eBay 2000 Annual Report Download - page 88

Download and view the complete annual report

Please find page 88 of the 2000 eBay annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 92

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92

eBay Inc.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
The pro forma provision for income taxes is composed of the following (in thousands):
Year Ended December 31,
1998 1999 2000
Current:
Federal ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ $4,303 $10,267 $31,420
State and localÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 1,243 2,505 8,498
Foreign ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ Ì Ì 280
5,546 12,772 40,198
Deferred:
Federal ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 1,138 (4,327) (5,887)
State and localÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 176 (1,091) (1,586)
1,314 (5,418) (7,473)
$6,860 $ 7,354 $32,725
The following is a reconciliation of the diÅerence between the proforma provision for income taxes and
the provision computed by applying the federal statutory rate of 34% 1998 and 35% for 1999 and 2000 to
income before income taxes (in thousands):
Year Ended December 31,
1998 1999 2000
Provision at statutory rate ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ $4,255 $ 6,314 $28,357
Permanent diÅerences:
Foreign income ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ Ì 1,741 229
Merger related expensesÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 384 329 175
Nonconsolidated subsidiary loss ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ Ì Ì 665
Stock based compensation ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 1,051 (379) 125
Tax exempt interest incomeÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ (175) (4,223) (4,241)
Other ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 316 2,706 2,922
State taxes, net of federal beneÑt ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 1,029 866 4,493
$6,860 $ 7,354 $32,725
Note 16 Ì Subsequent Events-Unaudited:
Litigation
On January 26, 2001, the Court issued a ruling dismissing all claims against eBay in the Gentry et.al
lawsuit. The Court ruled that eBay's business falls within the safe harbor provisions of 47 USC 230, which
grants internet service providers such as eBay with immunity from state claims based on the conduct of third
parties. The Court also noted that eBay was not a ""dealer'' under California law and thus not required to
provide certiÑcates of authenticity with autographs sold over its site by third parties. All counts of the
plaintiÅs' suit were dismissed with prejudice as to eBay. PlaintiÅs appealed this ruling. eBay believes it has
meritorious defenses and intends to defend itself vigorously.
In February 2001, the parties settled the Bidder's Edge lawsuit. All claims by both parties were dismissed,
and Bidder's Edge paid eBay an undisclosed amount.
GO.com
In January 2001, Disney announced that it was dissolving GO.com; consequently, eBay is currently in the
process of renegotiating new contract terms with Disney.
83