PayPal is ready to give away $25,000 to seven Facebook developers who create innovative applications that utilize the Facebook platform and the PayPal API.  The following is a break down of the awards:

• Grand Prize (1) - $10,000
• Second Prizes (2) – $5,000
• Third Prizes (4) – $2,500

Check out the comments on this Mashable post as their has been some controversy over the rules of the contest, which have just recently been updated (better for the developers).  More about the new terms on AuctionBytes.