eBay 2009 Annual Report Download - page 72

Financing Activities
The net cash used in financing activities of $945.7 million in 2009 was due primarily to net payments under
our credit agreement of $1.0 billion. The net cash flows used in financing activities of $1.7 billion in 2008 were
due primarily to the repurchase of approximately 80.6 million shares of our common stock for an aggregate
purchase price of approximately $2.2 billion and the repayment of a bank obligation of $434.0 million assumed
in the Bill Me Later acquisition, offset in part by the proceeds from stock option exercises totaling $152.8 million
and $800.0 million of net proceeds from borrowings under our credit agreement. The net cash flows used in
financing activities of $693.6 million in 2007 were due primarily to the repurchase of approximately 44.6 million
shares of our common stock for an aggregate purchase price of approximately $1.5 billion, offset in part by the
proceeds from stock option exercises totaling $507.0 million and $200.0 million of net proceeds from borrowings
under our credit agreement.
The negative effect of exchange rates on cash and cash equivalents during 2008 and 2009 was due to the
strengthening of the U.S. dollar against other foreign currencies, primarily the Euro. The positive effect of
exchange rates on cash and cash equivalents during 2007 was due to the weakening of the U.S. dollar against
other foreign currencies, primarily the Euro.
Stock Repurchases
In July 2006, our Board authorized the repurchase of up to $2.0 billion of our common stock within two
years from the date of authorization. In January 2007, our Board authorized, and we announced, an expansion of
the stock repurchase program to provide for the repurchase of up to an additional $2.0 billion of our common
stock over the next two years. During 2007, we repurchased approximately 44.6 million shares of our common
stock at an average price of $33.42 per share for an aggregate purchase price of $1.5 billion under this stock
repurchase program. In January 2008, our Board authorized, and we announced, another stock repurchase
program of up to $2.0 billion of our common stock that has no expiration date. During 2008, we repurchased
approximately 80.6 million shares of our common stock at an average price of $27.15 per share for an aggregate
purchase price of $2.2 billion, under these stock repurchase programs. During 2009 we did not repurchase any
shares of our common stock. As of December 31, 2009, we have the ability to repurchase up to $656.5 million
under our stock repurchase program.
Our stock repurchase programs may be limited or terminated at any time without prior notice. Stock
repurchases under these programs may be made through a variety of open market and privately negotiated
transactions, including structured stock repurchase transactions or other derivative transactions, at times and in
such amounts as management deems appropriate and will be funded from our working capital or other financing
alternatives. The timing and actual number of shares repurchased will depend on a variety of factors including
corporate and regulatory requirements, price and other market conditions and management’s determination as to
the appropriate use of our cash. The programs are intended to comply with the volume, timing and other
limitations set forth in Rule 10b-18 under the Securities Exchange Act of 1934.
Credit Agreement
In August 2007, we entered into an amendment to our 2006 credit agreement. The amendment agreement
increased the lender commitments and borrowing capacity under the 2006 credit agreement from its prior level of
$1.0 billion to $2.0 billion, maintained an option to increase borrowing capacity by an additional $1.0 billion
(after giving effect to the $1.0 billion increase described above) and extended the maturity date by an additional
year to November 7, 2012. Lehman Brothers Commercial Bank was a participating lender in our $2.0 billion
credit agreement. As a result of the bankruptcy of its parent company, our available line of credit has been
effectively reduced by its commitment of $160.0 million. As of December 31, 2009, $1.8 billion was available
under the credit agreement.
Loans under the credit agreement will bear interest at LIBOR plus a margin ranging from 0.20 percent to
0.50 percent. Subject to certain conditions stated in the credit agreement, we may borrow, prepay and reborrow
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