A Warning About eBay's Options 'Giveaway'

Internet auctioneer eBay(EBAY Quote) is coasting toward next week's shareholder meeting with its shares near their 52-week high -- and with key support for a plan to expand by 50% the number of stock options the company can give managers and employees.

But not everyone is signing off on eBay's proposal to sweeten significantly what is already one of the most generous options plans in the industry. At least one independent reviewer says that eBay's plan will lead to an excessive annual giveaway worth four times as much as the company's net income last year.

That's the opinion of newcomer proxy-advisory firm Glass Lewis. The firm, which recently enlisted former top SEC accountant Lynn Turner and signed the country's biggest public pension fund as a client, described eBay's options practices as "beyond the pale." ...