-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, GLpgl2Cf0UauthbmeGcsGUG6YVCiXiBkhKj1S73EZImzyDEnv/DB87RQq+EAl0TQ 2kXfiOOtBpqMEcf38PQruA== 0000950103-96-000738.txt : 19960227 0000950103-96-000738.hdr.sgml : 19960227 ACCESSION NUMBER: 0000950103-96-000738 CONFORMED SUBMISSION TYPE: 424B3 PUBLIC DOCUMENT COUNT: 1 FILED AS OF DATE: 19960223 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: MORGAN STANLEY GROUP INC /DE/ CENTRAL INDEX KEY: 0000789625 STANDARD INDUSTRIAL CLASSIFICATION: SECURITY BROKERS, DEALERS & FLOTATION COMPANIES [6211] IRS NUMBER: 132838811 STATE OF INCORPORATION: DE FISCAL YEAR END: 0131 FILING VALUES: FORM TYPE: 424B3 SEC ACT: 1933 Act SEC FILE NUMBER: 033-57833 FILM NUMBER: 96524986 BUSINESS ADDRESS: STREET 1: 1585 BROADWAY CITY: NEW YORK STATE: NY ZIP: 10036 BUSINESS PHONE: 2127034000 424B3 1 PROSPECTUS Dated March 29, 1995 Pricing Supplement No. 43 to PROSPECTUS SUPPLEMENT Registration Statement No. 33-57833 Dated March 29, 1995 February 15, 1996 Rule 424(b)(3) $60,000,000 Morgan Stanley Group Inc. GLOBAL MEDIUM-TERM NOTES, SERIES D EURO FIXED RATE SENIOR BEARER CASH EXCHANGEABLE NOTES DUE MARCH 6, 2002 Exchangeable for an Amount in U.S. Dollars Determined by Reference to the Market Price of the Ordinary Shares of the DAIMLER-BENZ CORPORATION The Global Medium-Term Notes, Series D (Euro Fixed Rate Senior Bearer Cash Exchangeable Notes Due March 6, 2002) described in this Pricing Supplement (the "Notes") will not be redeemable at the option of Morgan Stanley Group Inc. (the "Company") prior to the Maturity Date other than as described below or under the circumstances described under "Description of Notes - Tax Redemption" in the accompanying Prospectus Supplement. The Notes will be issued only in bearer form, which form is further described under "Description of Notes - Forms, Denominations, Exchange and Transfer" in the accompanying Prospectus Supplement. Notes in bearer form will not be exchangeable at any time for Notes in registered form at the option of the holder. The Notes will bear interest at the rate of 2.75% per annum payable annually on March 6 of each year (each an "Interest Payment Date") commencing March 6, 1997. The Notes will be issued in minimum denominations of $1,000 and will mature on March 6, 2002. The Maturity Date of the Notes may be accelerated under the limited circumstances described in paragraph 5 of "Adjustments to the Share Exchange Ratio" in this Pricing Supplement. On any Exchange Date, the holder of a Note will have the right (the "Exchange Right"), upon completion by the holder and acknowledgment by the Company and the Calculation Agent of an Official Notice of Exchange prior to 11:00 a.m. London time on such date, to exchange each $1,000 principal amount of such Note for an amount in U.S. Dollars equal to the Market Price on such date of 1.59 ordinary shares (as further defined herein, the "Share Exchange Ratio") of Daimler-Benz Corporation ("Daimler-Benz") converted into U.S. Dollars at the Currency Exchange Rate on such date. The Share Exchange Ratio will be adjusted for certain corporate events. See "Adjustments to Share Exchange Ratio" in this Pricing Supplement. An Exchange Date will be any day that is both a London Stock Exchange Trading Day and a Frankfurt Stock Exchange Trading Day that falls during the period beginning 30 days after the Original Issue Date and ending on the day prior to the earlier of the Maturity Date and any redemption date. On or after March 9, 1998, the Company may call the Notes, in whole but not in part, upon not less than 30 nor more than 60 days notice, at a redemption price equal to the principal amount thereof plus accrued and unpaid interest to but not including the redemption date. Daimler-Benz is neither affiliated with the Company nor involved in this offering of the Notes. The Market Price of the ordinary shares of Daimler-Benz on the date of this Pricing Supplement converted into U.S. Dollars at the rate of 1.4713DM per $1 was $546.80 (the "Initial U.S. Dollar Market Price"). The Company will cause any adjustments to the Share Exchange Ratio to be determined by the Calculation Agent for Chemical Bank, as Trustee under the Senior Debt Indenture. The Notes are further described below and in the Prospectus Supplement under "Description of Notes - Fixed Rate Notes" and "- Notes Linked to Commodity Prices, Equity Indices or Other Factors." An investment in the Notes entails risks not associated with similar investments in a conventional debt security, as described under "Risk Factors" on PS-5 and PS-6 herein. Application has been made to list the Notes on the London Stock Exchange. It is not possible to know whether the Notes will trade in the secondary market or if such market will be liquid or illiquid. MORGAN STANLEY & CO. International Capitalized terms not defined herein have the meanings given to such terms in the accompanying Prospectus Supplement. Principal Amount:.............. $60,000,000 Maturity Date:................. March 6, 2002, subject to acceleration under the limited circumstances described under paragraph 5 of "Adjustments to the Share Exchange Ratio." Specified Currency:............ U.S. Dollars. Unless other specified, in this Pricing Supplement all references to (i) "$" are to U.S. Dollars and (ii) "marks" or "DM" are to the German mark, the legal currency of the Federal Republic of Germany. Interest Rate:................. 2.75% per annum Interest Payment Dates:........ March 6 in each year, commencing March 6, 1997 Issue Price:................... 100% Original Issue Date (Settlement Date):............. March 6, 1996 Senior Note or Subordinated Note:.......................... Senior Minimum Denominations:......... $1,000 Trustee:....................... Chemical Bank, N.A. (London branch) Clearing Systems:.............. The Notes will be deposited with a common depositary for the Euroclear Operator and Cedel, for credit to the account designated by or on behalf of the subscribers thereof. Common Code:................... 6422314 ISIN:.......................... XS0064223141 Exchange Right:................ On any Exchange Date, the holders of Notes will be entitled upon completion by the holder and delivery to the Company and the Calculation Agent of an Official Notice of Exchange (in the form of Annex A attached hereto) prior to 11:00 a.m. London time on such date and acknowledgment of such notice by the Company and the Calculation Agreement and delivery on such date of such Notes to the Trustee, to exchange each $1,000 principal amount of Notes for an amount in U.S. Dollars equal to the Market Price on such date of 1.59 Ordinary Shares (the "Share Exchange Ratio ") of Daimler-Benz, subject to adjustment as described under "Adjustments to the Share Exchange Ratio" below, converted into U.S. Dollars at the Currency Exchange Rate on such date. Upon the exercise of such Exchange Right, holders of such exchanged Notes shall not be entitled to receive accrued but unpaid interest thereon except as provided under "Redemption of the Notes" below. Such payment will be made 3 Business Days after any Exchange Date, subject to delivery of such Notes to the Trustee on the Exchange Date. If the beneficial owner of a Note or an interest therein holds such Note or interest via the Euroclear Operator or Cedel, any such notice of exchange must be given to the Company via the Euroclear Operator or Cedel, as the case may be, in which case, such beneficial owner will be required to complete and deliver such Official Notice of Exchange to the Euroclear Operator or Cedel, prior to 9:00 a.m. London time on the Business Day prior to such Exchange Date (or at such other time as may be required by the then applicable operating procedures of the relevant clearing system) to permit the Euroclear Operator or Cedel, as holders of Notes, to comply with the conditions on the exercise of the Exchange Right described above. If an Official Notice of Exchange is received by the Company after 11:00 a.m. London time on any Exchange Date, such notice will be treated as having been received prior to 11:00 a.m. London time on the immediately succeeding Exchange Date, provided that such date is prior to the earlier of the Maturity Date and any redemption date. The Company shall, or shall cause the Calculation Agent to, deliver such cash to the Trustee for delivery to the holders. Share Exchange Ratio........... 1.59, subject to adjustment for certain corporate events. See "Adjustments to Share Exchange Ratio" below. Exchange Date.................. Any day that is both a London Stock Exchange Trading Day and a Frankfurt Stock Exchange Trading Day and that falls during the period beginning 30 days after the Original Issue Date and ending on the day prior to the earlier of the Maturity Date and any redemption date. Redemption of the Notes........ The Notes are not redeemable at the option of the Company prior to the Maturity Date other than as described below or under the circumstances described under "Description of Notes - Tax Redemption" in the accompanying Prospectus Supplement. On or after March 9, 1998, the Company may redeem the Notes, in whole but not in part, upon not less than 30 nor more than 60 days notice, at a redemption price equal to 100% of the principal amount thereof plus accrued and unpaid interest to, but not including, the redemption date. Notice of any such redemption will be given as described under "Optional Redemption" in the accompanying Prospectus Supplement. If the Notes are so called for redemption, the cash to be delivered to holders of Notes will be delivered on the redemption date. The Company shall, or shall cause the Calculation Agent to, deliver such cash to the Trustee for delivery to the holders. Holders of the Notes will continue to be entitled to exercise the Exchange Right and receive any amounts described under "Exchange Right" above; provided, however, that during the period beginning on the day the Company provides its notice of redemption and ending at 11:00 a.m. London time on the Exchange Date immediately preceding the redemption date, holders will also be entitled to receive accrued and unpaid interest to, but not including, the redemption date on any Notes so exchanged. Market Price:.................. The Market Price for any Exchange Date means the official closing price for the Ordinary Shares as reported by the Frankfurt Stock Exchange. If the official closing price is not available pursuant to the preceding sentence, the Market Price for any Exchange Date shall be the mean, as determined by the Calculation Agent, of the bid prices for the Ordinary Shares obtained from as many dealers in such shares, but not exceeding three, as will make such bid prices available to the Calculation Agent after 1:30 p.m. Frankfurt time on such Exchange Date. Ordinary Shares:............... The ordinary shares, nominal value DM 50 per share, of Daimler-Benz. Currency Exchange Rate:........ For any Exchange Date, the Currency Exchange Rate between the mark and the U.S. Dollar shall be determined by the Calculation Agent by obtaining the mark/U.S. Dollar Exchange Rate for such day from Reuter's Page "WMRH" (or, any successor page) at approximately 4:00 p.m. London time (the "Reuter's Quote"); provided that if no Reuter's Quote is shown for such day, the Currency Exchange Rate between the mark and the U.S. Dollar shall be determined by the Calculation Agent by obtaining the mark/U.S. Dollar Exchange Rate (at which a leading foreign exchange dealer selected by the Calculation Agent (a "Reference Dealer") is willing to purchase marks and sell U.S. Dollars) for such day from three Reference Dealers at approximately 4:30 p.m. London time (or if quotes are unavailable from three Reference Dealers, from two such dealers) and calculating the arithmetic mean of such quotes. Frankfurt Stock Exchange Trading Day:.................. A day on which trading is generally conducted on the Frankfurt Stock Exchange, as determined by the Calculation Agent, and on which a Market Disruption Event has not occurred. London Stock Exchange Trading Day:.................. A day on which trading is generally conducted on the London Stock Exchange Limited (the "London Stock Exchange"), as determined by the Calculation Agent. Calculation Agent:............. Morgan Stanley & Co. International Limited ("MS & Co International"). Because the Calculation Agent is an affiliate of the Company, potential conflicts of interest may exist between the Calculation Agent and the holders of the Notes, including with respect to certain determinations and judgments that the Calculation Agent must make in making adjustments to the Share Exchange Ratio or determining the Market Price or the Currency Exchange Rate or whether a Market Disruption Event has occurred. See "Currency Exchange Rate" and "Market Price" above and "Adjustments to the Share Exchange Ratio" and "Market Disruption Event" below. MS & Co. International is obligated to carry out its duties and functions as Calculation Agent in good faith and using its reasonable judgment. Risk Factors:.................. An investment in the Notes entails significant risks not associated with similar investments in a conventional debt security, including the following: The Company is not affiliated with Daimler-Benz and, although the Company as of the date of this Pricing Supplement does not have any material non-public information concerning Daimler-Benz, corporate events of Daimler-Benz, including those described below in "Adjustments to the Share Exchange Ratio," are beyond the Company's ability to control and are difficult to predict. Daimler-Benz is not involved in the offering of the Notes and has no obligations with respect to the Notes, including any obligation to take the interests of the Company or of holders of Notes into consideration for any reason. Daimler-Benz will not receive any of the proceeds of the offering of the Notes made hereby and is not responsible for, and has not participated in, the determination of the timing of, prices for or quantities of, the Notes offered hereby. There can be no assurance as to how the Notes will trade in the secondary market or whether such market will be liquid or illiquid. It is expected that, at issuance, the Notes will be listed on the London Stock Exchange. However, there can be no assurance that the Notes will not later be delisted or that trading in the Notes on the London Stock Exchange will not be suspended. In the event of a delisting or suspension of trading in the Notes, the Company will use its reasonable efforts to list the Notes on another securities exchange. The Notes will not be redeemable as a result of any such delisting or suspension of trading. If the Notes are not listed or traded on any securities exchange or if trading of the Notes is suspended, pricing information for the Notes may be more difficult to obtain, and the liquidity and market prices of the Notes may be adversely affected. The market value for the Notes will be affected by a number of factors independent of the creditworthiness of the Company and the value of the Ordinary Shares, including, but not limited to, the volatility of the Ordinary Shares, the dividend rate on the Ordinary Shares, Daimler-Benz's financial results and prospects, market interest and yield rates, the mark/U.S. Dollar exchange rate and the time remaining to any redemption date or the Maturity Date. In addition, the value of the Ordinary Shares depends on a number of interrelated factors, including economic, financial and political events in Germany and elsewhere, including factors affecting capital markets generally, the stock exchanges on which the Ordinary Shares are traded and the market segment of which Daimler-Benz is a part. The market value of the Notes is expected to depend in part on the extent of the appreciation, if any, of the U.S. Dollar equivalent of the Market Price of the Ordinary Shares above the Initial U.S. Dollar Market Price. The price at which a holder will be able to sell Notes prior to maturity may be at a discount, which could be substantial, from the accreted principal amount thereof, if, at such time, the U.S. Dollar equivalent of the Market Price of the Ordinary Shares is below, equal to or not sufficiently above the Initial U.S. Dollar Market Price. The historical Market Prices of the Ordinary Shares should not be taken as an indication of the Ordinary Shares's future performance during the term of any Note. In order to exercise the Exchange Right, a holder of the Notes must complete an Official Notice of Exchange prior to the time at which the Market Price and the Currency Exchange Rate with respect to such exercise will be determined. If the beneficial owner of a Note or an interest in a Note holds such Note or interest via the Euroclear Operator or Cedel, such Official Notice of Exchange must be completed on the Business Day prior to the relevant Exchange Date (or at such other time as may be required by the then applicable operating procedures of the relevant clearing system) as further described under "Exchange Right" above. Consequently, such holder will not be able to determine, at the time of completing such Official Notice of Exchange, the exact amount due upon such exercise and will bear the risk of subsequent changes in the Market Price of the Ordinary Shares or in the Currency Exchange Rate. Fluctuations in the exchange rate between the mark and the U.S. dollar will affect the U.S. Dollar equivalent of the Market Price of the Ordinary Shares on the Frankfurt Stock Exchange and, as a result, may consequently affect the market value of the Notes. See "Currency Exchange Rate" and "Historical Currency Exchange Rates." Because the Calculation Agent is an affiliate of the Company, potential conflicts of interest may exist between the Calculation Agent and the holders of the Notes, including with respect to certain determinations and judgments that the Calculation Agent must make in making adjustments to the Share Exchange Ratio or determining the Market Price or the Currency Exchange Rate or whether a Market Disruption Event has occurred that may influence the amount of cash receivable upon exercise of the Exchange Right. See "Currency Exchange Rate" and "Market Price" above and "Adjustments to the Share Exchange Ratio" and "Market Disruption Event" below. It is suggested that prospective investors who consider purchasing the Notes should reach an investment decision only after carefully considering the suitability of the Notes in light of their particular circumstances. Investors should also consider the tax consequences of investing in the Notes. See "United States Federal Taxation - Foreign Holders" in the accompanying Prospectus Supplement. Adjustments to the Share Exchange Ratio:................ The Share Exchange Ratio will be adjusted as follows: 1. If the Ordinary Shares are subject to a stock split (an increase in the number of Ordinary Shares without any increase in capital) or reverse stock split (a reduction in the number of Ordinary Shares without any decrease in capital) or a reduction of capital by consolidating Ordinary Shares or by redeeming, without payment, Ordinary Shares, then once such split or reduction has become effective, the Share Exchange Ratio will be adjusted to equal the product of the prior Share Exchange Ratio and the number of shares issued or redeemed in such stock split or reverse stock split with respect to one Ordinary Share. 2. If the Ordinary Shares are subject to a stock dividend (an "Ordinary Share Stock Dividend") (an increase of Ordinary Shares from Daimler-Benz reserves, but excluding any Ordinary Shares or other securities or other distribution of assets in specie in lieu of a cash dividend (a "Scrip Dividend")) that is given ratably to all holders of Ordinary Shares, then once the Ordinary Share Stock Dividend has become effective and the Ordinary Shares are trading ex-dividend, the Share Exchange Ratio will be adjusted so that the new Share Exchange Ratio shall equal the prior Share Exchange Ratio plus the product of (i) the number of shares issued with respect to one Ordinary Share and (ii) the prior Share Exchange Ratio. 3. If the Ordinary Shares are subject to any other stock dividend (a "Non-Ordinary Share Stock Dividend") (an increase of shares or an issue of securities other than Ordinary Shares (or securities described in paragraph 5 or 6 below) from Daimler-Benz reserves, but excluding any Scrip Dividend) that is given ratably to all holders of Ordinary Shares, then once such Non-Ordinary Share Stock Dividend has become effective and the Ordinary Shares are trading ex-dividend, the Share Exchange Ratio will be adjusted to equal the product of the prior Share Exchange Ratio times a fraction, the numerator of which shall be the Market Price of one Ordinary Share on the Frankfurt Stock Exchange Trading Day immediately preceding the date on which such Non-Ordinary Share Stock Dividend is announced and the denominator of which shall be (x) the Market Price of one Ordinary Share on the Frankfurt Stock Exchange Trading Day immediately preceding the date on which such Non-Ordinary Share Stock Dividend is announced less (y) the fair market value on the date of such announcement of the Non-Ordinary Share Stock Dividend per Ordinary Share, as determined in good faith by the Calculation Agent. 4. There will be no adjustments to the Share Exchange Ratio to reflect cash dividends or Scrip Dividends or other distributions paid with respect to the Ordinary Shares other than distributions described in paragraph 1, 2 or 3 above or in paragraph 5 or 6 or in clause (v) of paragraph 7 below and Extraordinary Dividends as described below. A cash dividend or other distribution with respect to the Ordinary Shares will be deemed to be an "Extraordinary Dividend" if such dividend or other distribution exceeds the immediately preceding non-Extraordinary Dividend for the Ordinary Shares by an amount equal to at least 10% of the Market Price of the Ordinary Shares on the Frankfurt Stock Exchange Trading Day preceding the ex-dividend date for the payment of such Extraordinary Dividend (the "ex-dividend date"). If an Extraordinary Dividend occurs with respect to the Ordinary Shares, the Share Exchange Ratio with respect to the Ordinary Shares will be adjusted on the ex-dividend date with respect to such Extraordinary Dividend so that the new Share Exchange Ratio will equal the product of (i) the then current Share Exchange Ratio and (ii) a fraction, the numerator of which is the Market Price on the Frankfurt Stock Exchange Trading Day preceding the ex-dividend date, and the denominator of which is the amount by which the Market Price on the Frankfurt Stock Exchange Trading Day preceding the ex-dividend date exceeds the Extraordinary Dividend Amount. The "Extraordinary Dividend Amount" with respect to an Extraordinary Dividend for the Ordinary Shares will equal (i) in the case of cash dividends or other distributions that constitute annual dividends, the amount per share of such Extraordinary Dividend minus the amount per share of the immediately preceding non-Extraordinary Dividend for the Ordinary Shares or (ii) in the case of cash dividends or other distributions that do not constitute annual dividends, the amount per share of such Extraordinary Dividend. To the extent an Extraordinary Dividend is not paid in cash, the value of the non-cash component will be determined by the Calculation Agent, whose determination shall be conclusive. A distribution on the Ordinary Shares described in paragraph 1, 2 or 3 above or in paragraph 5 or 6 or in clause (v) of paragraph 7 below that also constitutes an Extraordinary Dividend shall only cause an adjustment to the Share Exchange Ratio pursuant to paragraph 1, 2 or 3 above or in paragraph 5 or 6 or in clause (v) of paragraph 7 below, as the case may be. 5. If Daimler-Benz increases its share capital by issuing new Ordinary Shares against contributions by granting direct or indirect rights to all or substantially all of the holders of its Ordinary Shares ("Ordinary Share rights issues") or grants to all or substantially all holders of its Ordinary Shares directly or indirectly an option or warrant to subscribe or purchase Ordinary Shares ("Ordinary Share warrants issues") at an issue or exercise price per Ordinary Share less than the Market Price of the Ordinary Shares on the first Frankfurt Stock Exchange Trading Day on which such Ordinary Shares are listed "ex-rights" or "ex-warrants" (the "ex-date") and the ex-date precedes the earlier of the applicable Exchange Date and the Maturity Date of the Notes, then the Share Exchange Ratio will be adjusted to equal the product of the prior Share Exchange Ratio and a fraction, the numerator of which shall be the number of Ordinary Shares outstanding on the date of issuance of such rights or warrants, immediately prior to such issuance, plus the number of additional Ordinary Shares offered for subscription or purchase pursuant to such rights or warrants and the denominator of which shall be the number of Ordinary Shares outstanding on the date of issuance of such rights or warrants, immediately prior to such issuance, plus the number of additional Ordinary Shares which the aggregate amount payable to subscribe or purchase the total number of Ordinary Shares so offered for subscription or purchase pursuant to such rights or warrants would purchase at the Market Price on the ex-date of such rights or warrants, which shall be determined by multiplying such total number of shares offered by the exercise price of such rights or warrants and dividing the product so obtained by such Market Price. 6. If Daimler-Benz or any of its subsidiaries (i) issues any securities (other than Ordinary Shares or options, warrants or other rights to subscribe for or purchase Ordinary Shares) by granting direct or indirect rights to all or substantially all of the holders of its Ordinary Shares ("Non-Ordinary Share rights issues") or (ii) grants to all or substantially all holders of its Ordinary Shares directly or indirectly an option or warrant to subscribe for or purchase any securities other than Ordinary Shares or options, warrants or other rights to subscribe for or purchase Ordinary Shares ("Non-Ordinary Share warrants issues") and the ex-date precedes the earlier of the applicable Exchange Date and the Maturity Date of the Notes, then the Share Exchange Ratio will be adjusted on the ex-date to equal the product of the prior Share Exchange Ratio and a fraction, the numerator of which shall be the Market Price of one Ordinary Share on the Frankfurt Stock Exchange Trading Day immediately preceding the date on which such Non-Ordinary Share rights issue or Non-Ordinary Share warrants issue is announced and the denominator of which shall be (x) the Market Price of one Ordinary Share on the Frankfurt Stock Exchange Trading Day immediately preceding the date on which such Non-Ordinary Share rights issue or Non-Ordinary Share warrants issue is announced less (y) the fair market value on the date of such announcement of the portion of such Non- Ordinary Share rights issue or Non- Ordinary Share warrants issue attributable to one Ordinary Share, as determined in good faith by the Calculation Agent. 7. If (i) there occurs any reclassification or change of Ordinary Shares or other Exchange Property (as defined below) consisting of equity securities, (ii) Daimler-Benz, or any surviving entity or subsequent surviving entity of Daimler-Benz (a "Daimler-Benz Successor") has been subject to a merger, combination or consolidation and is not the surviving entity, (iii) any statutory exchange of securities of Daimler-Benz or any Daimler-Benz Successor with another corporation occurs (other than pursuant to clause (ii) above), (iv) Daimler-Benz or any Daimler-Benz Successor is liquidated, (v) Daimler-Benz or any Daimler-Benz Successor issues to all of its shareholders equity securities of an issuer other than Daimler-Benz or such Daimler-Benz Successor (other than in a transaction described in clauses (ii), (iii) or (iv) above) (a "Spin-off Event"), (vi) a tender or exchange offer by Daimler-Benz or any Daimler-Benz Successor is consummated for some or all of the outstanding Ordinary Shares or other Exchange Property consisting of equity securities or (vii) Ordinary Shares (or other kinds of Exchange Property) are nationalized, expropriated or otherwise required to be transferred to any governmental agency authority or entity (any such event in clauses (i) through (vii) a "Reorganization Event"), the method of determining the amount payable upon exchange pursuant to the exercise of the Exchange Right will be adjusted to provide that each exchanging holder of Notes will receive, in respect of the principal amount of such Notes, an amount in U.S. Dollars equal to the product of (x) the Share Exchange Ratio and (y) the Transaction Value (as defined below) per Ordinary Share of any securities, cash or any other assets distributed in any such Reorganization Event, including, in the case of a Spin-off Event, the Market Price on the Exchange Date of the Ordinary Share (or market value on the Exchange Date of any other equity security that comprises Exchange Property) with respect to which the spun-off security was issued (collectively, the "Exchange Property"); provided that, if upon consummation of any such Reorganization Event the Exchange Property consists only of cash, the maturity date of the Notes will be deemed to be accelerated to the date on which such cash is distributed to holders of Ordinary Shares. "Transaction Value" means (i) for any cash received in any such Reorganization Event, the amount of cash received per Ordinary Share, (ii) for any property other than cash or securities received in any such Reorganization Event, the market value of such Exchange Property received for each Ordinary Share at the date of the receipt of such Exchange Property, as determined by the Calculation Agent, and (iii) for any security received in any such Reorganization Event, an amount equal to the market price per share of such security on the applicable Exchange Date, multiplied by the quantity of such security received for each Ordinary Share, as such amounts in clauses (i) through (iii) are converted to U.S. Dollars at the currency Exchange Rate (or, if the value of such cash or property is not determined in marks, at an exchange rate determined in good faith by the Calculation Agent) applicable on the date such Transaction Value is determined. For purposes of paragraph 7 above, in the case of a consummated tender or exchange offer by Daimler-Benz or any Daimler-Benz Successor for some or all Exchange Property of a particular type, Exchange Property shall be deemed to include the amount of cash or other property paid by the offeror in the tender or exchange offer with respect to such Exchange Property (in an amount determined on the basis of the rate of exchange on the date such tender or exchange offer is consummated). In the event of a partial tender or exchange offer by Daimler-Benz with respect to the Ordinary Shares, the Exchange Property will be deemed to include cash or other property paid by Daimler-Benz in the tender or exchange offer in an amount determined as if Daimler-Benz had purchased or exchanged Ordinary Shares in the proportion in which all Ordinary Shares were purchased or exchanged from the holders thereof. In the event of a tender or exchange offer with respect to Exchange Property in which an offeree may elect to receive cash or other property, Exchange Property shall be deemed to include the kind and amount of cash and other property received by offerees who elect to receive cash. 8. If more than one of the events set out above occurs, the adjustments to the Share Exchange Ratio for the second and subsequent events shall be to the Share Exchange Ratio as adjusted for preceding events. No adjustments to the Share Exchange Ratio will be required unless such adjustment would require a change of at least 0.1% in the Share Exchange Ratio then in effect. The Share Exchange Ratio resulting from any of the adjustments specified above will be rounded to the nearest one thousandth with five ten-thousandths being rounded upward. No adjustments to the Share Exchange Ratio will be required other than those specified above. However, the Company may, at its sole discretion, cause the Calculation Agent to make additional adjustments to the Share Exchange Ratio to reflect changes occurring in relation to the Ordinary Shares or any other Exchange Property in other circumstances where the Company determines that such changes are appropriate. The adjustments specified above do not cover all events that could affect the Market Price of the Ordinary Shares. The Calculation Agent shall be solely responsible for the determination and calculation of any adjustments to the Share Exchange Ratio and of any related determinations, calculations or valuations with respect to any distributions of stock, other securities or other property or assets (including cash) in connection with any corporate event described in paragraph 7 above, and its determinations, calculations and valuations with respect thereto shall be conclusive. The Calculation Agent will provide information as to any adjustments to the Share Exchange Ratio upon written request by any holder of the Notes. Market Disruption Event:....... "Market Disruption Event" means, with respect to the Ordinary Shares: (i) a suspension, absence or material limitation of trading of the Ordinary Shares on the primary market for the Ordinary Shares for more than two hours of trading or during the one-half hour period preceding the close of trading in such market; or the suspension or material limitation on the primary market for trading in options contracts related to the Ordinary Shares, if available, during the one-half hour period preceding the close of trading in the applicable market, in each case as determined by the Calculation Agent in its sole discretion; and (ii) a determination by the Calculation Agent in its sole discretion that the event described in clause (i) above materially interfered with the ability of the Company or any of its affiliates to unwind all or a material portion of the hedge with respect to the Notes. For purposes of determining whether a Market Disruption Event has occurred: (1) a limitation on the hours or number of days of trading will not constitute a Market Disruption Event if it results from an announced change in the regular business hours of the relevant exchange, (2) a decision to permanently discontinue trading in the relevant contract will not constitute a Market Disruption Event, (3) a suspension of trading in an options contract on the Ordinary Shares by the primary securities market trading in such options, if available, by reason of (x) a price change exceeding limits set by such securities exchange or market, (y) an imbalance of orders relating to such contracts or (z) a disparity in bid and ask quotes relating to such contracts will constitute a suspension or material limitation of trading in options contracts related to the Ordinary Shares and (4) an "absence of trading" on the primary securities market on which options contracts related to the Ordinary Shares are traded will not include any time when such securities market is itself closed for trading under ordinary circumstances. Daimler-Benz; Ordinary Shares; Public Information............. According to publicly available documents, Daimler-Benz, a corporation organized under the laws of Germany, is engaged, together with its subsidiaries, in manufacturing passenger cars, commercial vehicles, rail systems, energy systems, aircraft, space systems, defense and civil systems and is also engaged in information technology services. The Ordinary Shares (and related American depositary shares) are registered under the Securities Exchange Act of 1934, as amended (the "Exchange Act"). Companies with securities registered under the Exchange Act are required to file periodically certain financial and other information specified by the Securities and Exchange Commission (the "Commission"). Information provided to or filed with the Commission is available at the offices of the Commission specified under "Available Information" in the accompanying Prospectus. In addition, information regarding Daimler-Benz may be obtained from other sources including, but not limited to, press releases, newspaper articles and other publicly disseminated documents. The Company makes no representation or warranty as to the accuracy or completeness of such reports. Such information is not incorporated by reference herein. THIS PRICING SUPPLEMENT RELATES ONLY TO THE NOTES OFFERED HEREBY AND DOES NOT RELATE TO THE ORDINARY SHARES OR OTHER SECURITIES OF DAIMLER-BENZ. ALL DISCLOSURES CONTAINED IN THIS PRICING SUPPLEMENT REGARDING DAIMLER-BENZ ARE DERIVED FROM THE PUBLICLY AVAILABLE DOCUMENTS DESCRIBED IN THE PRECEDING PARAGRAPH. NEITHER THE COMPANY NOR THE AGENT HAS PARTICIPATED IN THE PREPARATION OF SUCH DOCUMENTS OR MADE ANY DUE DILIGENCE INQUIRY WITH RESPECT TO THE INFORMATION PROVIDED THEREIN. NEITHER THE COMPANY NOR THE AGENT MAKES ANY REPRESENTATION THAT SUCH PUBLICLY AVAILABLE DOCUMENTS OR ANY OTHER PUBLICLY AVAILABLE INFORMATION REGARDING DAIMLER- BENZ ARE ACCURATE OR COMPLETE. FURTHERMORE, THERE CAN BE NO ASSURANCE THAT ALL EVENTS OCCURRING PRIOR TO THE DATE HEREOF (INCLUDING EVENTS THAT WOULD AFFECT THE ACCURACY OR COMPLETENESS OF THE PUBLICLY AVAILABLE DOCUMENTS DESCRIBED IN THE PRECEDING PARAGRAPH) THAT WOULD AFFECT THE TRADING PRICE OF THE ORDINARY SHARES (AND THEREFORE THE INITIAL U.S. DOLLAR MARKET PRICE AND THE SHARE EXCHANGE RATIO) HAVE BEEN PUBLICLY DISCLOSED. SUBSEQUENT DISCLOSURE OF ANY SUCH EVENTS OR THE DISCLOSURE OF OR FAILURE TO DISCLOSE MATERIAL FUTURE EVENTS CONCERNING DAIMLER-BENZ COULD AFFECT THE VALUE RECEIVED ON ANY EXCHANGE DATE WITH RESPECT TO THE NOTES AND THEREFORE THE TRADING PRICES OF THE NOTES. NEITHER THE COMPANY NOR ANY OF ITS AFFILIATES MAKES ANY REPRESENTATION TO ANY PURCHASER OF NOTES AS TO THE PERFORMANCE OF THE ORDINARY SHARES. The Company or its affiliates may presently or from time to time engage in business with Daimler-Benz including extending loans to, or making equity investments in, Daimler-Benz or providing advisory services to Daimler-Benz, including merger and acquisition advisory services. In the course of such business, the Company or its affiliates may acquire non-public information with respect to Daimler-Benz and, in addition, one or more affiliates of the Company may publish research reports with respect to Daimler- Benz. The Company does not make any representation to any purchaser of Notes with respect to any matters whatsoever relating to Daimler-Benz. Any prospective purchaser of a Note should undertake an independent investigation of Daimler-Benz as in its judgment is appropriate to make an informed decision with respect to an investment in the Ordinary Shares. Historical Information......... According to publicly available documents, the capital stock of Daimler-Benz consists solely of Ordinary Shares with a nominal value of DM 50 each, which are issued only in bearer form. The principal trading market of the Ordinary Shares is the Frankfurt Stock Exchange. The Ordinary Shares are also traded on the other German stock exchanges in Berlin, Bremen, Dusseldorf, Hamburg, Hannover, Munchen and Stuttgart and on the stock exchanges of Basel, Geneva, Zurich, London, Paris, Tokyo and Vienna. The following table sets forth the high and low official closing prices and average daily volume for the Ordinary Shares on the Frankfurt Stock Exchange for the periods indicated, as reported by Datastream. The table also sets out the gross annual dividends per Ordinary Share, as reported by Bloomberg Financial Markets. Such high and low official closing prices and the gross annual dividends are stated in marks. See "Risk Factors - Currency Exchange Rates" for information with respect to exchange rates applicable during the periods set forth below.
Price (in U.S. Gross Dollars) Annual Cash Per Ordinary Share<1> Per Ordinary Share Dividend (in Average Daily ------------------------------- ---------------------------- Marks) per Volume High Low High Low Ordinary Share<2> (000's)<1> ------------------------------- ---------------------------- --------------------- --------------- Calendar Year 1993 20.089 First Quarter 619.66 525.90 373.06 319.70 880.3 Second Quarter 614.53 544.08 361.81 338.57 946.6 Third Quarter 757.49 595.56 461.04 351.16 953.7 Fourth Quarter 835.83 687.93 481.89 403.67 898.3 1994 11.303 First Quarter 865.97 769.15 517.49 451.19 1025.2 Second Quarter 901.04 694.00 546.58 430.92 743.0 Third Quarter 841.00 710.50 533.80 418.93 788.7 Fourth Quarter 789.00 717.10 519.08 456.46 551.6 1995 15.714 First Quarter 762.00 607.00 491.68 437.48 740.4 Second Quarter 701.00 610.00 496.95 440.85 741.6 Third Quarter 751.00 635.00 504.70 459.48 630.9 Fourth Quarter 732.50 659.00 507.41 468.94 548.3 1996 -- First Quarter 824.5 722.00 553.73 502.61 1134.5 (though February 15, 1996) ____________________ (1) Source: Datastream (2) Source: Bloomberg Financial Markets. For the years 1993, 1994 and 1995, cash dividends on the Daimler-Benz Stock (converted into U.S. Dollars on the day each dividend was declared) were $12.501, $6.821 and $11.416, respectively.
The historical information, including the market prices and average daily trading volumes listed above, has been derived from publicly disseminated information that the Company believes to be accurate. Neither the Company nor the Agent makes any representation as to the accuracy of such information. The historical prices of the Ordinary Shares should not be taken as an indication of future performance, and no assurance can be given that the price of the Ordinary Shares will increase sufficiently to cause the beneficial owners of the Notes to receive an amount in excess of the principal amount thereof. Historical Currency Exchange Rate.......................... Fluctuations in the exchange rate between the mark and the U.S. Dollar will affect the U.S. Dollar equivalent of the Market Price of the Ordinary Shares and, as a result, are likely to affect the market price of the Notes. The following table sets forth, for the periods indicated, the period-end, high, low and average exchange rates for the purchase of U.S. dollars, expressed in marks per $1. Yearly Average Exchange Rates (amounts in DM)(1) ---------------------------------------------------- Year ended Period December 31, end High Low Average ----------- ----- ---- --- ------- 1991 1.5150 1.8360 1.4457 1.6592 1992 1.6190 1.6724 1.3900 1.5614 1993 1.7365 1.7405 1.5663 1.6537 1994 1.5498 1.7649 1.4920 1.6211 1995 1.4365 1.5621 1.3530 1.4325 First Quarter 1996 (through February 15, 1996) 1.4919 1.4360 1.4658 _______________ (1) Source: Datastream On February 15, 1996, the exchange rate was DM 1.4713 per $1. The information presented in this Pricing Supplement relating to the exchange rate of the U.S. Dollar as compared to the mark is furnished as a matter of information only. The mark has been subject to fluctuations in the past and may be subject to significant fluctuations in the future. The fluctuations in the U.S. Dollar/mark exchange rate that have occurred in the past are not necessarily indicative of fluctuations in that rate that may occur over the term of the Notes. The spot exchange rates between the mark and U.S. Dollar are at any moment a result of the supply of and demand for the currencies being compared, and changes in the exchange rates result over time from the interaction of many factors directly or indirectly affecting economic and political developments in other countries. Of particular importance are rates of inflation, interest rate levels, the balance of payments and the extent of governmental surpluses or deficits in Germany and the United States, all of which are in turn sensitive to the monetary, fiscal and trade policies pursued by the governments of Germany, the United States and other countries important to international trade and finance. European Monetary Union........ Germany is a party to the treaty establishing the European Community (the "EC"), as amended by the treaty on European Union (the "Treaty"). The Treaty provides that at or before January 1, 1999, and subject to the fulfillment of certain conditions, the ECU (currently a basket or index currency valued on the basis of specified amounts of the currencies of 12 of the 15 member countries of the EC) may become a currency in its own right, replacing all or some of the 15 currencies of the member countries of the EC, including the mark. Such new single European currency is expected to be named the Euro. If, pursuant to the Treaty, the mark is replaced by a new single European currency and the Ordinary Shares are then quoted in such single European currency in conformity with legally applicable measures taken pursuant to, or by virtue of, the Treaty, the amount in U.S. Dollars to be received upon an exchange of the Notes shall be calculated by reference to the U.S. Dollar equivalent of the single European currency Market Price of the Ordinary Shares. The spot exchange rates between such new single European currency and the U.S. Dollar would be affected by economic and political developments throughout those member countries of the EC participating in the European monetary union. Use of Proceeds and Hedging:... The net proceeds to be received by the Company from the sale of the Notes will be used for general corporate purposes and, in part, by the Company or one or more of its affiliates in connection with hedging the Company's obligations under the Notes. See also "Use of Proceeds" in the accompanying Prospectus. On the date of this Pricing Supplement, the Company, through its subsidiaries, hedged its anticipated exposure in connection with the Notes by taking positions in the Ordinary Shares. Such hedging was carried out in a manner designed to minimize any impact on the price of the Ordinary Shares. Purchase activity could potentially have increased the price of the Ordinary Shares, and therefore effectively increase the level to which the Ordinary Shares must rise before a holder of a Note will receive more than the accreted principal amount upon the exchange of such Note. Although the Company has no reason to believe that its hedging activity had a material impact on the price of the Ordinary Shares, there can be no assurance that the Company did not affect such price as a result of its hedging activities. The Company, through its subsidiaries, is likely to modify its hedge position throughout the life of the Notes by purchasing and selling the Ordinary Shares, options contracts on the Ordinary Shares listed on major securities markets or positions in any other instruments that it may wish to use in connection with such hedging. Supplemental Information Concerning Plan of Distribution........... Each Agent has represented and agreed that (i) it has not offered or sold and will not offer or sell any Notes to persons in the United Kingdom prior to admission of the Notes to listing in accordance with Part IV of the Financial Services Act 1986 (the "Financial Services Act") except to persons whose ordinary activities involve them in acquiring, holding, managing or disposing of investments (as principal or agent) for the purposes of their businesses or otherwise in circumstances which have not resulted and will not result in an offer to the public in the United Kingdom within the meaning of the Public Offers of Securities Regulations 1995 or the Financial Services Act; (ii) it has complied and will comply with all applicable provisions of the Financial Services Act with respect to anything done by it in relation to the Notes in, from or otherwise involving the United Kingdom; and (iii) it has only issued or passed on and will only issue or pass on in the United Kingdom any document received by it in connection with the issue of the Notes, other than any document which consists of or any part of listing particulars, supplementary listing particulars or any other document required or permitted to be published by listing rules under Part IV of the Financial Services Act, to a person who is of a kind described in Article 11(3) of the Financial Services Act (Investment Advertisements) (Exemption) Order 1995 or is a person to whom such document may otherwise lawfully be issued or passed on. ANNEX A OFFICIAL NOTICE OF EXCHANGE Dated:[At least 30 days after the Original Issue Date] Morgan Stanley Group Inc. 1585 Avenue of the Americas New York, New York 10036 Morgan Stanley & Co. International Limited, as Calculation Agent 25 Cabot Square Canary Wharf London E144 QA England Attn:Simon Midgen Fax No.: 44-171-425-6996 Dear Sirs: The undersigned holder of the Global Medium-Term Notes, Series D (Euro Fixed Rate Senior Bearer Cash Exchangeable Notes Due March 6, 2002) (Exchangeable for an Amount in U.S. Dollars Determined by Reference to the Market Price of the Ordinary Shares of the Daimler-Benz Corporation) of Morgan Stanley Group Inc. (the "Notes") hereby irrevocably elects to exercise with respect to the principal amount of the Notes indicated below, as of the date hereof (or, if this letter is received after 11:00 a.m. on any Exchange Date, as of the next Exchange Date, provided that such day is prior to the earlier of March 6, 2002 and any redemption date) the Exchange Right as described in Pricing Supplement No. 43 dated February 15, 1996 (the "Pricing Supplement") to the Prospectus Supplement dated March 29, 1995 and the Prospectus dated March 29, 1995 related to Registration Statement No. 33-57833. Capitalized terms not defined herein have the meanings given to such terms in the Pricing Supplement. Please date and acknowledge receipt of this notice in the place provided below on the date of receipt, and fax a copy to the fax number indicated, whereupon the Company will deliver an amount in U.S. Dollars 3 Business Days after the Exchange Date in accordance with the terms of the Notes, as described in the Pricing Supplement. Very truly yours, ---------------------------------- [Name of Holder] By: -------------------------------- [Title] -------------------------------- [Fax No.] $ -------------------------------- Principal Amount of Notes surrendered for exchange Receipt of the above Official Notice of Exchange is hereby acknowledged MORGAN STANLEY GROUP INC., as Issuer MORGAN STANLEY & CO. INTERNATIONAL LIMITED, as Calculation Agent By MORGAN STANLEY & CO. INTERNATIONAL LIMITED, as Calculation Agent By: -------------------------------- Title: Date and time of acknowledgement --------------------------- -----END PRIVACY-ENHANCED MESSAGE-----