Indemnification Agreement - Goldman Sachs Group Inc.


                            INDEMNIFICATION AGREEMENT

                  THIS INDEMNIFICATION AGREEMENT (this 'Agreement') is made and
entered into as of the 9th day of November 1999, by and between The Goldman
Sachs Group, Inc., a Delaware corporation ('GS Inc.'), and each of the
Indemnitees listed on the signature pages to this Agreement (each, an
'Indemnitee', and collectively, the 'Indemnitees') as such signature pages may
be amended and supplemented from time to time pursuant to the terms of this
Agreement.

                                   WITNESSETH

                  WHEREAS, GS Inc. has filed and proposes to file registration
statements with the Securities and Exchange Commission under the Securities Act
of 1933 (the 'Securities Act') for the public offering and sale of securities of
GS Inc., which securities may include shares of its common stock (including
shares to be sold by stockholders of GS Inc. or issuable in connection with
employee benefit plans), debt securities (including medium-term notes),
warrants, preferred stock and/or any other securities of GS Inc. approved by, or
pursuant to action of, the Board of Directors of GS Inc.;

                  WHEREAS, GS Inc. has in the past requested and will in the
future request certain of the Indemnitees to execute registration statements in
the capacity or capacities listed, or to be listed, in registration statements
and to take actions in connection with registration statements; and

                  WHEREAS, each Indemnitee is one of the following: (i) an
officer or director of GS Inc. or (ii) a person requested or authorized by the
Board of Directors of GS Inc. or any committee thereof to take actions on behalf
of GS Inc. in connection with a registration statement.

                  NOW, therefore, in consideration of each Indemnitee's acting
and agreeing to act in the capacities referred to above, and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereby agree as follows:

                  1. General. GS Inc. will indemnify and hold harmless each
Indemnitee against any Losses (as hereinafter defined), joint or several, to
which such Indemnitee may become subject, under the Securities Act or otherwise,
insofar as such Losses (or actions in respect thereof) arise out of or are based
upon an untrue statement or alleged untrue statement of a material fact
contained in any Registration Statement (as defined below) or any preliminary
prospectus, prospectus, or prospectus supplement comprising a part thereof or
relating thereto, or any amendment or supplement to any of the foregoing
documents (collectively, the 'Offering Documents') or any untrue or alleged
untrue oral statement relating to any offering contemplated by any Offering
Document, or arise out of or are based upon an omission or alleged omission to
state in any Offering Document or such oral statement a material fact required
to be stated therein or necessary to make the statements in any Offering
Document or such oral statement not misleading; provided, however, that GS Inc.
shall not be liable in any such case to the extent that any such Losses arise
out of or are based upon an untrue statement or alleged untrue statement or
omission or alleged omission relating to such Indemnitee made in any Offering
Document or such oral statement in reliance upon and in conformity with written
information relating to such Indemnitee furnished to GS Inc. by such Indemnitee
expressly for use therein. 'Registration Statement' means any registration
statement previously filed or hereafter filed by GS Inc. under the Securities
Act on any applicable form (including Forms S-8 and S-4) for the registration of
any securities of GS Inc. under the Securities Act, including, without
limitation, debt and equity securities, guarantees, back-up undertakings,
rights, warrants and options and interests in employee benefit plans, and shall
include any amendment, post-effective or otherwise, thereto and any related
registration statement filed pursuant to Rule 462 under the Securities Act.

                  Notwithstanding the foregoing provisions of this Section 1, GS
Inc. and each Indemnitee agree that insofar as indemnification for liabilities
arising under the Securities Act may be permitted under this Agreement to an
Indemnitee who is a director, officer or controlling person of GS Inc., in the
event that a claim for indemnification against such liabilities is made by such
an Indemnitee (other than the payment by GS Inc. of expenses incurred or paid by
such Indemnitee in the successful defense of any action, suit or proceeding) in
connection with a Registration Statement, GS Inc. will, unless in the opinion of
its counsel the matter has been settled by controlling precedent, submit to a
court of appropriate jurisdiction the question whether such indemnification by
it is against public policy as expressed in the Securities Act, and GS Inc. and
such Indemnitee will be governed by the final adjudication of such question.

                  2. Losses. As used in this Agreement, the term 'Losses' shall
include, without limitation, damages, losses, claims, judgments, liabilities,
fines, penalties, excise taxes, settlements, and costs, attorneys' fees,
accountants' fees, and disbursements and costs of attachment or similar bonds,
investigation costs, defense preparation costs, costs of preparing for and
presenting evidence or testimony, and any expenses of establishing a right to
indemnification under this Agreement. The term 'Losses' shall not include taxes
except to the extent taxes are imposed in respect of payments otherwise made
pursuant to this Agreement, in which case such Indemnitee's Losses shall include
an amount not greater than the net taxes payable (taking into account any
deductions, credits or other tax benefits available to such Indemnitee as a
result of the Losses in respect of which such payment is made and the payment of
the taxes imposed in respect of such payment).



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                  3. Enforcement. Subject to the provisions of the second
paragraph of Section 1 hereof, if a claim or request by an Indemnitee under this
Agreement is not paid by GS Inc. or on its behalf, within thirty (30) days after
a written claim or request has been received by GS Inc. and, if applicable, the
written undertaking in Section 5 hereof has been received by GS Inc., such
Indemnitee may at any time thereafter commence an arbitration proceeding in
accordance with Section 9 hereof against GS Inc. to recover the unpaid amount of
the claim or request and, if successful in whole or in part, such Indemnitee
shall be entitled to be paid also the expenses of prosecuting such proceeding.

                  4. Partial Indemnification; Contribution. If an Indemnitee is
entitled under any provision of this Agreement to indemnification by GS Inc. for
some or a portion of any Losses, but not for the total amount thereof, GS Inc.
shall nevertheless indemnify such Indemnitee for the portion of such Losses to
which such Indemnitee is entitled. If the indemnification provided for in this
Agreement is insufficient or unavailable for any reason, GS Inc. shall
contribute to relevant Losses to the maximum extent permitted by law.

                  5. Expenses. Expenses incurred by an Indemnitee in connection
with any proceeding shall be paid by GS Inc. upon request of such Indemnitee
that GS Inc. pay such expenses, but only upon receipt by GS Inc. of (i) a
written undertaking by or on behalf of such Indemnitee to reimburse GS Inc. for
expenses if and to the extent that it is ultimately determined that such
indemnification is not permitted by the Securities Act (and that contribution is
unavailable with respect to such payments) and (ii) satisfactory evidence of the
amount of such expenses.

                  6. Notice of Claim. Each Indemnitee shall promptly notify GS
Inc. in writing of any claim against such Indemnitee for which indemnification
will or could be sought under this Agreement. In addition, each Indemnitee shall
give GS Inc. such information and cooperation as it may reasonably require and
as shall be within such Indemnitee's power and at such times and places as are
not unduly burdensome for such Indemnitee.

                  7. Defense of Claim. With respect to any proceeding as to
which an Indemnitee notifies GS Inc. of the commencement thereof:


                  (a) GS Inc. will be entitled to participate at its own
         expense;

                  (b) subject to Section 7(c) hereof, GS Inc. shall not, in
         connection with any proceeding or related proceedings in the same
         jurisdiction against any Indemnitee and any other Indemnitees, be
         liable to such Indemnitee and such other Indemnitees for the fees and
         expenses of


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         more than one separate law firm (in addition to a single firm of local
         counsel);

                  (c) except as otherwise provided below, to the extent that it
         may wish, GS Inc. will be entitled to assume the defense thereof, with
         counsel reasonably satisfactory to such Indemnitee, which in GS Inc.'s
         sole discretion may be regular counsel to GS Inc. and may be counsel to
         other Indemnitees. The Indemnitees also shall have the right to employ
         one separate counsel for such Indemnitees in such action, suit or
         proceeding if such Indemnitees reasonably conclude that if they did not
         there would be a conflict of interest between GS Inc. and such
         Indemnitees, and under such circumstances the fees and expenses of such
         counsel shall be paid by GS Inc.; and

                  (d) GS Inc. shall not be liable to indemnify an Indemnitee
         under this Agreement for any amounts paid in settlement of any action,
         suit or proceeding effected without GS Inc.'s written consent. GS Inc.
         shall not settle any action, suit or proceeding in any manner which
         would impose any cost or limitation on an Indemnitee or would admit
         fault by an Indemnitee without such Indemnitee's written consent. No
         Indemnitee shall settle any action, suit, or proceeding without the
         prior written consent of GS Inc. Neither GS Inc. nor an Indemnitee will
         unreasonably withhold or delay its consent to any proposed settlement.

                  8. Non-exclusivity. The right to indemnification and the
payment of expenses incurred in defending a proceeding in advance of its final
disposition conferred in this Agreement shall not be exclusive of or affected in
any way by any other right which an Indemnitee may have or hereafter may acquire
under any statute, certificate of incorporation, by-laws, agreement,
arrangement, resolution or instrument providing indemnification or expense
payment, except that any payments otherwise required to be made by GS Inc.
hereunder shall be offset by any and all amounts received by an Indemnitee from
any other indemnitor or under one or more liability insurance policies
maintained by an indemnitor or otherwise and shall not be duplicative of any
other payments received by an Indemnitee from GS Inc. in respect of the matter
giving rise to the indemnity hereunder. When an Indemnitee is entitled to
indemnification, expense advancement or reimbursement under this Instrument and
any other agreement, arrangement, resolution or instrument of GS Inc., the
Indemnitee may choose to pursue its rights under one or more, but less than all,
of such applicable agreements, arrangements, resolutions or instruments, in
which case such Indemnitee need only comply with the standards and procedures of
the agreements, arrangements, resolutions or instruments under which it chooses
to pursue its rights.



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                  9. Arbitration.

                  (a) Subject to the provisions of the second paragraph of
         Section 1 and Section 9(b) hereof, any dispute, controversy or claim
         between an Indemnitee and GS Inc. arising out of or relating to or
         concerning the provisions of this Agreement shall be finally settled by
         arbitration in New York City before, and in accordance with the rules
         then applying of, the New York Stock Exchange, Inc. ('NYSE') or, if the
         NYSE declines to arbitrate the matter or the matter is not otherwise
         arbitrable before it, the American Arbitration Association (the 'AAA')
         in accordance with the commercial arbitration rules of the AAA.

                  (b) Notwithstanding the provision of Section 9(a) and in
         addition to its right to submit any dispute or controversy to
         arbitration, GS Inc. may bring an action or special proceeding in a
         state or federal court of competent jurisdiction sitting in the State
         of Delaware, whether or not an arbitration proceeding has theretofore
         been or is ever initiated, for the purpose of temporarily,
         preliminarily or permanently enforcing the provisions of this Agreement
         or to enforce an arbitration award, and, for the purposes of this
         Section 9(b), each Indemnitee (i) expressly consents to the application
         of Section 9(c) hereof to any such action or proceeding, (ii) agrees
         that proof shall not be required that monetary damages for breach of
         the provisions of this Agreement would be difficult to calculate and
         that remedies at law would be inadequate and (iii) irrevocably appoints
         each General Counsel of GS Inc., c/o The Corporation Trust Company,
         Corporation Trust Center, 1209 Orange Street, Wilmington, Delaware
         19801 as such Indemnitee's agent for service of process in connection
         with any such action or proceeding, who shall promptly advise such
         Indemnitee of any such service of process.

                  (c) (i) EACH INDEMNITEE HEREBY IRREVOCABLY SUBMITS TO THE
         EXCLUSIVE JURISDICTION OF ANY STATE OR FEDERAL COURT LOCATED IN THE
         STATE OF DELAWARE OVER ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR
         RELATING TO OR CONCERNING THIS AGREEMENT THAT IS NOT OTHERWISE
         ARBITRATED ACCORDING TO THE PROVISIONS OF SECTION 9(a) HEREOF. This
         includes any suit, action or proceeding to compel arbitration or to
         enforce an arbitration award. The parties acknowledge that the forum
         designated by this Section 9(c) has a reasonable relation to this
         Agreement, and to the parties' relationship with one another.
         Notwithstanding the foregoing, nothing herein shall preclude GS Inc.
         from bringing any action or proceeding in any other court for the
         purpose of enforcing the provisions of this Section 9.


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                  (ii) The agreement of an Indemnitee as to forum is independent
         of the law that may be applied in the action, and each Indemnitee
         agrees to this forum even if the forum may under applicable law choose
         to apply non-forum law. Each Indemnitee hereby waives, to the fullest
         extent permitted by applicable law, any objection which such Indemnitee
         now or hereafter may have to personal jurisdiction or to the laying of
         venue of any such suit, action or proceeding in any court referred to
         in Section 9(c)(i). The parties undertake not to commence any action
         arising out of or relating to this Agreement in any forum other than
         the forum described in this Section 9(c). The parties agree that, to
         the fullest extent permitted by applicable law, a final and
         non-appealable judgment in any such suit, action or proceeding in any
         such court shall be conclusive and binding upon the parties.

                  10. Binding Effect. This Agreement shall be binding upon and
inure to the benefit of and be enforceable by the parties hereto and their
respective successors, assigns (including any direct or indirect successor by
merger or consolidation), heirs, executors and administrators.

                  11. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF DELAWARE, WITHOUT REGARD
TO PRINCIPLES OF CONFLICTS OF LAWS.

                  12. Amendment. Each party understands that from time to time
certain other persons may become Indemnitees and certain Indemnitees will cease
to be Indemnitees to the extent provided in this Section 12. Accordingly, this
Agreement may be amended by action of GS Inc. from time to time to add
additional Indemnitees, without the approval of any other person other than such
proposed additional Indemnitees, each of whom shall execute a counterpart of the
signature page of this Agreement. This Agreement may also be amended by action
of GS Inc. and without the approval of any other person to remove an Indemnitee;
provided that such amendment shall not be effective unless GS Inc. has provided
30 days prior written notice to the Indemnitee and, in any event, such amendment
shall not affect any rights of such Indemnitee to be indemnified in respect of
Losses associated with the acts, omissions or status of such Indemnitee through
the effective date of such termination (including the right to subsequent
indemnification and expense advancement and reimbursement relating to such acts,
omissions or status).

                  13. Waiver of Breach. The failure or delay of a party at any
time to require performance by any other party of any provision of this
Agreement, even if known, shall not affect the right of such party to require
performance of that provision or to exercise any right, power, or remedy
hereunder, and any waiver by any party of any breach of any provision of this
Agreement shall not be construed as a waiver of any


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continuing or succeeding breach of such provision, a waiver of the provision
itself, or a waiver of any right, power, or remedy under this Agreement. No
notice to or demand on any party in any case shall, of itself, entitle such
party to other or further notice or demand in similar or other circumstances.

                  14. Severability. GS Inc. and each Indemnitee agree that the
agreements and provisions contained in this Agreement are severable and
divisible, that each such agreement and provision does not depend upon any other
provision or agreement for its enforceability, and that each such agreement and
provision set forth herein constitutes an enforceable obligation between GS Inc.
and such Indemnitee. Consequently, GS Inc. and each Indemnitee hereto agrees
that neither the invalidity nor the unenforceability of any provision of this
Agreement shall affect the other provisions hereof, and this Agreement shall
remain in full force and effect and be construed in all respects as if such
invalid or unenforceable provision were omitted.

                  15. Notices. Any communication, demand or notice to be given
hereunder will be duly given when delivered in writing by hand or first class
mail to GS Inc. at its principal executive office or to an Indemnitee at its
last address appearing in the business records of GS Inc. (or to such other
addresses as a party may designate by written notice to GS Inc.).

                  16. No Assignments. No Indemnitee may assign its rights or
delegate obligations under this Agreement without the prior written consent of
GS Inc. Any assignment or delegation in violation of this Section 16 shall be
null and void.

                  17. No Third Party Rights. Nothing expressed or referred to in
this Agreement will be construed to give any person other than the parties to
this Agreement any legal or equitable right, remedy or claim under or with
respect to this Agreement or any provision of this Agreement. This Agreement and
all of its provisions are for the sole and exclusive benefit of the parties to
this Agreement and their successors and permitted assigns.

                  18. Counterparts. This Agreement may be executed in any number
of counterparts, each of which shall be deemed an original, but all such
counterparts shall together constitute but one and the same instrument.



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                  IN WITNESS WHEREOF, the parties hereto have entered into this
Agreement as of the date first written above.

                                    THE GOLDMAN SACHS GROUP, INC.


                                    By: /s/ Gregory K. Palm
                                       --------------------------
                                    Name: Gregory K. Palm
                                    Title: Authorized Person






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INDEMNITEES: