As Oracle heads into 2009, CEO Larry Ellison has a $13.6 million carrot dangling in front of him.
That's the maximum bonus award the billionaire will be eligible for under the company's 2009 bonus plan, which was approved by shareholders during Oracle's annual meeting last week.
According to a Securities and Exchange Commission filing:
Under the Bonus Plan, participants will be eligible to receive awards based upon the attainment, in fiscal 2009, and certification of, certain performance criteria established by the Compensation Committee. For fiscal 2009:
(a) Mr. Ellison, our Chief Executive Officer; Mr. (Jeff) Henley, our Chairman of the Board; Ms. (Safra) Catz, a President and our Chief Financial Officer; and Mr. (Charles) Phillips, a President, will each receive an award based on Oracle's improvement in its pre-tax profit on a non-GAAP basis from fiscal 2008 to fiscal 2009.
But no matter how Catz, Phillips or any other executives perform under the plan, it is based on a fixed multiple of their target bonus and is less than the maximum $13.6 million Ellison is eligible to receive under the plan.
Such a cap is interesting, considering how little the maximum bonus may serve to motivate Ellison, who topped the Forbes list of the best-paid tech CEOs in 2007, with his $1 million base salary and $182 million in exercised and vested stock options. In 2008, Ellison's compensation package again included a $1 million base salary, but the value of his exercised and vested options was a staggering $543.8 million.