Forfeiture/Post-Vest% Rates Report

Forfeiture/Post-Vest% Rates Report Beginning with the Equity Edge 7.1 program, the Valuation Forfeiture Rates report has been renamed the Forfeiture/Post-Vest % Rates report. This updated report includes more accurate calculations of the forfeiture and the post-vest percentage rates. This chapter describes the following: Overview of Report Changes in Equity Edge 7.1 Forfeiture/Post-Vest % Rates Report Column s Overview of Report Changes in Equity Edge 7.1 The renamed Forfeiture/Post-Vest % Rates report has been updated to include the following: Vest Schedule: The report uses the vest schedule in effect on the Report Run Date. Grants included on Report: The new report will take into consideration all the grants where the Grant Date falls on or after the beginning date for the reporting period and occurs on or before the ending date for the reporting period. 1

: Forfeiture/Post-Vest% Rates Report Cancelled Grants: In addition, the report takes into account shares with a cancel date on or after the beginning of the report period that are forfeited (cancel before vesting), and shares that are likely to be exercised (vested and outstanding at termination). Grants that are cancelled after the Grant Date and on or before the current Report Run Date (on the database server) will be included in this report. Grants excluded from Report: The report will not include cancel/regrants, inactive grants, grants where Cancel Date is on or before the Grant Date, grants with 0 (zero) shares, and grants with an Expire Date that is prior to the Vest Date. When a grant is excluded because it expired before the Vest Date, the program inserts a footnote to the report. Cancellations other than Terminations: In previous versions of the Equity Edge program, the Valuation Forfeiture Rates report tallied the number of participants with outstanding grants at the beginning of the period and calculated the rate of terminations for this group of participants. It did not include grants that were cancelled for reasons other than termination. Using the vest schedule in effect on the Report Run date, the updated Forfeiture/Post-Vest % Rates report evaluates all cancellations for grants where the Grant Date is within the report date range. Cancellations prior to vest are included in the Forfeiture Rate calculation. Cancellations resulting from terminations where the grant has shares exercisable at the time of termination are included in the Post-Vest Rate calculation. Calculating Unvested Shares Forfeited: Beginning with the Equity Edge 7.1 release, in order to calculate the Unvested Shares Forfeited, The program only excludes shares that were not technically forfeited (for example, due to re-grant or re-pricing). The Equity Edge program takes into account any shares exercised before vest (that is, early exercised). In calculating the Forfeiture Rate, the program includes these shares if the Cancel Date (for the vesting period/grant) occurs before the Vest Date (for the vesting period/grant). For example, if the vesting period has 1,000 shares and 200 shares are exercised before vest, 1,000 shares are considered Unvested Shares Forfeited on the Cancel Date. Calculating Vested Shares Exercisable: Beginning with the Equity Edge 7.1 release, in order to calculate the Vested Shares Exercisable, The Equity Edge program takes into account any shares exercised before vest. If on the Vest Stop Date, the number of shares vested is greater than the number of shares exercised before vest (that is, early exercised), the difference between these two values is included in the Vested Shares Exercisable. For example, if the vesting period has 1,000 shares and 200 shares are exercised before vest, 800 shares are considered Vested Shares Exercisable on the Vest Stop Date. The program only includes Reason= Termination because shares vested as of Vest Stop Date may have a grace period during which the shares can be exercised. 2 Equity Edge 7.1 Tech Alert 2007 E*TRADE FINANCIAL Corp.

Overview of Report Changes in Equity Edge 7.1 Aggregate Values Displayed on Report: In previous versions of the Equity Edge program, the Valuation Forfeiture Rates report calculated a simple annualized employee turnover rate. The enhanced Forfeiture/Post-Vest % Rates report provides both an aggregate forfeiture rate and annual forfeiture rate for shares that were cancelled before vest (that is, forfeited). For shares that were cancelled after vesting, the new report provides an aggregate post-vest percentage rate and annual post-vest percentage rate. Report View: Using the Show Details check box, you can now choose to view the report in one of the following ways: By Grant (check box cleared): You can choose to view the report on a grant-by-grant basis By Vesting Period (check box selected): In order to audit/reconcile the calculations, run the report on a vesting period basis. Note: When running the Forfeiture/Post-Vest % Rates report, the following settings should be avoided: Selecting information below the grant level (for example, price) as the first sort criteria. (You can include such information as the second or third sort criteria.) Grouping information below the grant level. Report Batch Size: This report now uses the value in the Report Batch Size field (set in the Preferences window) to determine the default number of grants that are processed at a time. By default, the program processes grant records in groups of 1000 records. Important: This report evaluates information for each vesting period. As a result, it may take a significant amount of time to run if your company has a large number of grants or vesting more often than annual. It is our intention to improve the performance of this report in the next version of the software. 2007 E*TRADE FINANCIAL Corp. Equity Edge 7.1 Tech Alert 3

: Forfeiture/Post-Vest% Rates Report Forfeiture/Post-Vest % Rates Report This section describes the Forfeitures/Post-Vest % Rates report and replaces the description of any previous versions of the Valuation Forfeiture Rates report. Report Heading Forfeiture/Post-Vest % Rates The Forfeiture/Post-Vest % Rates report calculates an aggregate and annual Forfeiture Rate for shares forfeited (that is they are cancelled before vesting). This rate is used to haircut expense on the Expense Allocation - Recognition report. In addition, this report provides both an aggregate and annual Post-Vest Rate for shares likely to be exercised (that is, vested and outstanding at termination). This rate is used as an input to the Equity Edge Binomial Model. Note: The method used in this report to calculate the Forfeiture Rate and the Post-Vest % Rate is only one of a number of ways to determine these values. Please consult your valuation and / or accounting advisors for guidance. The Forfeiture/Post-Vest % Rates report uses the vest schedule in effect on the Report Run Date. It evaluates all cancellations for grants where the Grant Date is within the report date range. Cancellations prior to vest are included in the Forfeiture Rate calculation. Cancellations resulting from terminations where the grant has shares exercisable at the time of termination are included in the Post-Vest Rate calculation. The report does not include options cancelled via a cancel/regrant, inactive grants, grants with a Cancel Date that is on or before the Grant Date, vesting periods with zero (0) shares or grants with an Expire Date that is prior to the Vest Date. Note: If a single group of vesting or vested shares in a grant expires before the Vest Date, then the entire grant is excluded. The main section of the report contains information pertaining to each individual grant and shows one line per grant. If the label for Subtotals or Totals line is longer than the space available, the program automatically wraps the text on a second line. 4 Equity Edge 7.1 Tech Alert 2007 E*TRADE FINANCIAL Corp.

Forfeiture/Post-Vest % Rates Report You can select the Show Detail box on the Report-Run window to show one line per vesting period. The last section of the report is the Annual Summary section which contains the Aggregate Forfeiture Rate %, the Annualized Forfeiture Rate %, the Aggregate Post-Vest % Rate, the Annualized Post-Vest % Rate calculations, including all of the values necessary to audit those calculations, for each group, year or the entire report. If you re-run this report at a later date, in order to replicate the same results, set a filter for the Cancel Date to include grants where the Cancel Date falls on or before the Report Run Date of original report. However, even with this filter, the later report still may not match the original if any of the grants had any activity on the Report Run Date after the original report was run and that was recorded for that Report Run Date. The report can be sorted, grouped, or filtered for different employee populations and various grant characteristics. If (and only if) at least one grant has been excluded, the Equity Edge program places a footnote on the report: X grant(s) have been excluded from the report because the Expire Date is less than the Vest Date. To find, run the Data Check report. Note: When running the Forfeiture/Post-Vest % Rates report, the following settings should be avoided: Grouping information below the grant level. Selecting information below the grant level as the first sort criteria. This report now uses the value in the Report Batch Size field (set in the Preferences window) to determine the default number of grants that are processed at a time. If you export the data from this report to an Excel spreadsheet, two additional fields (Expire Date and Vest Stop Date) appear that may assist you in auditing and reconciling the calculations on the report. Due to space constraints, these columns were not included on the printed version of the report. Report Run window Figure 1 Report-Run Window for Valuation Forfeiture Rates report 2007 E*TRADE FINANCIAL Corp. Equity Edge 7.1 Tech Alert 5

: Forfeiture/Post-Vest% Rates Report Settings The Report-Run window contains one new field Show Details. Begin Date: Enter the beginning date for the period you want reported. The report will include all Options and Awards with a Grant Date on or after the Begin Date. End Date: Enter the ending date for the period you want reported. The report will include all Options and Awards with a Grant Date on or before the End Date. Report Type: The selections in the drop-down list are based upon the access privileges set in your Company User record. If you have the required permissions to access Reports for the Options and Awards module then the drop-down list contains: All, Options, Awards. Select the required category. If you have permission for Reports with respect only to either the Options or the Awards module, this field becomes read-only and displays the module to which you have access. Show Detail: Initially, the Show Detail check box is not selected. Select this check box to display each vesting period as individual line items. In this mode, the report also displays a subtotal for each grant. Clear this check box to display each grant as an individual line item. Note: If, after running the report, you change only the selection on the Show Detail check box and rerun the report, the program will not recalculate (since no modifications were made to the other parameters on the Report-Run Window). Initial Advanced Report Settings: The report allows grouping by one element only. The second and third group fields are disabled. By default, the report is sorted by ID and Number. Note: When running the Forfeiture/Post-Vest % Rates report, the following settings should be avoided: Selecting information below the grant level for example, price as the first sort criteria. (You can include such information as the second or third sort criteria.) Grouping information below the grant level. Column s The main section of the Forfeiture/Post-Vest % Rates report includes general information and preliminary calculations for each grant. The end of the report includes an Annual Summary which includes the Annual Forfeiture Rate % calculation used to haircut expense on the Expense Allocation Recognition report and the Annual Post-Vest % Rate calculation used in the Equity Edge Binomial Model. 6 Equity Edge 7.1 Tech Alert 2007 E*TRADE FINANCIAL Corp.

Column s Column descriptions are organized into sections for General Report Information, Forfeiture Information, and Post-Vest Information. These sections include information from the main report as well as from the Annual Summary. Special Tip: If you export the data from this report to an Excel spreadsheet, two additional fields (Expire Date and Vest Stop Date) appear that may assist you in auditing and reconciling the calculations on the report. Due to space constraints, these columns were not included on the printed version of the report. General Report Information This section includes descriptions of columns that are not related specifically to either calculation. Table 1-1 Report Fields Containing General Information (Main Report) Report Column ID Number Type Grant Date Shares Granted The Account ID for the grant The Number for the grant The type of grant The date the option or award was granted If the Show Detail check box is selected, this column displays the number of shares in the vesting period. The total number of shares for the grant is displayed on the grant line. If the Show Detail check box is cleared, this column displays the number of shares for the entire grant. Vest Date If the Show Detail check box is selected, this column displays the date the shares in the vesting period vest. In addition, the vest date of the last vesting period is displayed on the grant line. If the Show Detail check box is cleared, this column displays the final Vest Date for the grant. If the Vest Date is prior to the Grant Date, then this date is the Grant Date (shares cannot vest prior to being granted). Vesting Template The name of the vesting template currently associated with the grant as of the Report Run Date. 2007 E*TRADE FINANCIAL Corp. Equity Edge 7.1 Tech Alert 7

: Forfeiture/Post-Vest% Rates Report Table 1-1 Report Fields Containing General Information (Main Report) Report Column Time to Vest The time to vest (in years) for the vesting period or the grant. Rounded to 6 places of decimal. If the Show Detail check box is selected, for each vesting period, this column displays the amount of time (in years) between the Grant Date and the Vest Date for the vesting period, calculated as (Vest Date minus Grant Date) converted to years. In addition, on the grant line, the report displays the weighted-average amount of time (in years) between the Grant Date and the Vest Date for the entire grant. If the Show Detail check box is cleared, this column displays the weighted-average amount of time (in years) between the Grant Date and the Vest Date for the entire grant. The Time to vest is calculated as [(sum of (Time to vest multiplied by shares granted) for each vesting period) divided by shares granted for grant] Annual Summary This section includes descriptions of columns that are related specifically to the Annual Summary. Table 1-2 Report Fields Containing General Information (Annual Summary Section) Report Column Year The year in which the awards or options were granted. Total Shares Granted (Group, Year, or Totals) A separate line will be displayed for any year that has at least one day within the report date range. The total number of shares for each year or group. 8 Equity Edge 7.1 Tech Alert 2007 E*TRADE FINANCIAL Corp.

Column s Forfeiture Information This section includes descriptions of columns that are related to the Forfeiture Rate calculation used to haircut the accrual of expense on the Expense Allocation Recognition report. Table 1-3 Report Fields Containing Forfeiture Information (Main Report) Report Column Cancel Date The date the shares were cancelled. The Cancel Date can be on or before the Report Run (current) Date when the report is run. If the Cancel Date is after the Report-Run Date, then this field is blank. Unvested Shares Forfeited If the Show Detail check box is selected, this column displays the number of unvested shares at the time of cancellation that have been forfeited for the vesting period. In addition, this information for the entire grant is displayed on the grant line. If the grant does not have a Cancel Date, this column will display a zero (0). If the Show Detail check box is cleared, this column displays the number of unvested shares at the time of cancellation that have been forfeited for the entire grant. Options: For an option, if the Cancel Reason is Termination or Rehire, then this value includes all shares cancelled as of the Vest Stop Date. If the Cancel Reason is not Termination or Rehire, then this value is all shares cancelled as of the Cancel Date. Awards: For an award, this is the number of shares cancelled as of the Cancel Date (prior to vesting). Note: This report does not include shares that have been cancelled via a Cancel / Regrant or Reprice, that are inactive or that have a Cancel Date that is prior to the Grant Date. 2007 E*TRADE FINANCIAL Corp. Equity Edge 7.1 Tech Alert 9

: Forfeiture/Post-Vest% Rates Report Annual Summary The following columns in the Annual Summary section of the report contain Forfeiture information. Table 1-4 Report Fields Containing Forfeiture Information (Annual Summary Section) Report Column Total Unvested Shares The total of the Unvested Shares Forfeited. Forfeited (Group, Year If the grant has no Cancel Date, this column displays 0 (zero). or Totals) Average Vest Period The average length of time to vest for the Shares Granted. (Group, Year or Totals) This value is calculated as the sum of the Shares Granted (for each vesting period or grant) multiplied by the Time to Vest for each vesting period or grant divided by the Total Shares Granted (for group, year or totals) as follows: Sum of (Shares Granted multiplied by Time to Vest) divided by Total Shares Granted Aggregate Forfeiture Rate % (Group, Year or Totals) The Total Unvested Shares Forfeited as a percentage of the Total Shares Granted. The rate is calculated by dividing the Unvested Shares Forfeited (for group, year or totals) by the Total Shares Granted (for group, year or totals) as follows: Annual Forfeiture Rate % (Group, Year or Totals) Total Unvested Shares Forfeited divided by Total Shares Granted The Total Unvested Shares Forfeited as a percentage of the Total Shares Granted, annualized over the Average Vest Period. The rate is calculated by subtracting one minus the Aggregate Forfeiture Rate (for group, year or totals) to the power of one over the Average Vest Period (for group, year or totals) from one as follows: 1 minus ( (1 minus Aggregate Forfeiture Rate %) to the power of (1 / Average Vest Period) ) To Audit: To audit this calculation, you can use the following calculation in your spreadsheet program: 1-((1- Aggregate Forfeiture Rate in each year) ^ (1 / Average Vest Period in each year)) 10 Equity Edge 7.1 Tech Alert 2007 E*TRADE FINANCIAL Corp.

Column s Post-Vest Information This section includes descriptions of columns that are related to the Post-Vest % Rate calculation that may be used in the Equity Edge Binomial Model. The Equity Edge program only includes options in Post-Vest % Rate calculations. As a result, if you have included options and awards in the report, this section will display values for options only. (Award data will be excluded and displayed as a blank.) Table 1-5 Report Fields Containing Post-Vest Information (Main Report) Report Column Vest Cancel Date Time to Cancel The date the vested shares of the option were cancelled. Ignored if the Cancel Date falls after the Report Run Date. The "grace period" that an employee has to exercise his/her options from the termination date to the vest cancel date. If vest cancel date is blank or null, then Time to Cancel is set to 0. If the Show Detail check box is selected, this column displays the amount of time in terms of years between the Grant Date and the Vest Cancel Date for the vesting period. In addition, this information for the entire grant is displayed on the grant line. If the Show Detail check box is cleared, this column displays the weighted-average amount of time (in years) between the Grant Date and the Vest Cancel Date for the grant as a whole. The calculation is: For Awards, this column will display a blank. If Option has no Vest Cancel Date (the option was cancelled via the Option Cancel function), then = 0 else = (Vest Cancel Date minus Grant Date) converted to years. 2007 E*TRADE FINANCIAL Corp. Equity Edge 7.1 Tech Alert 11

: Forfeiture/Post-Vest% Rates Report Table 1-5 Report Fields Containing Post-Vest Information (Main Report) Report Column Vested Shares Exercisable If the Show Detail check box is selected, this column displays the number of vested exercisable shares at the time of cancellation for the vesting period. In addition, this information for the entire grant is displayed on the grant line. If the Show Detail check box is cleared, this column displays the number of vested exercisable shares at the time of cancellation for the entire grant. For an award, this column will display a blank. For Options: If Option has no cancellation then = 0 If Option and Cancel Reason is Termination, then = all shares that have vested and that are available to be exercised on or after the Vest Stop Date else = the total number of shares that have vested and that are available to be exercised on or after the Cancel Date Annual Summary The following columns in the Annual Summary section of the report contain post-vest % information. Table 1-6 Report Fields Containing Post-Vest % Information (Annual Summary Section) Report Column Total Vested Shares Exercisable (Group, Year or Totals) Vested Shares Wgt. Time To Vest (Group, Year or Totals) The total number of vested exercisable shares at the time of cancellation. Options with no cancellation will display 0 (zero) in this column For an award, this column will display a blank. The weighted-average length of time to vest for the Vested Shares Exercisable. This value is calculated as the sum of the Vested Shares Exercisable for each vesting period or grant multiplied by the Time to Vest for each vesting period or grant divided by the Total Vested Shares Exercisable (for group, year or totals) as follows: Sum of (Vested Shares Exercisable multiplied by Time to Vest) divided by Total Vested Shares Exercisable 12 Equity Edge 7.1 Tech Alert 2007 E*TRADE FINANCIAL Corp.

Column s Table 1-6 Report Fields Containing Post-Vest % Information (Annual Summary Section) Report Column Aggregate Post-Vest Rate % (Group, Year or Totals) The Total Vested Shares Exercisable as a percentage of all the Total Option Shares Granted minus Total Unvested Option Shares Forfeited. The rate is calculated by dividing the Total Vested Shares Exercisable (for group, year or totals) by the Total Option Shares Granted (for group, year or totals) minus the Total Unvested Option Shares Forfeited (for group, year or totals) as follows: Wgt. Avg Time to Cancel (Group, Year or Totals) Total Vested Shares Exercisable divided by Total Option Shares Granted minus Total Unvested Option Shares Forfeited. ( Note:Awards granted are excluded from the denominator in this calculation.) To Audit Options: To audit Options shares, choose Options from the Report Type drop down list in the Report Run Window. The report will run for Options only. The weighted-average length of time to cancel for the Vested Shares Exercisable. The value is calculated as the sum of the Vested Shares Exercisable for each vesting period or grant multiplied by the Time to Cancel for each vesting period or grant divided by the Total Vested Shares Exercisable (for group, year or totals) as follows: Sum of (Vested Shares Exercisable multiplied by Time to Cancel) divided by Total Vested Shares Exercisable Annual Post-Vest % Rate (Group, Year or Totals) The Total Vested Shares Exercisable as a percentage of the Total Option Shares Granted minus the Total Unvested Option Shares Forfeited, annualized over the Average Grace Period. The rate is calculated by subtracting one minus the Aggregate Post-Vest % Rate (for group, year or totals) to the power of one over the Weighted Average Time to Cancel (for group, year or totals) minus the Vested Shares Weighted Time to Vest (for group, year or totals) from one as follows: 1 minus ( (1 minus Aggregate Post Vest % Rate) to the power of (1 divided by Wgt. Avg. Time to Cancel minus Vested Shares Wgt. Time to Vest) ) To Audit: To audit this calculation, you can use the following calculation directly in your spreadsheet program: 1 - ((1 - Aggregate Post Vest % Rate) ^ (1 / (Wgt. Avg Time to Cancel Vested Shares Wgt. Time to Vest)) 2007 E*TRADE FINANCIAL Corp. Equity Edge 7.1 Tech Alert 13

: Forfeiture/Post-Vest% Rates Report DEMO Company FORFEITURE / POST-VEST % RATES Page: 1 FROM 11/01/2005 TO 12/31/2007 File: Forfeit REPORT TYPE: All Date: 05/31/2007 SHOW DETAIL: Yes Time: 14:30:25 PM Time Unvested Vest Time Vested Grant Shares Vest Vesting to Cancel Shares Cancel to Shares ID Number Date Granted Date Template Vest Date Forfeited Date Cancel Exercisable 124583 AG1244 11/01/05 2,000.0000 11/01/06 2-Year Annual 0.999316 06/26/07 0.0000 09/26/07 1.900068 0.0000 124583 AG1244 11/01/05 2,000.0000 11/01/07 2-Year Annual 1.998631 06/26/07 2,000.0000 09/26/07 1.900068 0.0000 ----------------- -------------------- ------------------ 124583 AG1244 11/01/05 4,000.0000 11/01/07 2-Year Annual 1.498973 06/26/07 2,000.0000 09/26/07 1.900068 0.0000 124585 AG1245 01/01/06 2,000.0000 01/01/07 2-Year Annual 0.999316 01/02/07 0.0000 04/02/07 1.248460 2,000.0000 124585 AG1245 01/01/06 2,000.0000 01/01/08 2-Year Annual 1.998631 01/02/07 2,000.0000 04/02/07 1.248460 0.0000 ----------------- -------------------- ------------------ 124585 AG1245 01/01/06 4,000.0000 01/01/08 2-Year Annual 1.498973 01/02/07 2,000.0000 04/02/07 1.248460 2,000.0000 124587 AG1247 01/01/07 1,500.0000 01/01/08 2-Year Annual 0.999316 01/02/08 0.0000 04/02/08 1.251198 1,500.0000 124587 AG1247 01/01/07 1,500.0000 01/01/09 2-Year Annual 2.001369 01/02/08 1,500.0000 04/02/08 1.251198 0.0000 ----------------- -------------------- ------------------ 124587 AG1247 01/01/07 3,000.0000 01/01/09 2-Year Annual 1.500342 01/02/08 1,500.0000 04/02/08 1.251198 1,500.0000 124588 AG1248 01/01/07 1,500.0000 01/01/08 2-Year Annual 0.999316 0.0000 0.0000 124588 AG1248 01/01/07 1,500.0000 01/01/09 2-Year Annual 2.001369 0.0000 0.0000 ----------------- -------------------- ------------------ 124588 AG1248 01/01/07 3,000.0000 01/01/09 2-Year Annual 1.500342 0.0000 0.0000 124586 AG1246 01/01/06 1,000.0000 01/01/07 3-Year Annual 0.999316 01/02/08 0.0000 04/02/08 2.250513 1,000.0000 124586 AG1246 01/01/06 1,000.0000 01/01/08 3-Year Annual 1.998631 01/02/08 0.0000 04/02/08 2.250513 1,000.0000 124586 AG1246 01/01/06 1,000.0000 01/01/09 3-Year Annual 3.000684 01/02/08 1,000.0000 04/02/08 2.250513 0.0000 ----------------- -------------------- ------------------ 124586 AG1246 01/01/06 3,000.0000 01/01/09 3-Year Annual 1.999544 01/02/08 1,000.0000 04/02/08 2.250513 2,000.0000 Report Grand Totals 17,000.0000 6,500.0000 5,500.0000 X grant(s) have benn excluded from the report because the Expire Date is less than the Vest Date. To find these grants run the Data Check report. Figure 2 Forfeiture / Post-Vest % Rates Report showing Details (General Section) 14 Equity Edge 7.1 Tech Alert 2007 E*TRADE FINANCIAL Corp.

Column s DEMO Company FORFEITURE / POST-VEST % RATES Page: 2 FROM 11/01/2005 TO 12/31/2007 File: Forfeit REPORT TYPE: All Date: 05/31/2007 ANNUAL SUMMARY SHOW DETAIL: Yes Time: 14:30:25 PM Total Total Vested Unvested Average Aggregate Annual Vested Shares Aggregate Wgt. Avg Annual Total Shares Shares Vest Forfeiture Forfeiture Shares Wgt. Time Post-Vest Time to Post-Vest Year Granted Forfeited Period Rate % Rate % Exercisable to Vest % Rate Cancel % Rate 2005 Totals 4,000.0000 2,000.0000 1.498973 50.00% 37.02% 0.0000 0.000000 0.00% 0.000000 0.00% 2006 Totals 7,000.0000 3,000.0000 1.713503 42.86% 27.86% 4,000.0000 1.249144 100.00% 1.749487 100.00% 2007 Totals 6,000.0000 1,500.0000 1.500342 25.00% 17.45% 1,500.0000 0.999316 33.33% 1.251198 80.01% ------------------ ------------------ ------------------ ------------------ ------------------ ------------------ ----------------- ----------------- ----------------- ----------------- Report Grand Total 17,000.0000 6,500.0000 1.587792 38.24% 26.17% 5,500.0000 1.181009 52.38% 1.613590 82.01% Figure 3 Forfeiture / Post-Vest % Rates Report Showing Details (Annual Summary Section) 2007 E*TRADE FINANCIAL Corp. Equity Edge 7.1 Tech Alert 15

: Forfeiture/Post-Vest% Rates Report DEMO Company FORFEITURE / POST-VEST % RATES Page: 1 FROM 11/01/2005 TO 12/31/2007 File: Forfeit REPORT TYPE: All Date: 05/31/2007 SHOW DETAIL: No Time: 14:30:25 PM Avg Time Unvested Vest Time Vested Grant Shares Vest Vesting to Cancel Shares Cancel to Shares ID Number Date Granted Date Template Vest Date Forfeited Date Cancel Exercisable 124583 AG1244 11/01/05 4,000.0000 11/01/07 2-Year Annual 1.498973 06/26/07 2,000.0000 09/26/07 1.900068 0.0000 124585 AG1245 01/01/06 4,000.0000 01/01/08 2-Year Annual 1.498973 01/02/07 2,000.0000 04/02/07 1.248460 2,000.0000 124586 AG1246 01/01/06 3,000.0000 01/01/09 3-Year Annual 1.999544 01/02/08 1,000.0000 04/02/08 2.250513 2,000.0000 124587 AG1247 01/01/07 3,000.0000 01/01/09 2-Year Annual 1.500342 01/02/08 1,500.0000 04/02/08 1.251198 1,500.0000 124588 AG1248 01/01/07 3,000.0000 01/01/09 2-Year Annual 1.500342 0.0000 0.0000 ------------------ ----------------- ----------------- Report Grand Totals 17,000.0000 6,500.0000 5,500.0000 X grant(s) have benn excluded from the report because the Expire Date is less than the Vest Date. To find these grants run the Data Check report. Figure 4 Forfeiture / Post-Vest % Rates Report (General Section) 16 Equity Edge 7.1 Tech Alert 2007 E*TRADE FINANCIAL Corp.

Column s DEMO Company FORFEITURE / POST-VEST % RATES Page: 2 FROM 11/01/2005 TO 12/31/2007 File: Forfeit REPORT TYPE: All Date: 05/31/2007 ANNUAL SUMMARY SHOW DETAIL: No Time: 14:30:25 PM Total Total Vested Unvested Average Aggregate Annual Vested Shares Aggregate Wgt. Avg Annual Total Shares Shares Vest Forfeiture Forfeiture Shares Wgt. Time Post-Vest Time to Post-Vest Year Granted Forfeited Period Rate % Rate % Exercisable to Vest % Rate Cancel % Rate 2005 Totals 4,000.0000 2,000.0000 1.498973 50.00% 37.02% 0.0000 0.000000 0.00% 0.000000 0.00% 2006 Totals 7,000.0000 3,000.0000 1.713503 42.86% 27.86% 4,000.0000 1.249144 100.00% 1.749487 100.00% 2007 Totals 6,000.0000 1,500.0000 1.500342 25.00% 17.45% 1,500.0000 0.999316 33.33% 1.251198 80.01% ------------------ ------------------ ------------------ ------------------ ------------------ ------------------ ----------------- ----------------- ----------------- ----------------- Report Grand Total 17,000.0000 6,500.0000 1.587792 38.24% 26.17% 5,500.0000 1.181009 52.38% 1.613590 82.01% ------------------ ------------------ ------------------ ------------------ ------------------ ------------------ ----------------- ----------------- ----------------- ----------------- Figure 5 Forfeiture / Post-Vest % Rates Report (Annual Summary Section) 2007 E*TRADE FINANCIAL Corp. Equity Edge 7.1 Tech Alert 17

: Forfeiture/Post-Vest% Rates Report 18 Equity Edge 7.1 Tech Alert 2007 E*TRADE FINANCIAL Corp.