Many of the changes have been orchestrated by activist investor Carl Icahn, who over the past two months has acquired a 7.5 percent stake in the company.
“We believe Chesapeake is now heading in the right direction,” Icahn said in a statement Thursday. “With the board providing strong oversight, the management team will be sharply focused on realizing the value of its assets and the company will be well positioned to create substantial value for shareholders going forward.”
Southeastern Asset Management proposed three of the new directors: Bob Alexander, founder and former CEO of Alexander Energy Corp.; Brad Martin, former chairman and CEO of Saks Inc.; and Fred Poses, CEO of Ascend Performance Materials. Icahn named associate Vincent Intrieri to the board.
Board members will earn $350,000 a year in cash and stock.
At least one of the Memphis-based money manager's choices has ties to Icahn as well.
Oil industry veteran Alexander also serves on the board of CVR Energy Inc., which recently was taken over by Icahn. The Texas-based company owns the oil refinery in Wynnewood.
Icahn's addition to Chesapeake's board, Intrieri, is CVR's chairman.
Out with the old
The new directors replace Richard K. Davidson, Kathleen M. Eisenbrenner, Frank Keating and Don Nickles, who resigned, and Charles T. Maxwell, who retired at the company's annual meeting on June 8.
Davidson and Oklahoma State University President Burns Hargis submitted their resignations June 8 after each received less than 30 percent of the vote on their re-election bid at Chesapeake's annual meeting. The board has not accepted Hargis' resignation.
Hargis, who heads the audit committee, will remain on the board at least until the panel completes its review of the financing arrangements between McClendon and companies or individuals who have done business with Chesapeake.
The board will revisit Hargis' resignation once the review is finished, the company said Thursday.
Gheit said Hargis' report is expected relatively quickly.
“It had better be finished soon,” the analyst said. “There is no room for more surprises and uncertainty. Nobody has an appetite for that.”
New York City Comptroller John C. Liu praised much of Thursday's announcement, but expressed disappointment that Hargis has not been replaced.
“We welcome the new board chair and directors, but the misguided decision to keep a director who was opposed by an overwhelming majority of investors tarnishes today's announcement,” Lu said.
The only three Chesapeake directors to survive the change are McClendon; Louis A. Simpson, who was proposed by Southeastern Asset Management in 2011 and will become chairman of Chesapeake's nominating and governance committee; and Merrill A. “Pete” Miller, who had been Chesapeake's lead independent director. That position has been eliminated, so Miller will be chairman of the board's compensation committee.