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Exhibit K
June 8, 2000
Dear __________
We are writing in connection with the appointment of __________ (the
"Managing Director") as a Managing Director of a subsidiary or affiliate of The
Goldman Sachs Group, Inc. ("GS") (collectively with its subsidiaries and
affiliates, and its and their predecessors and successors, the "firm"). Our
respective rights and obligations under the Owner Agreement dated as of July
11, 1999 among GS, the Managing Director and the Managing Director's family
limited partnership (the "Owner") shall continue in full force and effect.
The Owner will be required to enter into a Shareholders' Agreement (two
copies of which are attached) which will, among other things, include
restrictions on the transfer and voting of GS shares. (We enclose for your
information a description of the Shareholders' Agreement.) However, in order
not to restrict further the transfer of the shares of GS common stock the Owner
received in connection with the acquisition of The Hull Group L.L.C. by GS, we
hereby confirm to the Owner our understanding that the Shareholders' Committee
will, upon the request of the Owner, waive the General Transfer Restrictions
(as defined in the Shareholders' Agreement) to permit the Owner to sell the
shares of GS common stock acquired by the Owner pursuant to the Agreement and
Plans of Merger dated as of July 11, 1999.
The Owner will, however, be subject to the voting arrangements set out in
Section 4.2 of the Shareholders' Agreement (and the Managing Director will be
deemed to own beneficially GS shares owned by the Owner and will be entitled to
participate with respect to such shares in the Preliminary Vote referred to in
Section 4.1 of the Shareholders' Agreement). The Owner will also be bound by
the other covenants applicable to Covered Persons set out in Shareholders'
Agreement. Accordingly, until the date on which the Managing Director ceases to
be an Employee Covered Person.
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(i) The Owner will be a Covered Person under the Shareholders'
Agreement;
(ii) Such shares will be treated as Covered Shares and Voted Covered
Shares under the Shareholders' Agreement;
(iii) Sections 2.3(b) and 2.3(c) of the Shareholders' Agreement will be
applicable to the Owner as if the Owner were an Employee Covered
Person under the Shareholders' Agreement, but the Owner will not
be considered an Employee Covered Person for any other purpose;
and
(iv) The Owner agrees to abide by the Managing Director Hedging and
Pledging Restrictions, as currently in effect (the receipt of
which is hereby acknowledged), as the same may be amended from
time to time.
Upon the date on which the Managing Director ceases to be an Employee Covered
Person, the Owner will be removed from Appendix A to the Shareholders'
Agreement.
If the foregoing is in accordance with your understanding, kindly confirm
your acceptance and agreement by signing and returning in the enclosed envelope
the enclosed duplicate of this letter which will thereupon constitute an
agreement between us. Please also sign and return one of the enclosed copies of
the Shareholders' Agreement.
Very truly yours,
Henry M. Paulson, Jr.
Agreed to and accepted
as of the date of this letter
By: ___________________________
