EXHIBIT 4.2



 





EXHIBIT 4.2



THE GOLDMAN SACHS GROUP, INC.

NON-QUALIFIED DEFERRED COMPENSATION PLAN

FOR

U.S. EXTENDED MANAGING DIRECTORS

AND OTHER SELECT U.S. EMPLOYEES




ARTICLE 1

INTRODUCTION




     1.1 Purpose of Plan



     The Goldman Sachs Group, Inc. Non-Qualified Deferred Compensation Plan for
U.S. Extended Managing Directors and Other Select U.S. Employees is intended to
promote the interests of GS Inc. and its shareholders by encouraging certain
Eligible Employees to remain in the employ of the Firm by providing them with a
means by which they may request to defer receipt of a portion of their Eligible
Compensation.



ARTICLE 2

DEFINITIONS




     Wherever used herein, the following terms have the meanings set forth
below, unless a different meaning clearly is required by the context:



     2.1 Account means, for each Participant, a notional account maintained on
the books and records of GS Inc. (by GS Inc. or such third party record keeper
or record keepers as GS Inc. may from time to time appoint) that is established
for his or her benefit and as to which amounts are credited under Section 5.1.



     2.2 Administrative Committee means the person or persons designated by the
Compensation Policy Committee or the Board of Directors with the authority to
perform day-to-day administrative functions for the Plan. If no such person is
so serving at any time, the Compensation Policy Committee shall be the
Administrative Committee.



     2.3 Board of Directors means the Board of Directors of GS Inc.



     2.4 Compensation Policy Committee means the GS Inc. Compensation Policy
Committee, as it may be constituted from time to time.



     2.5 Code means the Internal Revenue Code of 1986. Reference to any
section or subsection of the Code includes reference to any comparable or
succeeding provisions of any legislation that amends, supplements or replaces
such section or subsection.



     2.6 Deferral means the portion of a Participant’s Eligible Compensation
that is deferred in accordance with Section 4.1 hereof.



     2.7 Deferral Date means, with respect to each Plan Year, the earliest date
GS Inc. determines that Eligible Compensation subject to a Deferral Request
would have been paid to the Eligible Employee in the absence of the Plan, or
such other date or dates as may be selected by the Administrative Committee in
its sole discretion prior to the date Deferral Requests are required to be
returned to the Administrative Committee for a Plan Year.



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     2.8 Deferral Request means any request by a Participant to make a Deferral
hereunder by submitting a Deferral Request Form in accordance with Section 4.1
hereof.



     2.9 Deferral Request Form means the form (which may be in electronic form)
specified by the Administrative Committee from time to time pursuant to which
an Eligible Employee can make a Deferral Request.



     2.10 Distribution Date means, with respect to each Deferral made by a
Participant, the date on which an amount shall become payable to a Participant
in accordance with Article 7 hereof.



     2.11 Effective Date means November 27, 2004, the date as of which the Plan
first became effective.



     2.12 Eligible Compensation means, for each Eligible Employee, with respect
to each Plan Year the amount the Firm determines in its sole discretion
otherwise would have been payable to the Eligible Employee as a gross
end-of-year bonus or, with respect to any Eligible Employee paid on a net
commission basis, Net Commissions (excluding any amounts payable to the
Eligible Employee that are directly attributable to the performance of services
prior to the beginning of such Plan Year), and before giving effect to any
Deferral, but after giving effect to: (i) any “voluntary contribution election”
under The Goldman Sachs Employees’ Profit Sharing Retirement Income Plan (as
that term is defined therein) or to any similar compensation reduction election
made in connection with a plan subject to Section 401(k) of the Code; (ii) the
cost of contribution by the Firm for any public or private employee benefit
plan; (iii) any compensation reduction election made in connection with a
“cafeteria plan” within the meaning of Section 125 of the Code; (iv) any
contribution to the Money Purchase Plan; (v) any “qualified transportation
fringe” (within the meaning of Section 132(f) of the Code); (vi) any amount the
Firm decides to contribute as part of compensation to the Goldman Sachs UK
Retirement Plan or GSI International Pension Plan or any other plan maintained
outside the United States primarily for non-U.S. citizens or residents that the
Administrative Committee determines is similar thereto; and (vii) the value of
any award recommendation in respect of any plan or arrangement the Firm
determines is similar to The Goldman Sachs UK Conditional Share Reward Plan,
including, without limitation, any such plan or arrangement involving the
establishment and funding of an “employee benefit trust” in the United Kingdom.
Unless otherwise permitted by the Administrative Committee, no year-end award
(including, if the Eligible Employee is paid on a commission basis, the portion
of such individual’s “Target Total Compensation” allocated to any such award)
granted under The Goldman Sachs Amended and Restated Stock Incentive Plan, as
in effect from time to time, shall constitute Eligible Compensation.
Notwithstanding the foregoing, the Administrative Committee, in its discretion,
with respect to any Eligible Employee or Eligible Employees (on a uniform or
non-uniform basis) shall have the authority to (a) designate any jurisdiction
or jurisdictions from which amounts earned by any Eligible Employee will be
excluded from Eligible Compensation and (b) include or exclude, as the case may
be, any amounts that otherwise would be excluded or included, as the case may
be, in any Eligible Employee’s Eligible Compensation.



     2.13 Eligible Employee means, unless otherwise provided by the
Administrative Committee, in a Plan Year, an individual (i) who does not
participate in The Goldman Sachs Partner Compensation Plan or The Goldman Sachs
Restricted Partner Compensation Plan and is not eligible to make a deferral
under The Goldman Sachs Group, Inc. Deferred Compensation Plan for Extended
Managing Directors and Other Select Employees of the United Kingdom, (ii) who
earned Minimum Eligible Compensation for either or both of the immediately
preceding Plan Year or the second preceding Plan Year, (iii) who is designated
by the Administrative Committee as eligible to participate in the Plan or is a
member of a class of employees who is designated by the Administrative
Committee as eligible to participate in the Plan for the Plan Year. The
Administrative Committee may, in its sole discretion, add or exclude any
individual or any member of a class of individuals from being considered an
Eligible Employee. An individual shall first be considered an Eligible
Employee on the date he or she first receives written notification from the
Administrative Committee that he or she is eligible to participate in the Plan.
Unless otherwise provided by the Administrative Committee (including, by
reason of legal, tax or other regulatory restrictions or impediments to the
individual or to the Firm arising out of a country other than the United States
or United Kingdom), an individual that is an Eligible Employee for any Plan
Year shall, for so long as he remains an active employee of the Firm, be an
Eligible Employee for any future Plan Year (or an Eligible Employee under The
Goldman Sachs Group, Inc. Non-



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Qualified Deferred Compensation Plan for U.K. Extended Managers and Other
Select U.K. Employees, with respect to any Plan Year in which such individual
meets the definition of “Eligible Employee” under that plan).



     2.14 ERISA means the Employee Retirement Income Security Act of 1974, as
amended from time to time. Reference to any section or subsection of ERISA
includes reference to any comparable or succeeding provisions of any
legislation that amends, supplements or replaces such section or subsection.



     2.15 Firm means GS Inc. and its subsidiaries and affiliates.



     2.16 GS Inc. means The Goldman Sachs Group, Inc., and any successor
thereto.



     2.17 Investment Committee means a committee of two or more individuals
selected by the Administrative Committee, which shall have the authority to
select the Notional Investments that are made available from time to time under
the Plan.



     2.18 Maximum Aggregate Deferral Amount means, with respect to each Plan
Year, $100 million or such other amount as may be determined by GS Inc. from
time to time, which shall be the maximum total of all Deferrals for all
Participants permitted under the Plan for such Plan Year. GS Inc. may, in its
discretion, (i) aggregate the Plan with such other deferred compensation plan
or plans as it may determine for purposes of applying the Maximum Aggregate
Deferral Amount and (ii) allocate the Maximum Aggregate Deferral Amount among
the Plan and any deferred compensation plans that are so aggregated with the
Plan in any manner deemed appropriate by it.



     2.19 Maximum Deferral Amount means, unless otherwise determined by GS Inc.
with respect to each Participant for each Plan Year, the lesser of: (i) 35% of
the Participant’s Eligible Compensation and (ii) $350,000 for U.S. Extended
Managing Directors or $200,000 for any other Participant.



     2.20 Minimum Deferral Amount means, with respect to each Participant for
each Plan Year, $10,000 or such other amount as may be determined by the
Administrative Committee prior to the date Deferral Request Forms are required
to be returned to the Administrative Committee for a Plan Year, which shall be
the minimum amount that a Participant may request as a Deferral for a Plan
Year.



     2.21 Minimum Eligible Compensation means total compensation of at least
$200,000 or such other amount as may be determined by the Administrative
Committee prior to the beginning of a Plan Year.



     2.22 Money Purchase Plan means The Goldman Sachs Money Purchase Pension
Plan, as amended from time to time, or any successor thereto.



     2.23 Net Commission means, for each Eligible Employee that is paid on a
commission basis, with respect to each Plan Year, the amount the Firm
determines in its sole discretion would be paid to the Employee as a net
commission after certain adjustments for draws and payments to client analysts
and certain other adjustments consistent with Firm practice as in effect from
time to time. For purposes of the foregoing, the Administrative Committee
shall prescribe such rules and limitations it deems appropriate for purposes of
taking into account the total compensation and adjustments to net commissions
of any commission-based Eligible Employee.



     2.24 Notional Investment means a hypothetical investment made available
under the Plan by the Investment Committee from time to time in which a
Participant’s Account may be deemed to be invested in whole or in part in
accordance with Sections 5.2 and 5.3 hereof in order to measure the value of
the Account.



     2.25 Participant means any Eligible Employee who participates in the Plan
in accordance with Article 3.



     2.26 Plan means The Goldman Sachs Group, Inc. Non-Qualified Deferred
Compensation Plan for U.S. Extended Managing Directors and Other Select U.S.
Employees.



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     2.27 Plan Year means the 12-month period that coincides with GS Inc.’s
fiscal year.



     2.28 Total and Permanent Disability means, with respect to any
Participant, if such Participant is unable to engage in any substantial gainful
activity by reason of any medically determinable physical or mental impairment
that can be expected to result in death or can be expected to last for a
continuous period of not less than 12 months, or is, by reason of any medically
determinable physical or mental impairment that can be expected to result in
death or can be expected to last for a continuous period of not less than 12
months, receiving income replacement benefits for not less than 3 months under
any accident or health plan covering employees of the Firm.



ARTICLE 3

PARTICIPATION




     3.1 Commencement of Participation



     Any Eligible Employee who requests to defer part of his or her Eligible
Compensation in accordance with Article 4 shall, if and to the extent the Firm,
in its discretion, agrees to follow the request, become a Participant in the
Plan as of the first Deferral Date as of which a Deferral is credited to the
Eligible Employee’s Account in accordance with Section 4.2.



     3.2 Continued Participation



     A Participant in the Plan shall continue to be a Participant so long as
any amount remains credited to his or her Account.



ARTICLE 4

DEFERRALS




     4.1 Deferral Request Form



     Subject to the provisions of Article 4 hereof, for each Plan Year for
which the Plan is in effect, an Eligible Employee may, by properly completing a
Deferral Request Form and filing it with the Administrative Committee not later
than the date specified by the Administrative Committee (which shall not be
later than the last day of the Plan Year immediately preceding the Plan Year
for which the Deferral Request is made, unless the Administrative Committee
determines that a later date is permitted under Section 409A of the Code),
request that a Deferral be made on his or her behalf, on such terms as the
Administrative Committee may permit in its sole discretion. The Firm may, in
its sole discretion, determine whether or not to follow any Deferral Request
with respect to any Eligible Employee.



     4.2 Mechanics of Deferral



     Subject to the provisions of this Article 4, if and to the extent the Firm
determines to follow a Deferral Request, an Eligible Employee’s Eligible
Compensation shall be reduced in accordance with the Participant’s Deferral
Request, and the amount of the resulting Deferral shall be credited to the
Participant’s Account as of the Deferral Date.



     4.3 Minimum Deferral Amount



     Notwithstanding anything herein or in any Deferral Request Form to the
contrary, no Deferral shall be for an amount and no Deferral Request shall be
valid to the extent that it specifies an amount less than the Minimum Deferral
Amount for the applicable Plan Year.



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     4.4 Maximum Deferral Amount



     Notwithstanding anything herein or in any Deferral Request Form to the
contrary, no Deferral shall be for an amount in excess of the Maximum Deferral
Amount. If any amount specified on a Deferral Request Form as a Deferral would
exceed the Maximum Deferral Amount, such Deferral Request Form shall be deemed
to have specified the Maximum Deferral Amount.



     4.5 Maximum Aggregate Deferral Amount



     Notwithstanding anything herein or in any Deferral Request Form to the
contrary, if and to the extent that the aggregate amounts specified on all
Deferral Request Forms in a Plan Year that the Firm determines to follow exceed
the Maximum Aggregate Deferral Amount, the amounts specified on each
Participant’s Deferral Request Form shall be reduced, and each Participants’
Deferrals shall be reduced, under a formula or method determined by the
Administrative Committee in its sole discretion, including, without limitation,
a pro rata reduction to the ratio of the Maximum Aggregate Deferral Amount to
the aggregate of the amounts specified by all Participants’ on their Deferral
Request Forms so that the aggregate Deferrals of all Participants do not exceed
the Maximum Aggregate Deferral Amount; provided that no Participant’s Deferral
shall be reduced to an amount below the Minimum Deferral Amount.



     4.6 Deferral Request Irrevocable



     Except to the extent determined by the Administrative Committee (but in no
event later than the date on which all Deferral Request Forms must be returned
to the Administrative Committee for a Plan Year), all Deferral Requests shall
be irrevocable when made, and no Participant may change or revoke his or her
Deferral Request with respect to Eligible Compensation payable for a Plan Year.



ARTICLE 5

ACCOUNTS




     5.1 Accounts



     The Administrative Committee shall maintain an Account for each
Participant that reflects each Participant’s Deferrals (and with respect to any
employee that is paid on a commission basis, any rate of interest credited from
and including the date deferred through but excluding the date such Deferral is
credited to his or her account calculated in a manner determined by the
Administrative Committee), and any adjustments determined in accordance with
Section 5.2, forfeitures and any payments made under Article 7 with respect to
the Account. The Administrative Committee shall provide each Participant with
a periodic statement of his or her Account adjusted in accordance with Section
5.2.



     5.2 Adjustment of Accounts



     The amount of each Participant’s Deferral (and with respect to any
employee that is paid on a commission basis, any rate of interest credited from
and including the date deferred through but excluding the date such Deferral is
credited to his or her account calculated in a manner determined by the
Administrative Committee), for a Plan Year shall be credited to the
Participant’s Account as of the applicable Deferral Date. The Participant’s
Account shall be adjusted from time to time to reflect: (i) Deferrals for
subsequent Plan Years, if any; (ii) gains (or losses) determined as if the
Account were invested directly in the Notional Investment or Notional
Investments selected by the Participant (without taking into account any tax
consequences that may have arisen were the Account so directly invested); (iii)
the amount described in Section 7.5; (iv) any payments under Article 7 in
respect of a Deferral; and (v) any administrative charge determined by the
Compensation Policy Committee or Administrative Committee in its sole
discretion to be appropriate to cover part or all of the cost to the Firm of
making the Plan available to Participants or otherwise maintaining the Plan.



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     5.3 Notional Investments



          (a) The Notional Investment or Notional Investments that shall be
available under the Plan shall be determined from time to time by the
Investment Committee in its sole discretion. The Investment Committee may, in
its sole discretion, provide limitations or procedures on the availability of
any Notional Investment or Notional Investments with respect to any Participant
or class of Participants. The Investment Committee may modify, amend,
eliminate or replace any or all of the Notional Investments that may be
available under the Plan to Plan Participants or any of them, in any manner in
its sole discretion at any time from time to time with or without notice to the
Participants and effective retroactively or prospectively, subject to Section
9.3 hereof.



          (b) In selecting any Notional Investment or Notional Investments to be
made available under the Plan or prescribing any rules related thereto, the
Investment Committee and the Administrative Committee shall be acting solely on
behalf of the Firm and not as a fiduciary or adviser with respect to any
Deferral, any Participant or any other person employed by the Firm or in
respect of any Account. Each Participant, by requesting to participate in the
Plan, agrees that none of the Investment Committee, the Administrative
Committee, the Compensation Policy Committee, GS Inc., the Firm or any other
person shall have any liability whatsoever to any Participant or any other
person as a result of, arising out of or related to the selection or
elimination or modification of Notional Investments, any monitoring of any such
Notional Investment or any Participant’s selection or failure to select any
Notional Investment.



          (c) The Administrative Committee or the Investment Committee may adopt
such rules and administrative practices as they, in their sole discretion,
shall deem necessary or appropriate in connection with any Participant’s
ability to select Notional Investments hereunder, including restrictions on the
timing or frequency of such selections; all such Notional Investment selections
shall be made in such form as may be required by the Administrative Committee
from time to time.



ARTICLE 6

VESTING




     6.1 Accounts Generally Vested



     Without limiting Section 7.6 or Section 10.1, each Participant shall be
immediately vested in, and shall have a nonforfeitable right to the balance
credited to, the Participant’s Account subject to the terms of the Plan,
including without limitation Section 7.5 hereof.



ARTICLE 7

PAYMENTS




     7.1 Commencement and Form of Payment



     The Participant shall receive a payment of the entire portion of the
Participant’s Account attributable to a Deferral in a single lump sum within 30
business days after the earlier of (i) the applicable Distribution Date and
(ii) the date on which the Participant’s active employment with the Firm ends
(provided if the Firm determines such Participant to be a “key employee” within
the meaning of Section 416(i) of the Code, the Participant will receive the
balance of his or her Account within 30 business days after the earlier of the
Distribution Date for that Deferral and six months after the Participant’s
active employment with the Firm ends).



     7.2 Distribution Date



     In accordance with procedures established by the Administrative Committee
in its sole discretion, at the time each Participant makes a Deferral Request,
the Participant shall select a Distribution Date with respect to a Deferral.
Unless otherwise determined by the Administrative Committee in its sole
discretion, a Participant shall be permitted



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to request only one of the following as a Distribution Date with respect
to a Deferral: (i) the third anniversary of the Deferral Date, (ii) the fourth
anniversary of the Deferral Date or (iii) the fifth anniversary of the Deferral
Date.



     7.3 Death and Total and Permanent Disability



          (a) If a Participant dies prior to the payment of the entire balance
credited to his or her Account, unless otherwise determined by the
Administrative Committee and notwithstanding any Participant’s request pursuant
to Section 7.2, the amount credited to his or her Account shall be paid as soon
as practicable to the representative of the Participant’s estate. No payment
shall be made to the representative of a Participant’s estate until the
Administrative Committee shall have been furnished with such evidence and other
documentation as it shall deem necessary or appropriate to establish the
validity of the payment.



          (b) If a Participant has a Total and Permanent Disability prior to the
payment of the entire balance credited to his or her Account, unless otherwise
determined by the Administrative Committee and notwithstanding any
Participant’s request pursuant to Section 7.2, such balance shall be paid as
soon as practicable to the Participant or if the Participant is determined by
the Administrative Committee, in its sole discretion, to be incompetent by
reason of physical or mental disability, to another person for the benefit of
the Participant, without responsibility on the part of the Administrative
Committee, the Firm or any other person to monitor the application or use of
such funds. No payment shall be made to the Participant or such other person
until the Administrative Committee shall have been furnished with such evidence
and other documentation as it shall deem necessary or appropriate to establish
the validity of the payment.



     7.4 Taxes and Social Security



     All Federal, State, foreign, local, hypothetical or other taxes, or social
security or social insurance charges, if any, that are required to be withheld
in respect of any Deferrals hereunder or from any payments made pursuant to
this Article 7 shall be withheld from amounts payable hereunder or from any
other amounts payable to a Participant by any person.



     7.5 Certain Account Adjustments



     Unless otherwise determined by GS Inc., the amount payable on a
Distribution Date to any Participant under the Plan shall be net of, and a
Participant’s Account shall be adjusted to reflect on such Distribution Date,
any outstanding amounts (including, without limitation, travel and
entertainment or advance account balances, loans, or amounts repayable to the
Firm pursuant to tax equalization, housing, automobile or other employee
programs) the Participant owes to the Firm (including by reason of any
obligations of such Participant under any Firm sponsored investment program,
including under the Firm’s “Special Investments Program”), any amounts owed to
the Firm by reason of such Participant’s misconduct with respect to such
Participant’s employment with the Firm, including, without limitation, the
Participant’s misappropriation of funds or other property from the Firm, and
any amount the Administrative Committee otherwise deems appropriate pursuant to
any tax equalization policy or agreement or otherwise applicable as of such
Distribution Date. Each Participant shall be required, as a condition to
participation in the Plan, to sign such documents, and make such
representations and consents, to the extent deemed necessary or appropriate by
the Administrative Committee, to comply with this Section 7.5.



     7.6 Certain Delayed Payments to Covered Employees



     Notwithstanding anything herein or in any Deferral Request Form to the
contrary, if and to the extent that GS Inc. determines, in its sole discretion,
that GS Inc.’s or the Firm’s U.S. Federal tax deduction in respect of a payment
under the Plan may be limited as a result of Section 162(m) of the Code or any
successor section of the Code, the Administrative Committee may delay such
Payment until such time or times as GS Inc. or the Administrative Committee
determines, in its sole discretion, that neither GS Inc.’s nor the Firm’s
deduction for any such payment will be limited as a result of Section 162(m) of
the Code or any successor section of the Code and as are consistent with
Section 409A of the Code.



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     7.7 Payment Currency



     Unless otherwise determined by the Administrative Committee in its
discretion, any payments under the Plan shall be made in the same currency in
which the Participant’s bonus or commissions otherwise would have been paid, in
the absence of the Plan.



ARTICLE 8

ADMINISTRATIVE COMMITTEE;INDEMNIFICATION




     8.1 Plan Administration and Interpretation



     The Plan shall be administered by the Administrative Committee. The
Administrative Committee shall have complete control and authority to
administer the Plan, and authority to determine the rights and benefits and all
claims, demands and actions arising out of the provisions of the Plan of any
Participant, representative of a deceased Participant’s estate, or any other
person having or claiming to have any interest under the Plan. The
Administrative Committee shall have complete discretion and power to interpret
the Plan and to decide all matters under the Plan. Any interpretation or
decision by the Administrative Committee shall be final, conclusive and binding
on all Participants and any person claiming under or through any Participant.
Any individual serving on the Administrative Committee who also is a
Participant shall not vote or act on any matter relating solely to himself or
herself. When making a determination or calculation, the Administrative
Committee shall be entitled to rely on information furnished by a Participant
or other person entitled to payment hereunder, or the Firm. The Administrative
Committee shall adopt such claims procedures as it determines in its sole
discretion may be necessary or appropriate for the proper determination of the
rights of any Participant under this Plan.



     8.2 Powers, Duties, Procedures, Etc.



     In exercising its powers and duties, the Administrative Committee may
adopt such rules and procedures, appoint such officers or agents, delegate such
powers and duties and receive such reimbursements and compensation, in each
case, as it may establish or determine from time to time consistent with the
provisions of the Plan.



     8.3 Indemnification of Administrative Committee and Investment Committee



     No member of the Administrative Committee or Investment Committee or any
employee, officer or director of the Firm (each such person, a “Covered
Person”) shall have any liability to any person (including any Participant) for
any action taken or omitted to be taken or any determination made in good faith
with respect to the Plan. Each Covered Person shall be indemnified and held
harmless by GS Inc. against and from: (a) any loss, cost, liability or expense
(including attorneys’ fees) that may be imposed upon or incurred by such
Covered Person in connection with or resulting from any action, suit or
proceeding to which such Covered Person may be a party or in which such Covered
Person may be involved by reason of any action taken or omitted to be taken
under the Plan and (b) any and all amounts paid by such Covered Person, with GS
Inc.’s approval, in settlement thereof, or paid by such Covered Person in
satisfaction of any judgment in any such action, suit or proceeding against
such Covered Person, provided that GS Inc. shall have the right, at its own
expense, to assume and defend any such action, suit or proceeding and, once GS
Inc. gives notice of its intent to assume the defense, GS Inc. shall have sole
control over such defense with counsel of GS Inc.’s choice. The foregoing
right of indemnification shall not be available to a Covered Person to the
extent that a court of competent jurisdiction in a final judgment or other
final adjudication, in either case not subject to further appeal, determines
that the acts or omissions of such Covered Person giving rise to the
indemnification claim resulted from such Covered Person’s bad faith, fraud or
willful criminal act or omission. The foregoing right of indemnification shall
not be exclusive of any other rights of indemnification to which Covered
Persons may be entitled under GS Inc.’s Amended and Restated Certificate of
Incorporation or Amended and Restated Bylaws, as a matter of law, or otherwise,
or any other power that GS Inc. may have to indemnify such persons or hold them
harmless.



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ARTICLE 9

AMENDMENT AND TERMINATION




     9.1 Amendments



     Subject only to Section 9.3 hereof, GS Inc. shall have the right, in its
sole discretion, to amend or modify the Plan in any respect from time to time,
including in any manner that adversely affects the right of any Participant.
Any such amendment may be effected by an action of the Board of Directors or
the Compensation Policy Committee. In addition, and without limiting the
foregoing, to the maximum extent permissible under Section 409A of the Code,
the Administrative Committee shall have the right, in its sole discretion, to
accelerate any payment to any or all Participants to any date or dates prior to
the Distribution Date.



     9.2 Termination of Plan



     This Plan is a strictly voluntary undertaking on the part of GS Inc. and
shall not be deemed to constitute a contract between GS Inc. and any Eligible
Employee (or any other person). Subject only to Section 9.3 hereof, GS Inc.
reserves the right to terminate the Plan at any time with respect to any or all
Participants, in whole or in part, by an instrument in writing that has been
executed on the Firm’s behalf by its duly authorized officer. Upon
termination, with respect to each Participant affected by any termination (an
“Affected Participant”) on a Participant-by-Participant basis the Firm shall,
to the maximum extent permitted under Section 409A of the Code either: (a)
elect to continue to maintain part or all of the Affected Participant’s Account
and pay amounts hereunder as they become due as if the Plan had not terminated;
or (b) pay promptly to each Affected Participant (or such Affected
Participant’s estate) part or all of the balance of the Affected Participant’s
Account (or combine, in any manner, the alternatives described in Sections
9.2(a) and 9.2(b) hereof).



     9.3 Existing Rights



     No amendment or modification to, or termination of, the Plan shall be
effective to the extent that it reduces the amount credited to a Participant’s
Account immediately prior to the amendment, modification or termination,
without the Participant’s prior written consent.



ARTICLE 10

MISCELLANEOUS




     10.1 No Funding



     The Plan constitutes a mere promise by GS Inc. to make payments in
accordance with the terms of the Plan, and Participants and beneficiaries shall
have the status with respect to the amounts credited to their Accounts from
time to time only of general unsecured creditors of GS Inc. Nothing in the
Plan will be construed to give any Participant or any other person rights to
any specific assets of GS Inc., the Firm or any other person. In all events,
it is the intent of GS Inc. that the Plan be treated in a manner consistent
with the applicable provisions of Section 409A of the Code and be treated as
unfunded for U.S. Federal tax purposes and for purposes of ERISA, and the Plan
shall be interpreted accordingly.



     10.2 Non-Assignability



     None of the benefits, payments, proceeds or claims of any Participant or
any other person shall be subject to any claim of any creditor of any
Participant or any other person and, in particular, such benefits, payments,
proceeds or claims shall not be subject to attachment or garnishment or other
legal process by any creditor of such Participant or other person, nor shall
any Participant or any other person have any right to alienate, participate,
hedge, commute, pledge, encumber or assign any of the benefits, payments,
proceeds or claims that he or she may expect to receive, contingently or
otherwise, under the Plan and any attempt to so alienate, participate, hedge,
commute, pledge, encumber or assign any such benefit, payment, proceed or claim
shall be null and void and of no force or effect.



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     10.3 Limitation of Participants’ Rights



     Nothing contained in the Plan shall confer upon any person a right to
continue to be employed by the Firm or shall affect any right the Firm may have
to terminate or alter the terms and conditions of a Participant’s employment.



     10.4 Participants Bound



     Any action with respect to the Plan taken by the Administrative Committee,
the Investment Committee, the Compensation Policy Committee, the Board of
Directors, the Firm or any action authorized by or taken at the direction of
any of them, shall be final, binding and conclusive upon all Participants (and
any other persons).



     10.5 Benefits Conditioned on Release



     Any payment to any Participant made in accordance with the provisions of
the Plan shall, to the extent thereof, be in full satisfaction of all claims
against the Firm, the Plan, the Administrative Committee and the Investment
Committee. The Administrative Committee may require a Participant, as an
express condition precedent to any payment hereunder, to execute a release to
such effect. If any Participant or other person entitled to payment hereunder
is determined by the Administrative Committee to be incompetent by reason of
physical or mental disability to give a valid release, the Administrative
Committee may cause the payment or payments becoming due to such person to be
made to another person for his or her benefit without responsibility on the
part of the Administrative Committee, the Firm or any other person to follow
the application or use of such funds.



     10.6 Arbitration; Choice of Forum



          (a) Any dispute, controversy or claim between the Firm and a Participant
arising out of or relating to or concerning the Plan shall be finally settled
by arbitration in New York City before, and in accordance with the rules then
obtaining of, the New York Stock Exchange, Inc. (the “NYSE”) or, if the NYSE
declines to arbitrate the matter (or if the matter otherwise is not arbitrable
by it), the American Arbitration Association (the “AAA”) in accordance with the
commercial arbitration rules of the AAA. Prior to arbitration, all claims
maintained by a Participant or any other person must first be submitted to the
Administrative Committee in accordance with claims procedures determined by the
Administrative Committee. This Paragraph is subject to the provisions of
Paragraphs (b) and (c) below.



          (b) THE FIRM AND EACH PARTICIPANT SHALL IRREVOCABLY SUBMIT TO THE
EXCLUSIVE JURISDICTION OF ANY STATE OR FEDERAL COURT LOCATED IN THE CITY OF NEW
YORK OVER ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO OR
CONCERNING THE PLAN THAT IS NOT OTHERWISE ARBITRATED OR RESOLVED ACCORDING TO
PARAGRAPH 10.6(a) HEREOF. This includes any suit, action or proceeding to
compel arbitration or to enforce an arbitration award. The Firm and each
Participant, by requesting to participate in the Plan, acknowledge that the
forum designated by this Paragraph (b) has a reasonable relation to the Plan
and to the Participant’s relationship with the Firm. Notwithstanding the
foregoing, nothing herein shall preclude the Firm from bringing any action or
proceeding in any other court for the purpose of enforcing the provisions of
this Section 10.6 or otherwise.



          (c) This provision as to forum is independent of the law that may be
applied in the suit, action or proceeding, and each Participant, by requesting
to participate in the Plan, and the Firm agrees to such forum even if the forum
may under applicable law choose to apply non-forum law. Each Participant, by
requesting to participate in the Plan and the Firm hereby waive, to the fullest
extent permitted by applicable law, any objection which the Participant or the
Firm now or hereafter may have to personal jurisdiction or to the laying of
venue of any such suit, action or proceeding in any court referred to in
Paragraph (b) of this Section 10.6. Each Participant, by requesting to
participate in the Plan, and the Firm undertake not to commence any suit,
action or proceeding arising out of or relating to or concerning the Plan in
any forum other than a forum described in this Section 10.6. Each Participant,
by requesting to participate in the Plan, and the Firm agree that, to the
fullest extent permitted by applicable law, a



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final and non-appealable judgment in any such suit, action or proceeding
in any such court shall be conclusive and binding upon the Participant and the
Firm.



          (d) Each Participant, by requesting to participate in the Plan,
irrevocably appoints the General Counsel of GS Inc. as the Participant’s agent
for service of process in connection with any action or proceeding arising out
of or relating to or concerning the Plan that is not arbitrated pursuant to the
provisions of this Section 10.6, who shall promptly advise the Participant of
any such service of process.



          (e) Each Participant, by requesting to participate in the Plan, agrees to
keep confidential the existence of, and any information concerning, a dispute,
controversy or claim described in this Section 10.6, except that a Participant
may disclose information concerning such dispute, controversy or claim to the
arbitrator or court that is considering such dispute, controversy or claim or
to his or her legal counsel (provided that such counsel agrees not to disclose
any such information other than as necessary to the prosecution or defense of
the dispute, controversy or claim).



     10.7 Governing Law



     The Plan shall be construed, administered and governed in all respects
under and by the laws of the State of New York, without reference to the
principles of conflicts of law (except if and to the extent preempted by
applicable Federal law). It is the intent of GS Inc. that this Plan be
considered and interpreted in all respects as part of a bonus plan within the
meaning of U.S. Department of Labor Regulation Section 2510.3-2(c) and not in
any respect as an employee pension plan for purposes of ERISA. If and to the
extent that any portion of this Plan shall be determined to be an employee
pension benefit plan subject to ERISA, then such portion shall be considered a
separate plan covering only those Participants as to whom this Plan is
determined to be a pension plan. Such pension plan shall in all respects be
considered and interpreted as a plan which is unfunded and maintained primarily
for the purpose of providing deferred compensation for a select group of
management or highly compensated employees and exempt from coverage of Parts 1,
2, 3 and 4 of Subtitle B of Title I of ERISA to the maximum extent permissible
under the provisions thereof. Further, it is the intent of GS Inc. that this
Plan be considered and interpreted in all respects as a nonqualified deferred
compensation plan satisfying the requirements of Section 409A of the Code and
deferring the recognition of income by Participants in respect of Deferrals
until amounts are actually paid to them pursuant to Article 7.



     10.8 Certain Consents



     As a condition of participating in the Plan, each Eligible Employee
wishing to make a Deferral Request, and each Participant, shall be required to
sign such documents, make such representations and sign such consents,
including, without limitation signing any consent or taking any other action
necessary for the Firm to insure the life of the Participant and name itself as
beneficiary to the extent deemed necessary or appropriate of such insurance.



     Without limiting the foregoing, by submitting a Deferral Request Form, a
Participant will have irrevocably agreed to consent to (i) the Firm’s supplying
to any third party recordkeeper such personal information as the Administrative
Committee deems advisable to administer the Plan, (ii) the Firm’s deducting
amounts from the Participant’s wages to reimburse the Firm for any advances
made on the Participant’s behalf to satisfy any withholding and other tax
obligations, (iii) the Firm’s deducting or withholding from any payment or
distribution to the Participant, whether or not pursuant to the Plan, the
amount of any taxes (including, without limitation, FICA, National Insurance
Contributions, if applicable, or social insurance taxes) the Administrative
Committee determines apply in connection with any Deferral or distribution
under the Plan and (iv) withholding from any distribution under the Plan any
amount the Administrative Committee determines is payable by the Participant to
the Firm.



     10.9 Currency Conversions



     The Administrative Committee, in its discretion, shall have the authority
to prescribe such rules and procedures as it may deem appropriate for purposes
of converting any currency into another currency for purposes of the Plan



11









 







including, without limitation, for purposes of determining (i) the Minimum
Deferral Amount, (ii) the Maximum Deferral Amount, (iii) the Maximum Aggregate
Deferral Amount, (iv) the amount of any Eligible Employee’s Deferral, (v) the
amount of any investment gains or losses to be allocated to a Participant’s
Account, (vi) the amount of any distribution, (vii) the amount of any
Participant’s Eligible Compensation and (viii) the amount of any Participant’s
Minimum Eligible Compensation.



     10.10 Non-Uniform Determinations



     None of the Administrative Committee’s determinations under the Plan need
to be uniform and any such determinations may be made by it selectively among
persons who make Deferral Requests under the Plan (whether or not such persons
are similarly situated). Without limiting the generality of the foregoing, the
Administrative Committee shall be entitled, among other things, to make
non-uniform and selective determinations with regard to Deferrals, currency
conversions and availability of Notional Investments, and to enter into
non-uniform and selective Deferral Requests, as to (a) the persons permitted to
make Deferrals, (b) the terms and provisions of any Deferral, (c) whether a
Participant’s employment with the Firm has been terminated for purposes of the
Plan and (d) any adjustments to be made with respect to any Deferral as
described herein or otherwise.



     10.11 Severability; Entire Agreement



     If any of the provisions of this Plan is finally held to be invalid,
illegal or unenforceable (whether in whole or in part), such provision shall be
deemed modified to the extent, but only to the extent, of such invalidity,
illegality or unenforceability and the remaining provisions shall not be
affected thereby. Each Participant, by requesting to participate in the Plan,
acknowledges that the Plan contains the entire agreement of the parties with
respect to the subject matter thereof and supersedes all prior agreements,
promises, covenants, arrangements, communications, representations and
warranties between them, whether written or oral with respect to the subject
matter thereof.



     10.12 No Third Party Beneficiaries



     The Plan shall not confer on any person other than the Firm and the
Participants any rights or remedies thereunder; provided that the exculpation
and indemnification provisions of Section 8.3 shall inure to the benefit of a
Covered Person’s estate, beneficiaries and legatees.



     10.13 Headings and Subheadings



     Headings and subheadings in this Plan are inserted for convenience only
and are not to be considered in the construction of the provisions hereof.



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