Filed Pursuant to Rule 424(b)(3)
Registration No. 333-112367
Prospectus Supplement to the Prospectus, dated February 6, 2004 and the
Prospectus Supplement dated February 6, 2004 -- No. 461
(GOLDMAN SACHS LOGO)
$325,000,000
THE GOLDMAN SACHS GROUP, INC.
Floating Rate Extendible Notes
Medium-Term Notes, Series B
-------------------
We will pay interest on the notes generally on the 21st day of each
March, June, September and December, beginning on March 21, 2005, at a rate
determined for each interest period equal to USD-federal funds-open rate plus
the applicable spread for that interest period. Each of the notes has an initial
maturity date of December 21, 2006. Holders will be entitled to extend the
maturity date of any of their notes for six-month periods each December 21 and
June 21, beginning on June 21, 2005, in accordance with the procedures described
in this prospectus supplement. If a holder does not extend the maturity date of
a note, that holder will receive a non-extendible substitute note for any note
not so extended. The substitute note will retain the then-current maturity date
of the original note, which is generally 18 months after the election date. In
no event may the maturity of any note be extended beyond December 19, 2014, the
final maturity date. We may redeem some or all of the notes on any interest
payment date, beginning on December 21, 2009, at 100% of the principal amount of
the notes to be redeemed plus accrued interest to the redemption date.
-------------------
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY OTHER REGULATORY
BODY HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE ACCURACY
OR ADEQUACY OF THIS PROSPECTUS SUPPLEMENT. ANY REPRESENTATION TO THE CONTRARY IS
A CRIMINAL OFFENSE.
-------------------
<Table>
<Caption>
Total
Per Note -----
Initial public offering price............................... 100.000% $325,000,000
Underwriting discount....................................... 0.250% $ 812,500
Proceeds, before expenses, to Goldman Sachs................. 99.750% $324,187,500
</Table>
The initial public offering price set forth above does not include
accrued interest, if any. Interest on the notes will accrue from December 21,
2004 and must be paid by the purchaser if the notes are delivered after December
21, 2004.
-------------------
The underwriters expect to deliver the notes through the facilities of
The Depository Trust Company against payment in New York, New York on December
21, 2004.
Goldman Sachs may use this prospectus supplement in the initial sale of
the notes. In addition, Goldman, Sachs & Co. or any other affiliate of Goldman
Sachs may use this prospectus supplement in a market-making transaction in the
notes after their initial sale. UNLESS GOLDMAN SACHS OR ITS AGENT INFORMS THE
PURCHASER OTHERWISE IN THE CONFIRMATION OF SALE, THIS PROSPECTUS SUPPLEMENT IS
BEING USED IN A MARKET-MAKING TRANSACTION.
GOLDMAN, SACHS & CO.
SIEBERT CAPITAL MARKETS THE WILLIAMS CAPITAL GROUP, L.P.
-------------------
Prospectus Supplement dated December 17, 2004.
This prospectus supplement and the accompanying prospectus dated February
6, 2004, as supplemented by the accompanying prospectus supplement dated
February 6, 2004, should be read together because the floating rate extendible
notes are part of a series of our debt securities called Medium-Term Notes,
Series B. The terms used here have the meanings given to them in the
accompanying prospectus dated February 6, 2004, as supplemented by the
accompanying prospectus supplement dated February 6, 2004, unless the context
requires otherwise.
Please note that in this prospectus supplement, references to "The Goldman Sachs
Group, Inc.", "we", "our" and "us" mean only The Goldman Sachs Group, Inc. and
do not include its consolidated subsidiaries, while references to "Goldman
Sachs" mean The Goldman Sachs Group, Inc. together with its consolidated
subsidiaries. References to "holders" mean those who own notes registered in
their own names, on the books that we or the trustee maintain for this purpose,
and not those who own beneficial interests in notes registered in street name or
in notes issued in book-entry form through The Depository Trust Company. Please
review the special considerations that apply to indirect holders in the
accompanying prospectus, under "Legal Ownership and Book-Entry Issuance". Also,
references to the "accompanying prospectus" mean the accompanying prospectus
dated February 6, 2004, as supplemented by the accompanying prospectus
supplement dated February 6, 2004, of The Goldman Sachs Group, Inc.
SPECIFIC TERMS OF YOUR NOTE
TYPE OF NOTE: floating rate extendible note
PRINCIPAL AMOUNT: $325,000,000
SPECIFIED CURRENCY -- PRINCIPAL: U.S. dollars
SPECIFIED CURRENCY -- INTEREST: U.S. dollars
DENOMINATION: integral multiples of $1,000, subject to a minimum denomination
of $2,000
ORIGINAL ISSUE DATE (SETTLEMENT DATE): December 21, 2004
NO LISTING: the notes will not be listed on any securities exchange or
interdealer market quotation system
INTEREST RATE BASIS: USD-federal funds-open rate
INTEREST DETERMINATION DATE: the interest determination date relating to the
particular interest reset date (and for the issue date) will be the same day
as the interest reset date
INTEREST PAYMENT DATE(S): March 21, June 21, September 21 and December 21 in
each year, beginning on March 21, 2005. The final interest payment date for
any notes maturing prior to the final maturity date will be the relevant
maturity date, and interest for the final interest period will accrue from
and including the interest payment date in the quarter immediately preceding
such relevant maturity date to but excluding the maturity date.
SPREAD: the table below indicates the applicable spread to be added to the
interest rate basis for the interest reset dates occurring during each of
the indicated interest periods:
<Table>
<Caption>
For the issue date and
interest reset dates
occurring: Spread
---------------------- ------
From and including the plus .17%
issue date to but excluding
the December 21, 2005
interest reset date
From and including the plus .17%
December 21, 2005 interest
reset date to but excluding
the December 21, 2006
interest reset date
From and including the plus .18%
December 21, 2006 interest
reset date to but excluding
the December 21, 2007
interest reset date
From and including the plus .19%
December 21, 2007 interest
reset date to but excluding
the December 21, 2008
interest reset date
From and including the plus .20%
December 21, 2008 interest
reset date to but excluding
the December 21, 2009
interest reset date
From and including the plus .21%
December 21, 2009 interest
reset date to but excluding
the final maturity date
</Table>
INTEREST PERIOD: The period from and including December 21, 2004, to but
excluding the next interest payment date, and each succeeding period
beginning on and including the immediately preceding interest payment date
to but excluding the next succeeding interest payment date
INTEREST RESET DATES: daily
CALCULATION AGENT: The Bank of New York
INITIAL MATURITY DATE: December 21, 2006, or if that day is not a business day,
the immediately preceding business day
S-2
FINAL MATURITY DATE: December 19, 2014, or if that day is not a business day,
the immediately preceding business day
CUSIP NO.: 38141EJX8
MAXIMUM RATE: none
MINIMUM RATE: none
USD-FEDERAL FUNDS-OPEN RATE: the USD-federal funds-open rate will be the rate
for U.S. dollar federal funds on the relevant interest determination date
under the heading "Federal Funds" and opposite the caption "Open", as that
rate is displayed on Moneyline Telerate page 5. If the USD-federal
funds-open rate cannot be determined in this manner, the following
procedures will apply.
If the rate described above is not displayed on Moneyline Telerate page 5 at
5:00 P.M., New York City time, on the relevant interest calculation date,
unless the calculation is made earlier and the rate is available from that
source at that time, then the USD-federal funds-open rate, for the relevant
interest determination date, will be the rate for that day displayed on
FEDSPREB Index on Bloomberg (which is the Fed Funds Opening Rate as reported
by Prebon Yamane on Bloomberg).
If the rate described above is not displayed on Moneyline Telerate Page 5
and does not appear on FEDSPREB Index on Bloomberg at 5:00 P.M., New York
City time, on the relevant interest calculation date, unless the calculation
is made earlier and the rate is available from that source at that time, the
USD-federal funds-open rate will be the arithmetic mean of the rates for the
last transaction in overnight, U.S. dollar federal funds, arranged before
9:00 A.M., New York City time, on the relevant interest determination date,
quoted by three leading brokers of U.S. dollar federal funds transactions in
New York City selected by the calculation agent.
If fewer than three brokers selected by the calculation agent are quoting as
described above, the USD-federal funds-open rate in effect for the new
interest period will be the USD-federal funds-open rate in effect for the
prior interest period. If the initial base rate has been in effect for the
prior interest period, however, it will remain in effect for the new
interest period.
ELECTIONS TO EXTEND THE MATURITY OF A NOTE:
the holder of a note may elect to extend the maturity of any principal
amount of $1,000 or any integral multiple thereof, subject to a minimum
denomination of $2,000, of that note during the notice period relating to
each election date (as described below). This election may not be made for
any note (or portion thereof) we will have called for redemption as
described below. A holder's election to extend the maturity of any note will
cause the maturity of those notes to be extended to the 21st day of the
calendar month which is six calendar months after (1) the initial maturity
date (in the case of the initial extension of maturity) or (2) any later
date to which the maturity date of the notes have previously been extended.
If any such date would otherwise be a day that is not a business day, then
the maturity date of those notes will be extended to the immediately
preceding business day. In no event may the maturity of any note be extended
beyond December 19, 2014, the final maturity date.
For example, your election to extend the maturity date of a note as of the
June 21, 2006 election date will cause the maturity date of that note to be
extended from December 21, 2007 to June 21, 2008 (or the immediately
preceding business day, if June 21, 2008 is not a business day). Your
election to extend the maturity date of a note effective as of the December
21, 2006 election date will cause the maturity date of that note to be
extended from June 21, 2008 to December 21, 2008 (or the immediately
preceding business day,
S-3
if December 21, 2008 is not a business day).
The election dates will be each June 21 and December 21, commencing on June
21, 2005. The last election date for any note then outstanding will be
December 21, 2012. However, if an election date would otherwise be a day
that is not a business day, the election date will be extended to the
immediately following business day.
To make an election to extend the maturity of the notes effective on any
election date, the holder of your note must deliver a notice of election
during the notice period for that election date. The notice period for each
election date will begin on the tenth business day prior to the election
date and end on 5:00 P.M., New York City time, of the second business day
prior to the election date. A notice of election must be delivered to the
trustee for the notes, through the normal clearing channels described in
more detail under "Other Terms" below, on or after the first day of the
notice period and no later than the close of business on the last business
day in the notice period relating to the applicable election date. Upon
delivery to the trustee of a notice of election to extend the maturity of
the notes or any portion thereof during any notice period, that election
will be revocable during each day of such notice period, until 5:00 P.M.,
New York City time, on the last business day in the notice period relating
to the applicable election date, at which time such notice will become
irrevocable.
If, with respect to any election date, the holder of your note does not make
a timely and proper election to extend the maturity of all or any portion of
the principal amount of your notes, the principal amount of your notes for
which no such election has been made will be due and payable on the
then-current maturity date. The principal amount of your notes for which
such election is not exercised will be represented by a substitute note
issued as of such election date. The substitute note so issued will have the
same terms as the original notes, except that it will not be extendible, it
will have a different CUSIP number and its non-extendible maturity date will
remain the then-current maturity date, which is generally 18 months after
the election date.
For example, if you do not elect to extend the maturity date of the notes
effective as of June 21, 2006, you will receive a substitute note. The
maturity date on that substitute note will remain the then-current maturity
date, or December 21, 2007 (or the immediately preceding business day, if
December 21, 2007 is not a business day). If you initially extended the
maturity of your notes on June 21, 2006, but do not elect to extend the
maturity date of your notes effective on the December 21, 2006, election
date, you will receive a substitute note. The maturity date on the
substitute note will remain the then-current maturity date, or June 21, 2008
(or the immediately preceding business day, if June 21, 2008 is not a
business day). The failure to elect to extend the maturity of all or any
portion of your notes will be irrevocable and will be binding upon any
subsequent holder of those notes.
REDEMPTION: on the December 21, 2009 interest payment date and on each interest
payment date occurring thereafter, Goldman Sachs may elect to redeem your
notes, in whole or in part, on not less than 30 days' notice to the holders
of the notes to be redeemed. The redemption price will be equal to 100% of
the principal amount of your notes to be redeemed, plus any accrued and
unpaid interest thereon to the date of redemption.
S-4
OTHER TERMS
The notes will be issued in registered global form and will remain on
deposit with the depositary for the notes as described under "Legal Ownership
and Book-Entry Issuance" in the accompanying prospectus. DTC will be the initial
depositary for the notes. Therefore, the holder of your notes must exercise the
option to extend the maturity of your notes through the depositary. To ensure
that the depositary will receive timely notice of your election to extend the
maturity of all or a portion of your notes, so that it can deliver notice of
your election to the trustee prior to the close of business on the last business
day in the notice period, you must instruct the direct or indirect participant
through which you hold an interest in the notes to notify the depositary of your
election to extend the maturity of your notes in accordance with the then
applicable operating procedures of the depositary.
The depositary must receive any notice of election from its
participants no later than 5:00 P.M. (New York City time) on the last business
day in the notice period for any election date. Different firms have different
cut-off times for accepting instructions from their customers. You should
consult the direct or indirect participant through which you hold an interest in
the notes to ascertain the cut-off time in order to ensure that timely notice
will be delivered to the depositary.
None of Goldman Sachs, the trustee or any agent of either of them will
have any liability to the holder or any direct participant, indirect participant
or beneficial owner for any delay in exercising the option to extend the
maturity of a note.
Goldman Sachs makes no recommendation as to whether you should extend
the maturity of a note. You are urged to consult your advisors as to the
desirability of exercising your right to extend the maturity of the notes.
S-5
UNITED STATES TAXATION
This section supplements the discussion of U.S. federal income taxation
in the accompanying prospectus, with respect to United States holders.
There are no regulations, rulings or other authorities directly
addressing the federal income tax treatment of debt instruments with terms that
are substantially similar to the notes, and therefore, the federal income tax
treatment of the notes is uncertain. Pursuant to Treasury regulations governing
modifications to the terms of debt instruments (the "Modification Regulations"),
the exercise of an option by a holder of a debt instrument to defer any
scheduled payment of principal is a taxable event if, based on all the facts and
circumstances, such deferral is considered material under the Modification
Regulations. The Modification Regulations do not specifically address the unique
features of the notes (including their economic equivalence to a ten-year debt
instrument containing put and call options). However, under the Treasury
regulations governing original issue discount on debt instruments (the "OID
Regulations"), for purposes of determining the yield and maturity of a debt
instrument that provides the holder with an unconditional option or options,
exercisable on one or more dates during the term of the debt instrument, that,
if exercised, require payments to be made on the debt instrument under an
alternative payment schedule or schedules (e.g., an option to extend the
maturity of the debt instrument), a holder is deemed to exercise or not exercise
an option or combination of options in a manner that maximizes the yield on the
debt instrument. Since the spread will periodically increase during the term of
the notes from an initial amount equal to .17% to an amount equal to .21%, under
these rules, as of the issue date, it would be reasonable to assume that
original holders of the notes would elect to extend the maturity of all of the
principal amount of the notes until June 21, 2010 and possibly until the final
maturity date in accordance with the procedures described under "Specific Terms
of Your Note" above. In addition, under the OID regulations, an issuer is deemed
to exercise an option or combination of options in a manner that minimizes the
yield on the debt instrument. Because the spread in the notes will not increase
after December 21, 2009, we will take the position that under the OID
regulations, calling the notes will not minimize the notes' yield and therefore
it is not assumed that the issuer would call the notes. Accordingly, we will
take the position that the final maturity date should be treated as the maturity
date of the notes. You will also be bound to take this position by the terms of
your note, absent an administrative or judicial determination to the contrary.
Although it is unclear how the OID Regulations should apply in
conjunction with the Modification Regulations, it will be reasonable to treat an
election to extend the maturity of all or any portion of the principal amount of
the notes in accordance with the procedures described above as not causing a
taxable event for U.S. federal income tax purposes.
Under the treatment described above, the notes will be treated as
having been issued with de-minimis original issue discount. Therefore, the notes
will not constitute discount notes. See "United States Taxation" in the
accompanying prospectus.
You should note that no assurance can be given that the IRS will
accept, or that the courts will uphold, the characterization and the tax
treatment of the notes described above. If the IRS were successful in asserting
that an election to extend the maturity of all or any portion of the principal
amount of the notes is a taxable event for U.S. federal income tax purposes,
then you would be required to recognize any gain inherent in the notes at such
time upon the exercise of such election. You should consult your tax advisors
regarding the U.S. federal income tax consequences of an investment in, and
extending the maturity of, the notes.
S-6
SUPPLEMENTAL PLAN OF DISTRIBUTION
The Goldman Sachs Group, Inc. and the underwriters for this offering
named below have entered into a terms agreement and a distribution agreement
with respect to the notes. Subject to certain conditions, each underwriter named
below has severally agreed to purchase the principal amount of notes indicated
in the following table.
<Table>
<Caption>
PRINCIPAL AMOUNT
UNDERWRITERS OF NOTES
- ------------ ----------------
Goldman, Sachs & Co. ..... $318,500,000
Muriel Siebert & Co.,
Inc. ................... 3,250,000
The Williams Capital
Group, L.P. ............ 3,250,000
------------
Total................... $325,000,000
============
</Table>
Notes sold by the underwriters to the public will initially be offered
at the original issue price set forth on the cover of this prospectus
supplement. The underwriters intend to purchase the offered notes from The
Goldman Sachs Group, Inc. at a purchase price equal to the original issue price
less a discount of 0.250% of the principal amount of the notes. Any notes sold
by the underwriters to securities dealers may be sold at a discount from the
original issue price of up to 0.150% of the principal amount of the notes. If
all of the offered notes are not sold at the original issue price, the
underwriters may change the offering price and the other selling terms.
Please note that the information about the settlement or trade date,
issue price, discounts or commissions and net proceeds to The Goldman Sachs
Group, Inc. set forth on the cover or elsewhere in this prospectus supplement
relates only to the initial issuance and sale of the notes. If you have
purchased your note in a market-making transaction after the initial issuance
and sale of the notes, any such relevant information about the sale to you will
be provided in a separate confirmation of sale.
None of the named underwriters is permitted to sell notes in this
offering to an account over which it exercises discretionary authority without
the prior written approval of the customer to which the account relates.
The Goldman Sachs Group, Inc. estimates that its share of the total
offering expenses, excluding underwriting discounts and commissions, whether
paid to Goldman, Sachs & Co. or any other underwriter, will be approximately
$100,000.
In the future, Goldman, Sachs & Co. or other affiliates of The Goldman
Sachs Group, Inc. may repurchase and resell the offered notes in market-making
transactions, with resales being made at prices related to prevailing market
prices at the time of resale or at negotiated prices. For more information about
the plan of distribution and possible market-making activities, see "Plan of
Distribution" in the accompanying prospectus and "Supplemental Plan of
Distribution" in the accompanying prospectus supplement.
The Goldman Sachs Group, Inc. has agreed to indemnify the several
underwriters against certain liabilities, including liabilities under the
Securities Act of 1933.
Certain of the underwriters and their affiliates have in the past
provided, and may in the future from time to time provide, investment banking
and general financing and banking services to the Goldman Sachs Group, Inc. and
its affiliates, for which they have in the past received, and may in the future
receive, customary fees. The Goldman Sachs Group, Inc. and its affiliates have
in the past provided, and may in the future from time to time provide, similar
services to the underwriters and their affiliates on customary terms and for
customary fees.
S-7
- -------------------------------------------------------
- -------------------------------------------------------
No dealer, salesperson or other person is authorized to give any information
or to represent anything not contained in this prospectus. You must not rely on
any unauthorized information or representations. This prospectus is an offer to
sell or a solicitation of an offer to buy the securities it describes, but only
under circumstances and in jurisdictions where it is lawful to do so. The
information contained in this prospectus is current only as of its date.
-------------------
TABLE OF CONTENTS
Prospectus Supplement
<Table>
<Caption>
Page
----
Specific Terms of Your Note................ S-2
Other Terms................................ S-5
United States Taxation..................... S-6
Supplemental Plan of Distribution.......... S-7
Prospectus Supplement dated February 6, 2004
Use of Proceeds............................ S-2
Description of Notes We May Offer.......... S-3
United States Taxation..................... S-20
Employee Retirement Income Security Act.... S-20
Supplemental Plan of Distribution.......... S-20
Validity of the Notes...................... S-22
Prospectus dated February 6, 2004
Available Information...................... 2
Prospectus Summary......................... 4
Ratio of Earnings to Fixed Charges......... 8
Use of Proceeds............................ 8
Description of Debt Securities We May
Offer.................................... 9
Description of Warrants We May Offer....... 31
Description of Purchase Contracts We May
Offer.................................... 48
Description of Units We May Offer.......... 53
Description of Preferred Stock We May
Offer.................................... 58
The Issuer Trusts.......................... 66
Description of Capital Securities and
Related Instruments...................... 69
Description of Capital Stock of The Goldman
Sachs Group, Inc. ....................... 93
Legal Ownership and Book-Entry Issuance.... 98
Considerations Relating to Securities
Issued in Bearer Form.................... 104
Considerations Relating to Indexed
Securities............................... 109
Considerations Relating to Securities
Denominated or Payable in or Linked to a
Non-U.S. Dollar Currency................. 112
Considerations Relating to Capital
Securities............................... 115
United States Taxation..................... 118
Plan of Distribution....................... 141
Employee Retirement Income Security Act.... 144
Validity of the Securities................. 144
Experts.................................... 144
Cautionary Statement Pursuant to the
Private Securities Litigation Reform Act
of 1995.................................. 145
</Table>
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- -------------------------------------------------------
- -------------------------------------------------------
$325,000,000
THE GOLDMAN SACHS
GROUP, INC.
Floating Rate Extendible Notes
Medium-Term Notes, Series B
-------------------
[GOLDMAN SACHS LOGO]
-------------------
GOLDMAN, SACHS & CO.
SIEBERT CAPITAL MARKETS
THE WILLIAMS CAPITAL GROUP, L.P.
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