The securities are unsecured notes issued by GS Finance Corp. and guaranteed by The Goldman Sachs Group, Inc.
The amount that you will be paid on your securities is based on the performance of the EURO STOXX 50
®
Index.
The securities may be automatically called on any call observation date.
Your securities will be automatically called if the index closing value on any call observation date is
greater than
or
equal to
the initial index value of 3,452.89, resulting in a payment on the applicable call payment date equal to the principal amount of your securities
times
(i) with respect to the first call observation date, 116.60%, (ii) with respect to the second call observation date, 133.20%, (iii) with respect to the third call observation date, 149.80%, (iv) with respect to the fourth call observation date, 166.40%, (v) with respect to the fifth call observation date, 183.00%, (vi) with respect to the sixth call observation date, 199.60%, (vii) with respect to the seventh call observation date, 216.20%, (viii) with respect to the eighth call observation date, 232.80% and (ix) with respect to the ninth call observation date, 249.40%. No payments will be made after the call payment date.
At maturity, if not previously called, (i) if the final index value (the index closing value on the valuation date) is
greater than
or
equal to
its initial index value, the return on your securities will be positive and equal to 166.00%; or (ii) if the final index value on the valuation date is
less than
its initial index value, you will receive a payment at maturity based on the index performance factor (the
quotient
of the final index value
divided
by the initial index value). You will not participate in any appreciation of the underlying index.
At maturity, for each $10 principal amount of your securities you will receive an amount in cash equal to:
The securities are for investors who seek a return of between 16.60% and 166.00%, depending on if and when their securities are automatically called, in exchange for the risk of losing all or a portion of the principal amount of their securities if the securities remain outstanding to maturity.
The estimated value of your securities at the time the terms of your securities are set on the pricing date is equal to approximately $9.78 per $10.00 principal amount. For a discussion of the estimated value and the price at which Goldman Sachs & Co. LLC would initially buy or sell your securities, if it makes a market in the securities, see the following page.
Your investment in the securities involves risks, including the credit risk of GS Finance Corp. and The Goldman Sachs Group, Inc. See page PS-13.
You should read the disclosure herein to better understand the terms and risks of your investment.
*Morgan Stanley Wealth Management, acting as dealer for the offering, will receive a selling concession of $0.025 for each security it sells. It has informed us that it intends to internally allocate $0.01 of the selling concession as a structuring fee. Goldman Sachs & Co. LLC will receive an underwriting discount of $0.045 for each security.
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. Any representation to the contrary is a criminal offense.
The securities are not bank deposits and are not insured by the Federal Deposit Insurance Corporation or any other governmental agency, nor are they obligations of, or guaranteed by, a bank.
Goldman Sachs & Co. LLC
GS Finance Corp. may use this prospectus in the initial sale of the securities. In addition, Goldman Sachs & Co. LLC or any other affiliate of GS Finance Corp., may use this prospectus in a market-making transaction in a security after its initial sale.
Unless GS Finance Corp. or its agent informs the purchaser otherwise in the
confirmation of sale, this prospectus is being used in a market-making transaction.
The securities are unsecured notes issued by GS Finance Corp. and guaranteed by The Goldman Sachs Group, Inc.
The amount that you will be paid on your securities is based on the performance of the EURO STOXX 50
®
Index.
The securities may be automatically called on any call observation date.
Your securities will be automatically called if the index closing value on any call observation date is
greater than
or
equal to
the initial index value of 3,452.89, resulting in a payment on the applicable call payment date equal to the principal amount of your securities
times
(i) with respect to the first call observation date, 116.60%, (ii) with respect to the second call observation date, 133.20%, (iii) with respect to the third call observation date, 149.80%, (iv) with respect to the fourth call observation date, 166.40%, (v) with respect to the fifth call observation date, 183.00%, (vi) with respect to the sixth call observation date, 199.60%, (vii) with respect to the seventh call observation date, 216.20%, (viii) with respect to the eighth call observation date, 232.80% and (ix) with respect to the ninth call observation date, 249.40%. No payments will be made after the call payment date.
At maturity, if not previously called, (i) if the final index value (the index closing value on the valuation date) is
greater than
or
equal to
its initial index value, the return on your securities will be positive and equal to 166.00%; or (ii) if the final index value on the valuation date is
less than
its initial index value, you will receive a payment at maturity based on the index performance factor (the
quotient
of the final index value
divided
by the initial index value). You will not participate in any appreciation of the underlying index.
At maturity, for each $10 principal amount of your securities you will receive an amount in cash equal to:
The securities are for investors who seek a return of between 16.60% and 166.00%, depending on if and when their securities are automatically called, in exchange for the risk of losing all or a portion of the principal amount of their securities if the securities remain outstanding to maturity.
Investment Summary
The Jump Securities with Auto-Callable Feature Based on the Value of the EURO STOXX 50
®
Index due June 21, 2029
(th
e
“securities”
)
d
o
no
t
provid
e
fo
r
th
e
regular
payment
of
interest.
Instead, the securities provide an opportunity to earn a fixed premium payment that could increase in amount the longer the securities remain outstanding. A fixed call premium payment will be paid on a call payment date (and the securities will be automatically called and no further payments will be made) if the closing value of the underlying index on the related call observation date is
greater than or equal to the initial index value
. If the securities have not been automatically called prior to maturity, a fixed maturity premium payment will be paid on the stated maturity date if the closing level of the underlying index on the valuation date is
greater than or equal to the initial index value
. If the securities have not been automatically called prior to maturity and the closing level of the underlying index on the valuation date is
less than the initial index value
, investors
will
be
fully
exposed
to
the
decline
in
the
underlying
index
on
a
1
-
to
-
1
basis,
and will receive a payment at maturity that is less than the stated principal amount of the securities and could be zero. No fixed call premium payment will be paid with respect to a call observation date, and the securities will remain outstanding, if the index closing value is below the initial index value on such date. No fixed maturity premium payment will be paid with respect to the valuation date, if the index closing value is below the initial index value on such date.
Accordingly, investors in the securities must be willing to accept the risk of not receiving any fixed premium payment during the term of the securities, even if the securities remain outstanding until the stated maturity, and the risk of losing
thei
r
entir
e
initia
l
investmen
t.
In addition, investors will not participate in any appreciation of the underlying index.
Maturity:
|
Approximately 10 years (unless automatically called)
|
Call premium amount:
|
16.60% with respect to the first call observation date, 33.20% with respect to the second call observation date, 49.80% with respect to the third call observation date, 66.40% with respect to the fourth call observation date, 83.00% with respect to the fifth call observation date, 99.60% with respect to the sixth call observation date, 116.20% with respect to the seventh call observation date, 132.80% with respect to the eighth call observation date and 149.40% with respect to the ninth call observation date
|
PS-5
June 2019
GS Finance Corp.
Jump Securities with Auto-Callable Feature
Based
on
the
Value
of
the EURO STOXX 50
®
Index
due
June 21, 2029
Principal at Risk Securities
|
Automatic call feature:
|
If, as measured on any call observation date, the index closing value is
greater than
or
equal to
the initial index value, your securities will be automatically called and you will receive for each $10 principal amount an amount in cash equal to the
sum
of (i) $10
plus
(ii) the
product
of $10
times
the call premium amount applicable to the corresponding call observation date. No further
payments will be made on the securities following an automatic call.
|
Payment at maturity:
|
•
If the final index value is
greater than
or
equal to
the initial index value, (i) $10
plus
(ii) the
product
of $10
times
the maturity date premium amount of 166.00%; or
•
If the final index value is
less than
the initial index value, the
product
of $10
times
the index performance factor
|
Index performance factor
|
The final index value / the initial index value
|
Maturity date premium amount:
|
166.00%
|
PS-6
June 2019
GS Finance Corp.
Jump Securities with Auto-Callable Feature
Based
on
the
Value
of
the EURO STOXX 50
®
Index
due
June 21, 2029
Principal at Risk Securities
|
Key Investment Rationale
The securities do not provide for the regular payment of interest. Instead, the securities are for investors who seek a return of between 16.60% and 166.00%, depending on if and when their securities are automatically called, in exchange for the risk of losing all or a portion of the principal amount of their securities if the securities remain outstanding to maturity. The following scenarios are for illustrative purposes only to demonstrate how the payment on a call payment date (if the securities are automatically called) and the payment at maturity (if the securities have not been automatically called) are calculated, and do not attempt to demonstrate every situation that may occur. Accordingly, the securities may or may not be automatically called, a positive return on the securities may never be realized and the payment at maturity may be less than the stated principal amount of the securities and may be zero.
Scenario
1:
the
securities are automatically called prior to
maturity and investors receive principal back and a return equal to the applicable call premium amount
|
This scenario assumes that
the
underlying
index
close
s at
or
above
the initial index value
on
a
call observation date. As a result, the
securities
are
automatically
called
fo
r
th
e
sum
of the
state
d
principa
l
amoun
t
plu
s
the
product
of the stated principal amount
times
th
e applicable
call premium amount
wit
h
respec
t
t
o
th
e
related call observation date
.
If
the
securities
are
automatically
called,
no
further
payment
s
will
be
made.
|
Scenario
2:
the
securities are not automatically called
prior
to
maturity and
investors
receive
principal back and a return equal to the maturity date premium amount at
maturity
|
This scenario assumes that the underlying index closes below the initial index value on every call observation date. Consequently, the securities are not automatically called and no call payments are made.
On
the valuation
date,
the
underlying
index
closes
at
or
above
the
initial index value.
At
maturity,
investors
will
receive
the
stated
principal
amount
plus
the
product
of the stated principal amount
times
the maturity date premium amount.
|
Scenario
3:
th
e
securities
are no
t
automatically called
prio
r
t
o
maturity
and
investors
suffer
a loss
of
principal
at
maturity
|
This
scenario
assumes
that
the underlying index closes below the initial index value on every call observation date. Consequently,
the
securities
are
not
automatically
called and no call payments are made
.
On
the valuation
date,
the
underlying
index
closes
below
the
initial index
value
.
At
maturity,
investors
will
receive
an
amount
equal
to
the
product
of the
stated
principal
amount
times
the
index
performance
factor.
Under
thes
e
circumstances
,
th
e
paymen
t
a
t
maturit
y
wil
l
b
e
les
s
tha
n
th
e
state
d
principal
amount
and
could
be
zero.
|
PS-7
June 2019
GS Finance Corp.
Jump Securities with Auto-Callable Feature
Based
on
the
Value
of
the EURO STOXX 50
®
Index
due
June 21, 2029
Principal at Risk Securities
|
How the Securities Work
The
following
diagrams
illustrate
the
potential
outcomes
for
the securities
depending
on
(1)
the
index
closing
value
on
each
annual call observation date
and
(2)
the
fina
l
inde
x
value
.
Pleas
e
se
e
“Hypothetica
l
Examples
”
belo
w
fo
r
illustratio
n
o
f
hypothetica
l
payout
s
o
n
the securities.
Diagram #1: Call Observation Dates
PS-8
June 2019
GS Finance Corp.
Jump Securities with Auto-Callable Feature
Based
on
the
Value
of
the EURO STOXX 50
®
Index
due
June 21, 2029
Principal at Risk Securities
|
Hypothetical Examples
The below examples are based on the following terms:
Stated principal amount:
|
$10 per security
|
Call premium amount:
|
16.60% with respect to the first call observation date, 33.20% with respect to the second call observation date, 49.80% with respect to the third call observation date, 66.40% with respect to the fourth call observation date, 83.00% with respect to the fifth call observation date, 99.60% with respect to the sixth call observation date, 116.20% with respect to the seventh call observation date, 132.80% with respect to the eighth call observation date, 149.40% with respect to the ninth call observation date
|
Maturity date premium amount:
|
166.00%
|
Initial index value:
|
3,452.89
|
How to determine the amount payable, if any, on a call payment
date:
Hypothetical Call Observation Date
|
Index Closing Value
|
Amount Payable on a Call Payment Date
(per security)
|
#1
|
3,000.00 (
below
initial index value)
|
$0.00
|
#2
|
3,200.00 (
below
initial index value)
|
$0.00
|
#3
|
4,000.00 (
at or above
initial index value)
|
$14.98
|
On each of hypothetical call observation dates #1 and #2, the underlying index closes below the initial index value. Therefore, the securities are not automatically called on the relevant call payment dates.
On hypothetical call observation date #3, the underlying index closes at or above the initial index value. Therefore, the securities are automatically called and the amount payable on the relevant call payment date equals
th
e
sum
of the
state
d
principa
l
amoun
t
plu
s
the
product
of the stated principal amount
times
th
e applicable
call premium amount
.
Your notes will not be automatically called, and you will not receive a payment on a call payment date, if the index closing value is below the initial index value on the related call observation date.
PS-9
June 2019
GS Finance Corp.
Jump Securities with Auto-Callable Feature
Based
on
the
Value
of
the EURO STOXX 50
®
Index
due
June 21, 2029
Principal at Risk Securities
|
Ho
w
t
o
calculat
e
th
e
paymen
t
a
t
maturit
y
(i
f
th
e
securities
hav
e
no
t
bee
n
automaticall
y
called):
Example
|
Index Closing Value (Final Index Value)
|
Payment at Maturity
(per security)
|
#1
|
3,600.00 (
at or above
the initial index value)
|
$26.60 ($10 + $10 ×
the maturity date premium amount
)
|
#2
|
1,726.45
(
below
the
initial index value)
|
$10
× the index
performance factor
=
$10
× (1,726.45 /
3,452.89)
=
$5.00
|
In
example
#
1,
the
final
index
value
is
at
or
above
the
initial index value.
Therefore,
investors
receive
at
maturity
the
stated
principal
amount
of
the securities
and
the
product of $10 times the maturity date premium amount. Investors will not participate in any appreciation of the underlying index.
In
example
#
2,
the
final
index
value
is
below
the
initial index value.
Therefore,
investors
are
exposed
to
the
downside
performance
of
the underlying
index
at
maturity
and
receive
at
maturity
an
amount
equal
to
the
stated
principal
amount
time
s
the
index
performanc
e
facto
r
.
If
the
final
index
value
is
below
the
initial index value,
you
will
be
exposed
to the
downside
performance
of
the
underlying
index
at
maturity,
and
your
payment
at
maturity
will
be
less than
$10.00
per
security
and
could
be
zero.
Additional Hypothetical Examples
The following examples are provided for purposes of illustration only. They should not be taken as an indication or prediction of future investment results and merely are intended to illustrate (i) the impact that various hypothetical index closing values on a call observation date could have on the amount payable, if any, on the related call payment date and (ii) the impact that various hypothetical index closing values on the valuation date could have on the payment at maturity assuming all other variables remain constant. While there are nine potential call payment dates, the examples below only illustrate the amount you will receive, if any, on the first or second call payment date.
The examples below are based on a range of index closing values that are entirely hypothetical; no one can predict what the index closing value will be on any day throughout the life of your securities, what the index closing value will be on any call observation date and what the final index value will be on the valuation date. The underlying index has been highly volatile in the past — meaning that the index closing value has changed considerably in relatively short periods — and its performance cannot be predicted for any future period.
The information in the following examples reflects hypothetical rates of return on the offered securities assuming that they are purchased on the original issue date at the stated principal amount and held to the stated maturity date. If you sell your securities in a secondary market prior to a call payment date or the stated maturity date, your return will depend upon the market value of your securities at the time of sale, which may be affected by a number of factors that are not reflected in the examples below such as interest rates, the volatility of the underlying index and the creditworthiness of GS Finance Corp., as issuer, and the creditworthiness of The Goldman Sachs Group, Inc., as guarantor. The information in the examples also reflects the key terms and assumptions in the box below.
Key Terms and Assumptions
|
Stated principal amount
|
$10
|
PS-10
June 2019
GS Finance Corp.
Jump Securities with Auto-Callable Feature
Based
on
the
Value
of
the EURO STOXX 50
®
Index
due
June 21, 2029
Principal at Risk Securities
|
Call premium amount
|
16.60% with respect to the first call observation date,
33.20% with respect to the second call observation date
49.80% with respect to the third call observation date
66.40% with respect to the fourth call observation date
83.00% with respect to the fifth call observation date
99.60% with respect to the sixth call observation date
116.20% with respect to the seventh call observation date
132.80% with respect to the eighth call observation date
149.40% with respect to the ninth call observation date
|
Maturity date premium amount
|
166.00%
|
Neither a market disruption event nor a non-index business day occurs on any originally scheduled call observation date or the originally scheduled valuation date
|
No change in or affecting any of the underlying index stocks or the method by which the underlying index publisher calculates the underlying index
Securities purchased on original issue date at the stated principal amount and held to a call payment date or the stated maturity date
|
For these reasons, the actual performance of the underlying index over the life of your securities and the actual index closing value on any call observation date, may bear little relation to the hypothetical examples shown below or to the historical index closing values shown elsewhere in this pricing supplement. For information about the historical values of the underlying index during recent periods, see “The Underlying Index — Historical Index Closing Values” below. Before investing in the offered securities, you should consult publicly available information to determine the values of the underlying index between the date of this pricing supplement and the date of your purchase of the offered securities.
Also, the hypothetical examples shown below do not take into account the effects of applicable taxes. Because of the U.S. tax treatment applicable to your securities, tax liabilities could affect the after-tax rate of return on your securities to a comparatively greater extent than the after-tax return on the underlying index stocks.
If your securities are automatically called on the first call observation date
(i.e., on the first call observation date the index closing value is
equal to
or
greater than
the initial index value), the cash payment that we would deliver for each $10 principal amount of your securities on the applicable call payment date would be the
sum
of $10.00
plus
the
product
of $10.00
times
the applicable call premium amount. If, for example, the index closing value on the first call observation date was determined to be 125.00% of the initial index value, your securities would be automatically called and the cash payment that we would deliver on your securities on the corresponding call payment date would be 116.60
% of the principal amount of your securities or $11.66 for each $10 of securities. No further payments would be made on the securities following an automatic call. You will not participate in any appreciation of the underlying index.
If your securities are
not
automatically called on the first call observation date and are called on the second call observation date
(i.e., on the first call observation date the index closing value is
less than
the initial index value and on the second call observation date the index closing value is
equal to
or
greater than
the initial index value), the cash payment that we would deliver for each $10 principal amount of your securities on the applicable call payment date would be the
sum
of $10.00
plus
the
product
of $10.00
times
the applicable call premium amount. If, for example, the index closing value on the second call observation date was determined to be 125.00% of the initial index value, your securities would be automatically called and the cash payment that we would deliver on your securities on the corresponding call payment date would be 133.20% of the principal amount of your securities or $13.32 for each $10 of securities. No further payments would be made on the securities following an automatic call. You will not participate in any appreciation of the underlying index.
PS-11
June 2019
GS Finance Corp.
Jump Securities with Auto-Callable Feature
Based
on
the
Value
of
the EURO STOXX 50
®
Index
due
June 21, 2029
Principal at Risk Securities
|
If the securities are
not
automatically called on any call observation date
(i.e., on each call observation date the index closing value is
less than
the initial index value), the amount we would deli
ver for each $10 principal amount of your securities on the maturity date will depend on the performance of the underlying index on the valuation date, as shown in the table below. The table below assumes that
the securities have
not
been automatically cal
led on a call observation date
and reflects hypothetical amounts that you could receive on the stated maturity date. The values in the left column of the table below represent hypothetical final index values and are expressed as percentages of the initial
index value. The amounts in the right column represent the hypothetical payments at maturity, based on the corresponding hypothetical final index value, and are expressed as percentages of the stated principal amount of a security (rounded to the nearest o
ne-thousandth of a percent). Thus, a hypothetical payment at maturity of 100.000% means that the value of the cash payment that we would deliver for each $10 of the outstanding stated principal amount of the offered securities on the stated maturity date w
ould equal 100.000% of the stated principal amount of a security, based on the corresponding hypothetical final index value and the assumptions noted above.
The Securities Have
Not
Been Automatically Called
Hypothetical Final Index Value
(as Percentage of Initial Index Value)
|
Hypothetical Payment at Maturity if the Securities Have
Not
Been Automatically Called on a Call Observation Date
(as Percentage of Stated Principal Amount)
|
200.000%
|
266.000%
|
150.000%
|
266.000%
|
125.000%
|
266.000%
|
110.000%
|
266.000%
|
105.000%
|
266.000%
|
100.000%
|
266.000%
|
99.999%
|
99.999%
|
90.000%
|
90.000%
|
80.000%
|
80.000%
|
60.000%
|
60.000%
|
50.000%
|
50.000%
|
30.000%
|
30.000%
|
25.000%
|
25.000%
|
0.000%
|
0.000%
|
If, for example, the securities have
not
been automatically called on a call observation date
and the final index value were determined to be 25.000% of the initial index value, the payment at maturity that we would deliver on your securities would be 25.000% of the stated principal amount of your securities, as shown in the table above. As a result, if you purchased your securities on the original issue date at the stated principal amount and held them to the stated maturity date, you would lose 75.000% of your investment (if you purchased your securities at a premium to stated principal amount you would lose a correspondingly higher percentage of your investment). If the final index value were determined to be zero, you would lose your entire investment in the securities. In addition, if the final index value were determined to be 200.000% of the initial index value, the payment at maturity that we would deliver on your securities would be limited to 266.000% of each $10 principal amount of your securities, as shown in the table above. As a result, if you held your securities to the stated maturity date, you would not benefit from any increase in the final index value over the initial index value.
The payments on a call payment date or at maturity shown above are entirely hypothetical; they are based on market prices for the underlying index stocks that may not be achieved on a call observation date or the valuation date and on assumptions that may prove to be erroneous. The actual market value of your
PS-12
June 2019
GS Finance Corp.
Jump Securities with Auto-Callable Feature
Based
on
the
Value
of
the EURO STOXX 50
®
Index
due
June 21, 2029
Principal at Risk Securities
|
securities on the stated maturity date or at
any other time, including any time you may wish to sell your securities, may bear little relation to the hypothetical payments at maturity shown above, and these amounts should not be viewed as an indication of the financial return on an investment in the
offered securities. The hypothetical payments on securities held to the stated maturity date in the examples above assume you purchased your securities at their stated principal amount and have not been adjusted to reflect the actual issue price you pay f
or your securities. The return on your investment (whether positive or negative) in your securities will be affected by the amount you pay for your securities. If you purchase your securities for a price other than the stated principal amount, the return o
n your investment will differ from, and may be significantly lower than, the hypothetical returns suggested by the above examples. Please read “Risk Factors — The Market Value of Your Securities May Be Influenced by Many Unpredictable Factors” below.
Payments on the securities are economically equivalent to the amounts that would be paid on a combination of other instruments. For example, payments on the securities are economically equivalent to a combination of an interest-bearing bond bought by the holder (although the securities do not pay interest) and one or more options entered into between the holder and us (with one or more implicit option premiums paid over time). The discussion in this paragraph does not modify or affect the terms of the securities or the U.S. federal income tax treatment of the securities, as described elsewhere in this pricing supplement.
We cannot predict the actual index closing values of the underlying index on any day, the final index value or what the market value of your securities will be on any particular index business day, nor can we predict the relationship between the index closing value and the market value of your securities at any time prior to the stated maturity date. The actual amount that you will receive on a call payment date or the maturity date, if any, and the rate of return on the offered securities will depend on whether or not the securities are automatically called and the actual index closing value on the call observation dates and the actual final index value determined by the calculation agent as described above. Moreover, the assumptions on which the hypothetical examples are based may turn out to be inaccurate. Consequently, the amount to be paid in respect of your securities on a call payment date or the stated maturity date, as applicable, may be very different from the information reflected in the examples above.
|
PS-13
June 2019
GS Finance Corp.
Jump Securities with Auto-Callable Feature
Based
on
the
Value
of
the EURO STOXX 50
®
Index
due
June 21, 2029
Principal at Risk Securities
|
Risk Factors
An investment in your securities is subject to the risks described below, as well as the risks and considerations described in the accompanying prospectus, in the accompanying prospectus supplement and under “Additional Risk Factors Specific to the Notes” in the accompanying general terms supplement no. 1,735. You should carefully review these risks and considerations as well as the terms of the securities described herein and in the accompanying prospectus, the accompanying prospectus supplement and the accompanying general terms supplement no. 1,735. Your securities are a riskier investment than ordinary debt securities. Also, your securities are not equivalent to investing directly in the underlying index stocks, i.e., the stocks comprising the underlying index to which your securities are linked. You should carefully consider whether the offered securities are suited to your particular circumstances.
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You May Lose Your Entire Investment in the Securities
You can lose your entire investment in the securities. Assuming your securities are not automatically called on a call observation date, the cash payment on your securities, if any, on the stated maturity date will be based on the performance of the EURO STOXX 50
®
Index as measured from the initial index value to the index closing value on the valuation date. If the final index value is
less than
the initial index value, you will lose 1.00% of the stated principal amount of your securities for every 1.00% decline in the index value over the term of the securities. Thus, you may lose your entire investment in the securities.
Also, the market price of your securities prior to the stated maturity date may be significantly lower than the purchase price you pay for your securities. Consequently, if you sell your securities before the stated maturity date, you may receive far less than the amount of your investment in the securities.
The Securities Are Subject to the Credit Risk of the Issuer and the Guarantor
Although the return on the securities will be based on the performances of the underlying index, the payment of any amount due on the securities is subject to the credit risk
of GS Finance Corp., as issuer of the securities, and the credit risk of The Goldman Sachs Group, Inc., as guarantor of the securities
. The securities are our unsecured obligations. Investors are dependent on our ability to pay all amounts due on the securities, and therefore investors are subject to our credit risk and to changes in the market’s view of our creditworthiness.
Similarly, investors are dependent on the ability of The Goldman Sachs Group, Inc., as guarantor of the securities, to pay all amounts due on the securities, and therefore are also subject to its credit risk and to changes in the market’s view of its creditworthiness.
See “Description of the Notes We May Offer — Information About Our Medium-Term Notes, Series E Program — How the Notes Rank Against Other Debt” on page S-4 of the accompanying prospectus supplement
and “Description of Debt Securities We May Offer— Guarantee by The Goldman Sachs Group, Inc.” on page 37 of the accompanying prospectus
.
The Amount You Will Receive on a Call Payment Date or on the Stated Maturity Date, as the Case May Be, Will Be Capped
Regardless of the index closing value on a call observation date or the valuation date, the amount you may receive on the related call payment date or the stated maturity date is capped and you will not benefit from any increase in the index closing value above the initial index value. If your securities are automatically called on a call observation date, the payment you will receive for each $10 face amount of your securities will depend on the applicable call premium amount. Similarly, if your securities remain outstanding until the stated maturity date, the payment you will receive for each $10 face amount of your securities will be based on the maturity date premium amount.
PS-14
June 2019
GS Finance Corp.
Jump Securities with Auto-Callable Feature
Based
on
the
Value
of
the EURO STOXX 50
®
Index
due
June 21, 2029
Principal at Risk Securities
|
Your Securities Are S
ubject to Automatic Redemption
We will automatically call and redeem all, but not part, of your securities on a call payment date, if, as measured on any call observation date, the index closing value is
greater than or equal to
the initial index value. No further payments will be made on the securities following an automatic call. Therefore, the term for your securities may be reduced to as short as approximately twelve months after the original issue date. You may not be able to reinvest the proceeds from an investment in the securities at a comparable return for a similar level of risk in the event the securities are called prior to maturity. For the avoidance of doubt, if your securities are automatically called, no discounts, commissions or fees described herein will be rebated or reduced.
The Amount You Will Receive on a Call Payment Date or on the Stated Maturity Date is Not Linked to the Index Closing Value at Any Time Other Than on the Applicable Call Observation Date or the Valuation Date, as the Case May Be
The amount you will receive on a call payment date, if any, will be paid only if the index closing value is greater than or equal to the initial index value on the related call observation date. Therefore, the index closing value on dates other than the call observation dates will have no effect on any amount paid in respect of your securities on the call payment date. In addition, the amount you will receive on the stated maturity date, if any, will be based on the index closing value on the valuation date. Therefore, for example, if the final index value dropped precipitously on the valuation date, the amount paid on the securities would be significantly less than it would otherwise have been had the amount been linked to the index closing value prior to such drop. Although the actual index closing value on the call payment dates, stated maturity date or at other times during the life of the securities may be higher than the index closing value on the call observation dates or the valuation date, you will not benefit from the index closing value on any date other than on the call observation dates or the valuation date.
The Return on Your Securities Will Not Reflect Any Dividends Paid on the Underlying Index Stocks
The underlying index publisher calculates the value of the underlying index by reference to the prices of its underlying index stocks, without taking account of the value of dividends paid on those stocks. Therefore, the return on your securities will not reflect the return you would realize if you actually owned the underlying index stocks and received the dividends paid on those stocks. You will not receive any dividends that may be paid on any of the underlying index stocks by the applicable underlying index stock issuer. See “—Investing in the securities is Not Equivalent to Investing in the Underlying Index; You Have No Shareholder Rights or Rights to Receive Any Underlying Index Stock” below for additional information.
PS-15
June 2019
GS Finance Corp.
Jump Securities with Auto-Callable Feature
Based
on
the
Value
of
the EURO STOXX 50
®
Index
due
June 21, 2029
Principal at Risk Securities
|
The Estimated Value of Your Securities At the Time the Terms of
Your Securities Are Set On the Pricing Date (as Determined By Reference to Pricing Models Used By GS&Co.) Is Less Than the Original Issue Price Of Your Securities
The original issue price for your securities exceeds the estimated value of your securities as of the time the terms of your securities are set on the pricing date, as determined by reference to GS&Co.’s pricing models and taking into account our credit spreads. Such estimated value on the pricing date is set forth above under “Estimated Value of Your Securities”; after the pricing date, the estimated value as determined by reference to these models will be affected by changes in market conditions, the creditworthiness of GS Finance Corp., as issuer, the creditworthiness of The Goldman Sachs Group Inc., as guarantor, and other relevant factors. The price at which GS&Co. would initially buy or sell your securities (if GS&Co. makes a market, which it is not obligated to do), and the value that GS&Co. will initially use for account statements and otherwise, also exceeds the estimated value of your securities as determined by reference to these models. As agreed by GS&Co. and the distribution participants, this excess (i.e., the additional amount described under “Estimated Value of Your Securities”) will decline to zero on a straight line basis over the period from the date hereof through the applicable date set forth above under “Estimated Value of Your Securities”. Thereafter, if GS&Co. buys or sells your securities it will do so at prices that reflect the estimated value determined by reference to such pricing models at that time. The price at which GS&Co. will buy or sell your securities at any time also will reflect its then current bid and ask spread for similar sized trades of structured securities.
In estimating the value of your securities as of the time the terms of your securities are set on the pricing date, as disclosed above under “Estimated Value of Your Securities”, GS&Co.’s pricing models consider certain variables, including principally our credit spreads, interest rates (forecasted, current and historical rates), volatility, price-sensitivity analysis and the time to maturity of the securities. These pricing models are proprietary and rely in part on certain assumptions about future events, which may prove to be incorrect. As a result, the actual value you would receive if you sold your securities in the secondary market, if any, to others may differ, perhaps materially, from the estimated value of your securities determined by reference to our models due to, among other things, any differences in pricing models or assumptions used by others. See “— The Market Value of Your Securities May Be Influenced by Many Unpredictable Factors” below.
The difference between the estimated value of your securities as of the time the terms of your securities are set on the pricing date and the original issue price is a result of certain factors, including principally the underwriting discount and commissions, the expenses incurred in creating, documenting and marketing the securities, and an estimate of the difference between the amounts we pay to GS&Co. and the amounts GS&Co. pays to us in connection with your securities. We pay to GS&Co. amounts based on what we would pay to holders of a non-structured security with a similar maturity. In return for such payment, GS&Co. pays to us the amounts we owe under your securities.
In addition to the factors discussed above, the value and quoted price of your securities at any time will reflect many factors and cannot be predicted. If GS&Co. makes a market in the securities, the price quoted by GS&Co. would reflect any changes in market conditions and other relevant factors, including any deterioration in our creditworthiness or perceived creditworthiness or the creditworthiness or perceived creditworthiness of The Goldman Sachs Group, Inc. These changes may adversely affect the value of your securities, including the price you may receive for your securities in any market making transaction. To the extent that GS&Co. makes a market in the securities, the quoted price will reflect the estimated value determined by reference to GS&Co.’s pricing models at that time, plus or minus its then current bid and ask spread for similar sized trades of structured securities (and subject to the declining excess amount described above).
Furthermore, if you sell your securities, you will likely be charged a commission for secondary market transactions, or the price will likely reflect a dealer discount. This commission or discount will further reduce the proceeds you would receive for your securities in a secondary market sale.
PS-16
June 2019
GS Finance Corp.
Jump Securities with Auto-Callable Feature
Based
on
the
Value
of
the EURO STOXX 50
®
Index
due
June 21, 2029
Principal at Risk Securities
|
There is no assurance that GS&Co. or any other party will be willing to purchase your securities at any price and, in this regard, GS&Co. is not obligated to
make a market in the securities. See “— Your Securities May Not Have an Active Trading Market” below.
The Market Value of Your Securities May Be Influenced by Many Unpredictable Factors
When we refer to the market value of your securities, we mean the value that you could receive for your securities if you chose to sell them in the open market before a call payment date or the stated maturity date. A number of factors, many of which are beyond our control, will influence the market value of your securities, including:
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•
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the value of the underlying index;
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•
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the volatility – i.e., the frequency and magnitude of changes – in the index closing value of the underlying index;
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•
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the dividend rates of the underlying index stocks;
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•
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economic, financial, regulatory, political, military and other events that affect stock markets generally and the underlying index stocks, and which may affect the index closing value of the underlying index;
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•
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interest rates and yield rates in the market;
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•
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the time remaining until your securities mature; and
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•
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our creditworthiness and the creditworthiness of The Goldman Sachs Group, Inc., whether actual or perceived, including actual or anticipated upgrades or downgrades in our credit ratings or the credit ratings of The Goldman Sachs Group, Inc. or changes in other credit measures.
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These factors, and many other factors, will influence the price you will receive if you sell your securities before a call payment date or maturity, including the price you may receive for your securities in any market making transaction. If you sell your securities before a call payment date or maturity, you may receive less than the principal amount of your securities or the amount you may receive on a call payment date or at maturity.
You cannot predict the future performance of the underlying index based on its historical performance. The actual performance of the underlying index over the life of the offered securities or the payment at maturity may bear little or no relation to the historical index closing values of the underlying index or to the hypothetical examples shown elsewhere in this pricing supplement.
Your Securities May Not Have an Active Trading Market
Your securities will not be listed or displayed on any securities exchange or included in any interdealer market quotation system, and there may be little or no secondary market for your securities. Even if a secondary market for your securities develops, it may not provide significant liquidity and we expect that transaction costs in any secondary market would be high. As a result, the difference between bid and asked prices for your securities in any secondary market could be substantial.
If the Value of the Underlying Index Changes, the Market Value of Your Securities May Not Change in the Same Manner
The price of your securities may move quite differently than the performance of the underlying index. Changes in the value of the underlying index may not result in a comparable change in the market value of your securities. Even if the value of the underlying index increases above the initial index value during some portion of the life of the securities, the market value of your securities may not reflect this amount. We discuss some of the reasons for this disparity under “— The Market Value of Your Securities May Be Influenced by Many Unpredictable Factors” above.
PS-17
June 2019
GS Finance Corp.
Jump Securities with Auto-Callable Feature
Based
on
the
Value
of
the EURO STOXX 50
®
Index
due
June 21, 2029
Principal at Risk Securities
|
Anticipated Hedging Activities by Goldman Sachs or Our Distributors May Negatively Impact Investors in the Securities and Cause Our Interests and Those of Our
Clients and Counterparties to be Contrary to Those of Investors in the Securities
Goldman Sachs expects to hedge our obligations under the securities by purchasing listed or over-the-counter options, futures and/or other instruments linked to the underlying index or the underlying index stocks. Goldman Sachs also expects to adjust the hedge by, among other things, purchasing or selling any of the foregoing, and perhaps other instruments linked to the underlying index or the underlying index stocks, at any time and from time to time, and to unwind the hedge by selling any of the foregoing on or before the valuation date for your securities. Alternatively, Goldman Sachs may hedge all or part of our obligations under the securities with unaffiliated distributors of the securities which we expect will undertake similar market activity. Goldman Sachs may also enter into, adjust and unwind hedging transactions relating to other index-linked securities whose returns are linked to changes in the value of the underlying index or the underlying index stocks, as applicable.
In addition to entering into such transactions itself, or distributors entering into such transactions, Goldman Sachs may structure such transactions for its clients or counterparties, or otherwise advise or assist clients or counterparties in entering into such transactions. These activities may be undertaken to achieve a variety of objectives, including: permitting other purchasers of the securities or other securities to hedge their investment in whole or in part; facilitating transactions for other clients or counterparties that may have business objectives or investment strategies that are inconsistent with or contrary to those of investors in the securities; hedging the exposure of Goldman Sachs to the securities including any interest in the securities that it reacquires or retains as part of the offering process, through its market-making activities or otherwise; enabling Goldman Sachs to comply with its internal risk limits or otherwise manage firmwide, business unit or product risk; and/or enabling Goldman Sachs to take directional views as to relevant markets on behalf of itself or its clients or counterparties that are inconsistent with or contrary to the views and objectives of the investors in the securities.
Any of these hedging or other activities may adversely affect the value of the underlying index — directly or indirectly by affecting the value of the underlying index stocks — and therefore the market value of your securities and the amount we will pay on your securities, if any, on a call payment date or at maturity. In addition, you should expect that these transactions will cause Goldman Sachs or its clients, counterparties or distributors to have economic interests and incentives that do not align with, and that may be directly contrary to, those of an investor in the securities. Neither Goldman Sachs nor any distributor will have any obligation to take, refrain from taking or cease taking any action with respect to these transactions based on the potential effect on an investor in the securities, and may receive substantial returns on hedging or other activities while the value of your securities declines. In addition, if the distributor from which you purchase securities is to conduct hedging activities in connection with the securities, that distributor may otherwise profit in connection with such hedging activities and such profit, if any, will be in addition to the compensation that the distributor receives for the sale of the securities to you. You should be aware that the potential to earn fees in connection with hedging activities may create a further incentive for the distributor to sell the securities to you in addition to the compensation they would receive for the sale of the securities.
Goldman Sachs’ Trading and Investment Activities for its Own Account or for its Clients, Could Negatively Impact Investors in the Securities
Goldman Sachs is a global investment banking, securities and investment management firm that provides a wide range of financial services to a substantial and diversified client base that includes corporations, financial institutions, governments and high-net-worth individuals. As such, it acts as an investor, investment banker, research provider, investment manager, investment advisor, market maker, trader, prime broker and lender. In those and other capacities, Goldman Sachs purchases, sells or holds a broad array of investments, actively trades securities, derivatives, loans, commodities, currencies, credit default swaps, indexes, baskets and other financial instruments and products for its own account or for the accounts of its customers, and will have other direct or indirect interests, in the global fixed income, currency, commodity, equity, bank loan and other markets. Any of Goldman Sachs’ financial market
PS-18
June 2019
GS Finance Corp.
Jump Securities with Auto-Callable Feature
Based
on
the
Value
of
the EURO STOXX 50
®
Index
due
June 21, 2029
Principal at Risk Securities
|
activities may, individually or in the aggregate, have an adverse effect on the market for your securities, and you should expect that the interests of Goldman Sachs or its clients or counterparties
will at times be adverse to those of investors in the securities.
Goldman Sachs regularly offers a wide array of securities, financial instruments and other products into the marketplace, including existing or new products that are similar to your securities, or similar or linked to the underlying index or underlying index stocks. Investors in the securities should expect that Goldman Sachs will offer securities, financial instruments, and other products that will compete with the securities for liquidity, research coverage or otherwise.
The Policies of the Underlying Index Publisher and Changes That Affect the Underlying Index or the Underlying Index Stocks Comprising the Underlying Index Could Affect the Payment at Maturity and the Market Value of the Securities
The policies of the underlying index publisher concerning the calculation of the value of the underlying index, additions, deletions or substitutions of underlying index stocks comprising the underlying index and the manner in which changes affecting the underlying index stocks or their issuers, such as stock dividends, reorganizations or mergers, are reflected in the value of the underlying index, could affect the value of the underlying index and, therefore, the payment on a call payment date or at maturity and the market value of your securities before a call payment date or the stated maturity date. The payment on a call payment date or at maturity and the market value of your securities could also be affected if the underlying index publisher changes these policies, for example, by changing the manner in which it calculates the underlying index value or if the underlying index publisher discontinues or suspends calculation or publication of the value of the underlying index, in which case it may become difficult to determine the market value of your securities. If events such as these occur, the calculation agent — which initially will be GS&Co., our affiliate — may determine the index closing value of the underlying index on any such date — and thus the payment on a call payment date or at maturity — in a manner it considers appropriate, in its sole discretion. We describe the discretion that the calculation agent will have in determining the closing index value on any index business day and the payment on a call payment date or at maturity more fully under “Supplemental Terms of the Notes — Discontinuance or Modification of an Underlying” and “— Role of Calculation Agent” on page S-28 of the accompanying general terms supplement no. 1,735.
Investing in the Securities is Not Equivalent to Investing in the Underlying Index; You Have No Shareholder Rights or Rights to Receive Any Underlying Index Stock
Investing in your securities is not equivalent to investing in the underlying index and will not make you a holder of any of the underlying index stocks. Neither you nor any other holder or owner of your securities will have any rights with respect to the underlying index stocks, including any voting rights, any right to receive dividends or other distributions, any rights to make a claim against the underlying index stocks or any other rights of a holder of the underlying index stocks. Your securities will be paid in cash and you will have no right to receive delivery of any underlying index stocks.
We May Sell an Additional Aggregate Stated Principal Amount of the Securities at a Different Issue Price
At our sole option, we may decide to sell an additional aggregate stated principal amount of the securities subsequent to the date of this pricing supplement. The issue price of the securities in the subsequent sale may differ substantially (higher or lower) from the original issue price you paid as provided on the cover of this pricing supplement.
If You Purchase Your Securities at a Premium to State
d Principal Amount, the Return on Your Investment Will Be Lower Than the Return on Securities Purchased at Stated Principal Amount and the Impact of Certain Key Terms of the Securities Will be Negatively Affected
The payment on a call payment date or at maturity will not be adjusted based on the issue price you pay for the securities. If you purchase securities at a price that differs from the stated principal amount of the securities, then the return on your investment in such securities held to a call payment date or the stated
PS-19
June 2019
GS Finance Corp.
Jump Securities with Auto-Callable Feature
Based
on
the
Value
of
the EURO STOXX 50
®
Index
due
June 21, 2029
Principal at Risk Securities
|
maturity date will differ from, and may be substantially less than, the return on securities purchased at stated principal amount. If you purchase your securities at a premium to stated principal amount and hold them to a call payme
nt date or the stated maturity date the return on your investment in the securities will be lower than it would have been had you purchased the securities at stated principal amount or a discount to stated principal amount.
An Investment in the Offered Securities Is Subject to Risks Associated with Foreign Securities
The value of your securities is linked to an underlying index that is comprised of stocks from one or more foreign securities markets. Investments linked to the value of foreign equity securities involve particular risks. Any foreign securities market may be less liquid, more volatile and affected by global or domestic market developments in a different way than are the U.S. securities market or other foreign securities markets. Both government intervention in a foreign securities market, either directly or indirectly, and cross-shareholdings in foreign companies, may affect trading prices and volumes in that market. Also, there is generally less publicly available information about foreign companies than about those U.S. companies that are subject to the reporting requirements of the U.S. Securities and Exchange Commission. Further, foreign companies are subject to accounting, auditing and financial reporting standards and requirements that differ from those applicable to U.S. reporting companies.
The prices of securities in a foreign country are subject to political, economic, financial and social factors that are unique to such foreign country's geographical region. These factors include: recent changes, or the possibility of future changes, in the applicable foreign government's economic and fiscal policies; the possible implementation of, or changes in, currency exchange laws or other laws or restrictions applicable to foreign companies or investments in foreign equity securities; fluctuations, or the possibility of fluctuations, in currency exchange rates; and the possibility of outbreaks of hostility, political instability, natural disaster or adverse public health developments. The United Kingdom has voted to leave the European Union (popularly known as “Brexit”). The effect of Brexit is uncertain, and Brexit has and may continue to contribute to volatility in the prices of securities of companies located in Europe and currency exchange rates, including the valuation of the euro and British pound in particular. Any one of these factors, or the combination of more than one of these factors, could negatively affect such foreign securities market and the price of securities therein. Further, geographical regions may react to global factors in different ways, which may cause the prices of securities in a foreign securities market to fluctuate in a way that differs from those of securities in the U.S. securities market or other foreign securities markets. Foreign economies may also differ from the U.S. economy in important respects, including growth of gross national product, rate of inflation, capital reinvestment, resources and self-sufficiency, which may have a positive or negative effect on foreign securities prices.
Your Securities May Be Subject to an Adverse Change in Tax Treatment in the Future
The tax consequences of an investment in your securities are uncertain, both as to the timing and character of any inclusion in income in respect of your securities.
The Internal Revenue Service announced on December 7, 2007 that it is considering issuing guidance regarding the proper U.S. federal income tax treatment of an instrument such as your securities that are currently characterized as pre-paid derivative contracts, and any such guidance could adversely affect the tax treatment and the value of your securities. Among other things, the Internal Revenue Service may decide to require the holders to accrue ordinary income on a current basis and recognize ordinary income on payment at maturity, and could subject non-U.S. investors to withholding tax. Furthermore, in 2007, legislation was introduced in Congress that, if enacted, would have required holders that acquired instruments such as your securities after the bill was enacted to accrue interest income over the term of such instruments even though there will be no interest payments over the term of such instruments. It is not possible to predict whether a similar or identical bill will be enacted in the future, or whether any such bill would affect the tax treatment of your securities. We describe these developments in more detail under “Supplemental Discussion of Federal Income Tax Consequences” on page S-95 of the accompanying general terms supplement no. 1,735. You should consult your tax advisor about this matter. Except to the extent otherwise provided by law, GS Finance Corp. intends to continue treating the securities for U.S. federal income tax purposes in accordance with the treatment described under
PS-20
June 2019
GS Finance Corp.
Jump Securities with Auto-Callable Feature
Based
on
the
Value
of
the EURO STOXX 50
®
Index
due
June 21, 2029
Principal at Risk Securities
|
“Supplemental Discussion of Federal Income Tax Consequences” on page S-95 of the accompanying general terms supplement no. 1,735 unless and until such time as Congress, the Treasury Department or the Internal Revenue Service determine that some o
ther treatment is more appropriate.
United States Alien Holders Should Consider the Withholding Tax Implications of Owning the Securities
The Treasury Department has issued regulations under which amounts paid or deemed paid on certain financial instruments (“871(m) financial instruments”) that are treated as attributable to U.S.-source dividends could be treated, in whole or in part depending on the circumstances, as a “dividend equivalent” payment that is subject to tax at a rate of 30% (or a lower rate under an applicable treaty), which in the case of any amounts a United States alien holder receives upon the sale, exchange, redemption or maturity of the securities, could be collected via withholding. If these regulations were to apply to the securities, we may be required to withhold such taxes if any U.S.-source dividends are paid on the stocks included in the underlying index during the term of the securities. We could also require a United States alien holder to make certifications (e.g., an applicable Internal Revenue Service Form W-8) prior to the
maturity of the securities in order to avoid or minimize withholding obligations, and we could withhold accordingly (subject to the United States alien holder’s potential right to claim a refund from the Internal Revenue Service) if such certifications were not received or were not satisfactory. If withholding was required, we would not be required to pay any additional amounts with respect to amounts so withheld. These regulations generally will apply to 871(m) financial instruments (or a combination of financial instruments treated as having been entered into in connection with each other) issued (or significantly modified and treated as retired and reissued) on or after January 1, 2021, but will also apply to certain 871(m) financial instruments (or a combination of financial instruments treated as having been entered into in connection with each other) that have a delta (as defined in the applicable Treasury regulations) of one and are issued (or significantly modified and treated as retired and reissued) on or after January 1, 2017. In addition, these regulations will not apply to financial instruments that reference a “qualified index” (as defined in the regulations). We have determined that, as of the issue date of your securities, your securities will not be subject to withholding under these rules. In certain limited circumstances, however, you should be aware that it is possible for United States alien holders to be liable for tax under these rules with respect to a combination of transactions treated as having been entered into in connection with each other even when no withholding is required. You should consult your tax advisor concerning these regulations, subsequent official guidance and regarding any other possible alternative characterizations of your securities for U.S. federal income tax purposes.
Foreign Account Tax Compliance Act (FATCA) Withholding May Apply to Payments on Your Securities, Including as a Result of the Failure of the Bank or Broker Through Which You Hold the Securities to Provide Information to Tax Authorities
Please see the discussion under “United States Taxation — Taxation of Debt Securities — Foreign Account Tax Compliance Act (FATCA) Withholding” in the accompanying prospectus for a description of the applicability of FATCA to payments made on your securities. The discussion in that section is hereby modified to reflect regulations proposed by the Treasury Department indicating its intent to eliminate the requirements under FATCA of withholding on gross proceeds from the sale, exchange, maturity or other disposition of relevant financial instruments. The Treasury Department has indicated that taxpayers may rely on these proposed regulations pending their finalization.
PS-21
June 2019
GS Finance Corp.
Jump Securities with Auto-Callable Feature
Based
on
the
Value
of
the EURO STOXX 50
®
Index
due
June 21, 2029
Principal at Risk Securities
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T
he
Underlying Index
The EURO STOXX 50
®
Index
The EURO STOXX 50
®
Index is a free-float market capitalization-weighted index of 50 European blue-chip stocks and was created by and is sponsored and maintained by STOXX Limited. Publication of the EURO STOXX 50
®
Index began on February 26, 1998, based on an initial index value of 1,000 at December 31, 1991. The value of the EURO STOXX 50
®
Index is disseminated on the STOXX Limited website. STOXX Limited is under no obligation to continue to publish the index and may discontinue publication of it at any time. Additional information regarding the EURO STOXX 50
®
Index may be obtained from the STOXX Limited website. We are not incorporating by reference the website or any material it includes in this pricing supplement.
The top ten constituent stocks of the EURO STOXX 50
®
Index as of May 22, 2019, by weight, are: Total S.A. (5.33%), SAP SE (5.15 %), LINDE PLC (3.86%), LVMH Moët Hennessy Louis Vuitton SE (3.70%), Allianz SE (3.55%), Siemens AG (3.53%), Sanofi (3.48%), Unilever N.V. (3.26%), ASML Holding N.V. (3.03%), and Airbus SE (2.78%);
constituent weights may be found at the STOXX Limited website and are updated periodically. We are not incorporating by reference the website or any material it includes in this pricing supplement.
As of May 22, 2019, the sixteen industry sectors which comprise the EURO STOXX 50
®
Index represent the following weights in the index: Automobiles & Parts (3.80%), Banks (9.92%), Chemicals (8.23%), Construction & Materials (3.05%), Food & Beverage (4.47%), Health Care (9.10%), Industrial Goods & Services (10.92%), Insurance (6.81%), Media (0.97%), Oil & Gas (6.84%), Personal & Household Goods (11.40%), Real Estate (0.79%), Retail (3.72%), Technology (10.53%), Telecommunications (4.57%), and Utilities (4.86%); industry weightings may be found at the STOXX Limited website and are updated periodically. Percentages may not sum to 100% due to rounding. Sector designations are determined by the underlying index publisher using criteria it has selected or developed. Index publishers may use very different standards for determining sector designations. In addition, many companies operate in a number of sectors, but are listed in only one sector and the basis on which that sector is selected may also differ. As a result, sector comparisons between indices with different index publishers may reflect differences in methodology as well as actual differences in the sector composition of the indices
.
As of May 22, 2019, the eight countries which comprise the EURO STOXX 50
®
Index represent the following weights in the index: Belgium (2.59%), Finland (1.06%), France (38.82%), Germany (31.65%), Ireland (1.00%), Italy (4.66%), Netherlands (10.26%) and Spain (9.96 %);
country weightings may be found at the STOXX Limited website and are updated periodically.
The above information supplements the description of the underlying index found in the accompanying general terms supplement no. 1,735. This information was derived from information prepared by the underlying index publisher, however, the percentages we have listed above are approximate and may not match the information available on the underlying index publisher's website due to subsequent corporation actions or other activity relating to a particular stock. For more details about the underlying index, the underlying index publisher and license agreement between the underlying index publisher and the issuer, see “The Underlyings — EURO STOXX 50
®
Index” on page S-75 of the accompanying general terms supplement no. 1,735.
The EURO STOXX 50
®
is the intellectual property of STOXX Limited, Zurich, Switzerland and/or its licensors (“Licensors”), which is used under license. The securities or other financial instruments based on the underlying index are in no way sponsored, endorsed, sold or promoted by STOXX and its Licensors and neither STOXX nor its Licensors shall have any liability with respect thereto.
PS-22
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Historical Index Closing Values
The index closing values have fluctuated in the past and may, in the future, experience significant fluctuations. Any historical upward or downward trend in the index closing value during any period shown below is not an indication that the underlying index is more or less likely to increase or decrease at any time during the life of your
securities
.
You should not take the historical index closing values as an indication of the future performance of the underlying index.
We cannot give you any assurance that the future performance of the underlying index or the underlying index stocks will result in your receiving any payments or receiving an amount greater than the outstanding principal amount of your
securities
on the stated maturity date.
Neither we nor any of our affiliates make any representation to you as to the performance of the underlying index. Before investing in the offered
securities
, you should consult publicly available information to determine the values of the underlying index between the date of this pricing supplement and the date of your purchase of the offered
securities
. The actual performance of the underlying index over the life of the offered
securities
, as well as the payment at maturity, if any, may bear little relation to the historical index closing values shown below.
The table below shows the high, low and period end index closing values of the
underlying index
for each of the four calendar quarters in 2014, 2015, 2016, 2017 and 2018 and the first two calendar quarters of 2019 (through June 18, 2019). We obtained the index closing values listed in the tables below from Bloomberg Financial Services, without independent verification.
Historical Quarterly High, Low and Period End Index Closing Values of the Underlying Index
|
High
|
Low
|
Period End
|
2014
|
|
|
|
Quarter ended March 31
|
3,172.43
|
2,962.49
|
3,161.60
|
Quarter ended June 30
|
3,314.80
|
3,091.52
|
3,228.24
|
Quarter ended September 30
|
3,289.75
|
3,006.83
|
3,225.93
|
Quarter ended December 31
|
3,277.38
|
2,874.65
|
3,146.43
|
2015
|
|
|
|
Quarter ended March 31
|
3,731.35
|
3,007.91
|
3,697.38
|
Quarter ended June 30
|
3,828.78
|
3,424.30
|
3,424.30
|
Quarter ended September 30
|
3,686.58
|
3,019.34
|
3,100.67
|
Quarter ended December 31
|
3,506.45
|
3,069.05
|
3,267.52
|
2016
|
|
|
|
Quarter ended March 31
|
3,178.01
|
2,680.35
|
3,004.93
|
Quarter ended June 30
|
3,151.69
|
2,697.44
|
2,864.74
|
Quarter ended September 30
|
3,091.66
|
2,761.37
|
3,002.24
|
Quarter ended December 31
|
3,290.52
|
2,954.53
|
3,290.52
|
2017
|
|
|
|
Quarter ended March 31
|
3,161.55
|
2,979.48
|
3,160.69
|
Quarter ended June 30
|
3,276.11
|
3,105.46
|
3,122.17
|
Quarter ended September 30
|
3,594.85
|
3,388.22
|
3,594.85
|
Quarter ended December 31
|
3,697.40
|
3,503.96
|
3,503.96
|
2018
|
|
|
|
Quarter ended March 31
|
3,672.29
|
3,278.72
|
3,361.50
|
Quarter ended June 30
|
3,592.18
|
3,340.35
|
3,395.60
|
Quarter ended September 30
|
3,527.18
|
3,293.36
|
3,399.20
|
Quarter ended December 31
|
3,414.16
|
2,937.36
|
3,001.42
|
2019
|
|
|
|
Quarter ended March 31
|
3,409.00
|
2,954.66
|
3,351.71
|
Quarter ending June 30 (through June 18, 2019)
|
3,514.62
|
3,280.43
|
3,452.89
|
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June 21, 2029
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The
graph below shows the daily historical index closing values from January 1, 2014 through June 1
8
, 2019. As a result, the following graph does not reflect the global financial crisis which began in 2008, which had a materially negative impact on the price o
f most equity securities and, as a result, the level of most equity indices. We obtained the index closing values in the graph below from Bloomberg Financial Services, without independent verification.
Historical Performance of the EURO STOXX 50
®
Index
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