Exhibit 10.2
1585 Broadway
New York, NY 10036
[Morgan Stanley]
[Logo Omitted]
June 30, 2005
Re: Letter Agreement
----------------
Dear Stephen:
In light of your key role with Morgan Stanley (the "Company")
and
in order to mitigate the uncertainties that
you may be experiencing regarding
your future with the Company, the Company
wishes to offer you the following
arrangement regarding your compensation for
the Company's 2005 and 2006 fiscal
years (the "Agreement").
Subject to your continued employment with the Company through
the
end of the Company's 2006 fiscal year, the
Company hereby agrees that the
aggregate of the annual base salary, annual
bonus and long-term incentive
compensation (the "Total Compensation")
payable to you by the Company during
each of the Company's 2005 and 2006 fiscal
years shall be at least equal to
$16,000,000 (the "Target Compensation
Amount"). Notwithstanding the foregoing,
in the event that, prior to the time at
which the full amount of the Target
Compensation Amount is paid to you with
respect to the Company's 2005 and 2006
fiscal years, your employment with the
Company is terminated by the Company
without Cause (as defined below) or you
resign for Good Reason (as defined
below), subject to your execution and
non-revocation of the Company's standard
form of settlement and release agreement,
you shall be entitled to payment of
the Target Compensation Amount in cash
(less any amount of such compensation
already paid to you) at such time as the
components of the Target Compensation
Amount would have been paid to you had you
remained employed by the Company
through the date on which such amounts
would otherwise have been paid to you.
In addition, your 1999 Year-end
Stock Option Award and 2003 Special
Stock Option Award will continue to vest
and remain exercisable for their full
10 year term. You will be provided with
continued medical coverage at an
initial cost to you of $14,410 per year
until you obtain alternative coverage
from another employer. You will also be
treated as have attained age 55 for
purposes of determining your e
