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FACTBOX-Chesapeake Energy's governance changes after CEO probes

Source: Thomson Reuters Foundation - Wed, 20 Feb 2013 18:02 GMT
Author: Reuters
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HOUSTON, Feb 20 (Reuters) - Chesapeake Energy Corp, the second-largest U.S. producer of natural gas, made sweeping governance changes last year following a series of Reuters investigations that found CEO Aubrey McClendon frequently blurs the line between his personal financial dealings and that of the company.

Chesapeake said on Wednesday that an investigation of McClendon's financial dealings by the board of director's audit committee and independent counsel found no evidence of intentional misconduct or conflict of interest.

The following is a summary of changes and developments:

April 26, 2012 - The board of directors agrees to an early end of the Founder Well Participation Program, a controversial perk allowing McClendon to take a 2.5 percent stake in every well the company drills provided he pay his share of the costs.

The board also announces it will investigate McClendon arranging more than ${esc.dollar}1 billion in financing from a big investor.

May 1 - Chesapeake's board says it will strip McClendon of his title as chairman and replace him with an executive who does not have a previous substantive relationship with the company.

May 18 - Chesapeake announces it will cut its board members' compensation by 20 percent and eliminate their personal use of company aircraft. McClendon's 2011 compensation reduced by 15 percent.

June 4 - Chesapeake agrees to replace four board members with representatives named by its largest investors, Southeastern Asset Management and Carl Icahn.

June 8 - Chesapeake shareholders reject two directors up for reelection, V. Burns Hargis and Richard Davidson, and vote down the company's executive compensation plan. The votes were non binding, and Hargis remained on the board.

June 21 - Chesapeake names Archie Dunham, the former CEO of ConocoPhillips, as its chairman. Four other new directors are appointed to the board.

Jan. 7, 2013 - In a filing with the U.S. Securities and Exchange Commission, Chesapeake says that McClendon will not receive a bonus for 2012.

Other actions detailed in the filing included deep cuts to incentive pay, a ban on personal jet travel for top executives other than McClendon, and measures to increase shareholder influence.

Jan. 29 - Chesapeake Energy says McClendon will step down as chief executive on April 1 and receive a compensation package valued at ${esc.dollar}47 million. (Reporting by Anna Driver; Editing by Patricia Kranz and Grant McCool)

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