Sealaska shareholders vote: Descendants and 'Leftouts' OK'd to receive shares

Resolution offering additional shares to elders fails to pass

Posted: Sunday, June 24, 2007

In a historic move Saturday, Sealaska shareholders voted to issue shares to two new groups of Natives - those that are "descendants" and "Leftouts."

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A third resolution to offer additional stock to shareholders over the age of 65 failed to pass, despite receiving the largest number of votes. Unlike the other two resolutions, this one required a supermajority to pass, said Todd Antioquia, Sealaska's director of corporate communications.

The three resolutions have drawn considerable controversy for nearly two decades, primarily because many shareholders in the Southeast Alaska regional Native corporation worried that the value of shares would be diluted.

But for Board Member Rosita Worl, the vote Saturday symbolized the survival of Native values.

"I just can't stress enough that this really is a statement about the survival of Native corporations and values... about the vitality of our culture," she said. "Corporations just don't give stock away."

Shareholder meeting results

The official, validated results from the annual Sealaska shareholder meeting Saturday in Anchorage:

Board of Directors:

Clarence Jackson, 72, Kake

Patrick Anderson, 53, Anchorage

Jodi Mitchell, 43, Juneau

Jackie Johnson, 51, Fairfax, Va.

Resolutions:

Resolution 1: PASSED.

Should eligible descendants of original shareholders be issued 100 shares of life estate stock?

Yes: 57 percent.

No: 41 percent.

Resolution 2: FAILED.

If shareholder descendants are enrolled, should Sealaska issue 100 shares of nonvoting life estate shares to Elders, in addition to shares they already own?

Yes: 64 percent.

No: 34 percent.

Note: This resolution did not pass because it required a different voting standard.

Resolution 3: PASSED.

If shareholder descendants are enrolled, should Leftouts (eligible Natives who missed previous enrollment periods) be issued 100 shares of life estate stock?

Yes: 57 percent.

No: 41 percent.

The new shares will differ from original shares because they are considered "life estate" shares - or shares that expire upon death. Shareholders will not be receiving the entire portion of the dividend that original shareholders now do, Worl said. The shares do come with voting rights, however.

When the Alaska Native Claims Settlement Act was passed by Congress, each Native alive in 1971 eligible to join Sealaska received 100 shares.

Descendants are the children of original shareholders and must be a quarter Native and at least 18 years old to be eligible to enroll. Leftouts are those who were originally considered eligible, but did not apply for whatever reason. They might have been in the military, for example, Antioquia said.

The two resolutions that passed owe much of their success to a bill passed by Congress last year. The bill, sponsored by U.S. Sen. Lisa Murkowski, relaxed voting requirements to allow a resolution to pass with a majority of voters present at a shareholder meeting, instead of a majority of all outstanding shares.

Uncertainty remained as to whether Resolution Two required the supermajority because the shares did not come with voting rights, Worl said. A Congressional amendment to allow for it to pass with a simple majority could have provided a remedy, but did not pass in time.

Before ballots were tallied during the annual meeting in Anchorage, board members voted to reconsider this resolution some time in the future after such an amendment can be passed.

It is estimated that roughly 5,500 descendants and 100 "Leftouts" immediately are eligible to enroll. With the failure of Resolution two, 2,065 elders will not be receiving new shares. Currently, there are 17,300 shareholders.

The shareholder resolutions in 2006 and 2007 have cost Sealaska roughly $1.5 million, including payment to print informational materials, conduct studies, host community meetings, pay for consulting and legal fees and the estimated increased proxy incentive payment for 2007. There also will be one-time expenses associated with issuing new shares to descendants and Leftouts, which can begin as soon as Monday.

Shareholders also selected new board members to terms expiring in 2010, including Clarence Jackson of Kake, Patrick Anderson of Anchorage, Jodi Mitchell of Juneau and Jackie Johnson of Fairfax, Va.

The four newly elected members have all served previously on the 13-member board.

Antioquia said Saturday's meeting had the largest turnout in at least seven years. Nearly 400 shareholders plus guests were in Anchorage plus an additional 278 households tuned in via live Web cast. The meeting was closed to the public.

• Brittany Retherford can be reached at brittany.retherford@juneauempire.com or 523-2276.



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