eBay 2001 Annual Report Download - page 91

eBay Inc.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Ì (CONTINUED)
Note 12 Ì Related Party Transactions:
We have entered into indemniÑcation agreements with each of our directors, executive oÇcers and
certain other oÇcers. These agreements require us to indemnify such individuals, to the fullest extent
permitted by Delaware law, for certain liabilities to which they may become subject as a result of their
aÇliation with us.
Commercial agreements
A member of our Board of Directors and the Audit and Compensation Committees of our Board of
Directors, is a member of the general partner of certain venture capital funds that beneÑcially hold in the
aggregate a greater than 10% equity interest in several public and private companies. We engaged in the
following transactions with such companies:
In December 1999, we entered into an Internet marketing agreement with a privately held company
that facilitates buying decisions for consumers. Under this agreement, we paid approximately $4,000 and
$503,000 of fees in 2000 and 2001, respectively, for the promotion of eBay.
In April 2000, we entered into an advertising and promotions agreement with a privately held
company that provides a marketplace for live advice. Under this agreement, we recognized revenues of
approximately $4.1 million and $1.0 million during the years ended December 31, 2000 and 2001,
respectively. In 1999, we invested $2.0 million in capital stock of such company and received a warrant to
purchase additional shares, which if exercised would bring our total ownership to less than 5% of its capital
stock.
In July 2000, we entered into an advertising and promotions agreement, which we subsequently
amended in December 1999 and April 2000, with a privately held company that provides a real estate
solution to home buyers and sellers. Under the terms of this agreement, we recognized revenues of
approximately $1.3 million and $441,000 during the years ended December 31, 2000 and 2001,
respectively. The member of our Board of Directors mentioned above is also a member of such company's
Board of Directors. In 2000, we invested $3.0 million in capital stock of such company and received a
warrant to purchase additional shares, which if exercised would bring our total ownership to less than 5%
of its capital stock.
In February 2001, our wholly owned subsidiary Half.com, entered into a content licensing and
inventory sales agreement with a company that provides order management and fulÑllment solutions.
Under this agreement, such company agreed to list its inventory on Half.com's website and to allow
Half.com to use such company's catalog data to supplement Half.com's existing catalog data. Half.com
paid such company approximately $100,000 in 2001 under this agreement.
All contracts with related parties are at rates and terms that we believe are comparable with those
entered into with independent third parties.
Notes receivable from eBay executive oÇcers
At December 31, 2000 and 2001, we held notes receivable from certain executive oÇcers totaling
$3.2 million and $4.0 million, respectively. One note is a non-interest bearing note issued in connection
with the relocation of one executive oÇcer to San Jose, California, while the remaining notes bear interest
at rates of 4.94%, 6.37%, and 6.40% per year. Each note is collateralized by Deeds of Trust, which we
hold. The outstanding principal and interest are due and payable by 2005.
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