SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) May 22, 2001
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E*TRADE Group, Inc.
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(Exact name of registrant as specified in charter)
Delaware 1-11921 94-2844166
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(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
4500 Bohannon Drive, Menlo Park, California 94025
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (650) 331-6000
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Not Applicable
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(Former name or former address, if changed since last report.)
ITEM 5. OTHER EVENTS
E*TRADE Group, Inc. ("E*TRADE") is providing the following information so that
it is specifically incorporated by reference into three resale registration
statements on Form S-3 (File Nos. 333-57158, 333-57160 and 333-57316) and its
registration statement on Form S-4 (File No. 333-62230) prior to their
effectiveness.
Private Placement of Convertible Notes
As previously announced, on May 29, 2001, E*TRADE sold $325 million principal
amount of its 6.75% convertible subordinated notes due 2008. E*TRADE has
granted the initial purchaser of the notes an option to purchase an additional
$50 million principal amount of notes.
The notes are convertible into E*TRADE common stock at a conversion price of
$10.925 per share (a 25% premium to the closing price of the common stock on
the date of pricing, May 22, 2001), are non-callable until May 2004 and
thereafter are callable at par, plus accrued interest plus a premium.
On a pro forma basis, assuming the notes had been issued on January 1,
2001, and giving effect to interest that would have accrued on the notes
during the period but without giving effect to interest earned on
investment of the net proceeds from the notes, the issuance of the notes
would have increased E*TRADE's reported basic and diluted net loss per
share for the three months ended March 31, 2001, from $0.03 per share to
$0.04 per share.
Potential Writedown of Certain Investments
E*TRADE actively monitors its investments in publicly held entities. Given
current market conditions combined with a sustained decline in the value of
some of its holdings in technology stocks during the past five months, E*TRADE
believes that sufficient time has passed to indicate that there has been an
other than temporary decline in the value of those holdings. Unless market
conditions improve or other facts and circumstances come to our attention
regarding an expected recovery in value in these securities through June 30,
2001, we would expect to write down our investments to their fair market value
at June 30, 2001, recognizing pre-tax losses of approximately $6.8 million
(approximately $4.1 million net of tax) based on their fair market value at
June 14, 2001.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Date: June 15, 2001
E*TRADE Group, Inc.
By: /s/ Leonard C. Purkis
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Leonard C. Purkis, Chief Financial
Officer (principal financial and
accounting officer)