This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Chesapeake Energy Chairman Puts Money Where Mouth Is

NEW YORK ( TheStreet) -- Retired ConocoPhillips (COP) CEO Archie Dunham, brought in by Chesapeake Energy (CHK - Get Report) to undo the mess made by CEO Aubrey McClendon and restore confidence in the oil and gas driller, is putting his money where his mouth is as non-executive chairman of Chesapeake.

Dunham purchased $1.5 million worth of Chesapeake shares at an average price of $20 in the past week, in two transactions that total more than the $1.1 million that Chesapeake has agreed to pay Dunham in stock and cash this year to serve as chairman, according to Securities and Exchange Commission filings.

The Chesapeake stock buy from Dunham -- 75,000 shares -- increased his existing stake by 30%, to 326,000 shares. Dunham owned 251,391 shares prior to the purchase -- including 51,000 shares across two stock awards given this past summer as part of his compensation as chairman. He was already an owner of 200,000 shares before joining Chesapeake as chairman.

Each newly appointed director at Chesapeake, including Dunham, received 10,000 shares of Chesapeake stock on July 2, the filings reveal. Dunham also received an initial restricted stock award worth $500,000 and an annual stock award valued at $250,000 when he agreed to serve as chairman. His total annual compensation was valued at $1.1 million by Bloomberg, based on company filings.

Insider sales tracker noted that Dunham's buy was the biggest insider transaction at Chesapeake in 10 months and came shortly after its sale of Permian and midstream assets that served to quiet near-term investor anxiety about liquidity.

"While it's possible that Dunham funded his recent CHK purchase with his ex/sale of soon-to-expire UNP [Union-Pacific] options," Insiderscore argued, "the fact remains that this is a significant display of conviction by a longtime energy-sector veteran, and it's a sharp display of confidence that CHK can meet its long-term liquidity needs. It is also the largest purchase at the oil and natural gas company since November 2011 and comes after three insiders purchased $868.5K at $17.89 in June."

Dunham had $1.5 million in expiring Union Pacific (UNP - Get Report) options, where he also serves on the board.

More on Chesapeake Energy:

Chesapeake Energy Sales Reshape Bull-Bear Divide

How to Shale boom cash hole goes much deeper than Chesapeake Energy

Chesapeake Energy can't get Chinese to overpay for every acre

--By Eric Rosenbaum

Follow TheStreet on Twitter and become a fan on Facebook.

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
CHK $6.78 -5.00%
UNP $88.51 -0.74%
AAPL $95.03 -2.90%
FB $117.52 7.90%
GOOG $691.20 -2.10%


Chart of I:DJI
DOW 17,830.76 -210.79 -1.17%
S&P 500 2,075.81 -19.34 -0.92%
NASDAQ 4,805.2910 -57.85 -1.19%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs