And the frequent flyer award goes to…
There’s still another four weeks to go until proxy season is essentially over. And while this may seem a bit premature, I think it’s a fairly safe bet that I2 (ITWO) CEO Michael McGrath is clearly in the running for the frequent flyer award. That’s because according to the preliminary proxy filed late Friday, I2 spent a whopping $942K ferrying McGrath between the company’s offices in Dallas and his home in Maine. There was also a $69K tax gross-up for use of high-altitude taxi service, which seems unusually low.
I first footnoted this unusual perk two years ago, right around the time the former high-flying stock had just about hit rock-bottom and McGrath was hired to fix things. Since then, the stock has rebounded, although the short interest remains fairly high as of March at around 16.5%.
Clearly, McGrath deserves some of the credit for the turnaround. But whether the company needed to offer this kind of service to “attract a CEO of the caliber of Mr. McGrath” as the CD&A claims seems a bit over-blown. There’s also the question of why I2 only spent $166K on the service in 2005. Granted, jet fuel was more expensive in 2006, but that really only explains part of the nearly six-fold increase in expenses.