It looks like the battle between Kirk Kerkorian and Robert J. Eaton, for control of Chrysler Corp. will climax at the company's annual shareholders meeting this May.

In a revised proxy statement field with the Securities and Exchange Commission, Mr. Kerkorian's Tracinda Corp. restates his demands for representation -- as many as three seats on an expanded board of directors -- and calls again for the return of some of Chrysler's $6.9 billion cash reserve to stockholders. But that argument has few takers.

So Mr. Kerkorian and his troops are now telling institutional investors that Chrysler has gotten sloppy and let slip away its profit margin advantage over Ford Motor Corp. and General Motors Corp.

Some auto analysts, however, dispute that claim. Now, it seems Mr. Kerkorian is left to try to gain control of, or heavily influence, Chrysler's board in a proxy fight at the May meeting.

Even if he doesn't gain control of Chrysler, Mr. Kerkorian is beginning to reap what some suggest he is really after: a greater return on his 14.1% stake in Chrysler. Chrysler stock was trading in the mid-$40s range when Mr. Kerkorian began his campaign last April. In mid-December trading in Chrysler stock was fetching $54 per share. The company also had bought back $1 billion worth of its stock last year, and it will purchase another $1 billion of its stock this year. Last month, Chrysler increased its dividend by 20% -- from 50 cents to 60 cents per share. Investors will collect that this month.

But this corporate combat transcends investment. Now, reputations are on the line. After all, Mr. Kerkorian attempted to buy Chrysler last spring for $22.3 billion but he couldn't finance the deal. The Las Vegas billionaire came across as naive, while former Chrysler chairman Lee Iacocca's reputation, after he joined in the takeover effort, has not been showered with many warm fuzzy accolades.

Chagrined and upset at the rebuff, Mr. Kerkorian has regrouped and hired Jerome B. York, Chrysler's former chief financial officer. With Mr. York on the takeover team, the new strategy seems to be to accuse Mr. Eaton of mismanaging Chrysler.

For his part, Mr. Eaton is shooting back. After Chrysler's board refused to grant Mr. Iacocca stock options worth $42 million last summer, the former chairman sued in a California court to get the options, which were granted to him before he retired three years ago.

In a counter suit filed in November in a Michigan court, Chrysler charges that Mr. Iacocca leaked confidential corporate information to Mr. Kerkorian and caused the investor to increase his stake in Chrysler, in an effort to gain control of the company.

If the charge is proven in court, Mr. Iacocca's consulting contract with Chrysler and the options that go with it would be abrogated. More serious, though, is the implicit insider trading implication. If found guilty, Messrs. Iacocca and Kerkorian could get stiff fines and jail terms.