Oracle Corp. plans to pay newly appointed co-President Mark Hurd a base salary of $950,000 annually and said the ousted Hewlett-Packard Co. CEO is eligible for a target bonus of $5 million in the current fiscal year.
Oracle released the details of Hurd's pay package in a filing with the Securities and Exchange Commission on Wednesday.
Hurd's pay package includes stock options totaling 10 million shares. The company said Hurd's options will carry an exercise price equal to the market value of the shares on the date they are granted, which the filing did not specify. If he stays with the company, Hurd will be awarded options to buy another 5 million shares each year for the next five years.
Oracle said Hurd's bonus for fiscal 2011, which ends in May, is targeted at $5 million but could reach $10 million. The company did not specify the conditions under which the bonuses would be awarded.
The new package will come on top of a severance payment from HP that could end up topping $40 million.
Hurd resigned as HP's CEO last month following an investigation that uncovered inaccurate expense reports related to Hurd's outings with an HP contractor who claimed that her work at HP dried up after she rebuffed Hurd's advances. Hurd has denied making any advances on the woman and has insisted he didn't prepare his own expense reports.
Oracle named Hurd as its co-president on Monday, but HP sued Hurd a day later to block him from joining Oracle. HP is worried Hurd will use his knowledge of the company to give Oracle an unfair advantage. Lawsuits of that kind often end with a court ordering an executive to avoid certain parts of their employers' businesses. The lawsuit could also delay when Hurd can actually start work at Oracle.
Hurd's move to Oracle has injected new friction into Oracle's relationship with HP. The two companies have cooperated for years, with HP selling corporate servers and Oracle providing the software that helps organize the information stored on them. But Oracle, which is based in Redwood City, California, moved into direct competition with HP in the hardware business when it bought Sun Microsystems for $7.4 billion last year.
HP's interim chief said Wednesday the company's 25-year alliance with Oracle has been "strained" by the dispute over Oracle's hiring of Hurd.
Speaking at a technology conference in New York, Cathie Lesjak said Hurd needs to be "reminded" that he signed agreements to keep HP's trade secrets and other confidential information secret. She says that's why HP is suing to stop him from working at Oracle.
The lawsuit against Hurd is working its way through a California court. Lesjak says she expects HP and Oracle to "go back to being good partners" when the dispute over Hurd is resolved.
Oracle has not been shy about handing out big salaries and bonuses.
In the fiscal year that ended in May, the company awarded its other co-president, Safra Catz, a salary of $800,000, a performance-related bonus of $3.9 million and stock options valued at $31.7 million.
Founder and CEO Larry Ellison, among the world's richest people, drew a pay package worth roughly $70 million, according to an Associated Press analysis of Oracle's securities filings. It consisted of a base salary of $250,000, a performance-based bonus of $6.5 million, stock options valued at $61.9 million and other perks totaling $1.5 million.
Hurd's pay at HP did not quite reach that magnitude. During HP's most recent fiscal year, Hurd was awarded a pay package as CEO valued at $24.2 million, according to an AP analysis. His base pay came to $1.3 million, with bonuses totaling $15.8 million and restricted stock valued at $6.6 million.
