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Table of Contents
Index to Financial Statements
401(k) Plan
The Company has a 401(k) salary deferral program for eligible employees who have met certain service requirements. The Company
matches certain employee contributions; additional contributions to this plan are at the discretion of the Company. Total contribution expense
under this plan was $8.7 million for 2003, $8.1 million for 2002 and $8.8 million for 2001.
NOTE 20—FACILITY RESTRUCTURING AND OTHER EXIT CHARGES
The following table summarizes the amount recognized by the Company as restructuring and other exit charges for the periods presented
(in thousands):
2003 Restructuring Plan
Year Ended December 31,
2003
2002
2001
2003 Restructuring Plan
$
112,970
$
—
$
—
2001 Restructuring Plan
16,390
11,385
202,765
Other exit activity
5,201
5,134
—
Total restructuring and other exit charges
$
134,561
$
16,519
$
202,765
In April 2003, the Company announced a restructuring plan (“2003 Restructuring Plan”). The 2003 Restructuring Plan has two elements:
facility consolidation and the exit and write-off of unprofitable product offerings and initiatives. The Company completed the 2003
Restructuring Plan for a total 2003 restructuring charge of approximately $113.0 million.
The rollforward of the 2003 Restructuring Plan reserve is presented below (in thousands):
Facility Consolidation
Facility
Consolidation
Other Exit
Activity
Total
Original 2003 Restructuring Plan for 2003
$
55,010
$
57,960
$
112,970
Cash payments
(11,007
)
(16,369
)
(27,376
)
Non
-
cash charges
(19,254
)
(38,370
)
(57,624
)
Restructuring liabilities at December 31, 2003
$
24,749
$
3,221
$
27,970
The facility consolidation charge for the 2003 Restructuring Plan for 2003, was $55.0 million, primarily representing charges to exit the
E*TRADE FINANCIAL Center in New York and consolidation of excess facilities in offices located in Menlo Park and Rancho Cordova,
California. The charge also includes a non-
cash charge of leasehold improvements and furniture and fixtures totaling $19.3 million. The charge
did not include relocation costs, which are expensed as incurred.
Other Exit Activity
The other exit activity charge for the 2003 Restructuring Plan for 2003, was $58.0 million related to the exit of or write-off of
unprofitable product lines and the early termination of certain contracts, such as the revenue sharing agreements associated with 43 E*TRADE
assets less the amount of estimated proceeds upon disposition, if any. The charge also includes a non-
cash charge of $38.4 million related to the
write-off of certain assets of unprofitable product lines including eAdvisor. These charges to the Company
88