Oracle 2005 Annual Report Download - page 90

Table of Contents
ORACLE CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
May 31, 2006
8. STOCKHOLDERS’ EQUITY
Stock Repurchases
Our Board of Directors has approved a program to repurchase shares of our common stock to reduce the dilutive effect of our stock option and stock purchase
plans. From the inception of the stock repurchase program in 1992 to May 31, 2006, a total of 1.8 billion shares have been repurchased for approximately $20.7
billion. We repurchased 24.1 million shares for $324 million, 114.8 million shares for $1.3 billion and 117.8 million shares for $1.5 billion in fiscal 2006, 2005
and 2004, respectively. At May 31, 2006, approximately $1.6 billion was available to repurchase shares of our common stock pursuant to the stock repurchase
program. In July 2006, the Board expanded the program such that $4.0 billion is available for repurchase under the program.
On January 31, 2006, we announced our plan to repurchase common stock equivalent to the amount of common stock issued in connection with the Siebel
acquisition. Our Board of Directors approved a separate program (2006 Program) to repurchase 140,720,666 shares of our common stock, which is equivalent to
the amount of common stock issued to former Siebel stockholders as of January 31, 2006. We repurchased 122,752,536 shares in the fourth quarter of fiscal 2006
for approximately $1.7 billion. At May 31, 2006, 17,968,130 shares were available for repurchase pursuant to our 2006 Program.
Shareholder Rights Plan
On December 3, 1990, the Board of Directors adopted a Shareholder Rights Plan. The Shareholder Rights Plan was amended and restated on March 31, 1998 and
subsequently amended on March 22, 1999. In connection with the Reorganization, on January 31, 2006, the original Shareholder Rights Plan, as amended, was
replaced by a substantially identical Shareholder Rights Plan. Pursuant to the Shareholder Rights Plan, we distributed Preferred Stock Purchase Rights as a
dividend at the rate of one Right for each share of our common stock held by stockholders of record as of January 31, 2006. The Board of Directors also
authorized the issuance of Rights for each share of common stock issued after the record date, until the occurrence of certain specified events. The Shareholder
Rights Plan was adopted to provide protection to stockholders in the event of an unsolicited attempt to acquire us. As a result of stock splits, each share of
common stock now has associated with it one-sixth of a Right.
The Rights are not exercisable until the earlier of: (1) ten days (or such later date as may be determined by the Board of Directors) following an announcement
that a person or group has acquired beneficial ownership of 15% of our common stock or (2) ten days (or such later date as may be determined by the Board of
Directors) following the announcement of a tender offer which would result in a person or group obtaining beneficial ownership of 15% or more of our
outstanding common stock, subject to certain exceptions (the earlier of such dates being called the Distribution Date). The Rights are initially exercisable for
one-six thousand seven hundred fiftieth of a share of our Series A Junior Participating Preferred Stock at a price of $125 per one-six thousand seven hundred
fiftieth of a share, subject to adjustment. However, if: (1) after the Distribution Date we are acquired in certain types of transactions, or (2) any person or group
(with limited exceptions) acquires beneficial ownership of 15% of our common stock, then holders of Rights (other than the 15% holder) will be entitled to
receive upon exercise of the Right, common stock (or in case we are completely acquired, common stock of the acquirer) having a market value of two times the
exercise price of the Right.
We are entitled to redeem the Rights, for $0.00148 per Right, at the discretion of the Board of Directors, until certain specified times. We may also require the
exchange of Rights, at a rate of one and one-half shares of common stock, for each Right, under certain circumstances. We also have the ability to amend the
Rights, subject to certain limitations.
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Source: ORACLE CORP, 10-K, July 21, 2006 Powered by Morningstar® Document Research℠