DEF 14A 1 d755300ddef14a.htm DEFINITIVE PROXY STATEMENT Definitive Proxy Statement
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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

SCHEDULE 14A

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Table of Contents

LOGO

 

 

LOGO

September 27, 2019

To our Stockholders:

You are cordially invited to attend the 2019 Annual Meeting of Stockholders of Oracle Corporation. Our Annual Meeting will be held on Tuesday, November 19, 2019, at 10:00 a.m., Pacific Time, in the Oracle Conference Center, located at 350 Oracle Parkway, Redwood City, California.

We describe in detail the actions we expect to take at the Annual Meeting in the following Notice of 2019 Annual Meeting of Stockholders and proxy statement. We have also made available a copy of our Annual Report on Form 10-K for fiscal 2019. We encourage you to read the Form 10-K, which includes information on our operations, products and services, as well as our audited financial statements.

This year, we will again be using the “Notice and Access” method of providing proxy materials to stockholders via the Internet. We believe that this process provides stockholders with a convenient and quick way to access the proxy materials and vote, while allowing us to conserve natural resources and reduce the costs of printing and distributing the proxy materials. We will mail to most of our stockholders a Notice of Internet Availability of Proxy Materials containing instructions on how to access our proxy statement and the Form 10-K and vote electronically via the Internet. This notice will also contain instructions on how to receive a paper copy of the proxy materials. All stockholders who are not sent a notice will be sent a paper copy of the proxy materials by mail or an electronic copy of the proxy materials by email. See “Questions and Answers about the Annual Meeting” beginning on page 66 for more information.

Please use this opportunity to take part in our corporate affairs by voting your shares on the business to come before this meeting. Whether or not you plan to attend the meeting, please vote electronically via the Internet or by telephone, or, if you requested paper copies of the proxy materials, please complete, sign, date and return the accompanying proxy card or voting instruction card in the enclosed postage-paid envelope. See “How Do I Vote?” on page 5 of the proxy statement for more details. Voting electronically, by telephone or by returning your proxy card does NOT deprive you of your right to attend the meeting and to vote your shares in person for the matters acted upon at the meeting. If you cannot attend the meeting in person, we invite you to listen to the meeting via audio webcast by going to www.oracle.com/investor.

 

 

Sincerely,

 

LOGO

 

Lawrence J. Ellison

Chairman and Chief Technology Officer

  

 




Table of Contents

 

LOGO

500 Oracle Parkway

Redwood City, California 94065

 

NOTICE OF 2019 ANNUAL MEETING OF STOCKHOLDERS

 

 

TIME AND DATE

 

10:00 a.m., Pacific Time, on Tuesday, November 19, 2019

PLACE

 

Oracle Conference Center

350 Oracle Parkway

Redwood City, California 94065

LIVE AUDIO WEBCAST

 

Available on our website at www.oracle.com/investor, starting at 10:00 a.m., Pacific Time, on Tuesday, November 19, 2019

ITEMS OF BUSINESS

 

(1)

  

To elect 15 director nominees to serve on the Board of Directors until our 2020 Annual Meeting of Stockholders.

 

(2)

  

To hold an advisory vote to approve the compensation of our named executive officers.

 

(3)

  

To ratify the selection of Ernst & Young LLP as our independent registered public accounting firm for fiscal 2020.

 

(4)

  

To consider and act on two stockholder proposals, if properly presented at the Annual Meeting.

 

(5)

  

To transact such other business as may properly come before the Annual Meeting and any adjournment or postponement thereof.

RECORD DATE

 

September 20, 2019

PROXY VOTING

 

It is important that your shares be represented and voted at the Annual Meeting. You can vote your shares electronically via the Internet, by telephone or by completing and returning the proxy card or voting instruction card if you requested paper proxy materials. Voting instructions are provided in the Notice of Internet Availability of Proxy Materials, or, if you requested printed materials, the instructions are printed on your proxy card and included in the accompanying proxy statement. You can revoke a proxy at any time prior to its exercise at the Annual Meeting by following the instructions in the proxy statement.

MEETING ADMISSION

 

You are entitled to attend the Annual Meeting only if you are a stockholder as of the close of business on September 20, 2019, the record date, or hold a valid proxy for the meeting. In order to be admitted to the Annual Meeting, you must present proof of ownership of Oracle common stock on the record date. This can be a brokerage statement or letter from a bank or broker indicating ownership on September 20, 2019, the Notice of Internet Availability of Proxy Materials, a proxy card, or legal proxy or voting instruction card provided by your broker, bank or nominee. Any holder of a proxy from a stockholder must present the proxy card, properly executed, and a copy of the proof of ownership. Stockholders and proxy holders must also present a form of photo identification such as a driver’s license or passport. We will be unable to admit anyone who does not present identification or refuses to comply with our security procedures.

 

LOGO

 

Brian S. Higgins

Vice President, Associate General Counsel and Secretary

September 27, 2019

 




Table of Contents

TABLE OF CONTENTS

 

Proxy Statement Summary

     1  

How Do I Vote?

     5  

Board of Directors

     6  

Nominees for Directors

     6  

Board Meetings

     12  

Committees, Membership and Meetings

     12  

Director Compensation

     15  

Corporate Governance

     18  

Corporate Governance Guidelines

     18  

Proxy Access and Director Nominations

     19  

Majority Voting Policy

     19  

Prohibition on Speculative Transactions and Pledging Policy

     20  

Board and Committee Performance Evaluations

     20  

Stock Ownership Guidelines for Directors and Senior Officers

     21  

Board Leadership Structure

     21  

Board’s Role in Risk Oversight

     22  

Board of Directors and Director Independence

     22  

Director Tenure, Board Refreshment and Diversity

     23  

Stockholder Outreach

     24  

Communications with the Board

     24  

Employee Matters

     24  

Security Ownership of Certain Beneficial Owners and Management

     25  

Delinquent Section 16(a) Reports

     27  

Executive Compensation

     28  

Compensation Discussion and Analysis

     28  

Report of the Compensation Committee of the Board of Directors

     43  

Fiscal 2019 Summary Compensation Table

     44  

Grants of Plan-Based Awards During Fiscal 2019

     46  

Outstanding Equity Awards at 2019 Fiscal Year-End

     47  

Option Exercises and Stock Vested During Fiscal 2019

     48  

Fiscal 2019 Non-Qualified Deferred Compensation

     49  

Potential Payments Upon Termination or Change in Control

     50  

Equity Compensation Plan Information

     51  

CEO Pay Ratio

     52  

Transactions with Related Persons

     52  

Legal Proceedings

     54  

Management Proposals

     55  

Proposal No. 1: Election of Directors

     55  

Proposal  No. 2: Advisory Vote to Approve the Compensation of our Named Executive Officers

     56  

Proposal  No. 3: Ratification of Selection of Independent Registered Public Accounting Firm

     58  

Report of the Finance and Audit Committee of the Board of Directors

     59  

Stockholder Proposals

     60  

Proposal No. 4: Stockholder Proposal Regarding Pay Equity Report

     60  

Proposal No. 5: Stockholder Proposal Regarding Independent Board Chair

     62  

Stockholder Proposals for the 2020 Annual Meeting

     65  

Questions and Answers about the Annual Meeting

     66  

No Incorporation by Reference

     71  

Other Business

     71  

Householding

     71  

 

2019 Annual Meeting of Stockholders   LOGO


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PROXY STATEMENT SUMMARY

This summary highlights information contained elsewhere in this Proxy Statement. For more complete information about these topics, please review our Annual Report on Form 10-K for fiscal 2019 and the contents of this Proxy Statement. Fiscal 2019 began on June 1, 2018 and ended on May 31, 2019. Fiscal 2020 began on June 1, 2019 and ends on May 31, 2020.

The Notice of Internet Availability of Proxy Materials, this Proxy Statement and the accompanying proxy card or voting instruction card, including an Internet link to our Annual Report on Form 10-K for fiscal 2019, were first made available to stockholders on or about September 27, 2019.

2019 Annual Meeting of Stockholders

 

 

Date and Time

Tuesday, November 19, 2019

10:00 a.m., Pacific Time

 

Place

Oracle Conference Center

350 Oracle Parkway

Redwood City, CA 94065

 

Record Date

September 20, 2019

 

Live Audio Webcast

Available on our website at www.oracle.com/investor, starting at 10:00 a.m., Pacific Time, on Tuesday, November 19, 2019

 

Attendance

You are entitled to attend the Annual Meeting only if you are a stockholder as of the close of business on September 20, 2019, or hold a valid proxy for the meeting. If you plan to attend the Annual Meeting, you will need to provide photo identification, such as a driver’s license or passport, and proof of ownership of Oracle common stock as of September 20, 2019 in order to be admitted to the Annual Meeting. We will be unable to admit anyone who does not present identification or refuses to comply with our security procedures.

 

Voting Roadmap

 

  Agenda Item

 

Board Recommendation

   Page  

    Election of 15 directors

  For Each Nominee      55      

    Advisory vote to approve the compensation of our named executive officers (NEOs)

  For      56      

    Ratification of selection of Ernst & Young LLP as our independent registered public accounting firm for fiscal 2020

  For      58      

    Stockholder proposals

 

  Against

 

    

 

60    

 

 

 

Corporate Governance Highlights

 

   

   LOGO

   Ongoing Board refreshment: 1 new independent director added in 2019, for a total of 5 directors added in the last 6 fiscal years

   LOGO

   Single class of voting stock and no supermajority voting provisions

   LOGO

   Pledging policy adopted in January 2018 with quarterly risk reviews

   LOGO

   Majority of independent directors (10 out of 15) and 100% independent Board committees

   LOGO

   33% of Board members are women or come from a diverse background

   LOGO

   Active stockholder outreach and engagement program

   LOGO

   Annual director elections

   LOGO

   Director majority voting policy

   LOGO

  

Separate Board Chair and Chief Executive Officer (CEO) roles

   LOGO

  

Lead independent director

   LOGO

  

Stockholder proxy access right

   LOGO

  

Annual Board and committee performance evaluations, including individual director interviews

   LOGO

  

Robust director and senior officer stock ownership guidelines

   LOGO

  

Anti-hedging policy applicable to all employees and directors

   LOGO

  

Stockholders representing at least 20% of the outstanding votes have the right to call a special meeting

   LOGO

 

  

Stockholder right to act by written consent



 

2019 Annual Meeting of Stockholders   LOGO   1


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Director Nominees

In Proposal No. 1, we are asking you to vote FOR each of the 15 director nominees listed below. Each director attended at least 75% of all Board meetings and applicable committee meetings during fiscal 2019.

 

  Nominee   Age   Director
Since
  Independent   Current Committees

Jeffrey S. Berg

Chairman of Northside Services, LLC; Former Chairman and CEO, International Creative Management, Inc.

  72   1997  

 

LOGO

 

   Independence (Chair)

   Finance and Audit

   Governance

Michael J. Boskin

Tully M. Friedman Professor of Economics and Wohlford Family Hoover Institution Senior Fellow, Stanford University

  73   1994  

 

LOGO

 

   Finance and Audit (Chair)

Safra A. Catz

CEO, Oracle Corporation

  57   2001  

 

 

 

Bruce R. Chizen*

Senior Adviser to Permira Advisers LLP; Venture Partner, Voyager Capital; Former CEO, Adobe Systems Incorporated

  64   2008  

 

LOGO

 

   Governance (Chair)

   Finance and Audit

George H. Conrades

Executive Advisor and Former Chairman and CEO, Akamai Technologies, Inc.; Managing Partner, Longfellow Venture Partners

  80   2008  

 

LOGO

 

   Compensation (Chair)

   Independence

Lawrence J. Ellison

Chairman, Chief Technology Officer (CTO) and Founder, Oracle Corporation

  75   1977  

 

 

 

Rona A. Fairhead

Former Minister of State, U.K. Department for International Trade; Former Chair of the BBC Trust; Former CEO, Financial Times Group

  58   2019  

 

LOGO

 

 

Hector Garcia-Molina

Leonard Bosack and Sandra Lerner Professor (Emeritus), Departments of Computer Science and Electrical Engineering, Stanford University

  65   2001  

 

LOGO

 

   Independence

Jeffrey O. Henley

Vice Chairman of the Board, Oracle Corporation

  74   1995  

 

 

 

Mark V. Hurd

CEO, Oracle Corporation

  62   2010  

 

 

 

Renée J. James

Chairman and CEO, Ampere Computing LLC; Operating Executive, The Carlyle Group; Former President, Intel Corporation

  55   2015  

 

 

 

Charles W. Moorman IV

Senior Advisor and Former CEO of Amtrak; Former CEO of Norfolk Southern Corporation

  67   2018  

 

LOGO

 

   Compensation

Leon E. Panetta

Co-founder and Chairman, Panetta Institute for Public Policy; Former U.S. Secretary of Defense; Former Director of the Central Intelligence Agency

  81   2015  

 

LOGO

 

   Compensation

   Governance

William G. Parrett

Former CEO of Deloitte Touche Tohmatsu

  74   2018  

 

LOGO

 

   Finance and Audit

Naomi O. Seligman

Senior Partner, Ostriker von Simson, Inc.

  81   2005  

 

LOGO

 

   Compensation (Vice Chair)

                 

 

*

Current lead independent director. See “Corporate Governance—Board Leadership Structure” on page 21 for more information.



 

2   LOGO   2019 Annual Meeting of Stockholders


Table of Contents

Stockholder Outreach and Board Responsiveness

We have a long tradition of engaging with our stockholders to solicit their views on a wide variety of issues, including corporate governance, environmental and social matters, executive compensation and other issues.

Independent Director Engagement. On a regular basis, certain of our independent directors hold meetings with our stockholders. The Board believes these meetings are important because they foster a relationship of accountability between the Board and our stockholders and help us better understand and respond to our stockholders’ priorities and perspectives. Thus far in fiscal 2020, members of the Compensation Committee held meetings with eight institutional stockholders representing approximately 16% of our outstanding unaffiliated shares.

Executive Director Engagement. As part of our regular Investor Relations engagement program, our executive directors hold meetings with a number of our institutional stockholders throughout the year. We also hold an annual financial analyst meeting at Oracle OpenWorld in San Francisco where analysts are invited to hear presentations from key members of our management team, including our executive directors. In fiscal 2019, our executive directors held meetings with stockholders representing approximately 29% of our outstanding unaffiliated shares (all percentages above calculated based on data available as of June 30, 2019).

Board Responsiveness. Below is a summary of the Board’s response to recent feedback received from investors.

 

     

What We Heard

     

 

   The Board’s Response

Add directors to the Board to maintain a mix of new and longer-tenured directors, and focus on recruiting diverse director candidates

  

 

LOGO

  

Board Refreshment and Diversity

 

The Board elected Mrs. Fairhead in July 2019 and has added a total of five new directors in the past six fiscal years. Presently, 33% of our Board members are women or come from a diverse background (four of our 15 Board members are women, including one of our CEOs).

 

The Governance Committee continues to consider potential director candidates on an ongoing basis. The Board’s Corporate Governance Guidelines affirm that the Governance Committee, acting on behalf of the Board, is committed to actively seeking women and minority candidates for the pool from which director candidates are selected.

 

Compensation for top executives should be reduced

  

 

LOGO

  

No Equity Awards Granted to Top Three Executives in Fiscal 2019

 

In fiscal 2019, Mr. Ellison, Ms. Catz and Mr. Hurd received no equity awards. Consequently, the total compensation for each of these executives reported in our Summary Compensation Table on page 44, in the aggregate, decreased by approximately 98% in fiscal 2019 compared to fiscal 2018.

 

Key executives should receive performance-based equity with performance metrics that align with stockholder value

  

 

LOGO

  

100% Performance-Based Equity Granted to Top Three Executives in Fiscal 2018

 

In fiscal 2018, Mr. Ellison, Ms. Catz and Mr. Hurd each received an equity award consisting entirely of performance-based stock options (PSOs) that may be earned only upon the attainment of rigorous stock price, market capitalization and operational performance goals over a five-year performance period. As noted above, no new equity awards were granted to these executives in fiscal 2019.

 

Six of the seven PSO tranches may be earned only if Oracle satisfies a combination of (1) an operational performance goal tied to significant growth of Oracle’s cloud business and (2) a substantial increase in Oracle’s market capitalization. The seventh PSO tranche may be earned only upon significant growth in Oracle’s stock price.

 

Due to the rigor and long-term nature of the PSO goals, none were achieved in fiscal 2018 or 2019, and thus no tranches of the PSOs have been earned to date.

 

When the grant date fair value of the PSOs is annualized over the five-year performance period, it represents a 47% decrease from the value of the fiscal 2017 equity awards granted to each of Mr. Ellison, Ms. Catz and Mr. Hurd. See page 29 for details on the PSOs.

 



 

2019 Annual Meeting of Stockholders   LOGO   3


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Executive Compensation Highlights

 

  No tranches of the PSOs granted to Mr. Ellison, Ms. Catz and Mr. Hurd in fiscal 2018 have been earned, due to the rigor and long-term nature of the PSO goals.

 

  Total compensation for Mr. Ellison, Ms. Catz and Mr. Hurd, in the aggregate, decreased by approximately 98% in fiscal 2019 compared to fiscal 2018 (as reported in the Summary Compensation Table (SCT) on page 44). In fiscal 2019, for these named executive officers (NEOs):

 

  Base salaries remained unchanged;

 

  No bonuses were earned; and

 

  No equity awards were granted.

 

  In the aggregate, approximately 95.2% of the total compensation reported in the SCT in fiscal 2019 for all other NEOs (Mr. Screven, Ms. Daley and Mr. Henley) was at-risk. The total compensation mix for these NEOs is heavily weighted toward equity-based awards, thus aligning their compensation with the interests of our stockholders.

     

 

Fiscal 2019 Named Executive Officers (NEOs)

 

  Lawrence J. Ellison, Chairman and CTO*

 

  Safra A. Catz, CEO

 

  Mark V. Hurd, CEO

 

  Edward Screven, Executive Vice President, Chief Corporate Architect

 

  Dorian E. Daley, Executive Vice President and General Counsel

 

  Jeffrey O. Henley, Vice Chairman

 

*  We have included Mr. Ellison as an NEO for fiscal 2019 on a voluntary basis in the interest of transparency. See page 44 for additional information.

   

 

 

 

Fiscal 2019 Compensation

Mr. Ellison, Ms. Catz and Mr. Hurd

 

Below is an excerpt of our fiscal 2019 SCT showing the total compensation for Mr. Ellison, Ms. Catz and Mr. Hurd. See page 44 for the full SCT and related footnotes.

 

 

 

 

 

 

Fiscal 2019 Compensation

Mr. Screven, Ms. Daley and Mr. Henley

 

LOGO

 
     Name  

Fiscal
Year

 

   

Salary
($)

 

   

All Other
Compensation ($)

 

   

Total ($)

 

        
 

 Lawrence J. Ellison

 

 

2019

 

 

 

1

 

 

 

1,662,827        

 

 

 

1,662,828

 

    
 

 Safra A. Catz

 

 

2019

 

 

 

950,000

 

 

 

15,981        

 

 

 

965,981

 

    
 

 Mark V. Hurd

 

 

2019

 

 

 

950,000

 

 

 

1,531,646        

 

 

 

2,481,646

 

    
                  

Compensation Best Practices

 

LOGO Best Practices We Employ

 

LOGO    High proportion of compensation for our most senior executives is performance-based and at-risk

 

LOGO    Caps on maximum payout of bonuses and performance-based equity awards

 

LOGO    Robust stock ownership guidelines

 

LOGO    Disciplined dilution rates from equity awards

 

LOGO    Compensation recovery (clawback) policy for cash bonuses in the event of a financial restatement

 

LOGO    Annual risk assessment of compensation programs

 

LOGO    Independent compensation consultant and independent compensation committee

 

LOGO    Anti-hedging policy applicable to all employees and directors

 

   

LOGO Practices We Avoid

 

LOGO  No severance benefit arrangements except as provided under our equity incentive plan to employees generally or as required by law

 

LOGO  No single-trigger change in control vesting of equity awards

 

LOGO  No change in control acceleration of performance-based cash bonuses

 

LOGO  No minimum guaranteed vesting for performance-based equity awards

 

LOGO  No discretionary cash bonuses for CEOs and CTO

 

LOGO  No tax gross-ups for NEOs

 

LOGO  No payout or settlement of dividends or dividend equivalents on unvested equity awards

 

LOGO  No supplemental executive retirement plans, executive pensions or excessive retirement benefits

 

LOGO  No repricing, cash-out or exchange of “underwater” stock options without stockholder approval



 

4   LOGO   2019 Annual Meeting of Stockholders


Table of Contents

LOGO

PROXY STATEMENT

We are providing these proxy materials in connection with Oracle Corporation’s 2019 Annual Meeting of Stockholders (the Annual Meeting). The Notice of Internet Availability of Proxy Materials (the Notice), this proxy statement and the accompanying proxy card or voting instruction card, including an Internet link to our most recently filed Annual Report on Form 10-K, were first made available to stockholders on or about September 27, 2019. This proxy statement contains important information for you to consider when deciding how to vote on the matters brought before the Annual Meeting. Please read it carefully.

HOW DO I VOTE?

 

Your vote is important. You may vote on the Internet, by telephone, by mail or by attending the Annual Meeting and voting by ballot, all as described below. The Internet and telephone voting procedures are designed to authenticate stockholders by use of a control number and to allow you to confirm that your instructions have been properly recorded. If you vote by telephone or on the Internet, you do not need to return your proxy card or voting instruction card. Telephone and Internet voting facilities are available now and will be available 24 hours a day until 11:59 p.m., Eastern Time, on November 18, 2019.

Vote on the Internet

If you are a stockholder of record, you may submit your proxy by going to www.voteproxy.com and following the instructions provided in the Notice. If you requested printed proxy materials, you may follow the instructions provided with your proxy materials and on your proxy card. If your shares are held with a broker, you will need to go to the website provided on your Notice or voting instruction card. Have your Notice, proxy card or voting instruction card in hand when you access the voting website. On the Internet voting site, you can confirm that your instructions have been properly recorded. If you vote on the Internet, you can also request electronic delivery of future proxy materials.

Vote by Telephone

If you are a stockholder of record, you can also vote by telephone by dialing 1-800-PROXIES (1-800-776-9437) or 1-718-921-8500. If your shares are held with a broker, you can vote by telephone by dialing the number specified on your voting instruction card. Easy-to-follow voice prompts will allow you to vote your shares and confirm that your instructions have been properly recorded. Have your proxy card or voting instruction card in hand when you call.

Vote by Mail

If you have requested printed proxy materials, you may choose to vote by mail, by marking your proxy card or voting instruction card, dating and signing it, and returning it in the postage-paid envelope provided. If the envelope is missing and you are a stockholder of record, please mail your completed proxy card to American Stock Transfer & Trust Company, LLC, 6201 15th Avenue, Brooklyn, New York 11219. If the envelope is missing and your shares are held with a broker, please mail your completed voting instruction card to the address specified therein. Please allow sufficient time for mailing if you decide to vote by mail.

Please note that if you received a Notice, you cannot vote by marking the Notice and returning it. The Notice provides instructions on how to vote by Internet and how to request paper copies of the proxy materials.

Voting at the Annual Meeting

The method or timing of your vote will not limit your right to vote at the Annual Meeting if you attend the Annual Meeting and vote in person. However, if your shares are held in the name of a bank, broker or other nominee, you must obtain a legal proxy, executed in your favor, from the holder of record to be able to vote at the Annual Meeting. You should allow yourself enough time prior to the Annual Meeting to obtain this proxy from the holder of record.

The shares voted electronically, telephonically, or represented by the proxy cards received, properly marked, dated, signed and not revoked, will be voted at the Annual Meeting.

 

2019 Annual Meeting of Stockholders   LOGO   5


Table of Contents

BOARD OF DIRECTORS

 

Nominees for Directors

Our Board of Directors (the Board) consists of 15 directors, 14 of whom stood for election at our last annual meeting of stockholders. The Board unanimously elected Rona A. Fairhead as a director effective as of July 31, 2019, and Mrs. Fairhead will stand for election at the Annual Meeting along with our other 14 directors. Mrs. Fairhead was identified as a potential director by the Nomination and Governance Committee (the Governance Committee).

Director Qualifications

Our Corporate Governance Guidelines (described in “Corporate Governance—Corporate Governance Guidelines” on page 18) contain Board membership qualifications that apply to Board nominees recommended by the Governance Committee. The Governance Committee strives for a mix of skills, experience and perspectives that will help create an outstanding, dynamic and effective Board. In selecting nominees, the Governance Committee assesses the independence, character and acumen of candidates and endeavors to collectively establish areas of core competency of the Board, including, among others, industry and technical knowledge and experience; management, accounting and finance expertise; and demonstrated business judgment, leadership and strategic vision. The Governance Committee values a diversity of backgrounds, experience, perspectives and leadership in different fields when identifying nominees. As noted in our Corporate Governance Guidelines, the Governance Committee is committed to actively seeking women and minority candidates for the pool from which director candidates are chosen.

The Governance Committee also takes director tenure into consideration when making director nomination decisions and believes that it is desirable to maintain a mix of longer-tenured, experienced directors and newer directors with fresh perspectives. The Governance Committee and the Board also believe that longer-tenured, experienced directors are a significant strength of the Board, given the large size of our company, the breadth of our product offerings and the international scope of our organization. See “Corporate Governance—Director Tenure, Board Refreshment and Diversity” on page 23 for more information.

Below we identify the key experiences, qualifications and skills our director nominees bring to the Board and that the Board considers important in light of Oracle’s businesses and industry.

 

   

Industry Knowledge and Experience. We seek to have directors with experience as executives or directors or in other leadership positions in the particular technology industries in which we compete because our success depends on developing and investing in innovative products and technologies. This experience is critical to the Board’s ability to understand our products and business, assess our competitive position within the technology industry and the strengths and weaknesses of our competitors, maintain awareness of technology trends and innovations, and evaluate potential acquisitions and our acquisition strategy.

 

   

Management, Accounting and Finance Expertise. We believe that an understanding of management practices, accounting and finance processes is important for our directors. We value management experience in our directors as it provides a practical understanding of organizations, processes, strategies, risk management and the methods to drive change and growth that permit the Board to, among other things, identify and recommend improvements to our business operations, sales and marketing approaches and product strategy. We also seek to have at least one independent director who qualifies as an audit committee financial expert, and we expect all of our directors to be financially knowledgeable.

 

   

Business Judgment, Leadership and Strategic Vision. We believe that directors with experience in significant leadership positions are commonly required to demonstrate excellent business judgment, leadership skills and strategic vision. We seek directors with these characteristics as they bring important insights to Board deliberations and processes.

The Board evaluates its own composition in the context of the diverse experiences and perspectives that the directors collectively bring to the boardroom. Their backgrounds provide the Board with vital insights in areas such as:

 

 

Finance and

Accounting

 

 

 

Technology

Industry

 

 

 

Cybersecurity and

Risk Management

 

 

 

Mergers and

Acquisitions

 

 

Operation of

Global Organizations

 

 

 

Computer

Science

 

 

 

Governmental Affairs

and Regulation

 

 

 

Strategic

Transformation

 

 

International Tax and

Monetary Policy

 

 

 

Intellectual

Property

 

 

 

Executive Leadership and

Talent Development

 

 

 

Customer

Perspective

 

 

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The experiences, qualifications and skills of each director that the Board considered in his or her nomination are included below the directors’ individual biographies on the following pages. The Board concluded that each nominee should serve as a director based on the specific experience and attributes listed below and the direct personal knowledge of each nominee’s previous service on the Board, including the insight and collegiality each nominee brings to the Board’s functions and deliberations. The age of each director is provided as of September 20, 2019, the record date for the Annual Meeting.

 

       

Jeffrey S. Berg

               

 

Independent Director

 

Age: 72

Director since 1997

 

Board Committees:

Independence (Chair),

Finance and Audit,

Governance

   

 

Mr. Berg has been an agent in the entertainment industry for over 40 years. Mr. Berg has served as Chairman of Northside Services, LLC, a media and entertainment advisory firm, since May 2015. Mr. Berg was Chairman of Resolution, a talent and literary agency he founded, from January 2013 until April 2015. Between 1985 and 2012, he was the Chairman and CEO of International Creative Management, Inc. (ICM), a talent agency for the entertainment industry. He has served as Co-Chair of California’s Council on Information Technology and was President of the Executive Board of the College of Letters and Sciences at the University of California at Berkeley. He previously served on the Board of Trustees of the Anderson School of Management at the University of California at Los Angeles.

 

Qualifications:    As the former CEO of ICM, Mr. Berg brings to the Board over 25 years of leadership experience running one of the world’s preeminent full service talent agencies in the entertainment industry. Mr. Berg’s prior experience as CEO and as a representative of some of the world’s most well-known celebrities offers the Board a unique perspective with respect to managing a global brand in rapidly changing industries and in management, compensation and operational matters.

   
       

 

       

Michael J. Boskin

               

 

Independent Director

 

Age: 73

Director since 1994

 

Board Committees:

Finance and Audit (Chair)

   

 

Dr. Boskin is the Tully M. Friedman Professor of Economics and Wohlford Family Hoover Institution Senior Fellow at Stanford University, where he has been on the faculty since 1971. He is CEO and President of Boskin & Co., Inc., a consulting firm. He was Chairman of the President’s Council of Economic Advisers from February 1989 until January 1993. Dr. Boskin previously served as a director of Exxon Mobil Corporation.

 

Qualifications:    Dr. Boskin is recognized internationally for his research on world economic growth, tax and budget theory and policy, U.S. saving and consumption patterns and the implications of changing technology and demography on capital, labor, and product markets. He brings to the Board significant economic and financial expertise and provides a unique perspective on a number of challenges faced by Oracle due to its global operations, including, for example, questions regarding international tax and monetary policy, treasury functions, currency exposure and general economic and labor trends and risks. In addition, Dr. Boskin’s experience as CEO of his consultancy firm and as a director of another large, complex global organization provides the Board with important perspectives in its evaluation of Oracle’s practices and processes.

   
       

 

       

Safra A. Catz

               

 

Chief Executive Officer

 

Age: 57

Director since 2001

   

 

Ms. Catz has been our CEO since September 2014. She served as our President from January 2004 to September 2014 and as our Chief Financial Officer (CFO) most recently from April 2011 until September 2014. Ms. Catz was previously our CFO from November 2005 until September 2008 and our Interim CFO from April 2005 until July 2005. Prior to being named President, she held various other positions with us since joining Oracle in 1999. Ms. Catz is currently a director of The Walt Disney Company and previously served as a director of HSBC Holdings plc. She also serves on the U.S. National Security Commission on Artificial Intelligence.

 

Qualifications:    In her current role at Oracle, Ms. Catz is primarily responsible for all operations at Oracle other than product development, sales and marketing, consulting, support and Oracle’s industry-specific global business units. Ms. Catz also leads the execution of our acquisition strategy and integration of acquired companies and products. Our Board benefits from Ms. Catz’s many years with Oracle and her unique expertise regarding Oracle’s strategic vision, management and operations. Prior to joining Oracle, Ms. Catz developed deep technology industry experience as a managing director with the investment banking firm Donaldson, Lufkin & Jenrette from 1986 to 1999 covering the technology industry. With this experience, Ms. Catz brings valuable insight regarding the technology industry generally, and in particular in the execution of our acquisition strategy. In addition, Ms. Catz’s service as a director of other large, complex global organizations provides the Board with important perspectives in its evaluation of Oracle’s practices and processes.

   
       


 

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Bruce R. Chizen

               

 

Independent Director

 

Age: 64

Director since 2008

 

Board Committees:

Governance (Chair),

Finance and Audit

   

 

Mr. Chizen is currently an independent consultant and has served as Senior Adviser to Permira Advisers LLP (Permira), a private equity firm, since July 2008, and as a Venture Partner at Voyager Capital, a venture capital firm, since August 2009. He has also served as an Operating Partner for Permira Growth Opportunities, a private equity fund, since June 2018. From 1994 to 2008, Mr. Chizen served in a number of positions at Adobe Systems Incorporated (Adobe), a provider of design, imaging and publishing software, including CEO (2000 to 2007), President (2000 to 2005), acting CFO (2006 to 2007) and strategic adviser (2007 to 2008). Mr. Chizen currently serves as a director of Synopsys, Inc.

 

Qualifications:    As the former CEO of Adobe, Mr. Chizen brings to the Board first-hand experience in successfully leading and managing a large, complex global organization in the technology industry. In particular, Mr. Chizen’s experience in heading the extension of Adobe’s product leadership provides the Board with perspectives applicable to challenges faced by Oracle. In addition, Mr. Chizen’s current roles at Permira and Voyager Capital require him to be very familiar with companies driven by information technology or intellectual property, which allows him to provide the Board with valuable insights in its deliberations regarding Oracle’s acquisition and product strategies. The Board also benefits from Mr. Chizen’s financial expertise and significant audit and financial reporting knowledge, including his experience as the former acting CFO of Adobe. Mr. Chizen’s service as a director of a large, complex global organization, as well as smaller private companies, provides the Board with important perspectives in its evaluation of Oracle’s practices and processes.

   
       

 

       

George H. Conrades

               

 

Independent Director

 

Age: 80

Director since 2008

 

Board Committees:

Compensation (Chair),

Independence

   

 

Mr. Conrades has served as an Executive Advisor to Akamai Technologies, Inc. (Akamai), a content delivery network services provider for media and software delivery and cloud security solutions, since June 2018. He previously served as Akamai’s CEO from 1999 to 2005 and Chairman from 1999 to March 2018. Mr. Conrades currently serves as Managing Partner at Longfellow Venture Partners, a private venture fund advising and investing in early stage healthcare and technology companies. He also served as a Venture Partner at Polaris Venture Partners, an early stage investment company, from 1998 to 2012 and is currently Partner Emeritus. Mr. Conrades currently serves as a director of Cyclerion, Inc. and previously served as a director of Akamai Technologies, Inc., Ironwood Pharmaceuticals, Inc. and Harley-Davidson, Inc.

 

Qualifications:    As the former CEO of Akamai, Mr. Conrades brings to the Board first-hand experience in successfully leading and managing a large, complex global organization in the technology industry. Mr. Conrades’ experience provides the Board with a perspective applicable to challenges faced by Oracle. In addition, Mr. Conrades’ current role at Longfellow Venture Partners requires him to be very familiar with growth companies, including those driven by information technology or intellectual property, which allows him to provide the Board with valuable insights in its deliberations regarding Oracle’s acquisition and product strategies. Mr. Conrades’ service as a director of large, complex global organizations, as well as smaller private companies, provides the Board with important perspectives in its evaluation of Oracle’s practices and processes.

   
       

 

       

Lawrence J. Ellison

               

 

Chairman, Chief Technology
Officer and Founder

 

Age: 75

Director since 1977

   

 

Mr. Ellison has been our Chairman of the Board and CTO since September 2014. Mr. Ellison served as our CEO from June 1977, when he founded Oracle, until September 2014. He previously served as our Chairman of the Board from May 1995 to January 2004. Mr. Ellison currently serves as a director of Tesla, Inc.

 

Qualifications:    Mr. Ellison is Oracle’s founder and served as our CEO since we commenced operations in June 1977 through September 2014. He is widely regarded as a technology visionary and one of the world’s most successful business executives. Mr. Ellison’s familiarity with and knowledge of our technologies and product offerings are unmatched. He continues to lead and oversee our product engineering, technology development and strategy. For over 40 years he has successfully steered Oracle in new strategic directions in order to adapt to and stay ahead of our competition and changing industry trends. Mr. Ellison is our largest stockholder, beneficially owning approximately 35.4% of the outstanding shares of our common stock, directly aligning his interests with those of our stockholders.

   
       


 

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Rona A. Fairhead

               

 

Independent Director

 

Age: 58

Director since 2019

   

 

Mrs. Fairhead served as Minister of State for Trade and Export Promotion, Department of International Trade in the United Kingdom from September 2017 to May 2019. She previously served as Chair of the British Broadcasting Corporation (BBC) Trust from October 2014 to April 2017. From 2006 to 2013, Mrs. Fairhead was Chair and CEO of the Financial Times Group Limited, which was a division of Pearson plc, and, prior to that, she served as Pearson plc’s CFO. Before joining Pearson plc, Mrs. Fairhead held a variety of leadership positions at Bombardier Inc. and Imperial Chemical Industries plc. Mrs. Fairhead previously served as a director of Pearson plc, HSBC Holdings plc and PepsiCo, Inc.

 

Qualifications:    Mrs.  Fairhead brings to the Board extensive international experience in finance, risk management and global operations gained from her leadership roles at the BBC Trust, the Financial Times Group, Pearson plc and other multinational companies. She also contributes significant expertise in government affairs from her experience as the U.K. Minister of State for Trade and Export Promotion. Mrs. Fairhead also offers her valuable perspectives on risk management resulting from her experiences serving as chair of the risk committee and financial system vulnerabilities committee of HSBC Holdings plc and as chair of the U.K. Government’s Cabinet Office Audit and Risk Committee. In addition, Mrs. Fairhead brings to the Board global marketplace insights and customer perspectives developed through her service on the boards of directors at multinational public companies across multiple industries.

   
       

 

       

Hector Garcia-Molina

               

 

Independent Director

 

Age: 65

Director since 2001

 

Board Committees:

Independence

   

 

Mr. Garcia-Molina has been the Leonard Bosack and Sandra Lerner Professor in the Departments of Computer Science and Electrical Engineering at Stanford University since October 1995 and served as Chairman of the Department of Computer Science from January 2001 to December 2004. He has been a professor at Stanford University since January 1992 and a professor emeritus since January 2018. From August 1994 until December 1997, he was the Director of the Computer Systems Laboratory at Stanford University.

 

Qualifications:    Widely regarded as an expert in computer science, Mr. Garcia-Molina brings to the Board significant technical expertise in the fields of computer science, generally, and database technology, specifically. He is the author of numerous books, journal articles, papers and reports documenting his research on a variety of technology subjects, including distributed computing systems, digital libraries and database systems. Mr. Garcia-Molina is a Fellow of the Association for Computing Machinery and the American Academy of Arts and Sciences and from 1997 to 2001 was a member of the U.S. President’s Information Technology Advisory Committee. He also serves as a Venture Advisor for Onset Ventures and is a member of technical advisory boards of numerous private companies. In these roles, and as a former director of other public companies, Mr. Garcia-Molina has helped oversee the strategy and operations of other technology companies and brings a valuable technical and industry-specific perspective to the Board’s consideration of Oracle’s product strategy, competitive positioning and technology trends.

   
       

 

       

Jeffrey O. Henley

               

 

Vice Chairman

 

Age: 74

Director since 1995

   

 

Mr. Henley has served as our Vice Chairman of the Board since September 2014. Mr. Henley previously served as our Chairman of the Board from January 2004 to September 2014. He served as our Executive Vice President and CFO from March 1991 to July 2004.

 

Qualifications:    Our Board benefits from Mr. Henley’s many years with Oracle and his deep expertise and knowledge regarding our strategic vision, management and operations. Mr. Henley meets regularly with significant Oracle customers and is instrumental in closing major commercial transactions worldwide. This role allows Mr. Henley to remain close to our customers and the technology industry generally. Mr. Henley also brings to the Board significant financial and accounting expertise from his service as our former CFO and in other finance positions prior to joining Oracle.

   
       


 

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Mark V. Hurd

               

 

Chief Executive Officer

 

Age: 62

Director since 2010

   

 

Mr. Hurd has been our CEO since September 2014. On September 11, 2019, Mr. Hurd commenced a leave of absence from his CEO duties to focus on his health. Mr. Hurd served as our President from September 2010 to September 2014. Prior to joining us, he served as Chairman of the Board of Directors of Hewlett-Packard Company from September 2006 to August 2010 and as CEO, President and a member of the Board of Directors of Hewlett-Packard Company from April 2005 to August 2010.

 

Qualifications:    In his role at Oracle, Mr. Hurd is responsible for sales and marketing, consulting, support and Oracle’s industry-specific global business units. Our Board benefits from Mr. Hurd’s insight as he has guided Oracle’s sales and marketing efforts, managed our support and consulting organizations and acted as a primary contact for our customers. As the former CEO of Hewlett-Packard Company and NCR Corporation, Mr. Hurd brings to the Board first-hand experience in successfully leading and managing large, complex global sales, support and consulting organizations in the technology industry. In addition, Mr. Hurd’s prior experience as Chairman of Hewlett-Packard Company’s board and as a director of another large, public company provides the Board with important perspectives in its evaluation of Oracle’s practices and processes.

   
       

 

       

Renée J. James

               

 

Non-Employee Director

 

Age: 55

Director since 2015

   

 

Ms. James is currently the Chairman and CEO of Ampere Computing LLC (Ampere), a company she founded in 2017 that produces high-performance semiconductors for hyperscale cloud, storage, and edge computing. Ms. James also has served as an Operating Executive for The Carlyle Group, a global alternative asset manager, since February 2016. In this role, Ms. James evaluates new technology investments for the firm and advises portfolio companies on their strategic direction and operational efficiency. In January 2016, Ms. James concluded a 28-year career with Intel Corporation (Intel), where she most recently served as President. Ms. James is Chair of the National Security Telecommunications Advisory Committee to the President of the United States. She also serves as a director of Citigroup Inc., Sabre Corporation and Vodafone Group Plc.

 

Qualifications:    As a seasoned technology executive, Ms. James brings to the Board extensive, international experience managing large, complex global operations in the technology industry. In her distinguished career at Intel, Ms. James held a variety of positions in research and development leadership in both software and hardware and the management of global manufacturing. Our Board benefits from the leadership, industry and technical expertise Ms. James acquired at Ampere and Intel and through her service on the boards of public and private companies in the technology and financial services industries. In addition, Ms. James brings to the Board expansive knowledge of cybersecurity gained through the positions she has held at Intel and as Chair of the National Security Telecommunications Advisory Committee to the President of the United States.

   
       

 

       

 Charles W. Moorman IV

               

 

Independent Director

 

Age: 67

Director since 2018

 

Board Committees:

Compensation

   

 

Mr. Moorman is currently a Senior Advisor to Amtrak, where he previously served as President and CEO from August 2016 to January 2018. Mr. Moorman was previously CEO (from 2005 to 2015) and Chairman (from 2006 to 2015) of Norfolk Southern Corporation (Norfolk Southern), a transportation company. From 1975 to 2005, he held various positions in operations, information technology, and human resources at Norfolk Southern. Mr. Moorman serves as a director of Chevron Corporation and Duke Energy Corporation, and previously served as a director of Norfolk Southern.

 

Qualifications:    As the former CEO of Norfolk Southern, Mr. Moorman brings to the Board extensive experience leading and managing the operations of a large, complex Fortune 500 company. Mr. Moorman’s forty-year career with Norfolk Southern included numerous senior management and executive positions requiring expertise in engineering, technology, finance and risk management. Mr. Moorman also brings to the Board significant regulatory expertise and familiarity with environmental affairs gained through his leadership roles at both Amtrak and Norfolk Southern. In addition, Mr. Moorman’s service as a director of other large public companies provides the Board with important perspectives in its evaluation of Oracle’s practices and processes.

   
       


 

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Leon E. Panetta

               

 

Independent Director

 

Age: 81

Director since 2015

 

Board Committees:

Compensation,
Governance

   

 

Secretary Panetta served as U.S. Secretary of Defense from 2011 to 2013 and as Director of the Central Intelligence Agency from 2009 to 2011. Prior to that time, Secretary Panetta was a member of the United States House of Representatives from 1977 to 1993, served as Director of the Office of Management and Budget from 1993 to 1994 and served as President Bill Clinton’s Chief of Staff from 1994 to 1997. He is the co-founder and Chairman of the Panetta Institute for Public Policy and currently serves as moderator of the Leon Panetta Lecture Series, a program he created. Secretary Panetta previously served as Distinguished Scholar to Chancellor Charles B. Reed of the California State University System and professor of public policy at Santa Clara University.

 

Qualifications:    With a distinguished record of public service at the highest levels of government, Secretary Panetta brings to the Board robust, first-hand knowledge of government affairs and public policy issues. Secretary Panetta’s 16 years of experience in the U.S. House of Representatives and service in the administrations of two U.S. Presidents allow him to advise the Board on a wide range of issues related to Oracle’s interactions with governmental entities. In addition, Secretary Panetta’s service as a leader of large and complex government institutions, including the U.S. Department of Defense, the Central Intelligence Agency and the Office of Management and Budget, provides the Board with important perspectives on Oracle’s operational practices and processes, as well as risk management and oversight expertise.

   
       

 

       

William G. Parrett

               

 

Independent Director

 

Age: 74

Director since 2018

 

Board Committees:

Finance and Audit

   

 

Mr. Parrett served as the CEO of Deloitte Touche Tohmatsu, a multinational professional services network, from 2003 until 2007. He joined Deloitte in 1967 and served in a series of roles of increasing responsibility until his retirement in 2007. Mr. Parrett serves as a director of The Blackstone Group L.P. and the Eastman Kodak Company. He previously served as a director of Conduent Inc., Thermo Fisher Scientific Inc., UBS Group AG and iGate Corporation. Mr. Parrett is a Certified Public Accountant with an active license.

 

Qualifications:    As the former CEO of Deloitte Touche Tohmatsu, Mr. Parrett brings to the Board significant experience leading and managing the operations of a large, complex global organization. Mr. Parrett is highly skilled in the fields of auditing, accounting and internal controls, and risk management, and he brings valuable financial expertise to the Board. In addition, Mr. Parrett’s service as a director of other public companies in the technology and financial services sectors provides the Board with important perspectives in its evaluation of Oracle’s practices and processes.

   
       

 

       

Naomi O. Seligman

               

 

Independent Director

 

Age: 81

Director since 2005

 

Board Committees:

Compensation (Vice Chair)

   

 

Ms. Seligman is a senior partner at Ostriker von Simson, Inc., a technology research firm which chairs the CIO Strategy Exchange. Since 1999, this forum has brought together senior executives in four vital quadrants of the IT sector. From 1977 until June 1999, Ms. Seligman served as a co-founder and senior partner of the Research Board, Inc., a private sector institution sponsored by 100 chief information officers from major global corporations. Ms. Seligman previously served as a director of Akamai Technologies, Inc., iGate Corporation and The Dun & Bradstreet Corporation.

 

Qualifications:    As a senior partner at Ostriker von Simson, Inc., a co-partner of the CIO Strategy Exchange, and a co-founder and former senior partner of the Research Board, Inc., Ms. Seligman is recognized as a thought leader in the technology industry. Ms. Seligman also serves as an independent advisor to some of the largest multinational corporations where she helps oversee global strategy and operations, which allows her to provide our Board with important perspectives in its evaluation of Oracle’s practices and processes. The Board also benefits from Ms. Seligman’s unique experience and customer-focused perspective and the valuable insights gained from the senior-level relationships she maintains throughout the technology industry.

   
       


 

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Recommendations of Director Candidates

The Governance Committee will consider all properly submitted candidates recommended by stockholders for Board membership. Our Corporate Governance Guidelines (available on our website at www.oracle.com/goto/corpgov) set forth the Governance Committee’s policy regarding the consideration of all properly submitted candidates recommended by stockholders as well as candidates recommended by current Board members and others.

Any stockholder wishing to recommend a candidate for consideration for nomination by the Governance Committee must provide a written notice to the Corporate Secretary of Oracle at 500 Oracle Parkway, Mailstop 5op7, Redwood City, California 94065, or by email (Corporate_Secretary@oracle.com) with a confirmation copy sent by mail. The written notice must include the candidate’s name, biographical data and qualifications and a written consent from the candidate agreeing to be named as a nominee and to serve as a director if nominated and elected. By following these procedures, a stockholder will have properly submitted a candidate for consideration. However, there is no guarantee that the candidate will be nominated.

Potential director candidates are generally suggested to the Governance Committee by current Board members and stockholders and are evaluated at meetings of the Governance Committee. In evaluating such candidates, every effort is made to complement and strengthen skills within the existing Board. The Governance Committee seeks Board approval of the final candidates recommended by the Governance Committee. The same identifying and evaluating procedures apply to all candidates for director, whether submitted by stockholders or otherwise.

Information regarding procedures for the stockholder submission of director nominations to be considered at our next annual meeting of stockholders may be found in “Corporate Governance—Proxy Access and Director Nominations” on page 19 and “Stockholder Proposals for the 2020 Annual Meeting” on page 65.

Board Meetings

Our business, property and affairs are managed under the direction of the Board. Members of the Board are kept informed of our business through discussions with our Chairman, Vice Chairman, CEOs, General Counsel, Corporate Secretary and other officers and employees, by reviewing materials provided to them, by visiting our offices and by participating in meetings of the Board and its committees.

 

During fiscal 2019, the Board met four times (four regularly scheduled meetings). Each director attended at least 75% of all Board and applicable committee meetings in fiscal 2019. Board members are expected to attend our annual meeting of stockholders, and all of our directors serving on the Board at the time of our last annual meeting of stockholders in November 2018 attended that meeting.

 

Committees, Membership and Meetings

  

Number of Board and Committee Meetings
Fiscal 2019

 

 

LOGO

The current standing committees of the Board are the Finance and Audit Committee (F&A Committee), the Governance Committee, the Compensation Committee and the Committee on Independence Issues (Independence Committee).

 

Each committee reviews its charter at least annually, or more frequently as legislative and regulatory developments and business circumstances warrant. Each of the committees may make additional recommendations to our Board for revision of its charter to reflect evolving best practices. The charters for the F&A, Governance, Compensation and Independence Committees are posted on our website at www.oracle.com/goto/corpgov.

 

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Committee Membership

The table below identifies committee membership as of September 20, 2019, the record date of the Annual Meeting.

 

         
  Director      Finance and Audit      Compensation      Governance      Independence

  Jeffrey S. Berg

     LOGO          

 

     LOGO           LOGO  Chair

  Michael J. Boskin

     LOGO  Chair     

 

    

 

    

 

  Safra A. Catz

    

 

    

 

    

 

    

 

  Bruce R. Chizen

     LOGO          

 

     LOGO  Chair     

 

  George H. Conrades

    

 

     LOGO  Chair     

 

     LOGO     

  Lawrence J. Ellison

    

 

    

 

    

 

    

 

  Rona A. Fairhead

    

 

    

 

    

 

    

 

  Hector Garcia-Molina

    

 

    

 

    

 

     LOGO     

  Jeffrey O. Henley

    

 

    

 

    

 

    

 

  Mark V. Hurd

    

 

    

 

    

 

    

 

  Renée J. James

    

 

    

 

    

 

    

 

  Charles W. Moorman IV

    

 

     LOGO          

 

    

 

  Leon E. Panetta

    

 

     LOGO           LOGO          

 

  William G. Parrett

     LOGO          

 

    

 

    

 

  Naomi O. Seligman

      

 

     LOGO  Vice Chair       

 

      

 

The Board has determined that all directors who served during fiscal 2019 on the Compensation, F&A, Governance and Independence Committees were independent under the applicable New York Stock Exchange (NYSE) listing standards during the periods they served on those committees. The Board has also determined that all directors who served during fiscal 2019 on the Compensation and F&A Committees satisfied the applicable NYSE and U.S. Securities and Exchange Commission (SEC) heightened independence standards for members of compensation and audit committees during the periods they served on those committees. See “Corporate Governance—Board of Directors and Director Independence” on page 22 for more information.

The Finance and Audit Committee

The F&A Committee oversees our accounting and financial reporting processes and the audit and integrity of our financial statements, assists the Board in fulfilling its oversight responsibilities regarding audit, finance, accounting, cybersecurity, tax and legal compliance and risk, and evaluates merger and acquisition transactions and investment transactions proposed by management. In particular, the F&A Committee is responsible for overseeing the engagement, independence, compensation, retention and services of our independent registered public accounting firm. The F&A Committee’s primary responsibilities and duties are to:

 

   

act as an independent and objective party to monitor our financial reporting process and internal control over financial reporting;

 

   

review and appraise the audit efforts of our independent registered public accounting firm;

 

   

receive regular updates from our internal audit department regarding our internal audit plan and compliance with various policies and operational processes across all lines of business;

 

   

evaluate our quarterly financial performance at earnings review meetings;

 

   

oversee management’s establishment and enforcement of financial policies and business practices;

 

   

oversee our compliance with laws and regulations and our Code of Ethics and Business Conduct;

 

   

provide an open avenue of communication between the Board and the independent registered public accounting firm, General Counsel, financial and senior management, Chief Compliance & Ethics Officer and internal audit department;

 

   

review and, if within its delegated range of authority, approve merger and acquisition and financial transactions proposed by our management; and

 

   

produce the Report of the Finance and Audit Committee of the Board, included elsewhere in this proxy statement, as required by SEC rules.

 

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The F&A Committee held executive sessions with our independent registered public accounting firm on four occasions in fiscal 2019. The Board has determined that Dr. Boskin and Mr. Parrett each qualify as an “audit committee financial expert” as defined by SEC rules.

The Compensation Committee

The primary functions of the Compensation Committee are to:

 

   

review and approve all compensation arrangements, including, as applicable, base salaries, bonuses and equity awards, of our CEOs and our other executive officers;

 

   

review and approve non-employee director compensation, subject to ratification by the Board;

 

   

lead the Board in its evaluation of the performance of our CEOs;

 

   

review and discuss the Compensation Discussion and Analysis (CD&A) portion of our proxy statement with management and determine whether to recommend to the Board that the CD&A be included in our proxy statement;

 

   

review the Compensation Committee Report for inclusion in our proxy statement, as required by SEC rules;

 

   

review, approve and administer our stock plans, and approve equity awards to certain participants;

 

   

annually assess the risks associated with our compensation practices, policies and programs applicable to our employees to determine whether such risks are appropriate or reasonably likely to have a material adverse effect on Oracle; and

 

   

oversee our 401(k) Plan Committee and amend the Oracle Corporation 401(k) Savings and Investment Plan (the 401(k) Plan) when appropriate.

The Compensation Committee helps us attract and retain talented executive personnel in a competitive market. In determining any component of executive or director compensation, the Compensation Committee considers the aggregate amounts and mix of all components in its decisions. Our legal department, human resources department and the independent compensation consultant support the Compensation Committee in its work. For additional details regarding the Compensation Committee’s role in determining executive compensation, including its engagement of an independent compensation consultant, refer to “Executive Compensation—Compensation Discussion and Analysis” beginning on page 28. See “Executive Compensation—Compensation Discussion and Analysis—Other Compensation Policies—Equity Awards and Grant Administration” on page 42 for a discussion of the Compensation Committee’s role as the administrator of our stock plans and for a discussion of our policies and practices regarding the grant of our equity awards.

Risk Assessment of Compensation Policies and Practices

The Compensation Committee, in consultation with management and Compensia, Inc., the committee’s independent compensation consultant, has assessed the compensation policies and practices applicable to our executive officers and other employees and concluded that they do not create risks that are reasonably likely to have a material adverse effect on Oracle. The Compensation Committee conducts this assessment annually.

Compensation Committee Interlocks and Insider Participation

No member of the Compensation Committee has ever been an officer or employee of Oracle or of any of our subsidiaries or affiliates. During the last fiscal year, none of our executive officers served on the board of directors or on the compensation committee of any other entity, any officers of which served either on our Board or on our Compensation Committee.

The Nomination and Governance Committee

The Governance Committee has responsibility for monitoring corporate governance matters, including periodically reviewing the composition and performance of the Board and its committees (including reviewing the performance of individual directors), reviewing and assessing the adequacy of our policies, plans and procedures regarding succession planning, and overseeing our Corporate Governance Guidelines. The Governance Committee also considers and recommends qualified candidates for election to the Board.

The Committee on Independence Issues

The Independence Committee is charged with reviewing and approving individual transactions, or a series of related transactions, involving amounts in excess of $120,000 between us (or any of our subsidiaries) and any of our affiliates, such as an executive officer, director or owner of 5% or more of our common stock. The Independence

 

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Committee’s efforts are intended to ensure that each proposed related person transaction is on terms that, when taken as a whole, are fair to us. If any member of the Independence Committee would derive a direct or indirect benefit from a proposed transaction, he or she is excused from the review and approval process with regard to that transaction. The role of the Independence Committee also encompasses monitoring of related person relationships as well as reviewing proposed transactions and other matters for potential conflicts of interest and possible corporate opportunities in accordance with our Global Conflict of Interest Policy. The Independence Committee also evaluates the independence of each non-employee director as defined by NYSE listing standards.

Director Compensation

Highlights

 

   

Annual and initial equity awards capped at a maximum dollar value

 

   

No per-meeting fees

 

   

Emphasis on equity to align director compensation with our stockholders’ long-term interests

 

   

Stockholder-approved limits on equity awards

 

   

No retirement benefits or perquisites

 

   

Robust stock ownership guidelines (see page 21 for details)

Overview

Our directors play a critical role in guiding our strategic direction and overseeing the management of Oracle. Ongoing developments in corporate governance, executive compensation and financial reporting have resulted in increased demand for highly qualified and productive public company directors. In addition, Oracle’s acquisition program and expansion into new lines of business can demand substantial time commitments from our directors.

These considerable time commitments and the many responsibilities and risks of being a director of a public company of Oracle’s size, complexity and profile require that we provide reasonable incentives for our non-employee directors’ continued performance by paying compensation commensurate with their qualifications and significant workload. Our non-employee directors are compensated based on their respective levels of Board participation and responsibilities, including service on Board committees. Our non-employee directors display a high level of commitment and flexibility in their service to Oracle. Several of our directors serve on more than one committee. In addition to engaging with our senior management, our non-employee directors personally attend and participate in important customer and employee events, such as Oracle OpenWorld and Oracle President’s Council forums, and meet with our stockholders throughout the year to better understand their perspectives. Annual cash retainers and equity awards granted to our non-employee directors are intended to correlate with the qualifications, responsibilities and time commitments of each such director.

Our employee directors, Mr. Ellison, Ms. Catz, Mr. Hurd and Mr. Henley, do not receive separate compensation for serving as directors of Oracle.

Cash Retainer Fees for Directors

 

In fiscal 2019, each of our non-employee directors received (1) an annual cash retainer fee of $52,500 for serving as a director of Oracle (prorated for directors who did not serve on the Board for the full fiscal year) and (2) each of the applicable retainer fees set forth in the table to the right for serving as a chair or as a member of one or more of the committees of the Board (prorated for directors who served as chairs or committee members for less than the full fiscal year).

 

Annual Committee Member Retainer Fees

 

    

F&A and Compensation Committees

   $ 25,000  

Governance and Independence Committees

   $ 15,000  

Additional Annual Retainer Fees for Committee Chairs

 

F&A and Compensation Committees

   $ 25,000  

Governance and Independence Committees

   $ 15,000  
 

Effective June 1, 2018, the Board eliminated per-meeting fees.

Annual Equity Grant for Directors

Non-employee directors also participate in our Amended and Restated 1993 Directors’ Stock Plan (the Directors’ Stock Plan), which sets forth stockholder-approved limits on annual equity awards for service on the Board and as a committee chair. The annual equity awards are granted on May 31 of each year. Committee chair equity awards are prorated for chairs who served for less than the full fiscal year.

 

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In fiscal 2018, the Board approved changes to our non-employee director compensation program, including reductions in the size of equity awards. The Board determined that each equity award will be limited to the lesser of the stockholder-approved limits set forth in the Directors’ Stock Plan or a specified maximum dollar value. Below is a summary of the stockholder-approved limits on annual equity awards set forth in the Directors’ Stock Plan, the maximum dollar value limit on annual equity awards effective May 31, 2018 and the number of RSUs actually granted to non-employee directors on May 31, 2019.

 

         
  Grant Type   Stockholder-Approved
Equity Award Limits
  Maximum Dollar
Value Effective
May 31, 2018
  Equity Actually
Granted on
May 31, 2019 (1)
 

% Reduction from

  Stockholder-Approved  

Limits (3)

  Board Annual Grant

  45,000 options (or 11,250 RSUs)     $ 400,000       7,905 RSUs       LOGO     30 %        

  F&A Committee Chair

  45,000 options (or 11,250 RSUs)     $ 200,000       3,952 RSUs       LOGO     65 %

  F&A Committee Vice Chair

  30,000 options (or 7,500 RSUs)              —               —  (2)       LOGO   100 %

  Compensation Committee Chair

  45,000 options (or 11,250 RSUs)     $ 200,000       3,952 RSUs       LOGO     65 %

  Governance Committee Chair

  15,000 options (or 3,750 RSUs)     $  65,000       1,284 RSUs         LOGO     66 %

  Independence Committee Chair

  15,000 options (or 3,750 RSUs)     $  65,000       1,284 RSUs         LOGO     66 %

 

(1)

Calculated by dividing the maximum dollar value by the closing price of Oracle common stock on the date of grant ($50.60 per share), rounding down to the nearest whole share.

 

(2)

The Board eliminated the annual equity award for service as F&A Committee Vice Chair in fiscal 2016.

 

(3)

Percentage reduction in the number of RSUs actually granted on May 31, 2019 compared to stockholder-approved equity award limits.

The Directors’ Stock Plan provides that in lieu of all or some of the stock option limits set forth in the plan, non-employee directors may receive grants of RSUs of an equivalent value, as determined on any reasonable basis by the Board. The Board determined that a ratio of four stock options to one RSU should be used, consistent with its approach for equity awards granted to Oracle employees. The Board determined in April 2016 that all non-employee director equity awards will be delivered in the form of RSUs that vest on the first anniversary of the date of grant.

Initial Equity Grant for New Directors

The Directors’ Stock Plan also provides for an initial equity award of not more than 45,000 stock options (or 11,250 RSUs) for new non-employee directors, prorated based upon the number of full calendar months remaining in the fiscal year of the director’s appointment. In accordance with the reductions to our non-employee director compensation described above, any new non-employee director will receive an initial equity award equal to the lesser of 11,250 RSUs or RSUs with a total value of $400,000 (calculated by dividing the maximum dollar value by the closing price of Oracle common stock on the date of grant, rounding down to the nearest whole share), prorated based upon the number of full calendar months remaining in the fiscal year of the director’s appointment.

Fiscal 2019 Director Compensation Table

The following table provides summary information regarding the compensation we paid to our non-employee directors in fiscal 2019.

 

       

Name (1)

     Fees Earned or
Paid in Cash ($)
     Stock Awards
(2) (3) ($)
     Total ($)    

  Jeffrey S. Berg

         122,500          456,326          578,826    

  Michael J. Boskin

         102,500          588,819          691,319    

  Bruce R. Chizen

         107,500          456,326          563,826    

  George H. Conrades

         117,500          588,819          706,319    

  Hector Garcia-Molina

         67,500          392,562          460,062    

  Renée J. James

         52,500          392,562          445,062    

  Charles W. Moorman IV

         73,288          392,562          465,850    

  Leon E. Panetta

         92,500          392,562          485,062    

  William G. Parrett

         73,288          392,562          465,850    

  Naomi O. Seligman

         77,500          392,562          470,062    

 

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(1)

Rona A. Fairhead joined the Board in fiscal 2020 and therefore received no fiscal 2019 compensation. In fiscal 2020, Mrs. Fairhead will receive Oracle’s standard non-employee director compensation, as described above.

 

(2)

The amounts reported in this column represent the aggregate grant date fair values of RSUs computed in accordance with the Financial Accounting Standards Board’s (FASB) Accounting Standards Codification (ASC) Topic 718, Compensation—Stock Compensation (FASB ASC 718). The non-employee directors have not presently realized a financial benefit from these awards because none of the RSUs granted in fiscal 2019 have vested. For information on the valuation assumptions used in our stock-based compensation computations, see Note 13 to our consolidated financial statements in our Annual Report on Form 10-K for fiscal 2019.

 

(3)

The following table provides additional information concerning the stock awards (in the form of RSUs) and stock options held by our non-employee directors as of the last day of fiscal 2019.

 

       
  Name   Total Unvested RSUs
Outstanding at
Fiscal 2019 Year End  (#)
  RSUs Granted During
Fiscal 2019 (a) (#)
 

Total Option
Awards Outstanding at  

Fiscal 2019 Year End (#)  

   

 

   

 

   

 

   

 

  Jeffrey S. Berg

      9,189       9,189       247,500    

 

 

 

   

 

 

 

   

 

 

 

   

 

 

 

  Michael J. Boskin

      11,857       11,857       450,000    

 

 

 

   

 

 

 

   

 

 

 

   

 

 

 

  Bruce R. Chizen

      9,189       9,189       225,000    

 

 

 

   

 

 

 

   

 

 

 

   

 

 

 

  George H. Conrades

      11,857       11,857       67,500    

 

 

 

   

 

 

 

   

 

 

 

   

 

 

 

  Hector Garcia-Molina

      7,905       7,905       225,000    

 

 

 

   

 

 

 

   

 

 

 

   

 

 

 

  Renée J. James

      8,491       7,905       9,375    

 

 

 

   

 

 

 

   

 

 

 

   

 

 

 

  Charles W. Moorman IV

      7,905       7,905          

 

 

 

   

 

 

 

   

 

 

 

   

 

 

 

  Leon E. Panetta

      7,905       7,905       37,500    

 

 

 

   

 

 

 

   

 

 

 

   

 

 

 

  William G. Parrett

      7,905       7,905          

 

 

 

   

 

 

 

   

 

 

 

   

 

 

 

  Naomi O. Seligman

      7,905       7,905       202,500    

 

 

 

   

 

 

 

   

 

 

 

   

 

 

 

 

  (a)

The RSUs reported in this column were granted on May 31, 2019 and vest on the first anniversary of the date of grant (May 31, 2020).

 

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CORPORATE GOVERNANCE

 

We regularly monitor developments in corporate governance and review our processes and procedures in light of such developments. As part of those efforts, we review federal laws affecting corporate governance, as well as rules adopted by the SEC and NYSE. We believe we have in place corporate governance procedures and practices that are designed to enhance our stockholders’ interests.

Corporate Governance Guidelines

The Board has adopted Corporate Governance Guidelines (the Guidelines), which address the following matters:

 

   

director qualifications;

 

   

director majority voting policy;

&nb