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Technology Stocks : Oracle Corporation (ORCL)

ORCL 213.94

-5.2%

2:07 PM EST

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To: Still Rolling who wrote (5069)	1/16/1998 7:37:00 PM
From: Maverick	Read Replies (2) of 19079

EMPLOYEES at Oracle Corp. (Nasdaq, ORCL) aren't fully sharing with other investors the pain of the sudden plunge last month in the software company's stock. In December, Oracle reduced the exercise price of about 20 percent of its outstanding stock options. That means employees who received options to buy stock between April and November -- when Oracle's shares fluctuated between $23.50 and $41.13 -- are catching a big break. When their options become eligible, some employees will be able to buy stock for the market price on the day last month the options were re-priced, likely less than $23. Option re-pricing is common when a company's stock drops. But just because it's not unusual doesn't mean investors like it. ''If we buy a stock for our clients and it drops 50 percent, who's going to re-price it for our clients?'' grouses Huachen Chen, who co-manages Dresdner RCM Capital Management LLC's Global Technology Fund in San Francisco. ''It's not fair. (But) it's life.'' In a filing with the Securities and Exchange Commission, Oracle explains that the re-pricing is ''an effort to retain employees.'' Elaborates an Oracle spokeswoman: ''We feel this is an opportunity to keep people's eyes on the ball.'' It is the first time Oracle has re-priced stock options, she says. Oracle's December re-pricing was not aimed at the executive suite; officers and directors were excluded from the goodie. In early December, Oracle announced disappointing earnings for its second fiscal quarter and revealed frustratingly slower growth in its key database software. The stock plummeted 29 percent Dec. 9 to $22.94 and hasn't recovered, contrary to the hopes of investors who reckoned such a solid company's stock suddenly was inexpensive. Oracle stock closed Thursday down 31 cents at $19.25. BY ADAM LASHINSKY Mercury News Staff Writer

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