Filed Pursuant to Rule 424(b)(3)
Registration Statement No. 333-112367
PRICING SUPPLEMENT TO THE PROSPECTUS SUPPLEMENT NO. 371
DATED FEBRUARY 6, 2004 -- NO. 468
(GOLDMAN SACHS LOGO)
THE GOLDMAN SACHS GROUP, INC.
Medium-Term Notes, Series B
$5,250,055.58
6.00% Mandatory Exchangeable Notes due January 2006
(Exchangeable for Common Stock of Corning Incorporated)
This pricing supplement and the accompanying prospectus supplement no.
371, relating to the mandatory exchangeable notes, should be read together.
Because the mandatory exchangeable notes are part of a series of our debt
securities called Medium-Term Notes, Series B, this pricing supplement and the
accompanying prospectus supplement no. 371 should also be read with the
accompanying prospectus dated February 6, 2004, as supplemented by the
accompanying prospectus supplement dated February 6, 2004. Terms used here have
the meanings given them in the accompanying prospectus supplement no. 371,
unless the context requires otherwise.
The mandatory exchangeable notes offered by this pricing supplement, which
we call the "offered notes" or the "notes", have the terms described in the
accompanying prospectus supplement no. 371, as supplemented or modified by the
following:
ISSUER: The Goldman Sachs Group, Inc.
FACE AMOUNT: each offered note will have a face amount equal to $11.627, which
is the initial index stock price; the aggregate face amount for all the offered
notes is $5,250,055.58
INITIAL INDEX STOCK PRICE: $11.627
ORIGINAL ISSUE PRICE: 100% of the face amount
NET PROCEEDS TO THE ISSUER: 99.9% of the face amount
TRADE DATE: January 21, 2005
SETTLEMENT DATE (ORIGINAL ISSUE DATE): January 28, 2005
STATED MATURITY DATE: January 30, 2006, unless extended for up to six business
days
INTEREST RATE (COUPON): 6.00% per year
INTEREST PAYMENT DATES: April 30, 2005, July 30, 2005, October 30, 2005 and
January 30, 2006
REGULAR RECORD DATES: for the interest payment dates specified above, five
business days before April 30, 2005, July 30, 2005, October 30, 2005 and January
30, 2006 respectively
INDEX STOCK AND INDEX STOCK ISSUER: common stock of Corning Incorporated
CUSIP NO.: 38143Y814
Your investment in the notes involves certain risks. We encourage you to
read "Additional Risk Factors Specific to Your Note" beginning on page S-3 of
the accompanying prospectus supplement no. 371 so that you may better understand
those risks. The offered notes are not principal-protected and the payment
amount is capped.
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 PRICING SUPPLEMENT. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
Goldman Sachs may use this pricing supplement in the initial sale of the
offered notes. In addition, Goldman, Sachs & Co. or any other affiliate of
Goldman Sachs may use this pricing supplement in a market-making transaction in
an offered note after its initial sale. UNLESS GOLDMAN SACHS OR ITS AGENT
INFORMS THE PURCHASER OTHERWISE IN THE CONFIRMATION OF SALE, THIS PRICING
SUPPLEMENT IS BEING USED IN A MARKET-MAKING TRANSACTION.
GOLDMAN, SACHS & CO.
PRICING SUPPLEMENT DATED JANUARY 21, 2005.
PRINCIPAL AMOUNT: On the stated maturity date, each offered
note will be exchanged for index stock at
the exchange rate or, at the option of
Goldman Sachs, for the cash value of that
stock based on the final index stock price.
EXCHANGE RATE: If the final index stock price equals or
exceeds the threshold appreciation price,
then the exchange rate will equal the
threshold fraction times one share of index
stock for each $11.627 of the outstanding
face amount. Otherwise, the exchange rate
will equal one share of the index stock for
each $11.627 of the outstanding face amount.
The exchange rate is subject to
anti-dilution adjustment as described in the
accompanying prospectus supplement no. 371.
Please note that the amount you receive for
each $11.627 of outstanding face amount on
the stated maturity date will not exceed the
threshold appreciation price and that it
could be substantially less than $11.627.
You could lose your entire investment in the
offered notes.
INITIAL INDEX STOCK PRICE: $11.627 per share.
FINAL INDEX STOCK PRICE: The closing price of one share of the index
stock on the determination date, subject to
anti-dilution adjustment.
THRESHOLD APPRECIATION PRICE: The initial index stock price times 1.25,
which equals $14.534 per share.
THRESHOLD FRACTION: The threshold appreciation price divided by
the final index stock price.
DETERMINATION DATE: The fifth business day prior to January 30,
2006 unless extended for up to five business
days.
NO LISTING: The offered notes will not be listed on any
securities exchange or interdealer market
quotation system.
CORNING INCORPORATED: According to its publicly available
documents, Corning Incorporated is a global
technology-based corporation that operates
in two reportable business segments:
Telecommunications and Technologies.
Information filed with the SEC by Corning
Incorporated under the Exchange Act can be
located by referencing its SEC file number:
001-03247.
HISTORICAL TRADING PRICE The index stock is traded on the New York
INFORMATION: Stock Exchange under the symbol "GLW". The
following table shows the quarterly high and
low trading prices and the quarterly closing
prices for the index stock on the New York
Stock Exchange for the four calendar
quarters in each of 2003 and 2004 and the
first calendar quarter in 2005, through
January 21, 2005. We obtained the trading
price information shown below from Bloomberg
Financial Services, without independent
verification.
S-2
HIGH LOW CLOSE
------ ----- -----
2003
Quarter ended March 31 .................. 6.25 3.75 5.84
Quarter ended June 30 ................... 8.02 5.42 7.39
Quarter ended September 30 .............. 10.00 7.26 9.42
Quarter ended December 31 ............... 12.01 9.35 10.43
2004
Quarter ended March 31 .................. 13.78 10.27 11.18
Quarter ended June 30 ................... 13.06 10.20 13.06
Quarter ended September 30 .............. 12.69 9.55 11.08
Quarter ended December 31 ............... 12.85 10.21 11.77
2005
Quarter ending March 31
(through January 21, 2005) ........... 12.23 11.40 11.52
Closing price on January 21, 2005........ 11.52
As indicated above, the market price of the
index stock has been highly volatile during
recent periods. It is impossible to predict
whether the price of the index stock will
rise or fall, and you should not view the
historical prices of the index stock as an
indication of future performance. See
"Additional Risk Factors Specific to Your
Note -- The Market Price of Your Note May Be
Influenced by Many Unpredictable Factors" in
the accompanying prospectus supplement no.
371.
HYPOTHETICAL PAYMENT AMOUNT: The table below shows the hypothetical
payment amounts that we would deliver on the
stated maturity date in exchange for each
$11.627 of the outstanding face amount of
your note, if the final index stock price
were any of the hypothetical prices shown in
the left column. For this purpose, we have
assumed that there will be no anti-dilution
adjustments to the exchange rate and no
market disruption events.
The prices in the left column represent
hypothetical closing prices for one share of
index stock on the determination date and
are expressed as percentages of the initial
index stock price, which equals $11.627 per
share. The amounts in the right column
represent the hypothetical cash value of the
index stock to be exchanged, based on the
corresponding hypothetical final index stock
prices, and are expressed as percentages of
the initial index stock price. Thus, a
hypothetical payment amount of 100% means
that the cash value of the index stock that
we would deliver in exchange for each
$11.627 of the outstanding face amount of
your note on the stated maturity date would
equal 100% of the initial index stock price,
or $11.627, based on the corresponding
hypothetical final index stock price and the
assumptions noted above.
S-3
HYPOTHETICAL
FINAL INDEX
STOCK PRICE AS % OF HYPOTHETICAL PAYMENT
INITIAL INDEX AMOUNTS AS % OF
STOCK PRICE $11.627 FACE AMOUNT
------------------- -------------------
200% 125%
175% 125%
150% 125%
125% 125%
110% 110%
100% 100%
75% 75%
50% 50%
0% 0%
The payment amounts shown above are entirely
hypothetical; they are based on market
prices for the index stock that may not be
achieved on the determination date and on
assumptions that may prove to be erroneous.
The actual market value of your note on the
stated maturity date or at any other time,
including any time you may wish to sell your
note, may bear little relation to the
hypothetical payment amounts shown above,
and those amounts should not be viewed as an
indication of the financial return on an
investment in the offered notes or on an
investment in the index stock. Please read
"Additional Risk Factors Specific to Your
Note" and "Hypothetical Payment Amounts on
Your Note" in the accompanying prospectus
supplement no. 371.
Payments on your note are economically
equivalent to the amounts that would be paid
on a combination of other instruments. For
example, payments on your note are
economically equivalent to the amounts that
would be paid on a combination of an
interest-bearing bond bought, and an option
sold, by the holder (with an implicit option
premium paid over time to the holder). The
discussion in this paragraph does not modify
or affect the terms of the offered notes or
the United States income tax treatment of
the offered notes as described under
"Supplemental Discussion of Federal Income
Tax Consequences" in the accompanying
prospectus supplement no. 371.
HEDGING: In anticipation of the sale of the offered
notes, we and/or our affiliates have entered
into hedging transactions involving
purchases of the index stock on the trade
date. For a description of how our hedging
and other trading activities may affect the
value of your note, see "Additional Risk
Factors Specific to Your Note -- Our
Business Activities May Create Conflicts of
Interest Between You and Us" and "Use of
Proceeds and Hedging" in the accompanying
prospectus supplement no. 371.
S-4