In its filing (full text¹), Google said the text of the Playboy article "presented certain statements about our company in isolation and did not disclose many of the related risks and uncertainties described in this prospectus." The interview was with the company's co-founders, Larry Page and Sergey Brin.

The company said in the filing that it doesn't consider the participation in the Playboy Magazine article to constitute a violation of SEC rules, but "if our involvement in a September 2004 magazine article about Google were held to be in violation of the Securities Act of 1933, we could be required to repurchase securities sold in this offering," it warned. It advised investors to base their decisions on its prospectus rather than on the Playboy interview, which took place at Google headquarters on April22, before the plans for an IPO were announced.

A spokeswoman for Playboy Enterprises Inc. said that there was no deal with Google about when the article would run. "We had no restrictions on when we could run it," said the spokeswoman, Theresa Hennessey. Google's vice president of corporate marketing, Cindy McCaffrey, declined to comment on the timing of the article, or whether Google had granted other interviews around the IPO.

Larry Soderquist, a law professor at Vanderbilt University, said Google may have thought it could complete the IPO process before the article was published, noting that some analysts had expected the offering to be completed by now. What's more, "there isn't anything in that interview to get excited about," he said. "It's hard to see how the article changes people's minds about Google."

The IPO has come under fire in recent weeks following Google's announcement that shares could be worth as much as $135 each, valuing the company at $36 billion -- much higher than some analysts and many investors had expected.

No Major Revelations

The seven-page interview doesn't include any major revelations about the company's business or finances. Among other things, the two executives talk about the company's post-IPO culture and Google's fledgling e-mail service.

Some investors have complained that Google has been overly conservative about disclosing information during the quiet period. Institutional investors who have attended recent pre-IPO meetings with Google's top executives say they have consistently declined to discuss any information not provided in their filings with regulators.

Google's founders have long been concerned about giving the appearance that they are soliciting interest in the IPO, according to people involved with the deal. Securities rules prohibit such actions, which are known as "gun jumping" or "priming the market."

'Completely Different Thing'

Mr. Page discusses his worries about "how to maintain our culture and the fun elements" after the IPO. He tries to distance Google from its fallen Internet peers. "A lot of those companies were around for less than a year or two before going public. We've been around for five," he says. "We have more than 150,000 advertisers and a lot of salespeople. Millions of people use Google. It's a completely different thing."

At one point, Mr. Brin discusses the "extreme cases, we're told, when Google has saved people's lives," including a heart-attack victim who he says decided to call the hospital after checking his symptoms on Google. Messrs. Brin and Page say they didn't expect privacy concerns related to the e-mail service they announced in April, which displays ads based on the specific content of a user's incoming e-mails.

Even though the interview was conducted before Google filed its IPO prospectus on April 29, the timing could still cause problems. The SEC's rules on the exact timeframe covered by the quiet period are vague, but regulators consider companies to be in the period even while they are still preparing IPO documents and working with investment bankers, according to people who specialize in IPOs. Google tapped Credit Suisse First Boston, a unit of Credit Suisse Group, and Morgan Stanley to lead the IPO in late April and had been interviewing investment banks for months before that.

Other technology companies have had problems with pre-offering publicity. In May, software maker salesforce.com Inc. delayed its IPO for about a month after Chief Executive Marc Benioff gave an extensive interview with The New York Times. In 1999, online grocer Webvan Group Inc. delayed its IPO amid similar concerns. Montreal-based Discreet Logic Inc. revised its prospectus and voluntarily delayed its Nasdaq IPO in 1995 after an interview executives conducted prior to filing with regulators was published in the run-up to the offering, according Jocelyn Arel, a partner in at Testa, Hurwitz & Thibeault LLP in Boston, who worked with the company.

Google's IPO already has attracted SEC attention. In a July regulatory filing, the company said SEC staff intended to recommend that the agency bring a civil injunction against Google's general counsel, alleging violation of federal securities laws involving a former employer; he has denied wrongdoing. Earlier this month, Google filed for an offering to buy back shares purchased with stock options it gave to some employees and consultants in a manner that potentially violated securities laws. This week, the company said it was handing over shares potentially valued at more than $300 million to rival Yahoo Inc. to settle two disputes between the companies.

In the past two days, a half-dozen Internet and technology companies have postponed their IPOs due to poor market conditions, including Active Network Inc., MatchNet Inc., Claria Corp., Lindows Inc. and PlanetOut Inc. Wireless company MetroPCS Communications Inc. also pulled its IPO yesterday, citing accounting issues.

From the Filing

The Playboy-related risk factor listed in Google's revised filing

If our involvement in a September 2004 magazine article about Google were held to be in violation of the Securities Act of 1933, we could be required to repurchase securities sold in this offering. You should rely only on statements made in this prospectus in determining whether to purchase our shares.

Information about Google has been published in an article appearing in the September 2004 issue of Playboy Magazine and entitled "Playboy Interview: Google Guys." The text of the article, which is included in this prospectus as Appendix B, contains information derived from an interview of Larry and Sergey conducted in April 2004, prior to the filing of our registration statement of which this prospectus is a part. The article presented certain statements about our company in isolation and did not disclose many of the related risks and uncertainties described in this prospectus. As a result, the article should not be considered in isolation and you should make your investment decision only after reading this entire prospectus carefully.

You should carefully evaluate all the information in this prospectus, including the risks described in this section and throughout the prospectus. We have in the past received, and may continue to receive, a high degree of media coverage, including coverage that is not directly attributable to statements made by our officers and employees. You should rely only on the information contained in this prospectus in making your investment decision.

We do not believe that our involvement in the Playboy Magazine article constitutes a violation of Section 5 of the Securities Act of 1933. However, if our involvement were held by a court to be in violation of the Securities Act of 1933, we could be required to repurchase the shares sold to purchasers in this offering at the original purchase price for a period of one year following the date of the violation. We would contest vigorously any claim that a violation of the Securities Act occurred.

Investors should be aware of the following modifications and updates to the article's content:

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