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Politics : Formerly About Advanced Micro Devices

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To: Road Walker who wrote (475861)	4/28/2009 1:19:45 PM
From: tejek	Read Replies (1) of 1573331

Things have gone way too far to the dark side in this country's version of capitalism: Chesapeake's (CHK) Reputation Takes Another Hit 4/28/2009 1:10 PM EDT As if the current state of the Nat Gas industry wasn't bad enough (as Jim Cramer pointed out yesterday), Chesapeake's (CHK) reputation just took another hit with the revelation of CEO, Aubrey McClendon's, pay package approved by his cozy board of directors. The pay deal was struck between McClendon and the board in December. Here's a summary of what McClendon receives: a one-time bonus of $75MM, an annual base salary of just under $1MM, $32.7MM in stock grants, and the company's shareholders also generously forked out $12.1MM to McClendon to take some no doubt lovely art work off his hands. (Why trouble yourself with going down to the nearest Oklahoma City pawn shop when your board of directors will give you a more than fair market price for your personal effects?) Keep in mind that CHK's stock dropped 75% last year (after being a star in the first 6 months of the year). And, don't forget that -- two months before this lavish pay package was approved -- Aubrey was forced to sell 31.5MM shares of CHK in October (or almost $700MM worth of stock at the time) due to margin calls. The optics for CHK are terrible. It suggests the board was doing McClendon a favor, after he got margined out of his CHK stake. Shareholders are furious - rightly so. It says this company is run like a small family-owned business, rather than a major public company, which it used to be. You would've given pause to buy CHK after reading Jim's piece yesterday. Now, you have no reason to buy. Position: None.

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