Sit. Stay. Be quiet. Make $1.8 million.

February 3, 2006

What’s going on at Chicago Bridge & Iron (CBI)? This agreement filed in an 8-K yesterday raises many more questions than it answers.

According to the agreement, Corporate Controller Tommy C. Rhodes will be paid a $1.8 “stay bonus”, provided that he sticks around the company until the end of June. But he’s not just being paid to stick around, it seems. He’s also required to “withdraw and dismiss or close any and all complaints he previously has filed against the company.”

Though the company never identified Rhodes before as a whistle-blower, they did issue this 8-K on Oct. 31 that noted that a senior member of CB&I’s accounting department had alleged accounting improprieties and that as a result, third quarter numbers would be delayed. Since then, however, the stock has climbed by about 1/3, which means that it’s been a win-win for just about everyone, including whistle-blower Rhodes. Still, something smells pretty fishy about this one.

UPDATE On Monday, the stock dropped more than 30%.

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