eBay 1998 Annual Report Download - page 48

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48
The following executive officers received grants of options in 1998 pursuant to the 1997 Stock Option Plan
(the “1997 Plan”).
Option Grants During 1998
Number of
Securities
Underlying
Options
Percentage
of Total
Options
Granted to
Employees
during
Exercise
Price Per Expiration
Potential Realizable Value at
Assumed Annual Rates of Stock Price
Appreciation for Option Term(4)
Name Granted(1) 1998(2) Share(3) Date 0% 5% 10%
Margaret C. Whitman.... . 7,200,000 41.7% $ 0.07 1/20/2008 $ 42,720,000 $ 69,888,248 $ 111,569,674
Steven P. Westly............ . 27,000 0.2 0.07 1/20/2008 160,200 262,081 418,386
36,000 0.2 0.22 3/4/2008 208,000 343,841 552,248
27,000 0.2 0.67 4/13/2008 144,000 245,881 402,186
18,000 0.1 3.11 6/8/2008 52,000 119,921 224,124
(1) Options granted in 1998 were granted under the 1997 Plan. All options granted were immediately exercisable
and were either incentive stock options or nonqualified stock options. These options were granted by the Board
and generally vest over four years at the rate of 25% of the shares subject to the option on the first vesting date
specified in the Stock Option Agreement and 2.08% per month thereafter. Upon certain changes in control of
the Company, this vesting schedule will accelerate as to all shares that are then unvested. Unvested shares are
subject to the Company’ s right of repurchase upon termination of employment. Options expire ten years from
the date of grant. In determining the fair market value of the Company’ s Common Stock on each grant date, the
Board considered, among other things, the price of arms’ -length sales of the Company’ s Common Stock and
Series B Preferred Stock, the Company’ s absolute and relative levels of revenues and other operating results,
the state of the Company’ s website development, the entry into the Company’ s market of certain potentially
significant competitors and the appreciation of stock values of a number of generally comparable Internet
companies. See and “—Compensation Arrangements” below and Note 10 of Notes to Consolidated Financial
Statements for a description of the material terms of these options.
(2) Based on options granted to purchase 17,286,756 shares of Common Stock of the Company during 1998.
(3) Options were granted at an exercise price equal to the fair market value of the Company’ s Common Stock, as
determined by the Board of Directors on the date of grant.
(4) Potential realizable values are computed by multiplying the number of shares of Common Stock subject to a
given option by the initial public offering price of $6.00 per share, assuming that the aggregate stock value
derived from that calculation compounds at the annual 0%, 5% or 10% rate shown in the table for the entire
ten-year term of the option and subtracting from that result the aggregate option exercise price. The 5% and
10% assumed annual rates of stock price appreciation are mandated by the rules of the Securities and Exchange
Commission and do not represent the Company’ s estimate or projection of future Common Stock prices.