exv10w09



 





 




    Exhibit 10.09



 




    eBay
    Inc.

    



 




    1998
    DIRECTORS STOCK OPTION PLAN



 




    As
    Adopted July 10, 1998



 



    (As Amended March 18, 1999, December 4, 2002,
    August 28, 2003, February 16, 2005 and
    January 10, 2007)



 



    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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