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THE GOLDMAN SACHS GROUP, INC. (NYSE:GS) Files An 8-K Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers

THE GOLDMAN SACHS GROUP, INC. (NYSE:GS) Files An 8-K Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers

Item5.02 Departure of Directors or Certain Officers; Election of
Directors; Appointment of Certain Officers; Compensatory
Arrangements of Certain Officers.

(e) On January22, 2017, Gary D. Cohn, former President and Chief
Operating Officer of The Goldman Sachs Group, Inc. (the
Registrant),
received guidance from the White House Office of General Counsel,
in coordination with the U.S. Office of Government Ethics (Ethics
Guidance), in connection with his appointment as Director of the
National Economic Council (NEC). The Ethics Guidance addressed
certain actions that needed to be taken for Mr.Cohn to sever his
financial interests relating to Goldman Sachs, consistent with
the requirements of applicable U.S. federal ethics laws and in
order for Mr.Cohn to fulfill the full range of his duties as
Director of the NEC.

The
Compensation Committee of the Board of Directors of the
Registrant (the Compensation Committee) discussed the matters
described below at its December 2016 and January 2017 meetings.
After it was confirmed that the Ethics Guidance was consistent
with the approach previously discussed and preliminarily agreed
by the Compensation Committee, a special committee comprised of
members of the Compensation Committee (the Special Committee) met
on January22, 2017 to act on these matters in order to permit
Mr.Cohn to commence employment in the U.S.
government.

The
actions taken by the Special Committee in connection with the
Ethics Guidance are described in further detail below, in
addition to a summary of the Compensation Committees earlier
determinations regarding Mr.Cohns 2016year-end
compensation.

2016Year-End Compensation

Mr.Cohn received total 2016 compensation of $20million,
which was down approximately 5% compared to his total 2015
compensation of $21million. This was comprised of year-end
variable compensation of $18.15million and base salary of
$1.85million.

Consistent with the Registrants longstanding practice of
paying a significant portion of our senior executives
year-end variable compensation in the form of equity-based
awards, 70% of this year-end variable compensation was paid
in the form of restricted stock units (RSUs), resulting in
a grant to Mr.Cohn of 54,903 RSUs based on the closing
price of the Registrants common stock on January19, 2017.
The remainder was paid in cash.

Given that Mr.Cohn served as our President and COO for all
of 2016 and continued to exhibit outstanding leadership
throughout that time, the Committee believed it was
appropriate to compensate Mr.Cohn for a full year of
service to the firm.

The terms the Registrant, Goldman Sachs, the firm, we and
our in this Form 8-K refer to The Goldman Sachs Group, Inc.
and its consolidated subsidiaries.

Treatment of Certain Outstanding Equity Awards

In order to avoid a potential conflict of interest, the
Ethics Guidance confirmed that U.S. federal ethics laws
require Mr.Cohn to divest his holdings of the Registrants
stock.

In addition to the RSUs granted to Mr.Cohn for his
2016year-end compensation described above, Mr.Cohn held
96,572 RSUs and an additional 99,909shares of our Common
Stock relating to prior years compensation that remained
subject to transfer restrictions (Shares at Risk).

All of these RSUs and Shares at Risk, including those
granted to Mr.Cohn for his 2016year-end compensation, were
fully vested. The RSUs were scheduled to be delivered to
Mr.Cohn at various dates ranging from January 2017 to
January 2020, and the transfer restrictions were scheduled
to be released on dates ranging from January 2017 to
January 2022.

to the standard terms of the Registrants equity plan, all
of Mr.Cohns RSUs and Shares at Risk were subject to a
Conflicted Employment provision that permitted the
automatic delivery of the awards and the release of
applicable transfer restrictions if the recipient accepted
employment in the U.S. government.

Consistent with these terms, it was determined that
Mr.Cohns position as Director of the NEC constituted
Conflicted Employment.

Accordingly, on January23, 2017, Mr.Cohn received delivery
of the shares of our Common Stock underlying all of his
outstanding RSUs (less shares withheld for applicable
taxes) and the transfer restrictions were released on all
Shares at Risk. This permitted Mr.Cohn to divest himself
from these interests, as well as his other freely
transferable shares of our Common Stock that he owned
outright.

Treatment of Outstanding LTIP and PSU Awards

At the time of his departure, Mr.Cohn held:

Historical performance-based cash awards under the
Registrants Long-Term Performance Incentive Plan granted
each year from January 2011 through January 2016 (LTIP
Awards); and

Historical performance-based restricted stock units awarded
as part of 2014 and 2015year-end compensation (PSUs).

The Ethics Guidance confirmed that U.S. federal ethics laws
did not permit Mr.Cohn to continue to hold the LTIP Awards
or PSUs once he commenced employment as Director of the
NEC.

Mr.Cohn was fully vested in these awards and, in the event
that he had simply retired from the firm, the awards would
have remained outstanding and would have been paid in due
course following the completion of the applicable
performance period.

In order to avoid any actual or perceived conflict of
interest, and given his longstanding leadership position at
the firm, his history of outstanding contributions to the
firms business and culture and his commitment to
maintaining strong client relationships, the Special
Committee amended the LTIP Awards and PSUs to shorten the
performance period to end on December31, 2016 and to settle
the awards on January23, 2017. A total number of 76,394
PSUs were earned and settled based on the closing price of
the Registrants common stock on January20, 2017.

In that connection, Mr.Cohn received a cash payment of
approximately $47million in respect of his LTIP Awards and
approximately $18million in respect of his PSUs.

Other Arrangements

The Ethics Guidance also confirmed that U.S. federal ethics
laws require Mr.Cohn to divest from his participation in
the firms legacy non-qualified deferred compensation plan,
which could otherwise be perceived to present a conflict of
interest in his new role.

Similarly, the Ethics Guidance confirmed that U.S. federal
ethics laws require Mr.Cohn to divest his investments in
certain private equity and hedge funds managed by the firm.
Certain of these interests were redeemed in accordance with
the funds standard redemption provisions. Certain other
interests will be purchased by the Registrant, with the
purchase price determined based on their net asset values
as of December31, 2016, but reflecting a discount due to
the relative illiquidity of certain of these investments,
among other factors.

Further details regarding these divestments will be
provided in the Proxy Statement for the Registrants 2017
Annual Meeting of Shareholders.

About THE GOLDMAN SACHS GROUP, INC. (NYSE:GS)
The Goldman Sachs Group, Inc. is a bank holding company and a financial holding company. The Company operates through four segments: Investment Banking, Institutional Client Services, Investing & Lending, and Investment Management. The Company’s Investment Banking segment provides financial advisory services, which include advisory assignments with respect to mergers and acquisitions, divestitures, corporate defense activities, restructurings, spin-offs and risk management. The Company’s Institutional Client Services segment makes markets and facilitates client transactions in fixed income, equity, currency and commodity products. The Company’s investing and lending activities include its investing and relationship lending activities across various asset classes, primarily debt securities and loans, public and private equity securities, and real estate. The Company’s investment management segment provides investment and wealth advisory services. THE GOLDMAN SACHS GROUP, INC. (NYSE:GS) Recent Trading Information
THE GOLDMAN SACHS GROUP, INC. (NYSE:GS) closed its last trading session up +2.52 at 236.20 with 4,448,152 shares trading hands.

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