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 th
