Voting for the worst footnote of 2009 ended last night and footnoted readers have chosen the disclosure by Chesapeake Energy (CHK) that it had spent $12.1 million to purchase Chairman and CEO Aubrey McClendon’s antique map collection. Here’s the disclosure in all of its glory from the April 30 proxy statement:
In December 2008, the Company purchased an extensive collection of historical maps of the American Southwest from Mr. McClendon for $12.1 million, which represented his cost. A dealer who had assisted Mr. McClendon in acquiring this collection over a period of six years advised the Company that the replacement value of the collection in December 2008 exceeded the purchase price by more than $8 million. The maps have been displayed at the Company’s Oklahoma City headquarters for a number of years, during which the Company has been insuring the maps in exchange for their display. Our corporate headquarters in Oklahoma City is comprised of numerous buildings in a campus-type setting. These maps have been displayed throughout the Company’s headquarters for a number of years, complementing the interior design features of our campus buildings and contributing to our workplace culture. Our employees and visitors appreciate the maps— depiction of the early years of the nation’s energy industry and the discovery and expansion of Indian Territory (now, Oklahoma) and the surrounding territories of the early United States. In addition, the collection connects to our Company’s everyday use of mapping in our business of exploring for and developing natural gas and oil. The Company was interested in continuing to have use of the map collection and believed it was not appropriate to continue to rely on cost-free loans of artwork from Mr. McClendon. The Board of Directors authorized the purchase of Mr. McClendon’s collection following review and approval by the Audit Committee and required that the Company’s purchase price be applied as a credit to Mr. McClendon’s future FWPP costs. Future purchases, if any, of historical maps or artwork for the Company’s headquarters will be made directly by the Company.
Now just imagine for a moment being the person responsible for writing this sort of bulls-it. Sounds like a fun job, eh? This particular disclosure got a lot of exposure this year after we wrote about it and even prompted Chesapeake to issue a amended proxy a few days later to provide additional details on the maps and other goodies the McClendon received. Toward the end of the year, it was also mentioned in this profile of footnoted friend Nell Minow in The New Yorker.
The second runner up with nearly 28% of the votes was this disclosure back in September about Freddie Mac’s (FRE) decision to give its new CFO a $1.95 million signing bonus and a host of other goodies — something that seemed particularly outrageous given Freddie Mac’s reliance on the government to stay afloat.
While the majority of the votes came from the United States, there were people who cast their vote from Asia, Europe and South America. You can view the entire results here.
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Given that tonight is New Year’s Eve, many of you might have some last minute questions about wine or other types of alcoholic beverages so I wanted to share my go-to person for all things related: my friend, W. Blake Gray whose site, The Gray Market Report has lots of good tips. Blake is an old friend and I reached out to him yesterday for some suggestions on wines to bring to a dinner party I’m heading to later tonight. Check out his site and some of his suggestions for champagne. Happy New Year to all! Footnoted will be back on Monday.
