EXHIBIT 10.38
VOTING AGREEMENT
Voting Agreement, dated as of April 30, 1999 (the "Voting
Agreement"), by and among The Goldman Sachs Group, Inc., a Delaware corporation
("GS Inc."), on the one hand, and The Sumitomo Bank, Limited, a corporation
organized under the laws of Japan ("Sumitomo"), and Sumitomo Bank Capital
Markets, Inc., a Delaware corporation and a wholly-owned subsidiary of Sumitomo
("SBCM"), on the other hand.
WHEREAS, pursuant to the Amended and Restated Subscription
Agreement, dated as of March 28, 1989 (as amended by the letter agreement, dated
March 15, 1999 of which this Voting Agreement is Annex C, the "Subscription
Agreement"), among Sumitomo and SBCM, on the one hand, and Goldman, Sachs & Co.,
a New York limited partnership ("GSNY"), and The Goldman Sachs Group, L.P., a
Delaware limited partnership (the "Partnership"), on the other, Sumitomo and
SBCM each delivered to the Partnership its irrevocable proxy, dated March 28,
1989, in the form of Annexes 5(a) and 5(b) to the Subscription Agreement (the
"Proxies");
WHEREAS, pursuant to a Plan of Incorporation adopted pursuant
to Article I, Section 14 of the Amended and Restated Memorandum of Agreement,
dated as of November 28, 1998 (the "Memorandum of Agreement") of the
Partnership, GS Inc. will succeed to the business of the Partnership and, in
connection therewith and pursuant to the terms of the Bank Partnership
Provisions of (and as defined in) the Memorandum of Agreement and the
Subscription Agreement, GS Inc. will issue securities to SBCM;
WHEREAS, the Securities are subject to the Proxies and GS Inc.
is willing to terminate the Proxies in consideration of the agreements and
undertakings of Sumitomo and SBCM contained herein;
GS Inc., Sumitomo and SBCM hereby agree as follows:
1. The Partnership, GSNY and GS Inc., as successor to the
Partnership, issuer of the securities and beneficiary of the Proxies,
release each of Sumitomo and SBCM from its Proxy.
2. Each of Sumitomo and SBCM agree, during the period of
limited duration specified below, to vote any and all securities of GS
Inc. or of any subsidiary of GS Inc. which have any voting rights,
general or special (herein collectively referred to as "Securities"),
and which Sumitomo or SBCM may from time to time hold of record or
beneficially own, and agree
to cause any direct or indirect subsidiary of Sumitomo to vote any
securities of GS Inc. or any subsidiary thereof that may be acquired by
such subsidiary of Sumitomo, at any meeting of stockholders of GS Inc.
or any such subsidiary (as the case may be), and to provide written
consent on behalf of Sumitomo, SBCM or any such subsidiary as to any
matter as to which written consent is sought from the owners of any
Securities, in each case (x) with respect to Securities of GS Inc., in
the same manner as the majority of the shares of common stock held by
the managing directors of GS Inc. shall be voted or consented in the
vote of the stockholders of GS Inc. and (y) in the case of Securities
of a subsidiary of GS Inc., in the same manner as the shares of common
stock held by the immediate parent of such subsidiary shall be voted or
consented. Notwithstanding the foregoing, however, this agreement shall
not extend to the approval of any change or modification in (i) the
Registration Rights Agreement, the Subscription Agreement or this
Agreement or (ii) the material terms of any Securities held by Sumitomo
and SBCM. For purposes of this Voting Agreement, the exchange,
conversion or other transfer of Securities or any other securities by
or on behalf of Sumitomo, SBCM or any direct or indirect subsidiary of
Sumitomo for other securities of GS Inc. (or any successor or assign
thereof) pursuant to and in accordance with the Subscription Agreement
and/or the Bank Partnership Provisions (including, but not limited to,
pursuant to Schedules I, II and III to the Subscription Agreement or
Section 5 of the Bank Partnership Provisions) shall not be considered a
change in the material terms of Securities held by Sumitomo or SBCM.
3. For purposes of this Voting Agreement, "Securities"
includes, without limitation, (i) the Public Preferred Stock defined in
Schedule III to the Subscription Agreement and the Public Common Stock
defined in Schedule II to the Subscription Agreement and (ii) any other
securities (which have voting rights, general or special) of GS Inc. or
any subsidiary thereof issued to SBCM pursuant to the Subscription
Agreement or the "Bank Partnership Provisions" referred to in the
Subscription Agreement. The provisions of this Agreement shall apply to
Securities of any successor or assign of GS Inc. (except an acquirer of
the business of GS Inc. as referred to in Section 6(c) of the Bank
Partnership Provisions) on the terms set forth therein.
4. This Voting Agreement shall terminate on the date of the
final disposition by Sumitomo and SBCM of any and all Securities
referred to in Section 13(b) of the Subscription Agreement or the
cancellation thereof.
5. To the extent (if any) Sumitomo and SBCM would retain under
law, regardless of the agreements in paragraph 2 hereof, any residual
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rights inconsistent with paragraph 2 hereof, each of Sumitomo and SBCM,
in consideration of the release by the Partnership, GSNY and GS Inc. of
each of Sumitomo and SBCM from its Proxy, and as agreed with (and
relied on by) the Partnership, GSNY and GS Inc., hereby specifically
and expressly (i) waives such rights, (ii) agrees never to exercise
such rights and (iii) agrees never to claim, as a complaint or a
defense, or otherwise assert that this Voting Agreement is not valid or
enforceable.
6. The invalidity or unenforceability of any provisions of
this Voting Agreement shall not affect the validity or enforceability
of any other provision. To the extent (if any) any provision hereof is
deemed invalid or unenforceable by its scope but may be made valid or
enforceable by limitations thereon, the undersigned intend that this
Voting Agreement shall be valid and enforceable to the fullest extent
permitted by law.
7. (a) THIS VOTING AGREEMENT SHALL BE GOVERNED BY AND WILL BE
CONSTRUED AND ENFORCED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF
THE STATE OF DELAWARE.
(b) Any dispute, controversy or claim arising out of or
relating to provisions of this Voting Agreement shall be finally
settled by arbitration in accordance with the Arbitration Rules of the
United Nations Commission on International Trade Law ("UNCITRAL") in
effect on the date of this Agreement. The number of arbitrators shall
be three and the Administering Authority shall be the American
Arbitration Association. The tribunal shall adopt rules of procedure
supplementary to the rules of UNCITRAL as it deems equitable under the
circumstances. All direct costs of an arbitration proceeding under this
Section, including fees and expenses of arbitration, shall be borne by
the party incurring them. The place of arbitration shall be The City of
New York. The arbitration shall be conducted in the English language.
An award rendered by all or a majority of the arbitrators shall be
final and binding, and judgment may be entered upon it in any court
having jurisdiction. In no event shall this subsection be construed as
conferring upon any court authority or jurisdiction to inquire into or
review such award on its merits. The parties agree to exclude any right
of application or appeal to the Federal, New York State and any other
courts in connection with any question of law or fact arising in the
course of the arbitration or with respect to any award made.
8. All notices and other communications hereunder shall be in
writing and shall be mailed by first class mail, postage prepaid,
addressed (a) if to Sumitomo or SBCM, at Sumitomo Bank Capital Markets,
Inc., 277 Park Avenue, New York, New York 10172, Attention: President,
or at
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such other address as SBCM shall furnish to GS Inc. in writing, or (b)
if to the Partnership, GSNY or GS Inc., at 85 Broad Street, New York,
New York 10004, Attention: General Counsel, or at such other address as
GS Inc. shall furnish to Sumitomo or SBCM in writing.
9. This Voting Agreement will be binding upon and inure to the
benefit of and be enforceable by the respective successors and assigns
of the parties hereto; provided, that this Voting Agreement shall not
be binding upon a transferee of Securities that is not affiliated with
Sumitomo who acquired such Securities in a disposition which is
permitted under the Subscription Agreement. This Voting Agreement may
be executed in any number of counterparts, each of which shall be an
original, but all of which together shall constitute one instrument.
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IN WITNESS WHEREOF, the parties hereto have executed and
delivered this Agreement as of the date above written.
THE SUMITOMO BANK, LIMITED
By: /s/ Ryuzo Kodama
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Ryuzo Kodama
Director and Head of the Americas Division
SUMITOMO BANK CAPITAL MARKETS, INC.
By: /s/ Natsuo Okada
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Natsuo Okada
President
THE GOLDMAN SACHS GROUP, INC.
By: /s/ Robert J. Katz
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Robert J. Katz
Executive Vice President
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