Mountain Village’s Native Corporation building lies dormant as the head of its Board of Directors is being sued for not holding an annual shareholders’ meeting.
The last confirmed annual meeting for Azachorok Inc. took place in October of 2017.
According to board member Loren Peterson, Board Chair Joyce Lee has ignored motions put forward by the Board, failed to coordinate an annual meeting, and is not fulfilling her fiduciary duty to the corporation. In response, concerned shareholders formed the Shareholders for Accountability group, which Peterson is also part of.
“This was formed in the last year after realizing the leaders of our corporation weren’t really making steps to advance the mission. And we saw that some shareholder programs were neglected and dissolved, and a lot of money had been spent in ways that were not benefitting the corporation.”
Lee could not be reached for comment before the airing of this story, and Peterson says he has not been able to speak with Lee for weeks. She became the head of Azachorok in 2017 following the last annual meeting, after being nominated by Peterson, the former Board Chair.
As of today, the lawsuit against Lee, brought forth by shareholder Hazel Walters, is still ongoing. In a statement released last week, Walters said she asked the Alaska Superior Court to intervene due to the “operational negligence taking place.”
Walters asserts that more than $750,000 of Azachorok’s funds have been spent on litigations in court. Peterson says the money lost totals more than that and has negatively affected shareholders by taking away things like the scholarship program.
“We were supposed to have a shareholder dividend, our first one in thirty years; that didn’t happen because a lot of those costs went to (pay) legal fees. That was done by Joyce Lee without authorization from the Board. So we’re going to try to fix what went wrong, but I think we will do it in a way that is fair and that’s (with) consensus, and who knows what that is going to look like.”
According to court records, the lawsuit will possibly be expedited, as Walters has requested an annual meeting be held soon. Board Chair Lee has said the Mountain Village Native Corporation would attempt to hold its annual meeting by March 30, but Peterson isn’t holding his breath.
“It’s been a tough battle, but we’re getting close. We’re hoping that in the next two weeks, the proxies will go out. But we’ve been in meetings this past year where we’ve said ‘the annual meeting will be in May, and then July, and then December,’ so I won’t believe it ‘till I actually see it.”
Besides allowing the Board to conduct regular business and uphold its fiduciary duties to shareholders, the next Azachorok annual meeting will also be an opportunity for the Board of Director elections to take place. According to Peterson, the Board has been short one director, with a total of six, since March of last year and is now in a “gridlock” without a seventh member.
Peterson also says the Native Corporation’s bylaws indicate another Board member, Felix Hess, would not be eligible to serve another term. Hess has been on the Board since its inception in 1973, roughly 36 years. Peterson feels there have been several improper procedures taken by other directors on the Board.
“One of our directors, Peter Andrews, along with Anita Andrews, they were on the nominations committee. And when they requested the bylaws, my understanding is they requested the most recent bylaws to determine eligibility of the corporation, for candidates that are applying to be directors. They were denied the bylaws. And then we learned later that candidates that were up for election, including Felix Hess and Howard Peterson, were reviewing applications.”
The Shareholders for Accountability group feels that having board members who are at the end of their terms reviewing other candidates was a conflict of interest, as stated by Board member Peterson.
Joyce Lee, the head of the Board, is also up for re-election this year, as her two-year term nears its end.
Peterson hopes the next annual meeting will happen sometime this spring and Azachorok will be able to move forward with new directors. He also encourages shareholders to continue to attend Board of Directors’ meetings and share their input.
