Showdown at the OK Corral

Big meeting in Oklahoma City today for Chesapeake Energy, as the company's annual meeting has become a referendum of sorts on CEO Aubrey McClendon and his massive pay increase a few months ago, which came in spite of a horrific year for the company.

As you may be aware, four different shareholder groups have filed lawsuits against Chesapeake because of McClendon's pay package, and this week an Oklahoma judge decided to combine the cases into one, lending further power to the shareholders' complaint. That case will be held in July in Oklahoma.

In addition, a leading proxy firm has recommended that Chesapeake shareholders vote against the three directors up for reelection (these directors are, naturally, good friends of McClendon), and instead vote for some fresh blood on the board, which has been so willing to accommodate McClendon and his mistakes.

It's not expected that any sort of Capraesque activities will happen today, that McClendon will be overthrown, that the board will be turned upside down, or anything like that. It is expected, however, that Aubrey McClendon will spend an uncomfortable afternoon in front of testy and outright hostile people who are incredibly pissed at how he has profited at the same time as their life savings have plummeted in value.

UPDATE: Trading Markets reports that McClendon lives to fight another day, as shareholders failed to boot any directors off the board.

Of note, though, directors received a much lower percentage of votes than in years past, and a proposal to limit directors to one year (from their current three-year commitment) fell just short of reaching the 3/4 majority required to pass.

In other words, the natives are getting restless, but not so restless that they want to kick the king out just yet. Makes one wonder what would have happened had CHK's stock not gotten above the $20 mark this spring.

Also in the Trading Markets story, McClendon was quoted thusly in response to one shareholder's passionate criticism of his CEOship in the past 12 months:

"I'e worked 100 hours a week, at least, since 1989 to build this company. I've sacrificed a lot to do that...I'm sorry you find me egocentric and greedy."

Yeah, those sacrifices were quite herculean, all right ...