SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
----------------
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported):
August 28, 1997
GS FINANCIAL PRODUCTS U.S., L.P.
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(Exact name of registrant as specified in its charter)
CAYMAN ISLANDS NO. 000-25178 NO. 52-1919759
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(State or Other Jurisdic- (Commission (IRS Employer
tion of Incorporation) File Number) Identification
No.)
P.O. BOX 896
HARBOUR CENTRE, NORTH CHURCH STREET
GRAND CAYMAN, CAYMAN ISLANDS N/A
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(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code: (345) 945-1326
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(Former name or former address, if changes since last report)
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ITEM 5. OTHER EVENTS.
On August 28, 1997, GS Financial Products U.S., L.P. (the "Company")
issued $120,000,000 aggregate principal amount of its 3% Exchangeable Notes due
August 28, 2002 (the "Securities"). Accompanying this Current Report on Form 8-K
as exhibits 4.1, 5.1, 5.2 and 8.1 are (i) the Officers' Certificate establishing
the terms of the Securities (including the form of Note); (ii) the opinions of
Company's U.S. and Cayman Islands counsel regarding the validity of the
Securities; and (iii) the opinion of the Company's U.S. counsel regarding the
material U.S. federal income tax consequences of the purchase, holding and
disposition of the Securities.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL
INFORMATION AND EXHIBITS.
(c) The following exhibits are filed as part of this Form 8-K:
4.1 Officers' Certificate establishing the terms of the Securities
(including the form of Note).
5.1 Opinion letter of the Company's U.S. counsel regarding the validity
of the Securities.
5.2 Opinion letter of the Company's Cayman Islands counsel regarding the
validity of the Securities.
8.1 Opinion letter of the Company's U.S. counsel regarding the material
U.S. federal income tax consequences of the purchase, holding and
disposition of the Securities.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
GS FINANCIAL PRODUCTS U.S., L.P.
(Registrant)
acting by its general partner
GS Financial Products US Co.
Date: September 4, 1997 By: /s/ Greg Swart
-------------------------------------
Name: Greg Swart
Title: President
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INDEX TO EXHIBITS
Exhibit
No. Description Page No.
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4.1 Officers' Certificate establishing
the terms of the Securities
(including the form of Note).
5.1 Opinion letter of the Company's
U.S. counsel regarding the validity
of the Securities.
5.2 Opinion letter of the Company's
Cayman Islands counsel regarding
the validity of the Securities.
8.1 Opinion letter of the Company's
U.S. counsel regarding certain
U.S. federal income tax matters.
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Exhibit 4.1
GS FINANCIAL PRODUCTS U.S., L.P.
Officers' Certificate
Pursuant to Section 301
The undersigned, Greg Swart and Amy Furman, President and Secretary,
respectively, of GS Financial Products US Co., the corporate general partner
(the "Corporate General Partner") of GS Financial Products U.S., L.P. (the
"Issuer"), pursuant to Section 301 of the Indenture, dated as of October 11,
1994 (the "Indenture"), between the Issuer and The Bank of New York, as Trustee
(the "Trustee"), and as authorized by the resolutions of the Board of Directors
of the Corporate General Partner by unanimous written resolutions dated November
27, 1995, and the written resolutions of a duly authorized Committee of the
Board of Directors of the Corporate General Partner, dated January 2, 1996 and
August 28, 1997(collectively, the "Resolutions"), do hereby certify as follows:
1. An Officers' Certificate pursuant to Section 301 of the Indenture,
dated January 3, 1996 (the "Officers' Certificate"), established a series of
debt securities to be issued under the Indenture, such series of debt securities
entitled "Medium-Term Notes, Series B" (the "Notes"), and the terms of such
Notes. Paragraph (k) of the Officers' Certificate was amended and restated by an
Officers' Certificate pursuant to Section 301 of the Indenture, dated August 9,
1996.
2. The terms of the Issuer's 3% Citicorp Exchangeable Notes due August
28, 2002 (the "Exchangeable Notes") set forth in the Pricing Supplement, dated
August 21, 1997 (the "Pricing Supplement"), to the Prospectus Supplement, dated
January 3, 1996 (the "Prospectus Supplement"), are hereby approved; the
Exchangeable Notes shall be part of the Notes; and the form of Exchangeable Note
attached hereto as Annex A is hereby approved.
3. For purposes only of the Exchangeable Notes being issued and sold
pursuant to the Pricing Supplement, paragraphs (f) and (k), respectively, of the
Officers' Certificate are hereby amended and restated as follows:
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(f)(i) Payment of cash with respect to any Exchangeable Note at the
Stated Maturity Date, Call Date or Redemption Date, as the case may be,
will be made upon surrender of such Exchangeable Note at the Corporate
Trust Office of the Trustee in the Borough of Manhattan, The City of New
York or at such other offices or agencies as the Issuer may designate and
at the offices of such other Paying Agents as the Issuer shall have
appointed pursuant to the Indenture. Any cash payments of all or a portion
of the aggregate Principal Amount of Exchangeable Notes represented by, and
any interest due with respect to, any Exchangeable Note at the Stated
Maturity Date, Call Date or Redemption Date, as the case may be, will be
made in immediately available funds upon surrender of such Exchangeable
Note as provided above, provided that the Exchangeable Note is presented to
the Paying Agent in time for the Paying Agent to make such payments in such
funds in accordance with its normal procedures. Payments of interest other
than at the Stated Maturity Date, Call Date or Redemption Date will be made
by check mailed to the address of the person entitled thereto as it appears
in the Security Register or by wire transfer as provided in the form of
Exchangeable Note; and
(ii) Deliveries or payments of shares of Common Stock, cash, property
or other securities with respect to any Exchangeable Note upon exchange
will be made on the Exchange Settlement Date following delivery prior to
12:00 noon, New York time, on an Exchange Date of (i) a properly completed
Notice of Exchange (with a copy to the Calculation Agent) and (ii) such
Exchangeable Note, duly endorsed in blank, at the Corporate Trust Office of
the Trustee in the Borough of Manhattan, The City of New York or at such
other offices or agencies as the Issuer may designate and at the offices of
such other Paying Agents as the Issuer shall have appointed pursuant to the
Indenture. Any cash payments due on the Exchange Settlement Date will be
made in immediately available funds.
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(k) The Exchangeable Notes will be denominated in amounts of $250,000
and integral multiples of $250,000.
4. The Exchangeable Notes are not redeemable at the option of any
Holder, are not entitled to the benefits of a sinking fund and are not subject
to the provisions of Section 1302 or 1303 of the Indenture.
5. During the period from August 28, 1997 to and including September
13, 1999, the Exchangeable Notes are redeemable, at the option of the Issuer,
upon not less than 60 days' notice if the Issuer certifies to the Trustee that
it has determined to terminate its periodic reporting obligation with the
Commission, as described in the first paragraph of "Description of
Securities--Redemption" in the Prospectus, dated December 28, 1995, as
supplemented and superseded by the following discussion. Any such redemption of
the Exchangeable Notes will be made as a whole and not in part, and the
Exchangeable Notes will be redeemed at a redemption price equal to the greater
of (i) 105% of the average of the Closing Values of the Exchangeable Notes on
the 10 Trading Days immediately preceding the Issuer Notice Date and (ii) 100%
of the Face Amount of the Exchangeable Notes to be redeemed, in each case
together with any accrued and unpaid interest up to but not including the
Redemption Date. "Closing Value" means, with respect to any Trading Day, the
average of the bid and ask prices as reported on such Trading Day by a
broker-dealer selected by the Issuer (which may be the Calculation Agent) to
determine the Closing Value.
6. On or after September 14, 1999, the Issuer may redeem the
Exchangeable Notes, as a whole but not in part, upon not more than 60 days' nor
less than 30 days' notice, at 100% of the Face Amount, together with any accrued
and unpaid interest to but excluding the Call Date.
7. For purposes only of the Exchangeable Notes, all references in the
Indenture to "money" or "sum", and any variation thereof, in connection with the
payment of the principal of the Exchangeable Notes, shall be deemed to refer to
Common Stock, cash, property and securities deliverable upon exchange of the
Exchangeable Notes in accordance with the provisions of the Exchangeable Notes
set forth in the form of Exchangeable Note.
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8. Solely for purposes of the aggregate principal amount of
Exchangeable Notes required for any consent, waiver, authorization or other
action taken or to be taken by holders of Exchangeable Notes pursuant to the
Indenture, the principal amount of the Exchangeable Notes will equal the Face
Amount of the Exchangeable Notes.
9. For purposes of Section 501 of the Indenture, it shall be an Event
of Default if Issuer fails to exchange any Exchangeable Note for Common Stock,
cash, property or other securities at an Exchange Settlement Date.
10. For purposes of Section 902 of the Indenture, the Issuer may not
enter into any supplemental indenture, without the consent of the Holder of each
Outstanding Exchangeable Note, that makes any change to the terms under which
the Exchangeable Notes are exchanged for Common Stock, cash, property or other
securities that is adverse to the Holders of the Outstanding Exchangeable Notes,
or reduces the amount of Common Stock, cash, property or other securities to be
received upon exchange of the Exchangeable Notes.
11. The Exchangeable Notes shall have the benefit of the covenants set
forth in Annex B hereto.
Capitalized terms used herein and not otherwise defined herein have the
meanings specified in the Indenture, the Prospectus Supplement or the Pricing
Supplement.
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IN WITNESS WHEREOF, Greg Swart, President of the Corporate General
Partner, and Amy Furman, Secretary of the Corporate General Partner, have
executed and caused this certificate to be delivered on August 21, 1997.
/s/ Greg Swart
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Greg Swart
President
GS Financial Products US Co.
/s/ Amy Furman
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Amy Furman
Secretary
GS Financial Products US Co.
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ANNEX A
THE HOLDER OF THIS SECURITY AGREES FOR THE BENEFIT OF GS FINANCIAL
PRODUCTS U.S., L.P. THAT, IF THE HOLDER PROPOSES TO SELL OR TRANSFER THIS
SECURITY TO ANY PENSION OR WELFARE PLAN (AS DEFINED IN SECTION 3 OF THE EMPLOYEE
RETIREMENT INCOME SECURITY ACT OF 1974 ("ERISA")), THE HOLDER WILL DO SO ONLY:
(U) TO THE EXTENT SUCH PURCHASE IS MADE BY OR ON BEHALF OF A BANK
COLLECTIVE INVESTMENT FUND MAINTAINED BY THE PURCHASER IN WHICH AT ANY TIME
WHILE THIS SECURITY IS OUTSTANDING NO PLAN, TOGETHER WITH ANY OTHER PLANS
MAINTAINED BY THE SAME EMPLOYER OR EMPLOYEE ORGANIZATION, HAS AN INTEREST
IN EXCESS OF 10% OF THE TOTAL OF ALL ASSETS IN SUCH COLLECTIVE INVESTMENT
FUND;
(V) TO THE EXTENT SUCH PURCHASE IS MADE BY OR ON BEHALF OF AN INSURANCE
COMPANY POOLED SEPARATE ACCOUNT MAINTAINED BY THE PURCHASER IN WHICH AT ANY
TIME WHILE THIS SECURITY IS OUTSTANDING NO PLAN, TOGETHER WITH ANY OTHER
PLANS MAINTAINED BY THE SAME EMPLOYER OR EMPLOYEE ORGANIZATION, HAS AN
INTEREST IN EXCESS OF 10% OF THE TOTAL OF ALL ASSETS IN SUCH POOLED
SEPARATE ACCOUNT;
(W) TO THE EXTENT SUCH PURCHASE IS MADE BY OR ON BEHALF OF AN INSURANCE
COMPANY GENERAL ACCOUNT IN WHICH AT ANY TIME WHILE THIS SECURITY IS
OUTSTANDING THE RESERVES AND LIABILITIES FOR THE GENERAL ACCOUNT CONTRACTS
HELD BY OR ON BEHALF OF ANY PLAN, AS DEFINED BY THE ANNUAL STATEMENT
APPROVED BY THE NATIONAL ASSOCIATION OF INSURANCE COMMISSIONERS ("NAIC"),
TOGETHER WITH SUCH RESERVES AND LIABILITIES WITH RESPECT TO ANY OTHER PLANS
MAINTAINED BY THE SAME EMPLOYER OR EMPLOYEE ORGANIZATION, DO NOT EXCEED 10%
OF THE TOTAL OF RESERVES AND LIABILITIES OF THE GENERAL ACCOUNT (EXCLUSIVE
OF SEPARATE ACCOUNT LIABILITIES) PLUS SURPLUS AS SET FORTH IN THE NAIC
ANNUAL STATEMENT FILED WITH THE STATE OF DOMICILE OF THE INSURER; OR
(X) TO THE EXTENT THAT SUCH PURCHASE IS MADE ON BEHALF OF A PLAN BY:
(i) AN INVESTMENT ADVISER REGIS TERED UNDER THE INVESTMENT ADVISERS ACT OF
1940, WITH, AS OF THE LAST DAY OF ITS MOST RECENT FISCAL YEAR, TOTAL ASSETS
UNDER ITS MANAGEMENT AND CONTROL IN EXCESS
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OF $50,000,000 AND SHAREHOLDERS' OR PARTNERS' EQUITY IN EXCESS OF $750,000
AS SHOWN IN ITS MOST RECENT BALANCE SHEET PREPARED IN ACCORDANCE WITH
GENERALLY ACCEPTED ACCOUNTING PRINCIPLES; (ii) A BANK AS DEFINED IN SECTION
202(A)(2) OF THE INVESTMENT ADVISERS ACT OF 1940, WITH EQUITY CAPITAL IN
EXCESS OF $1,000,000 AS OF THE LAST DAY OF ITS MOST RECENT FISCAL YEAR; OR
(iii) AN INSURANCE COMPANY QUALIFIED UNDER THE LAWS OF MORE THAN ONE STATE
TO MANAGE ASSETS WITH NET WORTH IN EXCESS OF $1,000,000 AS OF THE LAST DAY
OF ITS MOST RECENT FISCAL YEAR; AND, IN ANY CASE, IS OTHERWISE A QUALIFIED
PROFESSIONAL ASSET MANAGER, AS SUCH TERM IS USED IN PROHIBITED TRANSACTION
CLASS EXEMPTION 84-14 ISSUED BY THE DEPARTMENT OF LABOR, PROVIDED SUCH
PURCHASE WILL NOT BE MADE FOR OR ON BEHALF OF ANY PENSION OR WELFARE PLAN
(AS DEFINED ABOVE) WHICH, TOGETHER WITH ANY OTHER PLANS MAINTAINED BY THE
SAME EMPLOYER OR EMPLOYEE ORGANIZATION, REPRESENTS MORE THAN 20% OF THE
TOTAL CLIENT ASSETS MANAGED BY SUCH PURCHASER; OR
(Y) IF THE GOLDMAN SACHS GROUP L.P. ("GROUP") HAS NOTIFIED PURCHASERS
THAT PROHIBITED TRANSACTION EXEMPTION 93-78 MAY BE APPLICABLE TO THE
PURCHASE OF THIS SECURITY AND GROUP HAS OBTAINED A LETTER FROM THE INITIAL
PURCHASER OF THIS SECURITY TO THE EFFECT SET OUT IN PROHIBITED TRANSACTION
EXEMPTION 93-78, TO THE EXTENT: (1) THE PURCHASE OF AND DECISION TO INVEST
IN THIS SECURITY IS MADE BY A FIDUCIARY INDEPENDENT OF GROUP; (2) EACH PLAN
PURCHASING THIS SECURITY EITHER (i) HAS ASSETS EXCEEDING $500 MILLION, (ii)
HAS ASSETS EXCEEDING $25 MILLION AND THE FIDUCIARY RESPONSIBLE FOR
INVESTMENT HAS INVESTMENT RESPONSIBILITY FOR CONTROLLED GROUP PLANS
(DETERMINED USING THE DEFINITION OF CONTROLLED GROUP IN SECTION 1563 OF THE
INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE")) WHICH, IN THE
AGGREGATE, HAVE ASSETS OF AT LEAST $500 MILLION OR (iii) IS PART OF A
MASTER TRUST FOR MEMBERS OF A CONTROLLED GROUP (AS DEFINED IN SECTION 1563
OF THE CODE) WITH ASSETS EXCEEDING $500 MILLION, PROVIDED THE FIDUCIARY
MAKING THE INVESTMENT DECISION ON BEHALF OF THE MASTER TRUST HAS INVESTMENT
RESPONSIBILITY FOR ALL PLANS IN THE MASTER TRUST; AND (3) AFTER THE
ACQUISITION OF THIS SECURITY, NO MORE THAN 10% OF ANY PLAN'S ASSETS ARE
INVESTED IN ALL "INSTRUMENTS" OF GROUP, WITHIN THE MEANING OF PROHIBITED
TRANSACTION EXEMPTION 93-78; OR
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(Z) TO THE EXTENT SUCH PLAN IS A GOVERNMENTAL PLAN (AS DEFINED IN
SECTION 3(32) OF ERISA) THAT IS NOT SUBJECT TO THE PROVISIONS OF TITLE I OF
ERISA OR SECTION 401(a) OF THE CODE.
THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE
HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITARY OR A
NOMINEE THEREOF. THIS SECURITY MAY NOT BE EXCHANGED IN WHOLE OR IN PART FOR A
SECURITY REGISTERED, AND NO TRANSFER OF THIS SECURITY IN WHOLE OR IN PART MAY BE
REGISTERED, IN THE NAME OF ANY PERSON OTHER THAN SUCH DEPOSITARY OR A NOMINEE
THEREOF, EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE.
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No. 1 FACE AMOUNT: $120,000,000
CUSIP No. 362276AA5
GS FINANCIAL PRODUCTS U.S., L.P.
MEDIUM-TERM NOTE, SERIES B
(Fixed Rate)
SPECIFIED CURRENCY -- EXCHANGE RATE
U.S. Dollars AGENT: N/A
EXCHANGE RATE: STATED MATURITY
1455.207 shares of Common DATE: August 28, 2002, or
Stock per $250,000 Face if not a Business Day, the
Amount of this Security next succeeding Business Day
ISSUE DATE: August 28, 1997 REPAYMENT DATE: N/A
INTEREST RATE: 3.00% REGULAR RECORD DATES:
So long as the Securities
INTEREST PAYMENT DATES: of this series are repre-
February 28 and sented by one or more
August 28 commencing Global Securities, the
February 28,1998 Business Day immediately
preceding the applicable
DENOMINATIONS: Face Amount Interest Payment Date;
of $250,000 and integral otherwise, February 13 or
multiples thereof August 13, whether or not a
Business Day, immediately
preceding the relevant
Interest Payment Date.
OTHER TERMS:
CERTAIN DEFINITIONS
"Business Day" means any day that is not a Saturday, a Sunday or a day
on which the NYSE (or, if different, the principal securities exchange on which
the Common Stock (or, in the case of a Reorganization Event, any Exchange
Property) is then listed) is authorized or obligated by law or executive order
to close.
"Calculation Agent" means Goldman, Sachs & Co.
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"Call Date" means any date on or after September 14, 1999 fixed by the
Issuer for the redemption of this Security, but in no event earlier than 10
Business Days following the Call Notice Date.
"Call Notice Date" means any Business Day on which the Issuer, or the
Trustee on behalf of the Issuer, mails to Holders a notice of redemption.
"Citicorp" means Citicorp, a Delaware corporation.
"Closing Price" means, with respect to any security on any date, the
closing sale price or last reported sale price, regular way, for the security on
the principal national securities exchange on which such security is listed for
trading on such date or, in the event such security is not listed on any
national securities exchange, on the National Market System (the "NMS") of the
National Association of Securities Dealers, Inc. (the "NASD") on any such date
or, in the event such security is not quoted through the NMS of the NASD on any
such date, on such other U.S. national market system that is the primary market
for the trading of such security or, in the event such security is not listed on
any national securities exchange, or through the NMS of the NASD or any other
U.S. national market system, the Closing Price with respect to such security
will be the mean, as determined by the Calculation Agent, of the bid prices for
such security obtained from as many dealers in such security (which may include
the Calculation Agent or its affiliate), but not exceeding three, as will make
such bid prices available to the Calculation Agent.
"Commission" means the Securities and Exchange Commission.
"Common Stock" means the common stock, par value $1.00 per share, of
Citicorp.
"Default Amount" means, on any day, an amount, in U.S. dollars, equal
to the cost of having a Qualified Financial Institution expressly assume, as of
such day, the due and punctual payment of the principal amount of and interest
on this Security, and the performance and observance of every covenant thereof
and of the Indenture on the part of the Issuer to be performed or observed with
respect to this Security (or to undertake other obligations providing the same
economic value to the Holder of this Security as the Issuer's obligations
thereunder). Such cost will equal (i) the lowest amount that a Qualified
Financial Institution (selected as provided below) would charge to effect such
assumption (or undertaking) plus (ii) the
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reasonable expenses (including reasonable attorneys' fees) incurred by the
Holder of this Security in preparing any documentation necessary for such
assumption (or undertaking). During the Default Quotation Period, each of the
Holder of this Security and the Issuer may request a Qualified Financial
Institution to provide a quotation of the amount it would charge to effect such
assumption (or undertaking) and will notify the other in writing of such
quotation. The amount referred to in clause (i) of this paragraph will equal the
lowest (or, if there is only one, the only) quotation so obtained, and as to
which notice is so given, during the Default Quotation Period; provided,
however, that, with respect to any quotation, the party not obtaining such
quotation may object, on reasonable and significant grounds, to the effectuation
of such assumption (or undertaking) by the Qualified Financial Institution
providing such quotation and notify the other party in writing of such grounds
within two Business Days after the last day of the Default Quotation Period, in
which case such quotation will be disregarded in determining the Default Amount.
The Default Quotation Period will be the period beginning on the day the Default
Amount first becomes due and payable and ending on the third Business Day after
such due day, unless no such quotation is so obtained, or unless every such
quotation so obtained is objected to within five Business Days after such due
day as provided above, in which case the Default Quotation Period will continue
until the third Business Day after the first Business Day on which prompt notice
is given of such a quotation as provided above, unless such quotation is
objected to as provided above within five Business Days after such first
Business Day, in which case the Default Quotation Period will continue as
provided in this sentence. Notwithstanding the foregoing, if the Default
Quotation Period (and the subsequent two Business Day objection period) has not
ended prior to the fifth Business Day immediately preceding the Stated Maturity
Date, Redemption Date or Call Date, as the case may be, then the Default Amount
will equal the Face Amount of this Security.
"Exchange Date" means any Business Day that falls during the period
beginning on the Issue Date to but excluding the earliest of the fifth Business
Day immediately preceding the (i) Stated Maturity Date, (ii) the Redemption Date
or (iii) the Call Date.
"Exchange Notice Date" has the meaning set forth under "Exchange
Right".
"Exchange Rate" means 1455.207 shares of Common Stock per $250,000 Face
Amount of Notes.
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"Exchange Settlement Date" means the third Business Day after the
Exchange Notice Date.
"Issuer Notice Date" means any Business Day on which the Issuer, or the
Trustee on behalf of the Issuer, mails to Holders a notice of redemption with
respect to this Security.
"NYSE" means the New York Stock Exchange, Inc.
"Qualified Financial Institution" means, at any time, a financial
institution organized under the laws of any jurisdiction in the United States of
America, Europe or Japan that at such time has outstanding debt obligations with
a stated maturity of one year or less from the date of issue and rated A-1 or
higher by Standard & Poor's Ratings Group or P-1 or higher by Moody's Investors
Service, Inc. (or such other comparable rating, if any, then used by such rating
agency).
"Redemption Date" means any date prior to and including September 13,
1999 fixed for redemption of this Security by the Issuer, but in no event
earlier than 10 Business Days following the Issuer Notice Date.
EXCHANGE RIGHT
Subject to a prior redemption of the Securities as described under
"--Call Feature" or under "--Redemption" below, as the case may be, the Holder
of this Security will be entitled to exchange each $250,000 Face Amount of this
Security for 1455.207 shares of Common Stock (the "Exchange Rate"). In order to
exercise the exchange right, a Holder must deliver prior to 12:00 noon, New York
time, on an Exchange Date (such date being referred to as the "Exchange Notice
Date") to The Bank of New York (i) a duly completed Notice of Exchange (with a
copy to the Calculation Agent) substantially in the form of Annex A hereto, and
(ii) this Security duly endorsed in blank. A Notice of Exchange delivered at or
after 12:00 noon, New York time, will be considered delivered at the opening of
business on the following Business Day. Once given, a Notice of Exchange may not
be withdrawn or revoked without the written consent of the Issuer. The Exchange
Rate is subject to adjustment as a result of certain dilution events. The Holder
of this Security otherwise entitled to receive fractional shares of Common Stock
upon exchange will receive cash in lieu thereof based on the product of such
fraction and the Closing Price of the Common Stock on the Exchange Notice Date
(rounded to the nearest penny).
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Delivery of shares of the exchange of this Security and cash in lieu
of any fractional shares will be made on the Exchange Settlement Date.
Any question as to the validity of a Notice of Exchange or as to
whether such Notice has been properly and timely given will be resolved by the
Calculation Agent in its sole discretion whose determination shall be final and
binding on the Issuer and the Holder of this Security.
Upon any exercise of the Exchange Right with respect to this Security
at any time prior to 12:00 noon, New York time, on a Regular Record Date, the
Holder of this Security will not be entitled to the interest payment on the
related Interest Payment Date or on any Interest Payment Date thereafter. So
long as this Security is maintained in the form of one or more Global
Securities, if the exercise of the Exchange Right occurs at or after 12:00 noon,
New York time, on a Regular Record Date, then the Holder will receive interest
on the related Interest Payment Date. In the event the Securities of this series
do not remain in the form of one or more Global Securities, a Holder who exer
cises the Exchange Right with respect to this Security at or after 12:00 noon,
New York time, on a Regular Record Date but prior to the related Interest
Payment Date will be entitled to the interest payable in respect of the portion
of this Security surrendered for exchange on such Interest Payment Date but will
be required to include with such Holder's Notice of Exchange the amount of
interest payable on such Interest Payment Date in respect of the exchanged
portion of this Security. Notwithstanding the foregoing, in the event the Issuer
determines to redeem this Security as described below under "--Call Feature" and
subsequent to the Call Notice Date in respect thereof the Holder elects to
exercise the Exchange Right with respect to this Security then the Issuer will
pay to such Holder accrued but unpaid interest in respect of this Security up to
and including the date such Holder has surrendered this Security for exchange
and such Holder shall not be required to accompany such Holder's Notice of
Exchange with the payment of any interest.
ANTI-DILUTION ADJUSTMENTS
GENERAL
The Exchange Rate will be subject to adjustment by the Calculation
Agent as described below to the extent that any of the events requiring such
adjustment occur during the period commencing on the Issue Date and ending on
(but excluding) the fifth Business Day immediately preceding the Stated Maturity
Date, Redemption Date or Call Date, as the
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case may be. No adjustments to the Exchange Rate will be made other than those
specified below.
No adjustments to the Exchange Rate will be required unless such
adjustment would require a change of at least 0.1% in the Exchange Rate;
provided, however, that any adjustments which by reason of the foregoing are not
required to be made shall be carried forward and taken into account in any
subsequent adjustment. The Exchange Rate resulting from any of the adjustments
specified below will be rounded to the nearest one thousandth with five
ten-thousandths being rounded upward.
The Calculation Agent will provide information as to any adjustments to
the Exchange Rate upon written request by the Holder of this Security.
For purposes of clarity, it is intended that the adjustments for stock
splits, reverse stock splits, stock dividends, cash dividends and other
distributions described below are meant to apply only if such events actually
occur, as often as they occur.
STOCK SPLITS
If the Common Stock is subject to a stock split or reverse stock split,
then at the opening of business on the first day on which the Common Stock
trades without the right to receive such stock split (the "ex-dividend date"),
the Exchange Rate will be adjusted by multiplying such Exchange Rate by a
fraction, the numerator of which will be the number of shares of the Common
Stock outstanding at the close of business on the record date for holders of the
Common Stock entitled to such split plus or minus the change in the number of
shares resulting from such stock split or reverse stock split and the
denominator of which will be the number of shares of the Common Stock
outstanding at the close of business on such record date.
STOCK DIVIDENDS
If the Common Stock is subject to a stock dividend that is given
ratably to all holders of shares of the Common Stock, then at the opening of
business on the ex-dividend date, the Exchange Rate will be adjusted by
multiplying such Exchange Rate by a fraction, the numerator of which will be the
number of shares of the Common Stock outstanding at the opening of business on
such ex-dividend date plus the number of shares constituting such stock dividend
and the denominator of which will be the number of shares of the Common Stock
outstanding at the opening of business on such ex-dividend date.
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DIVIDENDS AND OTHER DISTRIBUTIONS
There will be no adjustments to the Exchange Rate to reflect cash
dividends or other distributions paid with respect to the Common Stock other
than (i) distributions that constitute Spin-Off Events as described in the first
paragraph under "--Merger, Consolidation or Sale of Assets" below and (ii)
Extraordinary Dividends as described below. A dividend or other distribution
with respect to the Common Stock will be deemed to be an "Extraordinary
Dividend" if such dividend or other distribution exceeds the immediately
preceding non-Extraordinary Dividend, if any, for the Common Stock by an amount
equal to at least 10% of the Closing Price of the Common Stock on the first
Business Day immediately preceding the ex-dividend date. If an Extraordinary
Dividend occurs with respect to the Common Stock, the Exchange Rate will be
adjusted by multiplying such Exchange Rate by a fraction, the numerator of which
will be the Closing Price of the Common Stock on the Business Day immediately
preceding the ex-dividend date with respect to such Extraordinary Dividend and
the denominator of which will be the difference between such Closing Price and
the Extraordinary Dividend Amount. The "Extraordinary Dividend Amount" with
respect to an Extraordinary Dividend for the Common Stock will equal (i) in the
case of cash dividends or other distributions that constitute quarterly
dividends, the amount per share of such Extraordinary Dividend minus the amount
per share of the immediately preceding non-Extraordinary Dividend for the Common
Stock or (ii) in the case of cash dividends or other distributions that do not
constitute quarterly 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 will be conclusive. A distribution on the Common Stock that
constitutes a Spin-Off Event and that also constitutes an Extraordinary Dividend
will only cause an adjustment to the Exchange Rate pursuant to the first
paragraph under "--Merger, Consolidation or Sale of Assets" below.
RIGHTS AND WARRANTS
If Citicorp issues rights or warrants to all holders of the Common
Stock to subscribe for or purchase the Common Stock at an exercise price per
share less than the Closing Price of the Common Stock on the record date for
determining the holders of the Common Stock entitled to receive such rights and
warrants, then the Exchange Rate will be adjusted by multiplying such Exchange
Rate by a fraction, the numerator of which will be the number of shares of the
Common Stock outstanding at the close of
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<PAGE>
business on such record date, plus the number of additional shares of the Common
Stock offered for subscription or purchase pursuant to such rights or warrants
and the denominator of which will be the number of shares of the Common Stock
outstanding at the close of business on such record date, plus the number of
additional shares of the Common Stock which the aggregate offering price of the
total number of shares of the Common Stock so offered for subscription or
purchase pursuant to such rights or warrants would purchase at the Closing Price
of the Common Stock on such record date, which will 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 Closing Price.
MERGER, CONSOLIDATION OR SALE OF ASSETS
If (A) (i) there occurs any reclassification or change of the Common
Stock, (ii) Citicorp or any surviving entity or subsequent surviving entity of
Citicorp (a "Successor") has been subject to a merger, combination or
consolidation and either (x) is not the surviving entity or (y) survives and all
of the outstanding shares of the Common Stock are exchanged for or converted
into Exchange Property (as defined below), (iii) any statutory exchange of
securities of Citicorp or any Successor with another entity occurs (other than
pursuant to clause (ii) above), (iv) any sale, lease, transfer, or conveyance to
another entity of the property of Citicorp or any Successor as an entirety or
substantially an entirety, (v) Citicorp or any Successor is liquidated,
dissolved or wound up, (vi) Citicorp issues to all of its shareholders equity
securities of an issuer other than Citicorp (other than in a transaction
described in clauses (ii), (iii), (iv) or (v) above, a "Spin-off Event") or
(vii) a tender or exchange offer is consummated for all the outstanding shares
of the Common Stock or for all of a particular type of Exchange Property (any
such event in clauses (i) through (vii), a "Reorganization Event"), and (B) in
the case of (i) a Reorganization Event other than a Spin-Off Event, the
effective time of such Reorganization Event occurs prior to the fifth Business
Day immediately preceding the Stated Maturity Date, Redemption Date or Call
Date, as the case may be, or (ii) a Spin-Off Event, the record date fixed for
the determination of the shareholders of Citicorp entitled to receive the
securities distributed in such Spin-Off Event (the "Spin-Off Record Date")
occurs prior to the fifth Business Day immediately preceding the Stated Maturity
Date, Redemption Date or Call Date, as the case may be, then this Security will
be exchangeable for the Transaction Value of each type of Exchange Property (as
defined below). The "Transaction Value" means (i) for any cash received in any
such Reorganization Event, the product
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of (A) the Exchange Rate (as in effect immediately prior to such Reorganization
Event) and (B) the amount of cash received per share of the Common Stock, (ii)
for any property other than cash or securities received in any such
Reorganization Event, the product of (A) the Exchange Rate applicable to such
Exchange Property on the Exchange Notice Date, and (B) the market value of such
Exchange Property on such Exchange Notice Date received for each share of the
Common Stock as determined by the Calculation Agent, and (iii) for any security
received in any such Reorganization Event, an amount equal to the product of (A)
the Exchange Rate applicable to such Exchange Property on the Exchange Notice
Date and (B) the Closing Price per share of such security on such Exchange
Exchange Notice Date multiplied by the quantity of such security received for
each share of the Common Stock. "Exchange Property" means securities, cash or
any other assets distributed in any Reorganization Event, including, in the case
of a Spin-off Event, the share of the Common Stock with respect to which the
spun-off security was issued. If Exchange Property consists of more than one
type of Exchange Property, the holder of this Security will receive an amount of
each type of Exchange Property in the same proportion as each type of Exchange
Property bears to the Transaction Value for all the Exchange Property.
For purposes of the preceding paragraph, in the case of a consummated
tender or exchange offer for all of a particular type of Exchange Property,
Exchange Property will 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
in such tender or exchange offer). 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 will be deemed to include the kind and
amount of cash and other property received by offerees who elect to receive
cash.
All Exchange Property received upon any Reorganization Event will be
subject to the same adjustments as hereinabove described. The Calculation Agent
will be solely responsible for the determination and calculation of any
adjustments to the Exchange Rate and of any related determinations and
calculations with respect to any distributions of stock, other securities or
other property or assets (including cash) in connection with any corporate event
described in the second preceding paragraph, and its determinations and
calculations with respect thereto will be conclusive and binding on the Issuer
and the Holder of this Security.
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CALL FEATURE
This Security is subject to redemption upon not less than 60 days' nor
more than 90 days' notice by first class mail at any time on or after September
14, 1999, as a whole or in part, at the election of the Issuer, at the Face
Amount of this Security, together in the case of any such redemption with
accrued interest to the Redemption Date, but interest installments due on or
prior to such Redemption Date will be payable to the Holder of this Security, or
one or more Predecessor Securities, of record at the close of business on the
relevant Record Dates referred to herein, all as provided in the Indenture.
On and after the Call Notice Date and until the fifth Business Day
immediately preceding the Call Date, the Holder of this Security will continue
to be entitled to exercise the Exchange Right.
REDEMPTION
During the period from the Issue Date to and including September 13,
1999, the Securities of this series are subject to redemption upon not less than
60 days' notice by mail, as a whole or in part, at the election of the Issuer,
if the Issuer, in an Officers' Certificate, certi fies to the Trustee that it
has determined to terminate its obligation to file reports with the Commission
pursuant to the Securities Exchange Act of 1934. Any such redemption of the
Securities will be made as a whole and not in part, and this Security will be
redeemed at a redemption price equal to the greater of (i) 105% of the average
of the Closing Values of this Security on the 10 Trading Days immediately
preceding the Issuer Notice Date and (ii) 100% of the Face Amount of this
Security, in each case together with any accrued and unpaid interest up to but
not including the Redemption Date (but interest installments due on or prior to
such Redemption Date will be payable to the Holder of this Security, or one or
more Predecessor Securities, of record at the close of business on the relevant
Record Dates referred to herein, all as provided in the Indenture). "Closing
Value" means, with respect to any Trading Day, the average of the bid and ask
prices as reported on such Trading Day by a broker-dealer selected by the Issuer
(which may be the Calculation Agent) to determine the Closing Value.
On and after the Issuer Notice Date and until the fifth Business Day
immediately preceding (but not including) the Redemption Date, the Holder of
this Security will continue to be entitled to exercise the Exchange Right.
A-13
<PAGE>
EVENTS OF DEFAULT AND ACCELERATION; DEFAULT AMOUNT
In case an Event of Default with respect to the Securities shall have
occurred and be continuing prior to the fifth Business Day immediately preceding
the Stated Maturity Date, Redemption Date or Call Date, as the case may be, the
amount payable to the Holder on any day on which the principal of this Security
becomes payable upon any acceleration, will equal the Default Amount and, on or
after such fifth Business Day, the Face Amount plus accrued and unpaid interest;
provided, however, that, solely for purposes of the aggregate principal amount
of Securities required for any consent, waiver, authorization or other action
taken or to be taken by holders of Securities pursuant to the Indenture, the
aggregate principal amount of the Securities will equal the aggregate Face
Amount of the Securities.
CALCULATION AGENT
All determinations made by the Calculation Agent will be at the sole
discretion of the Calculation Agent and, in the absence of manifest error, will
be conclusive for all purposes and binding on the Issuer and the Holder of this
Security, and the Calculation Agent will have no liability therefor.
DEFEASANCE AND COVENANT DEFEASANCE
This Security is not subject to defeasance or covenant defeasance.
-----------------------------
GS Financial Products U.S., L.P., a Cayman Islands exempted limited
partnership (hereinafter called the "Issuer", which term includes any successor
Person under the Indenture hereinafter referred to), for value received, hereby
promises to pay to Cede & Co., as nominee of The Depository Trust Company, or
registered assigns, the Face Amount shown above on the Stated Maturity Date,
unless this Security has been exchanged by the Holder prior to the fifth
Business Day immediately preceding the Stated Maturity Date or redeemed by the
Issuer as herein provided prior to the Stated Maturity Date. This Security shall
bear interest on the Face Amount specified above from the Issue Date specified
above (the "Issue Date") or from the most recent Interest Payment Date as
specified above to which interest on this Security (or any predecessor Security)
has been paid or duly provided for and at the Stated Maturity Date, at the rate
per annum equal to the Interest Rate specified above, until the aggregate Face
Amount of the Securities repre-
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<PAGE>
sented hereby is paid or duly provided for, provided that any portion of the
Face Amount specified above and any such installment of interest which is
overdue shall bear interest at the rate per annum equal to the Interest Rate (to
the extent that the payment of such interest shall be legally enforceable), from
the dates such amounts are due until they are paid or duly provided for, and
such interest shall be payable on demand. The interest so payable, and
punctually paid or duly provided for, on any such Interest Payment Date will be
paid to the person in whose name this Security (or one or more predecessor
Securities) is registered at the close of business on the Regular Record Dates
specified above (whether or not a Business Day) next preceding such Interest
Payment Date; provided, however, that interest payable at the Stated Maturity
Date will be payable to the person to whom the Face Amount shall be payable and
that Holders exercising their exchange rights will receive interest as described
under "--Exchange Right" above.
Any such interest which is payable, but not punctually paid or duly
provided for, on any Interest Payment Date will forthwith cease to be payable to
the Holder on such Regular Record Date and such defaulted interest may either be
paid to the person in whose name this Security (or one or more predecessor
Securities) is registered at the close of business on a special record date for
the payment of such interest to be fixed by the Issuer, notice whereof shall be
given to the Holder of this Security not less than 10 days prior to such special
record date, or be paid at any time in any other lawful manner not inconsistent
with the requirements of any securities exchange on which the Securities of
this series may be listed, and upon such notice as may be required by such
exchange.
Payment of interest and the Face Amount on this Security will be made
in the Specified Currency specified above. The Issuer will at all times appoint
and maintain a Paying Agent (which may be the Trustee) authorized by the Issuer
to pay the Face Amount of or interest on any Securities of this series on
behalf of the Issuer and having an office or agency (the "Paying Agency Office")
in The City of New York (the "Place of Payment") where Securities of this series
may be presented or surrendered for payment and where notices, designations or
requests in respect of payments with respect to Securities of this series may be
served. The Issuer has initially appointed The Bank of New York as Paying Agent.
Deliveries or payments of cash, shares of Common Stock, property or
other securities with respect to this Security at the Stated Maturity Date or
Exchange Date, as the case may be, shall be made against surrender of this
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Security at the Corporate Trust Office of the Trustee in the Borough of
Manhattan, The City of New York or at such other offices or agencies as the
Issuer may designate and at the offices of such other Paying Agents as the
Issuer shall have appointed pursuant to the Indenture. The Face Amount of this
Security and any interest due with respect to this Security at the Stated
Maturity Date will be made in immediately available funds upon surrender of this
Security as provided above, provided that this Security is presented to the
Paying Agent in time for the Paying Agent to make such payments in such funds in
accordance with its normal procedures. Payments of interest on this Security
other than at the Stated Maturity Date shall be made by check mailed on or
before the due date for such payment to the person entitled thereto at such
person's address appearing on the register of this Security or by wire transfer
to an account maintained by the payee with a bank located in the Borough of
Manhattan, The City of New York, if such registered Holder so elects by giving
written notice to the Trustee at its Corporate Trust Office in The City of New
York, not less than 15 days (or such fewer days as the Trustee may accept at its
discretion) prior to the date of the payments to be obtained, of such election
and of the account to which payments are to be made.
Reference is hereby made to the further provisions of this Security set
forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by
the Trustee referred to on the reverse hereof by the manual signature of an
authorized signatory, this Security shall not be entitled to any benefit under
the Indenture or be valid or obligatory for any purpose.
A-16
<PAGE>
IN WITNESS WHEREOF, the Issuer has caused this instrument to be duly
executed.
Dated: August 28, 1997
GS FINANCIAL PRODUCTS U.S., L.P.
By: GS Financial Products US Co.
General Partner
By_______________________________
Name:
Title:
Date of Authentication: August 28, 1997
This is one of the Securities
of the series designated
herein referred to in the
within-mentioned Indenture
THE BANK OF NEW YORK, as Trustee
By__________________________________
Authorized Signatory
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<PAGE>
[Reverse]
1. This Security is one of a duly authorized issue of securities of the
Issuer issued and to be issued in one or more series under the Indenture, dated
as of October 11, 1994 (the "Indenture"), between the Issuer and The Bank of New
York, as Trustee (herein called the "Trustee", which term includes any successor
trustee under the Indenture), to which Indenture and all indentures supplemental
thereto, reference is hereby made for a statement of the respective rights,
limitations of rights, duties and immunities thereunder of the Issuer, the
Trustee, the Holders of the Securities and of the terms upon which the
Securities are, and are to be, authenticated and delivered. The Securities
issued and to be issued in one or more series in accordance with the terms of
the Indenture are herein called the "Securities". Terms used and not defined
herein but defined in the Indenture are used herein as therein defined.
2. This Security is one of the series designated on the face hereof,
limited to an aggregate initial offering price not to exceed $500,000,000 (or
the equivalent thereof in any other currency or currencies or currency units)
(which amount may be increased at the option of the Issuer if in the future it
determines that it may wish to sell additional Securities of this series). The
Securities are issuable in the authorized denominations as specified on the face
hereof.
Payments of interest on the aggregate Face Amount of Securities
represented hereby with respect to any Interest Payment Date or the Stated
Maturity Date will include interest accrued to but excluding such Interest
Payment Date and such Stated Maturity Date, as the case may be. Interest on the
aggregate Face Amount of Securities represented hereby shall be computed on the
basis of a 360-day year of twelve 30-day months.
If any payment date would otherwise be a day which is not a Business
Day, with respect to this Security, such payment need not be made on such day,
but may be made on the next succeeding Business Day with the same force and
effect as if made on the due date, and no interest shall accrue on the period
from and after such due date to such succeeding Business Day by reason of such
payment being made on such Business Day.
3. This Security is not exchangeable for Securities registered in the
name of a person other than the Depositary or its nominee except in the event
(x) the Depositary has notified the Issuer that it is unwilling or
A-18
<PAGE>
unable to continue as Depositary for such Global Security or the Depositary has
ceased to be a clearing agency registered under the Securities Exchange Act of
1934, as amended, (y) the Issuer has delivered to the Trustee a written notice
that this Global Security shall be exchangeable or (z) an Event of Default has
occurred and is continuing with respect to the Securities of this series, and no
transfer of this Security (other than a transfer of this Security as a whole by
the Depositary to a nominee of the Depositary or by a nominee of the Depositary
to the Depositary or another nominee of the Depositary) may be registered except
in the limited circumstances described in this paragraph.
4. (a) As provided in the Indenture and subject to certain limitations
therein set forth, the transfer of this Security is registrable in the Security
Register, upon surrender of this Security for registration of transfer at the
office or agency of the Issuer in any place where the Face Amount of the
Securities and interest with respect to the Securities are payable, duly
endorsed by, or accompanied by a written instrument of transfer in form
satisfactory to the Issuer and the Security Registrar duly executed by, the
Holder thereof or his attorney duly authorized in writing, and thereupon one or
more new Securities of this series and of like tenor, of authorized
denominations and for the same aggregate Face Amount, will be issued to the
designated transferee or transferees.
(b) As provided in the Indenture and subject to certain limitations
therein set forth, Securities of this series are exchangeable for a like
aggregate Face Amount of Securities of this series and of like tenor of a
different authorized denomination, as requested by the Holder surrendering the
same.
(c) No service charge shall be made for any such registration of
transfer or exchange described in paragraph (a) or (b), but the Issuer may
require payment of a sum sufficient to cover any tax or other governmental
charge payable in connection therewith.
(d) Prior to due presentment of this Security for registration of
transfer, the Issuer, the Trustee and any agent of the Issuer or the Trustee may
treat the person in whose name this Security is registered as the owner hereof
for all purposes, whether or not this Security be overdue, and neither the
Issuer nor the Trustee nor any such agent shall be affected by notice to the
contrary.
A-19
<PAGE>
5. (a) If an Event of Default with respect to Securities of this series
shall occur and be continuing, the Securities of this series may be declared due
and payable in the manner and with the effect provided in the Indenture and on
the face hereof.
(b) As provided in and subject to the provisions of the Indenture, the
Holder of this Security shall not have the right to institute any proceeding
with respect to the Indenture or for the appointment of a receiver or trustee or
for any other remedy thereunder, unless such Holder shall have previously given
the Trustee written notice of a continuing Event of Default with respect to the
Securities of this series, the Holders of not less than 25% in principal amount
of the Securities of this series at the time Outstanding shall have made written
request to the Trustee to institute proceedings in respect of such Event of
Default as Trustee and offered the Trustee reasonable indemnity, and the Trustee
shall not have received from the Holders of a majority in principal amount of
Securities of this series at the time Outstanding a direction inconsistent with
such request, and shall have failed to institute any such proceeding, for 60
days after receipt of such notice, request an offer of indemnity. The foregoing
shall not apply to any suit instituted by the holder of this Security for the
enforcement of any payment of the Face Amount of the Securities represented
hereby or interest hereon on or after the respective due dates expressed herein.
6. The Indenture permits, with certain exceptions as therein provided
and except as otherwise provided on the face hereof, the amendment thereof and
the modification of the rights and obligations of the Issuer and the rights of
the Holders of the Securities of each series to be affected under the Indenture
at any time by the Issuer and the Trustee with the consent of the Holders of 50%
in principal amount of the Securities at the time Outstanding of each series to
be affected. The Indenture also contains provisions permitting the Holders of
specified percentages in principal amount of the Securities of each series at
the time Outstanding, on behalf of the Holders of all Securities of such series,
to waive compliance by the Issuer with certain provisions of the Indenture and
certain past defaults under the Indenture and their consequences. Any such
consent or waiver by the Holder of this Security shall be conclusive and binding
upon such Holder and upon all future Holders of this Security and of any
Security issued upon the registration of transfer hereof or in exchange herefor
or in lieu hereof, whether or not notation of such consent or waiver is made
upon this Security.
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<PAGE>
7. No reference herein to the Indenture and no provision of this
Security or of the Indenture shall alter or impair the obligation of the Issuer,
which is absolute and unconditional, to pay the Face Amount of this Security and
interest with respect to this Security, at the times, place and rate, and in the
coin, currency or other consideration, herein prescribed and to exchange this
Security as provided under "Exchange Right".
8. THIS SECURITY SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK.
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<PAGE>
ANNEX B
Notice of Adjustments and Certain Other Events
The Issuer shall, within ten Business Days following the occurrence of
an event that requires an adjustment to the Exchange Rate or the occurrence of a
Reorganization Event (or, in any case, if the Issuer is not aware of such
occurrence, as soon as practicable after becoming so aware), to provide written
notice to the Calculation Agent and the Trustee and to the Holders of the
Exchangeable Notes of the occurrence of such event and a statement in reasonable
detail setting forth the method by which the adjustment to the Exchange Rate was
determined or the change in the consideration to be received by the Holders of
the Exchangeable Notes following such event or Reorganization Event and setting
forth the revised Exchange Rate or consideration.
Payment of Certain Taxes Upon Exchange
The Issuer will pay any and all taxes that may be payable in respect of
the transfer and delivery of shares of Common Stock, property or other
securities on exchange of Exchangeable Notes. The Issuer shall not, however, be
required to pay any tax which may be payable in respect of any transfer involved
in the delivery of shares of Common Stock, property or other securities in a
name other than that of the Holder of the Exchangeable Note or Exchangeable
Notes to be exchanged, and no such transfer or delivery shall be made unless and
until the Person requesting such transfer has paid to the Issuer the amount of
any such tax, or has established, to the satisfaction of the Issuer, that such
tax has been paid.
Shares Free and Clear
(a) The Issuer hereby represents and warrants and agrees that upon
exchange of Exchangeable Notes for Common Stock, property or other securities,
the Holders of the Exchangeable Notes shall hold good and valid title to, and
become the beneficial owners of, such Common Stock, property or other
securities, free and clear of any and all liens, claims, charges, encumbrances
and equities. Except as provided under the caption "Payment of Certain Taxes
Upon Exchange", the Issuer shall pay all taxes and charges with respect to the
delivery of such Common Stock, property or
B-1
<PAGE>
other securities delivered in exchange for Exchangeable Notes.
(b) The Issuer shall prepare and obtain and keep in force such
governmental or regulatory permits or other authorizations as may be required by
law, and shall comply with all requirements as to the registration or
qualification, in order that any shares of Common Stock, property or other
securities delivered upon exchange of the Exchangeable Notes will be freely
transferable by the Holders and not subject to any prospectus delivery or other
requirements.
(c) Holders of the Exchangeable Notes will be responsible for the
payment of any and all brokerage and other transaction costs upon any subsequent
sale of the Common Stock, property or other securities received upon exchange of
the Exchangeable Notes.
Cancellation of Exchangeable Note
Upon receipt by the Trustee of Exchangeable Notes delivered to it for
exchange, the Trustee shall cancel and dispose of the same as provided in
Section 309 of the Indenture.
Duties of Trustee Regarding Exchange
Subject to the provisions of Section 601 of the Indenture, neither the
Trustee nor any exchange agent shall be responsible for any failure of the
Issuer to issue, transfer or deliver any Common Stock, property or other
securities upon the surrender of any Exchangeable Note for the purpose of
exchange.
B-2
Exhibit 5.1
SULLIVAN & CROMWELL
125 Broad Street
New York, New York 10004
Telephone: (212 558-4000
Facsimile: (212) 558-3588
August 28, 1997
Goldman, Sachs & Co.,
as Agent,
85 Broad Street,
New York, New York 10004.
Dear Sirs:
In connection with the sale by GS Financial Products U.S., L.P., a
Cayman Islands exempted limited partnership (the "Issuer"), to you, as
principal, pursuant to the Terms Agreement, dated August 21, 1997, between the
Issuer and you, and through you, as agent, pursuant to the Distribution
Agreement, dated as of January 3, 1996, between the Issuer and you, of
$120,000,000 face amount of the Issuer's 3% Citicorp Exchangeable Notes due
August 28, 2002 (the "Securities"), which constitute a part of the Issuer's
Medium-Term Notes, Series B, issued pursuant to the Indenture, dated as of
October 11, 1994 (the "Indenture"), between the Issuer and The Bank of New York,
as Trustee (the "Trustee") we, as your U.S. counsel, have examined such
corporate and partnership records, certificates and other
<PAGE>
Goldman, Sachs & Co. -2-
documents, and such questions of law, as we have considered necessary or
appropriate for the purposes of this opinion. Upon the basis of such
examination, we advise you that, in our opinion:
(1) The Indenture has been duly qualified under the Trust Indenture Act
of 1939, and, assuming the Indenture has been duly authorized, executed and
delivered by the Issuer, constitutes a valid and legally binding obligation
of the Issuer enforceable in accordance with its terms, subject to
bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and
similar laws of general applicability relating to or affecting creditors'
rights and to general equity principles.
(2) Assuming that the Securities have been duly authorized, executed
and delivered by the Issuer, the Securities have been duly authenticated
and issued and constitute valid and legally binding obligations of the
Issuer enforceable in accordance with their terms, subject to bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium and similar
laws of general applicability relating to or affecting creditors' rights
and to general equity principles.
<PAGE>
Goldman, Sachs & Co. -3-
The foregoing opinion is limited to the Federal laws of the United
States and the laws of the State of New York, and we are expressing no opinion
as to the effect of the laws of any other jurisdiction.
With your approval, we have relied as to certain matters on information
obtained from public officials, officers of the general partner of the Issuer
and other sources believed by us to be responsible, and we have assumed that the
Indenture has been duly authorized, executed and delivered by the Trustee, that
the Securities conform to the specimen thereof examined by us, that the
Trustee's certificates of authentication of the Securities have been manually
signed by one of the Trustee's authorized signatories, and that the signatures
on all documents examined by us are genuine, assumptions which we have not
independently verified.
Very truly yours,
/s/ SULLIVAN & CROMWELL
Exhibit 5.2
MAPLES and CALDER
Attorneys-at-Law
28th August, 1997
GOLDMAN, SACHS & CO.
85 Broad Street
New York
New York 10004
U.S.A.
Dear Sirs,
GS FINANCIAL PRODUCTS U.S., L.P.
US$120,000,000 3% CITICORP EXCHANGEABLE NOTES DUE 28TH AUGUST, 2002
We have acted as counsel as to the laws of the Cayman Islands to GS Financial
Products U.S., L.P., a Cayman Islands exempted limited partnership ("GSFP US"),
in connection with the issue by GSFP US of US$120,000,000 3% Citicorp
Exchangeable Notes due 28th August, 2002 (the "Notes", which expression shall
include the Notes in global form as contemplated by the Indenture) pursuant to
an Indenture dated as of 11th October, 1994 between GSFP US and The Bank of New
York (the "Indenture").
GSFP US has requested us to advise you:
(i) as to the due authorisation and execution by and enforceability against
GSFP US of the Indenture, certain related documents and of the Notes as
a matter of Cayman Islands law;
(ii) as to certain matters in relation to the liability of the general
partner of GSFP US in respect of its debts and obligations; and
(iii) as to certain matters in relation to Cayman Islands taxation.
In connection with the above, we have examined the following documents:
<PAGE>
MAPLES AND CALDER
GS FINANCIAL PRODUCTS U.S., L.P. 2
OPINION TO GOLDMAN, SACHS & CO. 28TH AUGUST, 1997
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1. the Certificate of Incorporation and Memorandum and Articles of
Association as amended of GS Financial Products US Co. ("GSFP US Co.")
together with its corporate records as provided to us and maintained at
its registered office in the Cayman Islands;
2. the Certificate of Registration of GSFP US;
3. the Limited Partnership Agreement dated 5th February, 1992 constituting
GSFP US together with the amended and restated versions of such
agreement dated as of 10th March, 1992 and the subsequent agreements
amending the Limited Partnership Agreement dated 27th November, 1992
and 24th November, 1993 (the "Partnership Agreement");
4. the minutes of the meetings and the unanimous written resolutions of
the Board of Directors of GSFP US Co. as supplied to us and filed on
its minute book maintained at its registered office (the "Board
Resolutions");
5. the minutes of the meetings and the written resolutions of the
Committee of the Board of Directors of GSFP US Co. as supplied to us
and filed on its minute book maintained at its registered office (the
"Committee Resolutions" and together with the Board Resolutions, the
"Resolutions");
6. a copy of the Indenture;
7. a copy of the Custodian Agreement dated 27th November, 1992 between
GSFP US and Goldman Sachs (Cayman) Trust, Limited ("GSCT") (the
"Custodian Agreement");
8. a copy of the Space Sharing Agreement dated 27th November, 1992 between
GSFP US and GSCT (the "Space Sharing Agreement");
9. a copy of the Origination Agreement dated November 27, 1992 between
Goldman, Sachs & Co. ("GS&Co.") and GSFP US;
10. a copy of the Origination Agreement dated January 5, 1994 between
Goldman Sachs International Limited and GSFP US;
<PAGE>
MAPLES AND CALDER
GS FINANCIAL PRODUCTS U.S., L.P. 3
OPINION TO GOLDMAN, SACHS & CO. 28TH AUGUST, 1997
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11. a copy of the Calculation Agreement dated January 5, 1994 between
GS&CO. and GSFP US;
12. the Back-up Services Agreement dated June 10, 1993 between Morgan
Grenfell (Cayman) Limited and GSFP US (the "Backup Agreement");
13. the Assignment and Assumption Agreement dated November 23, 1992 among
GSFP US, GS&Co., GS Capital Markets, L.P. ("GSCM") and The Goldman
Sachs Group, L.P. ("Group");
14. a copy of the Master ISDA Agreement dated February 24, 1993 between
GSFP US and GSCM (the "GSCM ISDA Agreement");
15. a copy of the Master ISDA Agreement dated November 4, 1993 between GSFP
US and GS Financial Products International, L.P. (the "GSFPI ISDA
Agreement" and together with the GSCM ISDA Agreement the "ISDA
Agreements");
16. the Contribution Agreement dated November 27, 1993, between Group, GS
Equity markets, L.P., GSCI Holdings, GS Financial Products Co., GS
Financial Products, L.P., GSFP US Co. and GSFP US (the "Contribution
Agreement");
17. a copy of the Distribution Agreement dated January 3, 1996 (the
"Distribution Agreement") and a draft of the Terms Agreement dated
August 21, 1997 (the "Terms Agreement"), each entered into between GSFP
US and GS&Co.;
18. a copy of the Calculation Agency Agreement dated January 3, 1996 and
entered into between GSFP US and The Bank of New York;
19. a copy of a specimen of the Notes;
20. a copy of the certificate dated 28th August, 1997 pursuant to Section
301 of the Indenture establishing the form and terms of the Notes;
21. a copy of the Pricing Supplement No. 3 dated 21st August, 1997 (the
"Pricing Supplement") to the Prospectus dated December 28, 1995
relating to the issue of the Notes and as supplemented by the
Prospectus Supplement dated 3rd January, 1996
<PAGE>
MAPLES AND CALDER
GS FINANCIAL PRODUCTS U.S., L.P. 4
OPINION TO GOLDMAN, SACHS & CO. 28TH AUGUST, 1997
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relating to the issue of US$500,000,000 Medium-Term Notes, Series B by
GSFP US, including the Notes (collectively the "Prospectus");
22. a copy of the Operating Policies adopted on behalf of GSFP US by
resolution of the Board of Directors of GSFP US Co. on 2nd August, 1994
as modified in or about November, 1995 (the "Operating Policies"); and
23. a draft of the letter appointing GS & Co. as Calculation Agent in
relation to the Notes.
The documents listed under 6 to 18 and 23 above inclusive are together referred
to herein as the "Transaction Documents".
All statements and opinions expressed herein are given only as to and based on
circumstances existing on the date hereof and known to us and as to the laws of
the Cayman Islands as the same are in force as at the date hereof and we have
assumed that there are no provisions of any law (other than the laws of the
Cayman Islands) which would or might affect any such statements or opinions.
Specifically, we have made no independent investigation of the laws of New York
or the Federal laws of the United States of America. We have not been
responsible for investigation or verification of statements of fact or the
reasonableness of any statements of opinion contained in any of the Transaction
Documents, nor do we express any opinion on the commercial terms or merits
thereof.
We have relied, without independent verification, upon the accuracy of a
certificate of a Director or Officer of GSFP US Co., a copy of which is attached
hereto.
We have also relied upon the following assumptions, which we have not
independently verified and will not independently verify:
(a) The Transaction Documents have been or will have been duly
authorised, executed and delivered by or on behalf of all
relevant parties (other than GSFP US as a matter of Cayman
Islands Law) and are and remain legal, valid, binding and
enforceable against all relevant parties in accordance with their
respective terms (and from the dates from which such agreements
are expressed to apply) under the laws of New York and all other
relevant laws (other than the laws of the Cayman Islands);
<PAGE>
MAPLES AND CALDER
GS FINANCIAL PRODUCTS U.S., L.P. 5
OPINION TO GOLDMAN, SACHS & CO. 28TH AUGUST, 1997
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(b) The choice of New York law as the governing law of the
Transaction Documents (other than the Custodian Agreement,
Contribution Agreement, the Space Sharing Agreement and the
Back-up Agreement) has been made in good faith and would be
regarded as a valid and binding selection which will be upheld by
the courts of New York and the federal courts of the United
States of America as a matter of New York law and all other
relevant laws (other than the laws of the Cayman Islands) and is
not designed to evade some provision of the laws of another
jurisdiction having a closer connection with the transactions
contemplated thereby;
(c) Copies of documents provided to us are true copies of the
originals and where draft documents have been provided to us, the
final form of the respective executed originals conforms or will
conform therewith in all respects;
(d) The genuineness of all signatures, initials and seals;
(e) The power, authority and legal right of all parties under all
relevant laws and regulations (other than GSFP US under the laws
of the Cayman Islands) to enter into, execute and perform their
respective obligations under the Transaction Documents;
(f) The Notes will be issued in all respects as contemplated by the
terms of the Indenture and will be duly completed, executed,
authenticated and delivered in accordance with, and as
contemplated by, the provisions of the relevant Transaction
Documents and the Resolutions (including any further relevant
resolutions passed by the Directors of GSFP US Co. or any
Committee or delegate(s) thereof) and will constitute a valid and
binding obligation of GSFP US as a matter of New York law and all
other relevant laws (other than the laws of the Cayman Islands);
(g) There has been and will be no breach of the Operating Policies by
GSFP US Co. or GSFP US and neither the issue of the Notes nor any
transaction contemplated in connection therewith will result in
any such breach occurring;
(h) That the terms of the Transaction Documents reflect the
intentions of the parties thereto;
<PAGE>
MAPLES AND CALDER
GS FINANCIAL PRODUCTS U.S., L.P. 6
OPINION TO GOLDMAN, SACHS & CO. 28TH AUGUST, 1997
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(i) That there exist no resolutions of the general partner of GSFP US
acting in such capacity that we have not reviewed and that the
authority of the general partner of GSFP US has not been
restricted in any manner other than as provided in the
Partnership Agreement and that the Partnership Agreement has not
been amended since its execution other dm as referred to in
paragraph 3 above;
(j) That the original copy of the Committee Resolutions of GSFP US
Co. dated 28th August, 1997, of which the signature page has been
sent by facsimile to us, has a copy of the Pricing Supplement
annexed thereto.
Based upon and subject to the foregoing and the qualifications set out below and
having regard to such legal considerations as we deem relevant, we are of the
opinion that:
1. GSFP US Co. has been duly registered as an exempted company with limited
liability and is validly existing and in good standing under the laws of the
Cayman Islands. GSFP US has been duly registered and is validly existing and in
good standing as an exempted limited partnership under the laws of the Cayman
Islands. GSFP US Co. and GSFP US have each been established for an unlimited
duration.
2. GSFP US Co. has full power and authority under its Memorandum and Articles
of Association and the Partnership Agreement to enter into and execute the
Transaction Documents and create and issue the Notes pursuant to the Indenture
on behalf of GSFP US.
3. The Transaction Documents have been duly authorised on behalf of GSFP US by
GSFP US Co., the general partner of GSFP US and, assuming that each such
Transaction Document has been unconditionally executed and delivered in
accordance with the authorities evidenced in the Resolutions, each constitutes
or will constitute, as the case may be, the legal, valid and binding obligations
of GSFP US, enforceable in accordance with its terms except and insofar as such
enforcement may be limited as hereinafter set forth. The term "enforceable" as
used above means that the obligations assumed by GSFP US or GSFP, as the case
may be, under the relevant instrument are a type which the courts of the Cayman
Islands enforce. It does not mean that those obligations will necessarily be
enforced in all circumstances in accordance with their terms. We would draw to
your attention the following:
<PAGE>
MAPLES AND CALDER
GS FINANCIAL PRODUCTS U.S., L.P. 7
OPINION TO GOLDMAN, SACHS & CO. 28TH AUGUST, 1997
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(a) enforcement may be limited by bankruptcy, insolvency, liquidation,
dissolution, reorganization and other laws of general application
relating to or affecting the rights of creditors. Notwithstanding
the foregoing, we have been asked to advise specifically in
relation to the enforceability of certain provisions in the ISDA
Agreements to the stated effect that upon their termination all
transactions entered into pursuant to their terms as evidenced by
confirmations thereunder will be treated as one; liabilities from
each party to the other (calculated in accordance with the terms
of the ISDA Agreements) are to be "netted" against each other with
the intended result that a single payment should be made by
whichever party has a "net" obligation to the other and such
obliged party should make a single payment in final satisfaction
of all outstanding obligations thereunder. We are unaware of any
directly relevant decided Cayman Islands authorities and,
accordingly, there is a degree of uncertainty in relation to the
outcome should such an issue fall to be decided by a Cayman
Islands court, which has broad discretion in relation to matters
relating to the dissolution of a Cayman Islands exempted limited
partnership. However, provided that any payment made on
termination of either of the ISDA Agreements was regarded as
constituting a fair pre-estimate of loss rather than a penalty and
such ISDA Agreement was not entered into on behalf of GSFP US with
a view to preferring the relevant counterparty over its other
creditors, we are of the opinion that a Cayman Islands court would
be likely to uphold the termination provisions of the ISDA
Agreements against the parties thereto in relation to the
"netting" of amounts payable thereunder in the event of the
insolvency of GSFP US;
(b) enforcement may be limited by general principles of equity - for
example, equitable remedies such as specific performance may not
be available, inter alia, where damages are considered to be an
adequate remedy;
(c) claims may become barred under the statutes of limitation or may
be or become subject to defences of set-off or counterclaim;
(d) where obligations are to be performed in a jurisdiction outside
the Cayman Islands, they may not be enforceable in the Cayman
Islands to the extent that performance would be illegal under the
laws of that jurisdiction;
<PAGE>
MAPLES AND CALDER
GS FINANCIAL PRODUCTS U.S., L.P. 8
OPINION TO GOLDMAN, SACHS & CO. 28TH AUGUST, 1997
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(e) the Cayman Islands court has jurisdiction to give judgment in the
currency of the relevant obligation and statutory rates of
interest payable upon judgments given after 1st June, 1995 will
vary according to the currency of the judgment. In the event that
GSFP US or GSFP US Co. becomes insolvent and is made subject to a
liquidation proceeding, the Cayman Islands court is likely to
require all debts to be proved in a common currency, which is
likely to be the "functional currency" of GSFP US or GSFP US Co.,
as the case may be, determined in accordance with the applicable
accounting principles;
(f) although some doubt exists, we consider that a certificate
representing a Note in registered form (assuming that as a matter
of New York law it is no more than evidence of entitlement and is
not transferable by delivery) would not attract Cayman Islands
stamp duty. An instrument transferring such a registered Note or
Notes, if brought to or executed in the Cayman Islands, would
attract duty of CI$100 in each case. All original counterparts of
any such stampable documents would attract duty of CI$2.00 each.
Any Transaction Documents would be subject to nominal Cayman
Islands stamp duty if executed in or brought within the
jurisdiction of the Cayman Islands in original form;
(g) a certificate, determination, calculation or designation of any
party to any of the Transaction Documents as to any matter
provided therein might be held by a Cayman Islands court not to be
conclusive, final and binding if, for example, it could be shown
to have an unreasonable or arbitrary basis or in the event of
manifest error;
(h) although there is no statutory enforcement in the Cayman Islands
of judgments obtained in other jurisdictions, the courts of the
Cayman Islands will recognise and enforce a foreign judgment of a
court of competent jurisdiction, based on the principle that a
judgment of a competent foreign court imposes upon the judgment
debtor an obligation to pay the sum for which judgment has been
given, and provided such judgment is final, for a liquidated sum
not in respect of taxes or a fine or penalty, and which was not
obtained in a manner, and is not of a kind the enforcement of
which is, contrary to the public policy of the Cayman Islands; a
Cayman Islands' court may stay proceedings if concurrent
proceedings are being brought elsewhere;
<PAGE>
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GS FINANCIAL PRODUCTS U.S., L.P. 9
OPINION TO GOLDMAN, SACHS & CO. 28TH AUGUST, 1997
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(i) obligations (if any) to make payments that may be regarded as
penalties will not be enforceable;
(j) a Cayman Islands court will not necessarily award costs and
disbursements in litigation in accordance with contractual
provisions in that regard;
(k) we make no comment with regard to the references to foreign
statutes in the Transaction Documents;
(l) any term of any of the agreements herein referred to may be
amended orally by the parties thereto, notwithstanding any
provision (if any) to the contrary contained therein;
(m) we reserve our opinion as to the extent to which a Cayman Islands
court would, in the event of any relevant illegality, sever the
offending provisions and enforce the remainder of the transaction
of which such provisions form a part, notwithstanding any express
provisions in that regard;
(n) to maintain GSFP US in good standing under the laws of the Cayman
Islands, annual filing fees must be paid and annual returns made
to the Registrar of Exempted Limited Partnerships;
(o) legal proceedings against an exempted limited partnership must be
instituted against a general partner thereof;
(p) any obligations of GSFP US or GSFP US Co. under the Transaction
Documents or the Notes which involve the government of any country
which is currently the subject of United Nations Sanctions (an
"Affected Country"), any person or body resident in, incorporated
in or constituted under the laws of any Affected Country or
exercising public functions in any Affected Country or any person
or body controlled by any of the foregoing or by any person acting
on behalf of any of the foregoing may be subject to restrictions
pursuant to such sanctions as implemented under the laws of the
Cayman Islands; at the date hereof, the Affected Countries are
Iraq and Libya;
<PAGE>
MAPLES AND CALDER
GS FINANCIAL PRODUCTS U.S., L.P. 10
OPINION TO GOLDMAN, SACHS & CO. 28TH AUGUST, 1997
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(q) we express no opinion as to any obligation which any of the
Transaction Documents may purport to establish in favour of any
person who is not a party thereto;
(r) in the event that further Notes were issued by GSFP US following a
change in its general partner or general partners, such Notes
would not necessarily rank pari passu or be exactly fungible with
previously issued Notes in that the holders thereof would have
recourse to different general partners if the assets of GSFP US
were insufficient to make payment in full in respect of all the
Notes. We are of the opinion that an instrument issued in exact
replacement of a previously issued Note would be treated as
evidencing the same original obligation and the liability of
general partners (or any general partner of a general partner) of
GSFP US thereon would be the same as in respect of the replaced
Note; and
(s) if GSFP US obtains a beneficial interest in any Notes then its
rights and obligations in respect thereof may merge, thus
extinguishing such rights and obligations, so that any attempted
resale of those Notes might constitute a separate issue of debt
obligations.
4. The creation and issue of the Notes pursuant to the Indenture have been
duly authorised on behalf of GSFP US.
5. Subject to each of GSFP US and its general partner making all annual
filings and payments required to maintain their good standing under the laws of
the Cayman Islands, no authorisations, consents or approvals are required from
any governmental authorities or agencies or other official bodies in the Cayman
Islands in connection with the execution of the Indenture and the creation,
offering, issue or delivery of the Notes pursuant thereto. If a Cayman Islands
company fails to make the annual filings and payments required by Cayman Islands
law, it will become liable to be struck off the register of companies and its
assets will vest in the Crown.
6. Subject as mentioned in paragraph 3(f) above, no stamp duties or other
taxes are payable under the laws of the Cayman Islands in respect of the
creation, offering, issue or delivery of Notes or the execution or delivery of
the Transaction Documents or the enforcement of any thereof and the holders of
Notes will not incur or become liable for any
<PAGE>
MAPLES AND CALDER
GS FINANCIAL PRODUCTS U.S., L.P. 11
OPINION TO GOLDMAN, SACHS & CO. 28TH AUGUST, 1997
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transfer or other like taxes under the laws of the Cayman Islands by reason only
of the acquisition, ownership or disposal of Notes.
7. Save as referred to in paragraph 5 above, it is not necessary to ensure the
legality, validity, enforceability or admissibility in evidence of the Notes or
any of the Transaction Documents that the Prospectus or any other document be
filed, recorded or enrolled with any governmental department or other authority
in the Cayman Islands. Subject to stamping as referred to in paragraph 3(f)
above, the Transaction Documents (when duly executed and delivered) are or will
be in appropriate form to be admissible in evidence in the Cayman Islands
courts.
8. The courts of the Cayman Islands will observe and give effect to the choice
of New York law as the governing law of the Transaction Documents so expressed
to be governed and the Notes.
9. The Notes when issued pursuant to the Indenture, upon due execution,
authentication and unconditional delivery as aforesaid, will constitute the
legal, valid and binding obligations of GSFP US enforceable in accordance with
their terms except and insofar as such enforcement may be limited in like manner
mutatis mutandis as referred to in paragraph 3. above and will rank pari passu
without any preference among themselves with all other outstanding unsecured and
unsubordinated obligations of GSFP US (other than certain limited statutory
preferences in a dissolution or a winding up).
10. It will not be necessary for any person to be licensed, qualified or
otherwise entitled to carry on business in the Cayman Islands (a) in order to
exercise or enforce their rights against GSFP US under any Notes or the
Transaction Documents, (b) by reason of their being or becoming the holder of a
Note or a party to any of the Transaction Documents or (c) in connection with
the performance by any party thereto of its obligations under any Transaction
Documents and none of such parties will be deemed to be resident, domiciled or
carrying on business in the Cayman Islands by reason only of its execution,
performance or enforcement thereof.
11. Pursuant to the Exempted Limited Partnership Law, 1991 of the Cayman
Islands (the "1991 Law"), the general partner or general partners of an exempted
limited partnership registered thereunder shall, in the event that the assets of
such exempted limited partnership are inadequate, be liable for all debts and
obligations of such exempted limited partnership. Although the position is not
beyond doubt and a contrary argument may be contended, we
<PAGE>
MAPLES AND CALDER
GS FINANCIAL PRODUCTS U.S., L.P. 12
OPINION TO GOLDMAN, SACHS & CO. 28TH AUGUST, 1997
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are, in the absence of any decided authority in the Cayman Islands, of the
opinion that a successor or additional general partner of an exempted limited
partnership will be liable as described above for all debts and obligations of
such partnership either existing at the time of its admission as a general
partner or incurred during the period of its general partnership. We are also of
the opinion that a general partner which ceases to be a general partner of an
exempted limited partnership will remain liable for all the debts and
obligations of such partnership for which it was liable as at the time of its
retirement unless a written release or discharge is given by the person or
persons thereby affected.
12. Currently, no taxes, duties, assessments or other governmental charges of
whatever nature will be payable (by withholding or otherwise) to the Government
of the Cayman Islands or any political sub-division thereof or any authority or
agency therein or thereof having power to tax in respect of payments of
principal or interest to be made by GSFP US under any Notes.
Holders of Notes will not be subject to Cayman Islands taxes or duties on gains
realised on the sale of Notes. The Cayman Islands currently levy no income,
corporate or capital gains tax and no estate duty, inheritance tax or gift tax
on individuals, companies or exempted limited partnerships and GSFP US has
obtained an undertaking from the Governor-in-Council of the Cayman Islands
pursuant to Section 17 of the 1991 Law to the effect that no such taxes will
apply to GSFP US for a period of fifty years from 10th March, 1992.
13. The issue and sale of the Notes and the compliance by GSFP US with all of
the provisions of the Transaction Documents and the consummation of the
transactions therein contemplated will not conflict with or result in a breach
or violation of any of the terms or provisions of the Partnership Agreement of
GSFP US or the Memorandum and Articles of Association of GSFP US Co. or any
statute or any order, rule or regulation known to us of any court or
governmental agency of the Cayman Islands or any Cayman Islands body having
jurisdiction over any of GSFP US, GSFP US Co. or any of their respective
properties in the Cayman Islands.
14. GSFP US has the power to submit to the jurisdiction of any United States or
New York State court in the Borough of Manhattan, City and State of New York,
and to appoint CT Corporation System, 1633 Broadway, New York, New York 10019 as
its authorised agent for the purposes and to the extent described in Section 14
of the Distribution Agreement.
<PAGE>
MAPLES AND CALDER
GS FINANCIAL PRODUCTS U.S., L.P. 13
OPINION TO GOLDMAN, SACHS & CO. 28TH AUGUST, 1997
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15. The description of Cayman Islands tax contained in the Prospectus
Supplement under the captions "Cayman Islands Exempted Limited Partnerships;
Limited Partnership Agreement" and "Taxation - Cayman Islands Taxation" is fair
and accurate and nothing has been omitted from such description which would make
it misleading in any material respect.
16. The statements contained in the Prospectus Supplement under the caption
"Description of Notes", in the Prospectus under the captions "Available
Information" and "Description of Debt Securities", and in the Form 10-K of GSFP
US for the fiscal year ended in November 29, 1996 under Item 1 "Business -
Cayman Islands Taxation" and Item 12 "Security Ownership of Certain Beneficial
Owners and Management" in so far as they relate to matters of Cayman Islands
law, are fair and accurate and nothing relating to matters of Cayman Islands law
has been omitted from such statements which would make them misleading in any
material respect.
17. Based solely on a search of the Cause Book maintained in the office of the
Clerk to the Grand Court in the Cayman Islands, the Register of Writs and Other
Originating Process for the period from 1st June, 1995 and enquiries of the
Registrar of Companies and the Registrar of Exempted Limited Partnerships of the
Cayman Islands, there were no actions pending against GSFP US Co. or GSFP US in
the Grand Court of the Cayman Islands, nor has any application or order been
made in the Cayman islands for the winding-up or dissolution of any such entity
in each case, as at the close of business on 27th August, 1997.
This opinion is addressed to and is for the benefit solely of the addressee
although it may be relied upon by Messrs. Sullivan & Cromwell for the purposes
of giving their legal opinion in relation to the authorisation, execution and
delivery of the Indenture and issue of Notes pursuant thereto (but for no other
purpose). This opinion may not be relied upon by any other person for any
purpose, nor may it be transmitted or disclosed to any other person without our
prior written consent.
Yours faithfully,
MAPLES AND CALDER
Encl.
SULLIVAN & CROMWELL
NEW YORK TELEPHONE:(212) 558-4000
TELEX:62694(INTERNATIONAL) 127816(DOMESTIC)
CABLE ADDRESS:LADYCOURT, NEW YORK
FACSIMILE:(212)558-3588
125 BROAD STREET, NEW YORK 10004-2498
1701 PENNSYLVANIA AVE., N.W., WASHINGTON, D.C. 20006-5805
444 SOUTH FLOWER STREET, LOS ANGELES 90071-2901
8, PLACE VENDOME 75001 PARIS
ST. OLAVE'S HOUSE, 9A IRONMONGER LANE, LONDON EC2V 8EY
101 COLLINS STREET, MELBOURNE 3000
2-1, MARUNOUCHI I-CHOME, CHIYODA-KU, TOKYO 100
NINE QUEEN'S ROAD, CENTRAL, HONG KONG
August 28, 1997
Goldman, Sachs & Co.,
85 Broad Street,
New York, New York 10004.
Ladies and Gentlemen:
As special tax counsel to GS Financial Products U.S., L.P. in
connection with the offering of its 3% Citicorp Exchangeable Notes Due August
28, 2002, pursuant to the Pricing Supplement dated August 21, 1997 (the "Pricing
Supplement") to the Prospectus dated December 28, 1995 and Prospectus Supplement
dated January 3, 1996, we hereby confirm to you that in our opinion the
statements set forth under the heading "United States Federal Income Tax
Considerations" in the Pricing Supplement are a fair and accurate summary of the
matters therein discussed.
Very truly yours,
Sullivan & Cromwell
