Exhibit 10.09
eBay
Inc.
1998
DIRECTORS STOCK OPTION PLAN
1. Purpose. This
1998 Directors Stock Option Plan (this
“Plan”) is established to provide equity
incentives for certain nonemployee members of the Board of
Directors of eBay Inc. (the “Company”),
who are described in Section 6.1 below, by granting such
persons options to purchase shares of common stock of the
Company (“Options”).
2.
Adoption and Stockholder
Approval. After this Plan is adopted by the Board
of Directors of
the Company (the
“Board”), this Plan will become
effective on the time and date (the
“Effective
Date”) on which the registration statement filed by
the Company with the Securities and Exchange Commission
(“SEC”) under the Securities Act of
1933, as amended (the
“Securities Act”),
to register the initial public offering of
the Company’s
Common Stock is declared effective by the SEC. This Plan shall
be approved by the stockholders of
the Company, consistent with
applicable laws, within twelve (12) months after the date
this Plan is adopted by the Board.
3.
Types of Options and
Shares. Options granted under this Plan shall be
non-qualified stock options
(“NQSOs”).
The shares of stock that may be purchased upon exercise of
Options granted under this Plan (the
“Shares”) are shares of the Common Stock
of
the Company.
4.
Number of Shares. The maximum
number of Shares that may be issued pursuant to Options granted
under this Plan (the
“Maximum Number”)
is
5,600,000
*
Shares, subject to adjustment as provided in this Plan. If any
Option is terminated for any reason without being exercised in
whole or in part, the Shares thereby released from such Option
shall be available for purchase under other Options subsequently
granted under this Plan. At all times during the term of this
Plan,
the Company shall reserve and keep available such number
of Shares as shall be required to satisfy the requirements of
outstanding Options granted under this Plan; provided, however
that if the aggregate number of Shares subject to outstanding
Options granted under this Plan plus the aggregate number of
Shares previously issued by
the Company pursuant to the exercise
of Options granted under this Plan equals or exceeds the Maximum
Number, then notwithstanding anything herein to the contrary, no
further Options may be granted under this Plan until the Maximum
Number is increased or the aggregate number of Shares subject to
outstanding Options granted under this Plan plus the aggregate
number of Shares previously issued by
the Company pursuant to
the exercise of Options granted under this Plan is less than the
Maximum Number.
5.
Administration. This Plan shall
be administered by the Board or by a committee of not less than
two members of the Board appointed to administer this Plan (the
“Committee”). As used in this Plan,
references to the Committee shall mean either such Committee or
the Board if no Committee has been established. The
interpretation by the Committee of any of the provisions of this
Plan or any Option granted under this Plan shall be final and
binding upon
the Company and all persons having an interest in
any Option or any Shares purchased pursuant to an Option.
6. Eligibility and Award Formula.
6.1
Eligibility. Options
shall be granted only to directors of
the Company who are not
employees of
the Company or any Parent, Subsidiary or Affiliate
of
the Company, as those terms are defined in Section 17
below (each such person referred to as an
“Optionee”).
6.2 Initial
Grant. [Intentionally blank].
6.3
Succeeding Grants. At
each Annual Meeting of
the Company commencing with the Annual
Meeting taking place in the year 2000, each Optionee will
automatically be granted an Option for
[15,000]
**
* Share
number reflects all stock splits from the Effective Date through
February 2005.
** Share
number does not reflect stock split effective February 16,
2005. Share number needs to be approved by Compensation
Committee of the Company’s Board.
Shares (a “Succeeding Grant”), provided
the Optionee (i) was elected to the Board prior to such
date, and (ii) is a director after the Annual Meeting, and
(iii) has served continuously as a member of the Board
since the date of such Optionee’s election.
7. Terms and Conditions of
Options. Subject to the following and to
Section 6 above:
7.1 Form of Option
Grant. Each Option granted under this Plan
shall be evidenced by a written Stock Option Grant
(“Grant”) in such form (which need not
be the same for each Optionee) as the Committee shall from time
to time approve, which Grant shall comply with and be subject to
the terms and conditions of this Plan.
7.2
Vesting. The date an
Optionee receives an Initial Grant or a Succeeding Grant is
referred to in this Plan as the
“Start Date”
for such Option. Each Succeeding Grant will vest as to
twenty-five percent (25%) of the Shares on the first anniversary
of the Start Date for such Succeeding Grant, and as to 2.08333%
of the Shares on each subsequent monthly anniversary of the
Start Date, so long as the Optionee continuously remains a
director or a consultant of
the Company.
7.3 Exercise Price. The
exercise price of an Option shall be the Fair Market Value (as
defined in Section 17.5) of the Shares, at the time that
the Option is granted.
7.4
Termination of
Option. Except as provided below in this
Section, each Option shall expire ten (10) years after its
Start Date (the
“Expiration Date”). The
Option shall cease to vest when the Optionee ceases to be a
member of the Board or a consultant of
the Company. The date on
which the Optionee ceases to be a member of the Board or a
consultant of
the Company shall be referred to as the
“Termination Date”. An Option may be
exercised after the Termination Date only as set forth below:
(a)
Termination Generally. If the
Optionee ceases to be a member of the Board or a consultant of
the Company for any reason except death of the Optionee or
disability of the Optionee (whether temporary or permanent,
partial or total, as determined by the Committee), then each
Option then held by such Optionee, to the extent (and only to
the extent) that it would have been exercisable by the Optionee
on the Termination Date, may be exercised by the Optionee no
later than seven (7) months after the Termination Date, but
in no event later than the Expiration Date.
(b)
Death or Disability. If the
Optionee ceases to be a member of the Board or a consultant of
the Company because of the death of the Optionee or the
disability of the Optionee (whether temporary or permanent,
partial or total, as determined by the Committee), then each
Option then held by such Optionee to the extent (and only to the
extent) that it would have been exercisable by the Optionee on
the Termination Date, may be exercised by the Optionee (or the
Optionee’s legal representative) no later than twelve
(12) months after the Termination Date, but in no event
later than the Expiration Date.
8. Exercise of Options.
8.1 Exercise Period. Subject
to the provisions of Section 8.5 below, Options shall be
exercisable as they vest; provided that the Committee may
provide that such Options shall be immediately exercisable
subject to repurchase in accordance with the vesting schedule
set forth in Section 7.
8.2
Notice. Options may be
exercised only by delivery to
the Company of an exercise
agreement in a form approved by the Committee stating the number
of Shares being purchased, the restrictions imposed on the
Shares and such representations and agreements regarding the
Optionee’s investment intent and access to information as
may be required by
the Company to comply with applicable
securities laws, together with payment in full of the exercise
price for the number of Shares being purchased.
8.3
Payment. Payment for the
Shares purchased upon exercise of an Option may be made
(a) in cash or by check; (b) by surrender of shares of
Common Stock of
the Company that have been owned by the Optionee
for more than six (6) months (and which have been paid for
within the meaning of SEC Rule 144 and, if such shares were
purchased from
the Company by use of a promissory note, such
note has been fully paid with respect to such shares) or were
obtained by the Optionee in the open public market, having a
Fair Market Value equal to the exercise price of the Option;
(c) by waiver of compensation due or accrued to the
Optionee
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for services rendered; (d) provided that a public market
for
the Company’s stock exists (and to the extent permitted
by law), through a
“same day sale” commitment from the
Optionee and a broker-dealer that is a member of the National
Association of Securities Dealers (an
“NASD
Dealer”) whereby the Optionee irrevocably elects to
exercise the Option and to sell a portion of the Shares so
purchased to pay for the exercise price and whereby the NASD
Dealer irrevocably commits upon receipt of such Shares to
forward the exercise price directly to
the Company;
(e) provided that a public market for
the Company’s
stock exists (and to the extent permitted by law), through a
“margin” commitment from the Optionee and an NASD
Dealer whereby the Optionee irrevocably elects to exercise the
Option and to pledge the Shares so purchased to the NASD Dealer
in a margin account as security for a loan from the NASD Dealer
in the amount of the exercise price, and whereby the NASD Dealer
irrevocably commits upon receipt of such Shares to forward the
exercise price directly to
the Company; or (f) by any
combination of the foregoing.
8.4
Withholding Taxes. Prior
to issuance of the Shares upon exercise of an Option, the
Optionee shall pay or make adequate provision for any federal or
state withholding obligations of
the Company, if applicable.
8.5 Limitations on
Exercise. Notwithstanding the exercise
periods set forth in the Grant, exercise of an Option shall
always be subject to the following limitations:
(a) An Option shall not be exercisable unless such exercise
is in compliance with the Securities Act and all applicable
state securities laws, as they are in effect on the date of
exercise.
(b) The Committee may specify a reasonable minimum number
of Shares that may be purchased upon any exercise of an Option,
provided that such minimum number will not prevent the Optionee
from exercising the full number of Shares as to which the Option
is then exercisable.
9. Nontransferability of
Options. During the lifetime of the Optionee, an
Option shall be exercisable only by the Optionee or by the
Optionee’s guardian or legal representative, unless
otherwise determined by the Committee. No Option may be sold,
pledged, assigned, hypothecated, transferred or disposed of in
any manner other than by will or by the laws of descent and
distribution, unless otherwise determined by the Committee.
10.
Privileges of Stock
Ownership. No Optionee shall have any of the
rights of a stockholder with respect to any Shares subject to an
Option until the Option has been validly exercised. No
adjustment shall be made for dividends or distributions or other
rights for which the record date is prior to the date of
exercise, except as provided in this Plan.
The Company shall
provide to each Optionee a copy of the annual financial
statements of
the Company at such time after the close of each
fiscal year of
the Company as they are released by
the Company
to its stockholders.
11. Adjustment of Option Shares.
(a) In the event that any dividend or other distribution,
reorganization, merger, consolidation, combination, repurchase,
or exchange of
the Company’s Common Stock or other
securities of
the Company, or other change in the corporate
structure of
the Company affecting
the Company’s Common
Stock (other than an Equity Restructuring) occurs such that an
adjustment is determined by the Committee (in its sole
discretion) to be appropriate in order to prevent dilution or
enlargement of the benefits or potential benefits intended to be
made available under the Plan, then the Committee shall, in such
manner as it may deem equitable, adjust the number and class of
Shares which may be delivered under the Plan, the exercise price
per Share and the number and type of Shares covered by each
Option which has not yet been exercised, and the numerical
limits of Section 4 and 6.3.
(b) In connection with the occurrence of any Equity
Restructuring, and notwithstanding anything to the contrary in
Sections 11(a) and 14, the exercise price and number
and type of securities subject to each outstanding Option will
be equitably adjusted by the Committee. The adjustments provided
under this Section 2.2(b) shall be nondiscretionary and
shall be final and binding on the affected Optionee and the
Company.
12.
No Obligation to Continue as
Director. Nothing in this Plan or any Option
granted under this Plan shall confer on any Optionee any right
to continue as a director of
the Company.
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13.
Compliance With Laws. The grant
of Options and the issuance of Shares upon exercise of any
Options shall be subject to and conditioned upon compliance with
all applicable requirements of law, including without limitation
compliance with the Securities Act, compliance with all other
applicable state securities laws and compliance with the
requirements of any stock exchange or national market system on
which the Shares may be listed.
The Company shall be under no
obligation to register the Shares with the SEC or to effect
compliance with the registration or qualification requirement of
any state securities laws, stock exchange or national market
system.
14.
Acceleration of Options on Certain Corporate
Transactions. In the event of (a) a
dissolution or liquidation of
the Company, (b) a merger or
consolidation in which
the Company is not the surviving
corporation (other than a merger or consolidation with a
wholly-owned subsidiary, a reincorporation of
the Company in a
different jurisdiction, or other transaction in which there is
no substantial change in the stockholders of
the Company or
their relative stock holdings and the Options granted under this
Plan are assumed, converted or replaced by the successor
corporation, which assumption, conversion or replacement will be
binding on all Optionees), (c) a merger in which the
Company is the surviving corporation but after which the
stockholders of
the Company (other than any stockholder which
merges (or which owns or controls another corporation which
merges) with
the Company in such merger) cease to own their
shares or other equity interests in
the Company, (d) the
sale of substantially all of the assets of
the Company, or
(e) the acquisition, sale or transfer of more than 50% of
the outstanding shares of
the Company by tender offer or similar
transaction, the vesting of all Options granted pursuant to this
Plan will accelerate and the Options will become exercisable in
full prior to the consummation of such event at such times and
on such conditions as the Committee determines, and must be
exercised, if at all, within seven months of the consummation of
said event. Any Options not exercised within such seven-month
period shall expire.
15. Amendment or Termination of
Plan. The Board may at any time terminate or
amend this Plan or any outstanding Option, provided that the
Board may not terminate or amend the terms of any outstanding
Option without the consent of the Optionee. In any case, no
amendment of this Plan may adversely affect any then outstanding
Options or any unexercised portions thereof without the written
consent of the Optionee.
16. Term of Plan. Options may be
granted pursuant to this Plan from time to time within a period
of ten (10) years from the Effective Date.
17. Certain Definitions. As used in
this Plan, the following terms shall have the following meanings:
17.1
“Parent” means any corporation
(other than
the Company) in an unbroken chain of corporations
ending with
the Company if each of such corporations other than
the Company owns stock possessing 50% or more of the total
combined voting power of all classes of stock in one of the
other corporations in such chain.
17.2
“Subsidiary” means any
corporation (other than
the Company) in an unbroken chain of
corporations beginning with
the Company if each of the
corporations other than the last corporation in the unbroken
chain owns stock possessing 50% or more of the total combined
voting power of all classes of stock in one of the other
corporations in such chain.
17.3
“Affiliate” means any
corporation that directly, or indirectly through one or more
intermediaries, controls or is controlled by, or is under common
control with, another corporation, where
“control”
(including the terms
“controlled by” and
“under
common control with”) means the possession, direct or
indirect, of the power to cause the direction of the management
and policies of the corporation, whether through the ownership
of voting securities, by
contract or otherwise.
17.4
“Equity Restructuring” means a
non-reciprocal transaction (i.e. a transaction in which the
Company does not receive consideration or other resources in
respect of the transaction approximately equal to and in
exchange for the consideration or resources
the Company is
relinquishing in such transaction) between
the Company and its
stockholders, such as a stock split, spin-off, rights offering,
nonrecurring stock dividend or recapitalization through a large,
nonrecurring cash dividend, that affects the shares of the
Company’s Common Stock (or other securities of
the Company)
or the share price of
the Company’s Common Stock (or other
securities) and causes a change in the per share value of the
Shares underlying outstanding Options.
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17.5
“Fair Market Value” means, as
of any date, the value of a share of
the Company’s Common
Stock determined as follows:
(a) if such Common Stock is then quoted on the Nasdaq
National Market, its closing price on the Nasdaq National Market
on the date of determination as reported in The Wall Street
Journal;
(b) if such Common Stock is publicly traded and is then
listed on a national securities exchange, its closing price on
the date of determination on the principal national securities
exchange on which the Common Stock is listed or admitted to
trading as reported in The Wall Street Journal;
(c) if such Common Stock is publicly traded but is not
quoted on the Nasdaq National Market nor listed or admitted to
trading on a national securities exchange, the average of the
closing bid and asked prices on the date of determination as
reported in The Wall Street Journal;
(d) in the case of an Option granted on the Effective Date,
the price per share at which shares of
the Company’s Common
Stock are initially offered for sale to the public by the
Company’s underwriters in the initial public offering of
the Company’s Common Stock pursuant to a registration
statement filed with the SEC under the Securities Act; or
(e) if none of the foregoing is applicable, by the
Committee in good faith.
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