eBay 2007 Annual Report Download - page 113

any further vote or action by the stockholders. At December 31, 2006 and 2007, there were 10 million shares of
$0.001 par value Preferred Stock authorized for issuance, and no shares issued or outstanding.
Note 11 — Common Stock:
Our Certificate of Incorporation, as amended, authorizes us to issue 3,580 million shares of common stock. A
portion of the shares outstanding are subject to repurchase or forfeiture over a four-year period from the earlier of
the issuance date or employee hire date, as applicable. At December 31, 2006 and 2007 there were 551,676 and
431,202 shares subject to repurchase rights or forfeiture, respectively.
At December 31, 2007, we had reserved 210.9 million shares of common stock available for future issuance
under our stock option plans, including 126.7 million shares related to outstanding stock options and restricted stock
units and 84.2 million shares available for future grant. In addition, as of December 31, 2007, we had reserved
approximately 4.0 million shares of common stock available for future issuance under our deferred stock unit plan,
and approximately 5.2 million shares of common stock available for future issuance under our employee stock
purchase plan.
Treasury Stock
In June 2006, our Board of Directors authorized a stock repurchase program for $2.0 billion of our common
stock, excluding broker commissions. In January 2007, our Board authorized an expansion of the stock repurchase
program to provide for the repurchase of up to an additional $2.0 billion of our common stock by January 2009. In
January 2008, our Board approved an additional stock repurchase program, for further details see “Note 14 — Sub-
sequent Events.” The stock repurchase activity under our stock repurchase program during 2007 is summarized as
follows (in thousands, except per-share amounts):
Shares
Repurchased
Average
Price per
Share
Value of
Shares
Repurchased
Remaining
Amount
Authorized
Balance at January 1, 2007 .............. 54,526 $30.54 $1,665,450 $ 334,550
Additional authorization in January 2007 .... — — — 2,000,000
Repurchase of common stock ............. 44,558 $33.42 1,489,232 (1,489,232)
Balance at December 31, 2007 ............ 99,084 $31.84 $3,154,682 $ 845,318
These repurchased shares are recorded as treasury stock and are accounted for under the cost method. No
repurchased shares have been retired.
During the year ended December 31, 2007, we entered into structured equity hedging transactions. According
to the terms of the transactions, on the maturity date, if the market price of our common stock exceeded a pre-
determined price, we had the option to settle the transaction in cash or shares of our common stock. If the market
price of our common stock was below that pre-determined price, we were required to settle the transactions in shares
of our common stock. The structured equity transaction activity during 2007 is summarized as follows (in million,
except per-share amounts):
Settlement
Date
Transaction
Amount
Cash Settlement
Amount
Cash Premium
Received
Shares of Stock
Repurchased
Effective Price
per Share
Q1’07. . . ............ 3/30/07 $99.6 $102.3 $2.7 — —
Q2’07. . . ............ 6/29/07 $93.7 — — 3.0 $31.40
Q3’07. . . ............ 9/28/07 $98.2 $103.1 $5.0 — —
Q4’07. . . ............ 12/21/07 $47.7 — — 1.4 $33.42
Q4’07. . . ............ 12/28/07 $47.6 — — 1.4 $33.33
103
eBay Inc.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)