Chesapeake's CEO Aubrey McClendon departure deal released
BY Staff Reports
Friday, February 01, 2013
2/01/13 at 7:10 AM
Chesapeake Energy Corp. offered details Thursday on how much it will pay CEO and founder Aubrey McClendon to leave the company.
Since McClendon's departure will be treated as a termination without cause, he will receive his annual base salary and bonus of $975,000 and $1.95 million, respectively, over the remaining four years of his employment contract, according to a federal filing.
McClendon will retire as CEO, president and a director by April 1, or earlier, if a successor is found that quickly, the document said.
Sources have said McClendon also will walk away with $34 million in accelerated vesting of restricted stock that he was awarded previously, but that was not addressed in Thursday's Securities and Exchange commission filing.
McClendon, 53, was perhaps best-known for his eyebrow-raising compensation over the years at Oklahoma City-based Chesapeake.
McClendon overall made $18 million in 2011 and $21 million the previous year, records show.
But while he was highly paid, the CEO also put a lot of that money into Chesapeake stock, and sometimes felt the consequences. In 2008, he sold more than 33 million company shares to help meet margin calls on his shares. Yet, even then the company's board responded by giving him a special $75 million cash payment.
Last year it was learned that he had borrowed money to fund his own personal stake in oil and gas wells operated by the company. His personal loan portfolio reportedly exceeded $840 million.
McClendon's surprise announcement Tuesday that he would retire culminated a shareholder revolt by Carl Icahn and Southeastern Asset Management's O. Mason Hawkins that earlier cost the CEO the chairmanship he'd held for more than two decades. McClendon also relinquished his annual bonus and saw executive perks curtailed amid federal investigations of his loans.
Icahn and Hawkins, who together control 22 percent of Chesapeake's stock, pushed for McClendon's resignation after concluding his presence and the controversy surrounding his personal business deals was hurting the company's share price, an unnamed source told Bloomberg News.
An internal probe of McClendon's dealings did not find any wrongdoing, Chesapeake officials said Tuesday, at the same time his departure was announced.
Original Print Headline: Chesapeake releases CEO departure deal
Aubrey McClendon: His April 1 exit from Chesapeake will be treated as a termination without cause.