Eric Savitz of Barron’s reports that TheStreet.com‘s stock fell in Thursday trading by more than 8 percent after the business news web site reported fourth quarter earnings and held a conference call in which the company disclosed it has not yet reached agreement with co-founder Jim Cramer on a new contract.
Savitz wrote, “The company did acknowledge that it could be affected by a weakening economy. ‘As we all know, the economic environment has grown more challenging over the past few months, and there is great uncertainty as to how weak economic conditions might become and the impact this might have on our advertisers, subscribers and visitors to our network of sites,’ CFO Eric Ashman said on the call.
“One tidbit that might have made investors uneasy was a brief comment from Chairman and CEO Tom Clarke about the status of negotiations of a new employment agreement between the company and Jim Cramer. Clarke noted on the call that the agreement scheduled to expire December 31, 2007 was extended on the same terms through February 15, 2008. One day before that, on February 14, the agreement was extended once more on the same terms, this time through April 15. Cramer’s writings are a key driver to the site; he also has a 6.4% stake in the company, of which he is a director. It’s not in either side’s interest to let the arrangement expire; but the need for a series of short extensions certainly hints at a drawn-out negotiation process.”
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