Starter Kit Loan and Security Agreement - Imperial Bank and eBay Inc.


                                 IMPERIAL BANK
                                 -------------
                          INNOVATIVE BUSINESS BANKING

                    STARTER KIT LOAN AND SECURITY AGREEMENT

Borrower:  eBay, Inc.             Address:  2005 Hamilton Ave., Suite 270
          -----------                       --------------------------------

Date:   July 20, 1997                       San Jose, CA 95125
      -----------------                     ------------------

THIS LOAN AND SECURITY AGREEMENT ('Agreement') is made and entered into on the
above date between IMPERIAL BANK ('Bank'), whose address is 226 Airport Parkway,
                                                            --------------------
San Jose, CA  95110 and the party(ies) named above (jointly and severally,
-------------------                                                       
'Borrower'), whose chief executive office is located at the above address
('Borrower's Address').

1.   LOANS. Bank will make loans to Borrower (the 'Loans') in amounts determined
by Bank in its reasonable business judgment up to the amount (the 'Credit
Limit') shown on the Schedule to this Agreement (the 'Schedule'), provided no
Event of Default and no event which, with notice or passage of time or both,
would constitute an Event of Default is occurring or has occurred. All Loans and
other monetary Obligations will bear interest at the rate shown on the Schedule.
Interest will be payable monthly, on the date shown on the monthly billing from
Bank. Bank may, in its discretion, charge Borrower's deposit accounts maintained
with Bank for any amounts coming due under this Agreement.

2.   SECURITY INTEREST. As security for all present and future indebtedness,
guarantees, liabilities, and other obligations, of Borrower to Bank
(collectively, the 'Obligations'), Borrower hereby grants Bank a continuing
security interest in all of Borrower's right title and interest in and to any
property now or hereafter described in a security agreement executed by Borrower
to Bank as well as the following types of property, whether now owned or
hereafter acquired, and wherever located (collectively, the 'Collateral'): All
'accounts', 'general intangibles,' 'chattel paper,' 'documents,' 'letters of
credit,' 'instruments,' 'deposit accounts,' 'inventory,' 'farm products,'
'fixtures' and 'equipment,' as such terms are defined in Division 9 of the
California Uniform Commercial Code in effect on the date hereof, and all
products, proceeds and insurance proceeds of the foregoing.

3.   REPRESENTATIONS AND AGREEMENTS OF BORROWER. Borrower represents to Bank as
follows, and Borrower agrees that the following representations will continue to
be true, and that Borrower will comply with all of the following agreements
throughout the term of this Agreement.

3.1  CORPORATE EXISTENCE AND AUTHORITY. Borrower, if a corporation, is and will
continue to be, duly authorized, validly existing and in good standing under the
laws of the jurisdiction of its incorporation. The execution, delivery and
performance by Borrower of this Agreement, and all other documents contemplated
hereby have been 

 
duly and validly authorized, and do not violate any law or any provision of and
are not grounds for acceleration under, any agreement or instrument which is
binding upon Borrower.

3.2  NAME: PLACE OF BUSINESS. The name of Borrower set forth in this Agreement
is its correct name. Borrower shall give Bank 15 days prior written notice
before changing its name. The address set forth in the heading to this Agreement
is Borrower's chief executive office. In addition, Borrower has places of
business and Collateral is located only at the locations set forth on the
Schedule. Borrower will give Bank at least 15 days prior written notice before
changing its chief executive office or locating the Collateral at any other
location.

3.3  COLLATERAL. Bank has and will at all times continue to have a first-
priority perfected security interest in all of the Collateral (including
intellectual property) other than specific equipment identified in existing
filed or to be filed Financing Statements. Borrower will immediately advise Bank
in writing of any material loss or damage to the Collateral.

3.4  FINANCIAL CONDITION AND STATEMENTS. All financial statements now or in the
future delivered to Bank have been, and will be prepared in conformity with
generally accepted accounting principles. Since the last date covered by any
such statement, there has been no material adverse change in the financial
condition or business of Borrower. Borrower will provide Bank: (i) within 30
days after the end of each month, a monthly financial statement prepared by
Borrower, and such other information as Bank shall reasonably request: (ii)
within 90 days following the end of Borrower's fiscal year, complete annual
financial statements, certified by independent certified public accountants
acceptable to Bank and accompanied by the unqualified report thereon by said
independent certified public accountants; and (iii) other financial information
reasonably requested by Bank from time to time.

3.5  TAXES: COMPLIANCE WITH LAW. Borrower has filed, and will file, when due,
all tax returns and reports required by applicable law, and Borrower has paid,
and will pay, when due, all taxes, assessments, deposits and contributions now
or in the future owed by Borrower. Borrower has complied, and will comply, in
all material respects, with all applicable laws, rules and regulations.

3.6  INSURANCE. Borrower will at all times adequately insure all of the tangible
personal property Collateral and carry such other business insurance as is
customary in Borrower's industry, with Bank named as Loss Payee.

3.7  ACCESS TO COLLATERAL AND BOOKS AND RECORDS. At reasonable times, on one
business day's notice, Bank or its agents, shall have the right to inspect the
Collateral, and the right to audit and copy Borrower's books and records.

 
3.8   BANKING RELATIONSHIP AND OPERATING ACCOUNTS. Borrower shall maintain its
primary operating deposit accounts with Bank. Borrower shall at all times
maintain its primary banking relationship with Bank.

3.9   ADDITIONAL AGREEMENTS. Borrower shall not, without Bank's prior written
consent, such consent not to be unreasonably withheld, do any of the following:
(i) enter into any transaction outside the ordinary course of business except
for the sale of capital stock to venture investors, provided that Borrower
promptly delivers written notification to Bank of any such stock sale; (ii) sell
or transfer any Collateral, except in the ordinary course of business; (iii) pay
or declare any dividends on Borrower's stock (except for dividends payable
solely in stock of Borrower); (iv) redeem, retire, purchase or otherwise
acquire, directly or indirectly, any of Borrower's stock other than the
repurchase of up to five percent (5%) of Borrower's then issued stock in any
fiscal year from Borrower's employees or directors pursuant to written
agreements with Borrower; (v) incur additional borrowed moneys other than
indebtedness fully subordinated to the debt due to Bank, and equipment leases;
(vi) merge, liquidate a substantial portion of its assets, or acquire other
assets other than in the normal course of business; or (vi) merge, liquidate a
substantial portion of its assets, or acquire other assets other than in the
normal course of business; or (vii) make loans, investments, or advances to
outside parties other than in the normal course of business except in connection
with Board-approved employee stock purchase plans.

3.10  NOTICE OF LEGAL PROCEEDINGS. Borrower will notify Bank in writing of any
legal action commenced against it which may result in damages over $50,000.

4.    TERM. This Agreement shall continue in effect until the maturity date set
forth on the Schedule (the 'Maturity Date'). This Agreement may be terminated,
without penalty, prior to the Maturity Date as follows: (i) by Borrower,
effective three business days after written notice of termination is given to
Bank; or (ii) by Bank at any time after the occurrence of an Event of Default,
without notice, effective immediately. On the Maturity Date or on any earlier
effective date of termination, Borrower shall pay all Obligations in full,
whether or not such Obligations are otherwise then due and payable. No
termination shall in any way affect or impair any security interest or other
right or remedy of Bank, nor shall any such termination relieve Borrower of any
Obligation to Bank, until all of the Obligations have been paid and performed in
full.

5.    EVENTS OF DEFAULT AND REMEDIES. The occurrence of any of the following
events shall constitute an 'Event of Default' under this Agreement: (a) Any
representation, statement, report or certificate given to Bank by Borrower or
any of its officers, employees or agents, now or in the future, is untrue or
misleading in a material respect; or (b) Borrower fails to pay when due any Loan
or any interest thereon or any other monetary Obligation; or (c) the total
Obligations outstanding at any time exceed the Credit Limit or (d) Borrower
fails to perform any other non-monetary Obligation, which failure is not cured
within 10 business days after the date due; or (e) Dissolution, termination of
existence, insolvency or business failure of Borrower or appointment of a

 
receiver, trustee or custodian, for all or any part of the property of
assignment for the benefit of creditors by, or the commencement of any
proceeding by or against Borrower under any reorganization, bankruptcy,
insolvency, arrangement, readjustment of debt, dissolution or liquidation law or
statute of any jurisdiction, now or in the future in effect; or (f) a material
adverse change in the business, operations, or financial or other condition of
Borrower. If an Event of Default occurs, Bank, shall have the right to
accelerate and declare all of the Obligations to be immediately due and payable,
increase the interest rate by an additional five percent per annum, and exercise
all rights and remedies recorded by applicable law. If any interest payment,
principal payment or principal balance payment due from Borrower is delinquent
ten or more days, Borrower agrees to pay Bank a late charge in the amount of 5%
of the payment so due and unpaid, in addition to the payment, but nothing in
this provision is to be construed as any obligation on the part of Bank to
accept payment of any payment past due or less than the total unpaid principal
balance after maturity. All payments shall be applied first to any late charges
owing, then to interest and the remainder, if any, to principal.

6.   GENERAL. If any provision of this Agreement is held to be unenforceable,
the remainder of this Agreement shall still continue in full force and effect.
This Agreement and any other written agreements, documents and instruments
executed in connection herewith are the complete agreement between Borrower and
Bank and supersede all prior and contemporaneous negotiations and oral
representations and agreements, all of which are merged and integrated in this
Agreement. There are no oral understandings, representations or agreements
between the parties which are not in this Agreement or in other written
agreements signed by the parties in connection this Agreement. The failure of
Bank at any time to require Borrower to comply strictly with any of the
provisions of this Agreement. The failure of Bank at any time to require
Borrower to comply strictly with any of the provisions of this Agreement shall
not waive Bank's right later to demand and receive strict compliance. Any waiver
of a default shall not waive any other default. None of the provisions of this
Agreement may be waived except by a specific written waiver signed by an officer
of Bank and delivered to Borrower. The provisions of this Agreement may not be
amended, except in a writing signed by Borrower and Bank. Borrower shall
reimburse Bank for all reasonable attorney's fees and all other reasonable costs
incurred by Bank, in connection with this Agreement (whether or not a lawsuit is
filed) including any post petition bankruptcy activities. If Bank or Borrower
files any lawsuit against the other predicated on a breach of this Agreement,
the prevailing party shall be entitled to recover its reasonable costs and
attorney's fees from the non-prevailing party. Borrower may not assign any
rights under this Agreement without Bank's prior written consent. This Agreement
shall be governed by the laws of the State of California to the jurisdiction of
whose courts Borrower hereby agrees to submit.

7.   MUTUAL WAIVER OF JURY TRAIL. BORROWER AND BANK EACH HEREBY WAIVE THE RIGHT
TO TRIAL BY JURY IN ANY ACTION OR PROCEEDING BASED UPON, ARISING OUT OF, OR IN
ANY WAY RELATING TO, THIS AGREEMENT OR ANY CONDUCT, ACT OR OMISSION OF BANK OR

 
BORROWER OR ANY OR THEIR DIRECTORS, OFFICERS, EMPLOYEES, AGENTS, ATTORNEYS OR
AFFILIATES.

8.   REFERENCE PROCEEDINGS. a. Each controversy, dispute or claim ('Claim')
between the parties arising out of or relating to this Agreement, which is not
settled in writing within ten days after the 'Claim Date' (defined as the date
on which a party gives written notice to all other parties that a controversy,
dispute or claim exists), will be settled by a reference proceeding in Los
Angeles, California in accordance with the provisions of Section 63B et seq. of
                                                                     -- ---
the California Code of Civil Procedure, or their successor section ('CCP'),
which shall constitute the exclusive remedy for the settlement of any Claim,
including whether such Claim is subject to the reference proceeding and the
parties waive their rights to initiate any legal proceedings against each other
in any court or jurisdiction other than the Superior Court of Los Angeles (the
'Court'). The referee shall be a retired Judge selected by mutual agreement of
the parties, and if they cannot so agree within thirty days after the Claim
Date, the referee shall be selected by the Presiding Judge of the Court. The
referee shall be appointed to sit as a temporary judge, as authorized by law.
The referee shall (a) be requested to set the matter for hearing within sixty
(60) days after the Claim Date and (b) try any and all issues of law or fact and
report a statement of decision upon them, if possible, within ninety (90) days
of the Claim Date. Any decision rendered by the referee will be final, binding
and conclusive and judgment shall entered pursuant to CCP 644 in the Court. All
discovery permitted by this Agreement shall be completed no later than fifteen
(15) days before the first hearing date established by the referee. The referee
may extend such period in the event of a party's refusal to provide requested
discovery for any reason whatsoever, including, without limitation, legal
objections raised to such discovery or unavailability of a witness due to
absence or illness. No party shall be entitled to 'priority' in conducting
discovery. Depositions may be taken by either party upon seven (7) days written
notice, and, request for production or inspection of documents shall be
responded to within ten (10) days after service. All disputes relating to
discovery which cannot be resolved by the parties shall be submitted to the
referee whose decision shall be final and binding upon the parties.

b.   The referee shall be required to determine all issues in accordance with
existing case law and the statutory laws of the State of California. The rules
of evidence applicable to proceedings at law in the State of California will be
applicable to the reference proceeding. The referee shall be empowered to enter
equitable as well as legal relief, to provide all temporary and/or provisional
remedies and to enter equitable orders that will be binding upon the parties.
The referee shall issue a single judgment at the close of the reference
proceeding which shall dispose of all of the claims of the parties that are the
subject of the reference. The parties hereto expressly reserve the right to
contest or appeal from the final judgment or any appealable order or appealable
judgment entered by the referee. The parties expressly reserve the right to
findings of fact, conclusions of law, a written statement of decision, and the
right to move for a new trail or a different judgment, which new trial, if
granted, is also to be a reference proceeding under this provision.

 
Borrower:                             Bank:

eBay, Inc.                            IMPERIAL BANK
------------------------------                                         

By:  /s/ PIERRE OMIDYAR               By:  /s/ D. SOUSA
     -------------------------             ---------------------------
         CEO

By:  /s/ J. SKOLL                     Title:  AVP
     -------------------------                ------------------------
         President

 
                                 IMPERIAL BANK
                                 -------------
                          INNOVATIVE BUSINESS BANKING

          Master Schedule to Starter Kit Loan and Security Agreement

BORROWER:                 eBay, Inc.
                       -----------------

DATE:                     July 20, 1997
                       ---------------------

     This Schedule is incorporated into and an integral part of the Starter Kit
Loan and Security Agreement between Imperial Bank ('Bank') and the above-named
Borrower of even date.

 
                             
CREDIT LIMIT (AGGREGATE)     $750,000 (includes, without limitation, Equipment Advances
(Section 1):                 and the Letter of Credit Reserve, if any).
 
INTEREST RATE (Section 1):   The rate equal to Bank's Prime Rate in effect from time to
                             time, plus 1.25% per year.  Interest shall be calculated
                             on the basis of a 360 day year for the actual number of
                             days elapsed.  The Prime Rate shall be the rate announced
                             from time to time by Bank as its 'Prime Rate;' as a base
                             rate upon which other rates charged by Bank are based, and
                             it is not necessarily the best rate available at Bank.
                             The interest rate applicable to the Obligations shall
                             change on each date there is a change in the Prime Rate.

MATURITY DATE (Section 4):   January 5, 1999.

OTHER LOCATIONS AND          ________________________________________________
ADDRESSES                    ________________________________________________
(Section 3.2):               ________________________________________________
                             ________________________________________________ 

OTHER AGREEMENTS:            1.  LOAN FEE.  Borrower shall concurrently pay Bank a
                             non-refundable Loan Fee in the amount of $3,000.

                             2. RECEIPT OF EQUITY. As a condition to any
                             advances and prior to funding, Borrower shall
                             provide Bank with evidence of receipt of not less
                             than $3,000,000 in new equity from investor(s)
                             acceptable to Bank.


 
Borrower:                             Bank:

eBay, Inc.                            IMPERIAL BANK
-----------------------------                                         

By:  /s/ PIERRE OMIDYAR               By:  /s/ D. SOUSA
     ------------------                    ------------------------
         CEO

By:  /s/ J. SKOLL                     Title:  AVP
     ------------------                       ---------------------
         President

 
                                 IMPERIAL BANK
                                 -------------
                          INNOVATIVE BUSINESS BANKING

    SCHEDULE TO STARTER KIT LOAN AND SECURITY AGREEMENT (EQUIPMENT ADVANCES)

BORROWER:     eBay, Inc.
            -------------------------

DATE:         July 20, 1997
            -------------------------

     This Schedule is an integral part of the Loan and Security Agreement
between Imperial Bank ('Bank') and the above-named Borrower of even date.

CREDIT LIMIT           $750,000 (such amount to be funded under the aggregate
(EQUIPMENT)            Credit Limit). Equipment Advances will be made only on or
(Section 1):           prior to January 5, 1998 (the 'Last Advance Date') and
                       only for the purpose of purchasing equipment reasonably
                       acceptable to Bank. Borrower must provide invoices for
                       the equipment to Bank on or before the Last Advance Date.
                        
INTEREST RATE          The rate equal to Bank's Prime Rate in effect from time
(Section 1):           to time, plus 1.25% per annum. Interest shall be
                       calculated on the basis of a 360 day year for the actual
                       number of days elapsed. The Prime Rate shall be the rate
                       announced from time to time by Bank as its 'Prime Rate;'
                       as a base rate upon which other rates charged by Bank are
                       based, and it is not necessarily the best rate available
                       at Bank. The interest rate applicable to the Obligations
                       shall change on each date there is a change in the Prime
                       Rate.
 
MATURITY DATE          After the Last Advance Date, the unpaid principal balance
(Section 4):           of the Equipment Advances shall be repaid in 24 equal
                       monthly installments of principal, plus interest,
                       commencing on February 5, 1998 and continuing on the same
                       day of each month thereafter until the entire unpaid
                       principal balance of the Equipment Advances and all
                       accrued unpaid interest have been paid (subject to Bank's
                       right to accelerate the Equipment Advances on an Event of
                       Default).

Borrower:                          Bank:

eBay, Inc.                         IMPERIAL BANK
-------------------------
By:  /s/ PIERRE OMIDYAR            By:  /s/ D. SOUSA
     --------------------              ________________________
        CEO

By:  /s/ J. SKOLL                  Title:  AVP
     --------------------                  ---------------------
        President



 
                                 IMPERIAL BANK
                                 -------------
                          INNOVATIVE BUSINESS BANKING

SCHEDULE TO STARTER KIT LOAN AND SECURITY AGREEMENT (LETTERS OF CREDIT SUBLIMIT)

BORROWER:     eBay, Inc.
             ----------------

DATE:         July 20, 1997
             -------------------

     This Schedule is an integral part of the Loan and Security Agreement
between Imperial Bank ('Bank') and the above-named Borrower of even date.


                      
LETTERS OF CREDIT        The aggregate Credit Limit Shall be reduced by an amount equal
Sublimit (Section        to $205,000 (the 'Letter of Credit Reserve'). Bank may, in its
 1):                     sole discretion, advance as Loans, any amounts that may become
                         due or owing to Bank in connection with letter of credit
                         services furnished to Borrower by or through Bank (the 'Letter
                         of Credit Services').  Borrower shall execute all standard form
                         applications and agreements of Bank in connection with the
                         Letter of Credit Services and, without limiting any of the
                         terms of such applications and agreements, Borrower will pay
                         all standard fees and charges of Bank in connection with the
                         Letter of Credit Services and, without limiting any of the
                         terms of such applications and agreements, Borrower will pay
                         all standard fees and charges of Bank in connection with the
                         Letter of Credit Services.
                                                        
MATURITY DATE            January 5, 1999.
(Section 4):
 

Borrower:                               Bank:

eBay, Inc.                              IMPERIAL BANK
----------------------                                         

By:  /s/ PIERRE OMIDYAR                 By:  /s/ D. SOUSA
     ------------------                      --------------------
       CEO

By:  /s/ J. SKOLL                       Title:  AVP
     ------------                             --------------------
       President