PALO ALTO, Calif. - If Larry Ellison wants to be the world's
richest man, he may get that title sooner rather later.
In lieu of a salary and bonus, the 56-year-old chairman
of software maker Oracle Corp., was
granted options for a whopping 20 million shares during
the next four years as part of a new contract that took
effect in June 1999, according to the company's annual
proxy filing with the Securities and Exchange
His 24% stake in the company he co-founded in
1977 is now worth about US$55.3 billion, more than the
shareholding his arch-rival Bill Gates holds in Microsoft
Corp., a company he co-founded. But Gates
is still the richest man on the planet with a fortune of
more than US$60 billion, according to Forbes magazine.
Oracle said in its filings that the board of directors'
compensation committee agreed to the new contract to
give Ellison further incentive to stay close to Oracle and
boost the company's stock price.
Ellison is back at the helm and firmly in control of
Oracle after periods of what many had called
inattention. Employees sighting him on the corporate
campus in the past took to calling him Elvis for his
infrequent appearances. One money manager who
appeared on CNBC earlier this year commented that he
tended to stay away from Oracle stock when "Larry is
on his boat" and tended to own it when Ellison was on
dry land and at the office.
But that changed in the last couple of years as a
reinvigorated Ellison has seen what the Internet could
do for his company: make its stock-market value higher
than that of the vaunted but now besieged Microsoft.
Investors have richly rewarded Ellison, other Oracle top
executives and employees. The stock has soared
nine-fold in the last two years.
On Tuesday, Oracle shares closed down US$4-1/16 at
US$79-3/4 on Nasdaq.
The recent departure of Oracle's long-time No. 2, Ray
Lane, also showed Ellison's recommitment to Redwood
Shores, Calif.-based Oracle. Lane, in recent interviews,
has said that Ellison stripped him of so many of his
responsibilities there was little left for him to do at the
Lane is now a venture capitalist at Kleiner Perkins
Caufield & Byers in Menlo Park, Calif. His holdings in
Oracle are worth about US$800 million.
In exchange for the options for 20 million shares,
Ellison is giving up an average salary and bonus of US$2.7
million. His strike price on the options is US$13.75 per
share. Normally, Oracle said, Ellison would have
received about 13.6 million shares in a four-year period.
Lane realized a pretax gain of US$230.7 million by
exercising options during the fiscal year ended May 31,
according to the company's proxy statement.
Oracle's top five executives got US$417.5 million pretax
from exercising options last fiscal year. Ellison made
US$75 million, Jeff Henley, chief financial officer, collected
US$76 million, Gary Bloom, executive vice president, got
US$20.5 million and Jay Nussbaum, executive vice
president, collected $15 million.
Ellison was paid US$208,000 in salary before the new
contract went into effect in June 1999.