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These excerpts taken from the EBAY 10-K filed Feb 28, 2007. 6. Option
Provisions.
Each Option shall be in such form and shall contain such terms
and conditions as the Board shall deem appropriate. All Options
shall be separately designated Incentive Stock Options or
Nonstatutory Stock Options at the time of grant, and, if
certificates are issued, a separate certificate or certificates
will be issued for shares of Common Stock purchased on exercise
of each type of Option. The provisions of separate Options need
not be identical, but each Option shall include (through
incorporation of provisions hereof by reference in the Option or
otherwise) the substance of each of the following provisions:
(a) Term. Subject to the provisions of
subsection 5(c) regarding Ten Percent Stockholders, no
Option shall be exercisable after the expiration of ten
(10) years from the date it was granted.
(b) Exercise Price.
(i) Subject to the provisions of subsection 5(c)
regarding Ten Percent Stockholders and subsection 6(b)(ii)
below, the exercise price of each Option shall be not less than
one hundred percent (100%) of the Fair Market Value of the
Common Stock subject to the Option on the date the Option is
granted.
(ii) An Option may be granted with an exercise price lower
than that set forth in subsection 6(b)(i) above if such
Option is granted pursuant to an assumption or substitution for
another option in a manner satisfying the provisions of
Section 424(a) of the Code.
(c) Consideration.
(i) The purchase price of Common Stock acquired pursuant to
an Option shall be paid, to the extent permitted by applicable
statutes and regulations, either (i) in cash at the time
the Option is exercised or (ii) at the discretion of the
Board at the time of the grant of the Option (or subsequently in
the case of a Nonstatutory Stock Option) (1) by delivery to
the Company, or attestation to the Company of ownership, of
other Common Stock or (2) in any other form of legal
consideration that may be acceptable to the Board.
(ii) Unless otherwise specifically provided, the purchase
price of Common Stock acquired pursuant to an Option that is
paid by delivery to the Company, or attestation to the Company
of ownership, of other Common Stock shall be paid only by shares
of the Common Stock of the Company that have been held for more
than six (6) months (or such longer or shorter period of
time required to avoid a charge to earnings for financial
accounting purposes).
(d) Transferability of an Incentive Stock
Option. An Incentive Stock Option shall not be
transferable except by will or by the laws of descent and
distribution and shall be exercisable during the lifetime of the
Optionholder only by the Optionholder. Notwithstanding the
foregoing, the Optionholder may, by delivering written notice to
the Company, in a form satisfactory to the Company, designate a
third party who, in the event of the death of the Optionholder,
shall thereafter be entitled to exercise the Option.
(e) Transferability of a Nonstatutory Stock
Option. A Nonstatutory Stock Option shall be
transferable to the extent provided in the Option Agreement. If
the Nonstatutory Stock Option does not provide for
1 Denotes
that such share number reflects the stock split of eBay’s
common stock occurring in 8/03 and 2/05.
transferability, then the Nonstatutory Stock Option shall not be
transferable except by will or by the laws of descent and
distribution and shall be exercisable during the lifetime of the
Optionholder only by the Optionholder. Notwithstanding the
foregoing, the Optionholder may, by delivering written notice to
the Company, in a form satisfactory to the Company, designate a
third party who, in the event of the death of the Optionholder,
shall thereafter be entitled to exercise the Option.
(f) Vesting Generally. The total number
of shares of Common Stock subject to an Option may, but need
not, vest and therefore become exercisable in periodic
installments that may, but need not, be equal. The Option may be
subject to such other terms and conditions on the time or times
when it may be exercised (which may be based on performance or
other criteria) as the Board may deem appropriate. The vesting
provisions of individual Options may vary. The provisions of
this subsection 6(f) are subject to any Option provisions
governing the minimum number of shares of Common Stock as to
which an Option may be exercised.
(g) Termination of Continuous Service. In
the event an Optionholder’s Continuous Service terminates
(other than upon the Optionholder’s death or Disability),
the Optionholder may exercise his or her Option (to the extent
that the Optionholder was entitled to exercise such Option as of
the date of termination) but only within such period of time
ending on the earlier of (i) the date three (3) months
following the termination of the Optionholder’s Continuous
Service (or such longer or shorter period specified in the
Option Agreement), or (ii) the expiration of the term of
the Option as set forth in the Option Agreement. If, after
termination, the Optionholder does not exercise his or her
Option within the time specified in the Option Agreement, the
Option shall terminate.
(h) Extension of Termination Date. An
Optionholder’s Option Agreement may also provide that if
the exercise of the Option following the termination of the
Optionholder’s Continuous Service (other than upon the
Optionholder’s death or Disability) would be prohibited at
any time solely because the issuance of shares of Common Stock
would violate the registration requirements under the Securities
Act, then the Option shall terminate on the earlier of
(i) the expiration of the term of the Option or
(ii) the expiration of a period of three (3) months
after the termination of the Optionholder’s Continuous
Service during which the exercise of the Option would not be in
violation of such registration requirements.
(i) Disability of Optionholder. In the
event that an Optionholder’s Continuous Service terminates
as a result of the Optionholder’s Disability, the
Optionholder may exercise his or her Option (to the extent that
the Optionholder was entitled to exercise such Option as of the
date of termination), but only within such period of time ending
on the earlier of (i) the date twelve (12) months
following such termination (or such longer or shorter period
specified in the Option Agreement), or (ii) the expiration
of the term of the Option as set forth in the Option Agreement.
If, after termination, the Optionholder does not exercise his or
her Option within the time specified herein, the Option shall
terminate.
(j) Death of Optionholder. In the event
(i) an Optionholder’s Continuous Service terminates as
a result of the Optionholder’s death or (ii) the
Optionholder dies within the period (if any) specified in the
Option Agreement after the termination of the
Optionholder’s Continuous Service for a reason other than
death, then the Option may be exercised (to the extent the
Optionholder was entitled to exercise such Option as of the date
of death) by the Optionholder’s estate, by a person who
acquired the right to exercise the Option by bequest or
inheritance or by a person designated to exercise the option
upon the Optionholder’s death, but only within the period
ending on the earlier of (1) the date eighteen
(18) months following the date of death (or such longer or
shorter period specified in the Option Agreement) or
(2) the expiration of the term of such Option as set forth
in the Option Agreement. If, after death, the Option is not
exercised within the time specified herein, the Option shall
terminate.
6. Option
Provisions
Each Option shall be in such form and shall contain such terms
and conditions as the Board shall deem appropriate. The
provisions of separate Options need not be identical, but each
Option shall include (through incorporation of provisions hereof
by reference in the Option or otherwise) the substance of each
of the following provisions:
(a) Exercise Price. The exercise price of
each Option shall not be less than one hundred percent (100%) of
the Fair Market Value of the Common Stock subject to the Option
on the date the Option is granted. Notwithstanding the
foregoing, an Option may be granted with an exercise price lower
than that set forth in the preceding sentence if such Option is
granted pursuant to an assumption or substitution for another
option in a manner satisfying the provisions of
Section 424(a) of the Code.
(b) Consideration. The purchase price of
Common Stock acquired pursuant to an Option shall be paid, to
the extent permitted by applicable statutes and regulations,
either (i) in cash at the time the Option is exercised, or
(ii) at the discretion of the Board: (1) by delivery
to the Company, or attestation to the Company of ownership, of
other Common Stock, (2) according to a deferred payment or
other similar arrangement with the Optionholder, whether through
the use of a promissory note or otherwise, or (3) in any
other form of legal consideration that may be acceptable to the
Board; provided, however, that at any time that the Company is
incorporated in Delaware, payment of the Common Stock’s
“par value,” as defined in the Delaware General
Corporation Law, shall not be made by deferred payment.
Unless otherwise specifically provided, the purchase price of
Common Stock acquired pursuant to an Option that is paid by
delivery to the Company, or attestation to the Company of
ownership, of other Common Stock shall be paid only by shares of
the Common Stock of the Company that have been held for more
than six (6) months (or such longer or shorter period of
time required to avoid a charge to earnings for financial
accounting purposes).
(c) Transferability. An Option shall be
transferable to the extent provided in the Option Agreement. If
the Option does not provide for transferability, then the Option
shall not be transferable except by will or by the laws of
descent and distribution and shall be exercisable during the
lifetime of the Optionholder only by the Optionholder.
Notwithstanding the foregoing, the Optionholder may, by
delivering written notice to the Company, in a form satisfactory
to the Company, designate a third party who, in the event of the
death of the Optionholder, shall thereafter be entitled to
exercise the Option.
(d) Vesting Generally. The total number
of shares of Common Stock subject to an Option may, but need
not, vest and therefore become exercisable in periodic
installments that may, but need not, be equal. The Option may be
subject to such other terms and conditions on the time or times
when it may be exercised (which may be based on performance or
other criteria) as the Board may deem appropriate. The vesting
provisions of individual Options may vary. The provisions of
this subsection 6(d) are subject to any Option provisions
governing the minimum number of shares of Common Stock as to
which an Option may be exercised.
(e) Termination of Continuous Service. In
the event an Optionholder’s Continuous Service terminates
(other than upon the Optionholder’s death or Disability),
the Optionholder may exercise his or her Option (to the extent
that the Optionholder was entitled to exercise such Option as of
the date of termination) but only within such period of time
ending on the earlier of (i) the date three (3) months
following the termination of the
1 Denotes
that such share number reflects the stock split of eBay’s
common stock occurring only in 2/05 because this provision was
approved in 2004.
Optionholder’s Continuous Service (or such longer or
shorter period specified in the Option Agreement), or
(ii) the expiration of the term of the Option as set forth
in the Option Agreement. If, after termination, the Optionholder
does not exercise his or her Option within the time specified in
the Option Agreement, the Option shall terminate.
(f) Extension of Termination Date. An
Optionholder’s Option Agreement may also provide that if
the exercise of the Option following the termination of the
Optionholder’s Continuous Service (other than upon the
Optionholder’s death or Disability) would be prohibited at
any time solely because the issuance of shares of Common Stock
would violate the registration requirements under the Securities
Act, then the Option shall terminate on the earlier of
(i) the expiration of the term of the Option, or
(ii) the expiration of a period of three (3) months
after the termination of the Optionholder’s Continuous
Service during which the exercise of the Option would not be in
violation of such registration requirements.
(g) Disability of Optionholder. In the
event that an Optionholder’s Continuous Service terminates
as a result of the Optionholder’s Disability, the
Optionholder may exercise his or her Option (to the extent that
the Optionholder was entitled to exercise such Option as of the
date of termination), but only within such period of time ending
on the earlier of (i) the date twelve (12) months
following such termination (or such longer or shorter period
specified in the Option Agreement), or (ii) the expiration
of the term of the Option as set forth in the Option Agreement.
If, after termination, the Optionholder does not exercise his or
her Option within the time specified herein, the Option shall
terminate.
(h) Death of Optionholder. In the event
(i) an Optionholder’s Continuous Service terminates as
a result of the Optionholder’s death or (ii) the
Optionholder dies within the period (if any) specified in the
Option Agreement after the termination of the
Optionholder’s Continuous Service for a reason other than
death, then the Option may be exercised (to the extent the
Optionholder was entitled to exercise such Option as of the date
of death) by the Optionholder’s estate, by a person who
acquired the right to exercise the Option by bequest or
inheritance or by a person designated to exercise the option
upon the Optionholder’s death, but only within the period
ending on the earlier of (1) the date eighteen
(18) months following the date of death (or such longer or
shorter period specified in the Option Agreement), or
(2) the expiration of the term of such Option as set forth
in the Option Agreement. If, after death, the Option is not
exercised within the time specified herein, the Option shall
terminate.
(i) Early Exercise. The Option may, but
need not, include a provision whereby the Optionholder may elect
at any time before the Optionholder’s Continuous Service
terminates to exercise the Option as to any part or all of the
shares of Common Stock subject to the Option prior to the full
vesting of the Option. Any unvested shares of Common Stock so
purchased may be subject to a repurchase option in favor of the
Company or to any other restriction the Board determines to be
appropriate. The Company will not exercise its repurchase option
until at least six (6) months (or such longer or shorter
period of time required to avoid a charge to earnings for
financial accounting purposes) have elapsed following exercise
of the Option unless the Board otherwise specifically provides
in the Option.
This excerpt taken from the EBAY DEF 14A filed Apr 26, 2006. 6. Option
Provisions.
Each Option shall be in such form and shall contain such terms
and conditions as the Board shall deem appropriate. All Options
shall be separately designated Incentive Stock Options or
Nonstatutory Stock Options at the time of grant, and, if
certificates are issued, a separate certificate or certificates
will be issued for shares of Common Stock purchased on exercise
of each type of Option. The provisions of separate Options need
not be identical, but each Option shall include (through
incorporation of provisions hereof by reference in the Option or
otherwise) the substance of each of the following provisions:
(a) Term. Subject to the provisions of
subsection 5(c) regarding Ten Percent Stockholders, no Option
shall be exercisable after the expiration of ten (10) years
from the date it was granted.
(b) Exercise Price.
(i) Subject to the provisions of subsection 5(c)
regarding Ten Percent Stockholders and subsection 6(b)(ii)
below, the exercise price of each Option shall be not less than
one hundred percent (100%) of the Fair Market Value of the
Common Stock subject to the Option on the date the Option is
granted.
(ii) An Option may be granted with an exercise price
lower than that set forth in subsection 6(b)(i) above if such
Option is granted pursuant to an assumption or substitution for
another option in a manner satisfying the provisions of
Section 424(a) of the Code.
(c) Consideration.
(i) The purchase price of Common Stock acquired
pursuant to an Option shall be paid, to the extent permitted by
applicable statutes and regulations, either (i) in cash at
the time the Option is exercised or (ii) at the discretion
of the Board at the time of the grant of the Option (or
subsequently in the case of a Nonstatutory Stock Option)
(1) by delivery to the Company, or attestation to the
Company of ownership, of other Common Stock or (2) in any
other form of legal consideration that may be acceptable to the
Board.
(ii) Unless otherwise specifically provided, the
purchase price of Common Stock acquired pursuant to an Option
that is paid by delivery to the Company, or attestation to the
Company of ownership, of other Common Stock shall be paid only
by shares of the Common Stock of the Company that have been held
for more than six (6) months (or such longer or shorter
period of time required to avoid a charge to earnings for
financial accounting purposes).
(d) Transferability of an Incentive Stock
Option. An Incentive Stock Option shall not be
transferable except by will or by the laws of descent and
distribution and shall be exercisable during the lifetime of the
Optionholder only by the Optionholder. Notwithstanding the
foregoing, the Optionholder may, by delivering written notice to
the Company, in a form satisfactory to the Company, designate a
third party who, in the event of the death of the Optionholder,
shall thereafter be entitled to exercise the Option.
(e) Transferability of a Nonstatutory Stock
Option. A Nonstatutory Stock Option shall be
transferable to the extent provided in the Option Agreement. If
the Nonstatutory Stock Option does not provide for
transferability, then the Nonstatutory Stock Option shall not be
transferable except by will or by the laws of descent and
distribution and shall be exercisable during the lifetime of the
Optionholder only by the Optionholder. Notwithstanding the
foregoing, the Optionholder may, by delivering written notice to
the Company, in a form satisfactory to the Company, designate a
third party who, in the event of the death of the Optionholder,
shall thereafter be entitled to exercise the Option.
(f) Vesting Generally. The total number
of shares of Common Stock subject to an Option may, but need
not, vest and therefore become exercisable in periodic
installments that may, but need not, be equal. The Option may be
subject to such other terms and conditions on the time or times
when it may be exercised (which may be based on performance or
other criteria) as the Board may deem appropriate. The vesting
provisions of individual Options may vary. The provisions of
this subsection 6(f) are subject to any Option provisions
governing the minimum number of shares of Common Stock as to
which an Option may be exercised.
(g) Termination of Continuous Service. In
the event an Optionholder’s Continuous Service terminates
(other than upon the Optionholder’s death or Disability),
the Optionholder may exercise his or her Option (to the extent
that the Optionholder was entitled to exercise such Option as of
the date of termination) but only within such period of time
ending on the earlier of (i) the date three (3) months
following the termination of the Optionholder’s
Table of Contents
Continuous Service (or such longer or shorter period specified
in the Option Agreement), or (ii) the expiration of the
term of the Option as set forth in the Option Agreement. If,
after termination, the Optionholder does not exercise his or her
Option within the time specified in the Option Agreement, the
Option shall terminate.
(h) Extension of Termination Date. An
Optionholder’s Option Agreement may also provide that if
the exercise of the Option following the termination of the
Optionholder’s Continuous Service (other than upon the
Optionholder’s death or Disability) would be prohibited at
any time solely because the issuance of shares of Common Stock
would violate the registration requirements under the Securities
Act, then the Option shall terminate on the earlier of
(i) the expiration of the term of the Option or
(ii) the expiration of a period of three (3) months
after the termination of the Optionholder’s Continuous
Service during which the exercise of the Option would not be in
violation of such registration requirements.
(i) Disability of Optionholder. In the
event that an Optionholder’s Continuous Service terminates
as a result of the Optionholder’s Disability, the
Optionholder may exercise his or her Option (to the extent that
the Optionholder was entitled to exercise such Option as of the
date of termination), but only within such period of time ending
on the earlier of (i) the date twelve (12) months
following such termination (or such longer or shorter period
specified in the Option Agreement), or (ii) the expiration
of the term of the Option as set forth in the Option Agreement.
If, after termination, the Optionholder does not exercise his or
her Option within the time specified herein, the Option shall
terminate.
(j) Death of Optionholder. In the event
(i) an Optionholder’s Continuous Service terminates as
a result of the Optionholder’s death or (ii) the
Optionholder dies within the period (if any) specified in the
Option Agreement after the termination of the
Optionholder’s Continuous Service for a reason other than
death, then the Option may be exercised (to the extent the
Optionholder was entitled to exercise such Option as of the date
of death) by the Optionholder’s estate, by a person who
acquired the right to exercise the Option by bequest or
inheritance or by a person designated to exercise the option
upon the Optionholder’s death, but only within the period
ending on the earlier of (1) the date eighteen
(18) months following the date of death (or such longer or
shorter period specified in the Option Agreement) or
(2) the expiration of the term of such Option as set forth
in the Option Agreement. If, after death, the Option is not
exercised within the time specified herein, the Option shall
terminate.
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