the principal hereof may be declared, and upon
such declaration shall become, due and payable, in the manner, with the effect
and subject to the conditions provided in the Indenture.
Pursuant to the terms of the Indenture, the Guarantor has
unconditionally guaranteed on a subordinated basis to the Holder of each
Debenture evidenced hereby the due and punctual payment of the principal of and
interest on [(together with any Additional
_______________
/1/ Applicable to Definitive Capital Units only.
<PAGE>
6
Amounts)]/1/, this Debenture when and as the same shall become due and payable,
whether at maturity or by declaration of acceleration or otherwise, according to
the terms of each such Debenture and of the Indenture.
The indebtedness evidenced by this Debenture is subordinate, to
the extent and in the manner set forth in the Indenture, to the prior payment in
full of all Senior Indebtedness of MS plc, and the obligations of the Guarantor
under the Guarantee with respect to the Debentures is subordinate to the extent
and in the manner set forth in the Indenture to the prior payment in full of all
Senior Indebtedness of the Guarantor. Each holder of this Debenture, by
accepting the same, (a) agrees to and shall be bound by such provisions, (b)
authorizes and directs the Trustee on his behalf to take such action as may be
necessary or appropriate to effectuate the subordination so provided and (c)
appoints the Trustee as attorney-in-fact for any and all such purposes.
The Indenture contains provisions permitting MS plc, the
Guarantor and the Trustee, with the consent of the Holders of not less than a
majority in aggregate principal amount of the Securities of all series issued
under such Indenture then Outstanding and affected, voting as one class, to add
any provisions to, or change in any manner or eliminate any of the provisions
of, such Indenture or modify in any manner the rights of the Holders of the
Securities of each series so affected; provided that MS plc, the Guarantor and
the Trustee may not, without the consent of the Holder of each outstanding
Security affected thereby, (i) extend the stated maturity of the principal of
any 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 in which the principal thereof
(including any amount in respect of original issue discount), premium, if any,
or interest thereon is payable, or reduce the amount of any original issue
discount security payable upon acceleration or provable in bankruptcy, or alter
the provisions of the Guarantee of the Securities in any manner adverse to the
Holders, or alter certain provisions of such Indenture relating to Securities
issued thereunder not denominated in U.S. dollars, or impair or affect the right
to institute suit for the enforcement of any payment on any Security when due or
(ii) reduce the aforesaid percentage in principal amount of Securities of any
series issued under such Indenture, the consent of the Holders of which is
required for any such modification. It is also provided in the Indenture that,
with respect to certain defaults or Events of Default regarding the Securities
of any series, prior to any declaration accelerating the maturity of such
Securities, the Holders of a majority in aggregate principal amount Outstanding
of the Securities of such series (or, in the case of certain defaults or Events
of Default, all or certain series of the Securities) may on behalf of the
Holders of all the Securities of such series (or all or certain series of the
Securities, as the case may be) waive any such past default or Event of Default
and its consequences. The preceding sentence shall
_______________
/1/ Not applicable to Definitive Capital Units issued pursuant to an Optional
Definitive Capital Unit Request or pursuant to the request of a Holder upon
original issuance thereof.
<PAGE>
7
not, however, apply to a default in the payment of the principal of or interest
and any Additional Amounts on any of the Securities. Any such consent or waiver
by the Holder of this Debenture (unless revoked as provided in the Indenture)
shall be conclusive and binding upon such Holder and upon all future Holders and
owners of this Debenture and any Securities which may be issued in exchange or
substitution herefor [or on registration of transfer hereof]/1/, irrespective
of whether or not any notation thereof is made upon this Debenture or such other
Securities.
No provision of this Debenture or of the Indenture shall alter
or impair the obligation of MS plc, which is absolute and unconditional, to pay
the principal of and interest [and Additional Amounts]/2/ on this Debenture at
the time, place and rate, and in the coin or currency, herein prescribed unless
otherwise agreed between MS plc and the registered Holder of this Debenture.
MS plc, the Guarantor, the Trustee and any authorized agent of
MS plc, the Guarantor or the Trustee may deem and treat the Holder hereof as the
absolute owner of this Debenture (whether or not this Debenture shall be overdue
and notwithstanding any notation of ownership or other writing hereon), for the
purpose of receiving payment of, or on account of, this Debenture, and for all
other purposes, and none of MS plc, the Guarantor, the Trustee or any authorized
agent of MS plc, the Guarantor or the Trustee shall be affected by any notice to
the contrary.
No recourse under or upon any obligation, covenant or agreement
of MS plc or the Guarantor in the Indenture or any indenture supplemental
thereto or in any Security, or because of the creation of any indebtedness
represented thereby, shall be had against any incorporator, stockholder, officer
or director, as such, of MS plc or the Guarantor or of any successor
corporation, either directly or through MS plc or the Guarantor or any successor
corporation, under any rule of law, statute or constitutional provision or by
the enforcement of any assessment or by any legal or equitable proceeding or
otherwise, all such liability being expressly waived and released by the
acceptance hereof and as part of the consideration for the issue hereof.
This Debenture shall for all purposes be governed by, and
construed in accordance with, the laws of the State of New York.
All terms used in this Debenture which are defined in the
Indenture and not otherwise defined herein shall have the meanings assigned to
them in the Indenture.
_______________
/1/ Applicable to Definitive Capital Units only.
/2/ Not applicable to Definitive Capital Units issued pursuant to an Optional
Definitive Capital Unit Request or pursuant to the request of a Holder upon
original issuance thereof.
<PAGE>
8
Unless the certificate of authentication hereon has been
executed by the Trustee by manual signature, this Debenture shall not be
entitled to any benefit under the Indenture or be valid or obligatory for any
purpose.
<PAGE>
[SCHEDULE A
SCHEDULE OF INCREASES AND DECREASES
The initial number of U.S.$25.00 principal amount Debentures
represented by this Global Debenture is 7,000,000. The following increases and
decreases in the number of Debentures represented by this Global Debenture have
been made:
<TABLE>
<CAPTION>
Total
Number of
Debentures
Represented
Increase in Decrease in hereby Notation
Date of Number of Number of Following Made by or
Increase Purchase Purchase such Increase on Behalf
or Decrease Contracts Contracts or Decrease of Trustee
- ----------- ----------- ----------- ------------- ----------
<S> <C> <C> <C> <C>
- ----------- ----------- ----------- ------------- ----------
- ----------- ----------- ----------- ------------- ----------
- ----------- ----------- ----------- ------------- ----------
- ----------- ----------- ----------- ------------- ----------
- ----------- ----------- ----------- ------------- ----------
- ----------- ----------- ----------- ------------- ----------
- ----------- ----------- ----------- ------------- ----------
- ----------- ----------- ----------- ------------- ----------
- ----------- ----------- ----------- ------------- ----------
- ----------- ----------- ----------- ------------- ----------
- ----------- ----------- ----------- ------------- ----------
- ----------- ----------- ----------- ------------- ----------
- ----------- ----------- ----------- ------------- ----------
- ----------- ----------- ----------- ------------- ----------
- ----------- ----------- ----------- ------------- ----------
- ----------- ----------- ----------- ------------- ----------
- ----------- ----------- ----------- ------------- ----------
- ----------- ----------- ----------- ------------- ----------
- ----------- ----------- ----------- ------------- ----------
- ----------- ----------- ----------- ------------- ----------
- ----------- ----------- ----------- ------------- ----------
- ----------- ----------- ----------- ------------- ----------
- ----------- ----------- ----------- ------------- ----------
]/1/
- ----------- ----------- ----------- ------------- ----------
</TABLE>
_______________
/1/ Applicable to Global Debenture only.
<PAGE>
[REVERSE]/1/
[FORM OF PURCHASE CONTRACT]
MORGAN STANLEY GROUP INC.
PURCHASE CONTRACT(S)
Purchase Contract(s) between
Morgan Stanley Group Inc.,
and
[the person named on the face of this
Capital Unit Certificate]1 [Chemical Bank, as
Book-Entry Unit Depositary]/2/
or registered assigns,
as holder hereunder (the "Holder")
Subject to the conditions hereinafter set forth, the Holder
agrees to purchase and pay for, and Morgan Stanley Group Inc., a corporation
duly incorporated and existing under the laws of the State of Delaware (the
"Corporation"), agrees to sell, for value received, on February 28, 2015 (the
"Stated Purchase Date") or, at the election of the Corporation, subject to the
terms of the Capital Unit Agreement referred to below, on any earlier Interest
Payment Date on or after August 30, 1996 (together with the Stated Purchase
Date, a "Purchase Date"), that number of Depositary Shares (the "Depositary
Shares"), each Depositary Share representing a 1/8 interest in a share of 8.40%
Cumulative Preferred Stock, without par value, stated value $200.00 per share,
of the Corporation, corresponding to the number of Purchase Contracts specified
[on the face hereof]1 [on Schedule I hereto]2, at a purchase price of $25.00 per
Depositary Share, unless a Termination Event or Cancellation Event shall have
occurred on or prior to the Purchase Date. The Purchase Contract(s) evidenced
hereby shall not entitle the Holder to purchase Depositary Shares prior to a
Purchase Date or from and after the date a Termination Event has occurred.
The Purchase Price for the Depositary Shares purchased pursuant
to the Purchase Contracts evidenced hereby shall be payable at the Corporate
Trust Office of the Agent (i) by application of payments received by the Agent
with respect to the principal of the Debentures constituting a part of the
Capital Units of which the Purchase Contracts evidenced hereby form a part (a
"Debenture Settlement") or (ii) at the option of the Holder, upon written notice
to the Agent not less than 10 days nor more than 20 days prior to the applicable
Purchase Date, in such coin or currency of the United States of America as at
the time of payment is legal tender for payment of public and private debts, to
the Agent in
_______________
/1/ Applicable to Definitive Capital Units only.
/2/ Applicable to Global Purchase Contract only.
<PAGE>
2
immediately available funds payable to or upon the order of the Corporation
delivered to the Agent not later than 12:00 P.M. New York City time on the
Business Day immediately preceding the Purchase Date (a "Cash Settlement"). A
Holder who fails to provide notice to the Agent as provided above that it will
make a Cash Settlement with respect to the settlement of a Purchase Contract, or
a Holder who provides such notice but does not make payment in the manner
provided above, will be deemed to have elected to make a Debenture Settlement.
In the event of a Debenture Settlement, the principal of the Debenture included
in the Capital Unit of which such Purchase Contract constitutes a part will be
paid to the Agent upon surrender to the Agent of the Capital Unit Certificate
representing such Capital Unit.
The Holder, by his acceptance hereof, covenants and agrees that,
to the extent and in the manner provided in the Capital Unit Agreement, but
subject to the terms thereof, payments in respect of principal of the Debentures
constituting a part of the Capital Units of which the Purchase Contracts
evidenced hereby form a part, in the absence of a Cash Settlement by the Holder,
shall be applied by the Agent in satisfaction of the Holder's obligations under
such Purchase Contracts. [In the event that the Holder elects to make a Cash
Settlement with respect to his obligations under the Purchase Contracts
evidenced hereby with respect to which a Purchase Date is occurring, the Holder
must properly effect a Cash Settlement with respect to all (but not less than
all) of such Purchase Contracts.]/1/ [In the event that a beneficial holder, as
specified in the records of the direct and indirect participants of the
Depositary and as certified in writing by such beneficial holder, of Purchase
Contracts evidenced hereby elects to make a Cash Settlement with respect to his
obligations under Purchase Contracts evidenced hereby with respect to which a
Purchase Date is occurring, the beneficial holder must properly effect a Cash
Settlement with respect to all (but not less than all) of the Purchase Contracts
beneficially held.]/2/
The Purchase Contracts evidenced hereby and the obligations and
rights of the Corporation and the Holder hereunder shall terminate if a
Termination Event shall have occurred. "Termination Event" is defined in the
Capital Unit Agreement to mean any of the following events: (i) the occurrence
of a Bankruptcy Event at any time on or prior to the Stated Purchase Date; or
(ii) the existence of a Cancellation Condition at 5:00 P.M. New York City time
on the date that is five Business Days prior to the Stated Purchase Date.
Each Purchase Contract evidenced hereby is one of a duly
authorized issue of contracts of the Corporation relating to the purchase of an
aggregate of not more than 7,000,000 Depositary Shares (subject to increase as
provided in the Capital Unit Agreement up to a maximum of 8,050,000 Depositary
Shares) at an aggregate purchase price of
_______________
/1/ Applicable to Definitive Capital Units only.
/2/ Applicable to Global Purchase Contract only.
<PAGE>
3
$175,000,000 (subject to increase as provided in the Capital Unit Agreement up
to a maximum of $201,250,000, issued and to be issued under a Capital Unit
Agreement, dated as of August 1, 1995 (the "Capital Unit Agreement"), among the
Corporation, Morgan Stanley Finance plc ("MS plc") Chemical Bank, as Agent and
Book-Entry Unit Depositary (in its capacity as agent, herein called the "Agent"
and, in its capacity as Book-Entry Unit Depositary, the "Book-Entry Unit
Depositary") and as Trustee under the Indenture referred to therein and the
holders from time to time of Capital Units, to which Capital Unit Agreement and
supplemental agreements thereto reference is hereby made for a description of
the respective rights, limitations of rights, obligations, duties and immunities
thereunder of the Agent, the Book-Entry Unit Depositary, the Corporation, MS plc
and the Holders and of the terms upon which the Purchase Contracts are, and are
to be, executed, countersigned and delivered.
The Agent may require a Holder, among other things, to furnish
appropriate endorsements and transfer documents in connection with any transfer
or exchange. No service charge shall be required for any such registration of
transfer or exchange, but MS plc, the Corporation, the Agent and the Book-Entry
Unit Depositary may require payment of a sum sufficient to cover any tax or
other governmental charge imposed in connection with any registration of
transfer or exchange of Capital Units. Except as provided in the Capital Unit
Agreement, the Purchase Contracts are not separable from the Debentures
constituting a part of the Capital Units of which the Purchase Contracts
evidenced hereby form a part, and may be transferred only together with a
corresponding number of Debentures.
Upon registration of transfer of a Capital Unit, the transferee
shall be bound (without the necessity of any other action on the part of such
transferee, except as may be required by the Agent), under the terms of the
Capital Unit Agreement and the Purchase Contracts evidenced thereby and the
transferor shall be released from the obligations under the Purchase Contracts
evidenced by the Capital Units so transferred. The Corporation covenants and
agrees, and the Holder, by his acceptance hereof, likewise covenants and agrees,
to be bound by the provisions of this paragraph.
The Corporation may, at its option, accelerate to any Interest
Payment Date that is on or after August 30, 1996 the closing of the purchase of
2,000,000 or more Purchase Contracts upon not less than 30 and not more than 60
days' notice, subject to cancellation and termination in the circumstances set
forth in the next paragraph, provided that no partial acceleration may result in
fewer than 2,000,000 Purchase Contracts remaining Outstanding after such
closing.
The Corporation will not be entitled to accelerate the
obligations of the Holder to any Accelerated Purchase Date, and notice of any
such acceleration will be automatically rescinded and annulled, if, at 5:00 P.M.
New York City time on the date that is five business days prior to such
Accelerated Purchase Date, a Cancellation Condition exists. The rescission of
any notice of acceleration as set forth above will not prevent the Corporation
<PAGE>
4
from giving notice of an Accelerated Purchase Date with respect to any Purchase
Contracts at a later date.
Any or all of the Purchase Contracts may be redeemed at the
option of the Corporation, or from time to time in part, upon not less than 30
and not more than 60 days' notice, on any Interest Payment Date on or after
August 30, 2000, at a redemption price equal to $.025 per Purchase Contract;
provided that no partial redemption shall result in fewer than 2,000,000
Unsettled Purchase Contracts remaining Outstanding after such redemption.
In the event that MS plc shall redeem a Debenture constituting
part of a Capital Unit pursuant to the provisions of the Indenture, the
Corporation shall redeem the Purchase Contract constituting part of the same
Capital Unit on the redemption date of such related Debenture.
In the event that MS plc shall redeem Debentures constituting
part of Capital Units pursuant to a Tax Redemption, the Corporation shall redeem
all Purchase Contracts then Outstanding on the redemption date of the
Debentures.
Subject to certain exceptions, the terms of the Purchase
Contracts and the provisions of the Capital Unit Agreement relating to or
affecting the Purchase Contracts may be amended with the consent of the affected
Holders of not less than a majority of the Outstanding Capital Units and certain
Purchase Contract Defaults may be waived with the consent of the Holders of a
majority of the Outstanding Capital Units. Without the consent of any Holder of
Capital Units, the terms of the Capital Unit Agreement relating to the Purchase
Contracts may be amended to cure any ambiguity, to correct or supplement any
provision in the Capital Unit Agreement with respect to and affecting the
Purchase Contracts, to evidence the assumption of the Corporation's covenants
with respect to or affecting the Purchase Contracts or to make any other
provisions with respect to matters or questions arising under the Capital Unit
Agreement with respect to or affecting the Purchase Contracts that do not
adversely affect the interests of the Holders in any material respect.
Holders of the Purchase Contracts may not enforce the Capital
Unit Agreement or such Purchase Contracts except as provided in the Capital Unit
Agreement.
An incorporator, or past, present or future stockholder,
officer, attorney-in-fact or director, as such, of the Corporation or MS plc
shall not have any liability for any obligations of the Corporation or MS plc
under the Purchase Contracts or the Capital Unit Agreement or for any claim
based on, with respect to or by reason of such obligations or their creation.
The Holder by his acceptance hereof waives and releases all such liability. The
waiver and release are part of the consideration for the issue of the Purchase
Contracts.
All capitalized terms used but not defined herein that are
defined in the Capital Unit Agreement have the meanings set forth therein.
<PAGE>
5
The Purchase Contracts shall for all purposes be governed by,
and construed in accordance with, the laws of the State of New York.
Prior to due presentment of a Capital Unit Certificate or Global
Purchase Contract for registration of transfer, MS plc, the Corporation, the
Trustee, the Book-Entry Unit Depositary and the Agent, and any agent of MS plc,
the Corporation, the Trustee, the Book-Entry Unit Depositary or the Agent may
treat the Person in whose name this Purchase Contract is registered as a party
to the Purchase Contracts evidenced hereby for the purpose of performance of
such Purchase Contracts and for all other purposes whatsoever, and none of MS
plc, the Corporation, the Trustee, the Book-Entry Unit Depositary or the Agent,
nor any such agent shall be affected by notice to the contrary.
The Holder, by his acceptance hereof, authorizes the Agent to
execute the Purchase Contracts evidenced hereby on his behalf, authorizes and
directs the Agent on his behalf to take such other action, and covenants and
agrees to take such other action, as may be necessary or appropriate, or as may
be required by the Agent, to effectuate the provisions of the Capital Unit
Agreement relating to the purchase of Depositary Shares, appoints the agent as
his attorney-in-fact for any and all such purposes, and agrees to be bound by
the terms thereof.
_______________
The Purchase Contracts shall not, prior to the performance
thereof, entitle the Holder to any of the rights of a holder of Depositary
Shares, Preferred Stock or any other shares of capital stock of the Corporation.
No Purchase Contract evidenced hereby shall be valid or
obligatory for any purpose until countersigned by the Agent by manual signature.
<PAGE>
6
IN WITNESS WHEREOF, Morgan Stanley Group Inc. has caused this
instrument to be duly executed.
Dated: ________________________ MORGAN STANLEY GROUP INC.
By: ________________________
CHEMICAL BANK, as Agent and
as attorney-in-fact of
the Holder hereof
By: ________________________
Authorized Officer
Countersigned:
CHEMICAL BANK,
as Agent
By: ________________________
Authorized Officer
<PAGE>
7
[FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers 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 Capital Unit, and all rights thereunder, hereby irrevocably
constituting and appointing
- ---------------------------------------
attorney to transfer such security on the books of the Corporation, with full
power of substitution in the premises.
Dated: __________ Signature: ____________________
NOTICE: The signature to this assignment must correspond with the name as
written upon the face of the within Capital Unit in every particular
without alteration or enlargement or any change whatsoever.]/1/
_______________
/1/ Applicable to Definitive Capital Units only.
<PAGE>
[SCHEDULE I
SCHEDULE OF INCREASES AND DECREASES
The initial number of Purchase Contracts represented by this
Global Purchase Contract is 7,000,000. The following increases and decreases in
the number of Purchase Contracts represented hereby have been made:
<TABLE>
<CAPTION>
Increase in Decrease in Total Notation
Date of Number of Number of Number of Made by or
Increase Purchase Purchase Purchase on Behalf
or Decrease Contracts Contracts Contracts of Agent
- ----------- ----------- ----------- --------- ----------
<S> <C> <C> <C> <C>
- ----------- ----------- ----------- --------- ----------
- ----------- ----------- ----------- --------- ----------
- ----------- ----------- ----------- --------- ----------
- ----------- ----------- ----------- --------- ----------
- ----------- ----------- ----------- --------- ----------
- ----------- ----------- ----------- --------- ----------
- ----------- ----------- ----------- --------- ----------
- ----------- ----------- ----------- --------- ----------
- ----------- ----------- ----------- --------- ----------
- ----------- ----------- ----------- --------- ----------
- ----------- ----------- ----------- --------- ----------
- ----------- ----------- ----------- --------- ----------
- ----------- ----------- ----------- --------- ----------
- ----------- ----------- ----------- --------- ----------
- ----------- ----------- ----------- --------- ----------
- ----------- ----------- ----------- --------- ----------
- ----------- ----------- ----------- --------- ----------
- ----------- ----------- ----------- --------- ----------
- ----------- ----------- ----------- --------- ----------
- ----------- ----------- ----------- --------- ----------
- ----------- ----------- ----------- --------- ----------
- ----------- ----------- ----------- --------- ----------
- ----------- ----------- ----------- --------- ----------
]/1/
- ----------- ----------- ----------- --------- ----------
</TABLE>
_______________
/1/ Applicable to Global Purchase Contract only.
<PAGE>
Exhibit 23.1
[Letterhead of Shearman & Sterling]
August 1, 1995
Morgan Stanley Group Inc.
Morgan Stanley Finance plc
c/o Morgan Stanley Group Inc.
1251 Avenue of the Americas
New York, New York 10020
Morgan Stanley Group Inc.
Morgan Stanley Finance plc
8.40% Capital Units
--------------------------
Ladies and Gentlemen:
We have acted as special tax counsel to Morgan Stanley Group Inc. and
Morgan Stanley Finance plc (the "Registrants") in connection with the
preparation and filing with the Securities and Exchange Commission under the
Securities Act of 1933, as amended, of a Prospectus Supplement dated July 27,
1995 contained in the Registrants' Registration Statement on Form S-3
(Registration No. 33-58611) (the "Registration Statement").
We are of the opinion that the discussion in the Prospectus Supplement
under the caption "Certain Tax Considerations," insofar as it relates to
statements of law or legal conclusions under the laws of the United States or
matters of United States law fairly presents the information called for and
fairly summarizes the matters referred to therein.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement.
Very truly yours,
/s/ Shearman & Sterling
<PAGE>
Exhibit 23.2
[Letterhead of Linklater & Paines]
August 1, 1995
Morgan Stanley Group Inc.
Morgan Stanley Finance plc
c/o Morgan Stanley Group Inc.
1251 Avenue of the Americas
New York, New York 10020
Dear Sirs:
Morgan Stanley Finance plc
--------------------------
We have acted as English legal advisers to Morgan Stanley Finance plc
(the "Registrant") in connection with the preparation and filing with the
Securities and Exchange Commission under the Securities Act of 1933, as amended,
of a Prospectus Supplement dated July 27, 1995 contained in the Registrant's
Registration Statement on Form S-3 (Registration No. 33-58611) (the
"Registration Statement").
We are of the opinion that the discussion in the Prospectus Supplement under the
caption "Certain Tax Considerations," insofar as it relates to statements of law
or legal conclusions under the laws of the United Kingdom or matters of United
Kingdom law fairly presents the information called for and fairly summarises the
matters referred to therein.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement.
Yours faithfully,
/s/ Linklaters & Paines
Linklaters & Paines
- -------------------
