Summary
eBay Inc. has filed an 8-K report detailing significant amendments and a settlement agreement related to the sale of its stake in Skype. The company, along with its subsidiaries, entered into Amendment No. 3 to the share purchase agreement with Springboard Group S.a.r.l. to sell the Skype Companies. This amendment reflects a settlement of ongoing litigation involving Joltid Limited, which will transfer its software rights to Skype and end all pending lawsuits upon the transaction's completion.
Key Highlights
- 1eBay entered into Amendment No. 3 to its share purchase agreement for the sale of Skype.
- 2A settlement agreement was executed, resolving litigation with Joltid Limited and its affiliates.
- 3Joltid Limited will transfer all licensed software to the Skype Companies.
- 4The pending litigation by Joltid against eBay and the investor group will be terminated.
- 5eBay's equity stake in the buyer (Springboard Group) at closing will be reduced from approximately 35% to around 30% due to equity issuances related to the settlement.
- 6Marc L. Andreessen, an eBay board member, is a general partner at Andreessen Horowitz, which will own less than 5% of the buyer.
- 7The filing date of the report is November 6, 2009, with the earliest event reported being November 5, 2009.
Frequently Asked Questions
This 8-K filing announces an amendment to eBay's agreement to sell its stake in Skype and a settlement agreement that resolves litigation with Joltid Limited. These actions are key steps towards completing the sale of the Skype Companies.
The settlement agreement leads to a reduction in eBay's equity stake in the buyer, Springboard Group S.a.r.l., at the closing of the Skype sale. eBay's stake will be approximately 30%, down from the previously planned 35%, due to equity issuances by the buyer as part of the settlement.
The settlement agreement requires Joltid Limited to transfer all software previously licensed to the Skype Companies to those companies. In return, Joltid will end all pending litigation against eBay and the investor group involved in the Skype acquisition.
The filing notes that Marc L. Andreessen, a member of eBay's board of directors, is a general partner at Andreessen Horowitz. Andreessen Horowitz is part of the investor group forming the buyer and will own less than 5% of the buyer. This disclosure addresses potential conflicts of interest.