Oracle offers Hurd a huge package

Oracle has offered its new co-president, former Hewlett-Packard chief Mark Hurd, a hiring package with a bonus of up to $10 million and options potentially worth tens of millions more.

Oracle, software maker, named Hurd co-president on Monday, a month after he stepped down from HP because of a scandal involving expense reports and a female contractor.

According to the offer letter, filed on Wednesday with the US Securities and Exchange Commission, Oracle is offering Hurd a starting annual base salary of $950 000 and a bonus of as much as $10 million, plus options to purchase 10 million Oracle common shares after the next board meeting.

Fred Whittlesey, an executive compensation consultant with the Hay Group, said it was difficult to estimate the value of stock options because no one knows where Oracle's share price may go in the future.

Using the valuation of options disclosed by Oracle in its most recent annual report, Whittlesey estimated Hurd's hiring package to be worth about $72 million, with $66 million of that in options that vest over four years.

That estimate, which Whittlesey called "theoretical" and based on accounting rules, would only be realised after four years of service from Hurd and Oracle shares rising to $30.60.

Whittlesey said it was normal for a new executive such as Hurd to have a hiring package larger than what he will receive in future years.

Hurd's offer letter also included a grant to buy an additional five million Oracle common shares each year for the next five years.

At HP, Hurd was one of the technology sector's most well-paid chief executives. He took home roughly $98 million in total compensation from HP over the past three years, including $30 million in fiscal 2009.

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