SiliconBeat

Should Skype, the Internet telephone company purchased by eBay in 2005, come out the loser in its growing litigation against Joltid, which licenses critical peer-to-peer communication technology to the company, the “continued operation of Skype’s business as currently conducted would likely not be possible”, according to a filing eBay made with the Securities and Exchange Commission Wednesday.

Joltid, the British Virgin Islands-based company founded in 2001 by the folks behind Read the rest of this entry »

Add eBay to the list of  technology company seeking to rescue its employees underwater options. Last week, the online auctioneer’s board of directors approved putting two proposals before shareholders at the company’s annual meeting on April 29 that would facilitate the exchange of underwater options for a smaller number of restricted shares  that will retain value as long as eBay’s stock price does.

“Like many companies, we have experienced a significant decline Read the rest of this entry »

The Internet auctioneer, eBay, reported a sequential drop in quartlery quarterly sales Wednesday for the first time in its history as a public company. Sales totaled $2.12 billion in the 2008 third quarter, up 12.1 percent from the year before quarter, but down 3.6 percent from the quarter before, something that has never happened before.

The results included an accelerating sequential drop Read the rest of this entry »

EBay said Tuesday that Marc Andreessen has joined its board. Andreesen, who was a co-founder and a principal architect of Netscape Communications and later served as chief technology officer of America Online, which acquired the pioneering browser firm in 1998.

Andreessen also founded Opsware, formerly known as LoudCloud, a provider of data-center automation software that was acquired by Hewlett-Packard in 2007. His most recent endeavor is as co-founder of Ning Read the rest of this entry »

It’s not cheap to change your chief executive, especially when the old one sticks around as a special advisor. Just ask eBay.

The company filed details of compensation being offered to its new CEO, John Donahoe:

• Salary: $900,000. (OK, that’s a slight savings, as Meg Whitman got $995,016 last year. But she’s sticking around as a “special advisor” making $600,000 a year.)
• Bonus target: $1,125,000. (Once again, a slight savings from the $1,132,692 Whitman got in 2006, the most recent figures available. Note: stock price fell 30 percent that year. And as special advisor she’s got a target bonus worth $600,000. In addition, she remains eligible to get extra money she would have received with respect to the 2008 annual component of the “eBay Incentive Plan” had she remained eligible to receive payment through the first quarter of 2009.)
• Long-term equity award: $8 million worth of stock options and restricted stock units. (Whitman, who will get no new equity awards, will get continued vesting of performance-based restricted stock units she would have been granted had she remained eligible to receive them through the first quarter of 2009.)
• Promotion award: $15 million worth of stock options and restricted stock units.

Whitman , who will remain on eBay’s board, will also get free office space and “secretarial services” for three years. Memoir, anyone? (Whitman is reportedly toying with the idea of a run for governor of California.) If nothing else, her arrangements allow her to bide her time in case some of her 2.8 million underwater options rise up into the money.

In the roughly five months before Meg Whitman announced Wednesday she would step down as chief executive of eBay, she made more than $100 million exercising options for the first time since the company went public, bringing her take from eBay stock to more than a half billion dollars.

EBay’s shares fell the next day, dropping $1.76, or 6.1 percent, to $27.18 before closing
Friday at a 52-week low of $26.83.

In addition to the Whitman announcement, eBay also released results Wednesday for its
fourth quarter, which beat Wall Street expectations, but warned of slower-than-expected growth.

Whitman’s recent stock sales were made under a trading plan she set up last February to sell up to 6.4 million shares between June 2007 and February 2008. The plan was formed under SEC rule 10b5-1, which permits insiders to adopt plans for selling or purchasing specific amounts of stocks over a certain time, so long as the individual is not in possession of “material nonpublic information” when the plan is adopted.

Whitman’s announcement Wednesday raises a question: when did she know she was going to quit, and could her decision be considered “”material nonpublic information”?

We asked eBay but received no reply after two days.

During a conference call Wednesday, Whitman told analysts, “I’ve repeatedly said that 10 years was about the right amount of time for any CEO to stay at the helm of a company. Now that I’ve reached that milestone, I’ve decided that it’s time for eBay to have new leadership, a new perspective and a new vision.”

When we asked about the sales back in September, a spokesperson for eBay assured us that Whitman remained committed to the company and that her sales were simply a part of her “personal asset management.”

An option grant for 2.4 million shares given to Whitman when she was hired cost her
$480,000 to exercise before the company went public. She used $60,000 of her own money and borrowed the rest from eBay. Those shares, when sold over the years, brought her $412 million, according to Thomson Financial.

The Los Angeles Times reported Friday that Whitman appears to be investigating a career in politics, citing a source “close to her” who said she had been ‘talking with Republicans around the state” about running for governor of California in 2010, and “had become ‘fascinated’ by politics in her work as a fundraiser for GOP presidential hopeful Mitt Romney, a former governor of Massachusetts and a former colleague of Whitman at the consulting firm Bain & Co.”

That’s the same firm where she found her eventual successor, John Donahoe.

Like Romney is doing, Whitman could easily finance her own campaign, as she ranked No. 361 on Forbes’ 2007 list of the richest Americans, with an estimated net worth of $1.4 billion.

Here’s an update on the stock sales of folks who are so much wealthier than you that they don’t even breathe the same air any more:

First, Oracle (ticker:ORCL) CEO Larry Ellison sold 4 million shares of Oracle stock between Nov. 6 and Nov. 9 at an average of $19.06 per share to collect $85.1 million.

Next, eBay (ticker:EBAY) CEO Meg Whitman sold 640,000 shares of eBay stock on Nov. 7 and 8 at an average price ranging from $32.16 to collect $21.4 million.

And finally, John Doerr (ticker:GOD) sold 42.350 shares of his Google (ticker:GOOG) stock on Nov. 1 for prices ranging from $703.50 to $712.59 per share to collect $30 million.

EBay Chief Executive Meg Whitman has returned to the ranks of the company’s inside sellers this year for the first time since 2003, according to Thomson Financial.

Her latest trades took place at the height of the recent stock market gyrations on Aug. 9, a day the Dow dropped 387 points, or 2.8 percent on credit worries, and Aug. 10, the day the Federal Reserve injected billions of dollars of extra liquidity into the financial system, helping cut the Dow’s loss that day to 31 points, or 0.2 percent.

Whitman exercised options to buy 320,000 shares of eBay stock at $10.02 per share both days and then sold them at prices ranging from $35.63 to $36.75. The trades left her with a profit of $16.75 million.

Good timing or bad?
Read the rest of this entry »

What do you get the Silicon Valley CEO who has already sold $432.6 million in stock? Why, more stock sales, silly.

According to a Form 4 filed Monday, eBay CEO Meg Whitman spent $6.4 million to exercise 640,000 options and then immediately sold the stock over two days last week for prices ranging from $35.63 to $36.75, for a net gain of $16.7 million. That leaves her with only 22 million shares.

But there was one interesting tidbit in a second table included in the Form 4 that listed the scheduled vesting dates for her remaining stock options. Two chunks of stock, one 500,000 grant from 2003 and another 550,000 grant from 2005, have respective strike prices of  $39.90 per share and $42.58. With eBay’s stock trading around $35 per share, that puts both sets under water.

In addition, Whitman got another grant of 1.2 million shares in 2004 with a strike price of $34.615 that are barely in the money.

eBay, the San Jose-based on-line auction site, disclosed today that it had reached an agreement with Wells Fargo Bank and Banc of America Securities to extend its credit limit from $1 billion to $2 billion, with an option to increase it to $3 billion.

According to a securities filing today, the company said it may use the funds for a variety of things, including acquisitions. That would be good news for dozens of companies thinking about IPOs that will be put on hold now that the market has gone south for the summer.