This page provides resources about the proposition to increase the board from five (5) to seven (7) members. It is vital to the Board to inform Shareholders of the advantages and disadvantages, so they understand the proposition in its entirety.

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Dear Shareholders,

The Board will be proposing to increase the board from five (5) to seven (7) members at the 2021 Annual Meeting of Shareholders. As the governing body of the Corporation, the Board has a fiduciary responsibility to our Shareholders. Each Director brings different talent, skill sets, and expertise to the Board. As the Corporation continues to grow, the need for additional skill sets grows. An increase in board members expands the Board’s ability to govern the Corporation.

More details will be provided to Shareholders and there will be an opportunity to ask questions and share concerns prior to the 2021 Annual Meeting.

The Board is open to receiving Shareholders’ insights and concerns. If you have questions or concerns not addressed here, please contact us.

Board Increase FAQs

Click on the questions below to see answers to frequently asked questions.

Q: Why will the Board be proposing to increase the number of Directors from five (5) to seven (7) Directors?

A: As the governing body of the Corporation, the Board has a fiduciary responsibility to our Shareholders. Each Director brings different talent, skill sets, and expertise to the Board. As the Corporation continues to grow, the need for additional skill sets grows. An increase in board members expands the Board’s ability to govern the Corporation.

Q: What will be the impacts of increasing the size of the Board?

A: Increasing the size will increase diversity on the board by opening new opportunities for Shareholders to participate, expand knowledge and expertise, increase Shareholder representation (location, age, family, gender, etc.) and lessen conflicts of interest. The increase would enhance future stability of the corporation as a result.

Increasing board size from five (5) to seven (7) directors is projected to impact overall Board costs by 1% or less. This calculation is based on the hypothetical addition of two (2) Board members. The cost of two (2) additional members is a total of approximately $19,000. Board fees average $9,500 per director per year. Costs for travel, meals and related business expenses varies depending upon the business of Leisnoi and its family of companies during any given year. It is anticipated that the average yearly cost of adding two (2) additional Board members will not impact the overall budget by more than 1%.

The cost of adding two (2) new directors will minimally impact Leisnoi’s budget and overall costs, and have little affect on Shareholder dividends. The below shows Leisnoi’s overall expenses compared to the expense of the Board.

Q: Will an increase in board size affect my dividend/distribution amount?

A: There is no impact in the event a distribution is declared from the Leisnoi Shareholder Settlement Trust. Trustees who are also Leisnoi Directors do not receive fees from the Trust for serving as Trustees. If the Corporation declared a dividend, there would be minimal impact as Board fees are a negligible cost of doing business.

Q: What are the board sizes of Leisnoi’s sister Village Corporations?

A: Sister Village Corporations related to Leisnoi’s have the following board size:

  • Afognak Native Corporation – 9 board members
  • Ouzinkie Native Corporation – 9 board members
  • Old Harbor Native Corporation – 9 board members
  • Natives of Kodiak, Inc. – 9 board members
  • Akhiok-Kaguyak, Inc. – 7 board members

Q: What is the process to increase the board from five (5) to seven (7) members at the 2021 Annual Meeting?

A: Section 3.3.1 of Leisnoi’s Bylaws provides for a fixed membership of five (5) Directors. Alaska Statute 10.06.230(c) requires that a bylaw changing a fixed number of directors shall be adopted by approval of the outstanding shares.

To successfully increase the size of the Board to seven (7) Directors, a quorum (50% of voting shares + 1 share) must be present by proxy or in person at the meeting. Once a quorum is established, a majority of the shares that voted by proxy or in person at the meeting must vote in favor of increasing the Board size.

Q: What will the qualifications be for additional Board members?

A: Leisnoi’s Bylaws state the following qualifications for an individual to be elected to and serve on the Board of Directors:

  • All directors must be voting Shareholders of the Corporation and over the age of eighteen (18); and
  • No person who is elected as a Director is eligible for employment, either as an employee or independent contractor, by the Corporation or by any subsidiary of the Corporation. If a person who is elected as a Director is employed by or contracts his or her personal services to the Corporation, that person shall resign his or her employment or terminate his or her personal services contract effective the date on which such person is elected.

Q: How will the two (2) new Board members be selected? What process will be used?

A: If the Shareholder vote is successful to amend the Bylaws and increase the Board to seven (7) members, the following process will be followed in 2021 to fill the two (2) new Board seats:

1) A nominations committee, consisting of two (2) Directors and three (3) Shareholders shall be appointed.

2) An application period will be opened for interested Shareholders to submit applications for consideration of filling the two (2) new Board seats.

3) The Nominations Committee will review applications and conduct interviews of qualified Shareholder candidates.

4) The Nominations Committee will make recommendations to the Board of Directors of applicants to fill the two (2) new Board seats – expiring in 2024.

5) The Board of Directors shall select and appoint the two (2) new Board members –whose terms shall expire at the 2024 Annual Meeting.

6) Those newly appointed Director seats shall then be up for election when their terms end in 2024.

Q: What will be the effects of NOT increasing the size of the Board?

A: As Leisnoi diversifies and adds new companies, the current 5-member Board’s ability to provide oversight will become challenging and could impact the Corporation’s ability to grow shareholder value.

Per Bylaws, current Board committees cannot have majority of Board representation on a Board committee. Therefore, with a five (5) member Board, no more than two (2) Directors can serve on a committee.  Increasing the Board to seven (7) will allow up to three (3) Directors on a committee.  Seven (7) Directors will better allocate the sharing of Director responsibilities by providing more members to serve on various committees.

Corporate Growth

Since 2010, Leisnoi’s lines of business have become increasingly diversified, and have shifted towards technical sectors such as Government Contracting and Investments. This growth ensures the continued profitability of the Corporation, and opens the opportunity for more Shareholders to participate in driving Leisnoi’s success.

Per Bylaws, Board committees are note allowed to have majority of Board representation on a committee. Therefore, with a five (5) member Board, no more than two (2) Directors can serve on a committee.  Increasing the Board to seven (7) will allow up to three (3) Directors on a committee.  Seven (7) Directors will better allocate the sharing of Director responsibilities by providing more members to serve on various committees.

Expanding the Board from (5) five to (7) seven will increase director diversity by opening new opportunities for Shareholders to participate, expand knowledge and expertise, increase Shareholder representation (location, age, family, gender, etc.) and lessen conflicts of interest. The increase would enhance future stability of the Corporation as a result.

Our Shareholders

The data below is a snapshot of Leisnoi’s Shareholder demographics. As the number of Shareholders has grown, they have expanded beyond Kodiak and Alaska – and we now have Shareholders throughout the United States. Additionally, as original Shareholders have willed or gifted shares, their distribution is seen across a wide range of age groups. As our owner base evolves, it’s important to ensure there is adequate representation for all Shareholders. Adding two new directors opens up the opportunity for more Shareholders to be involved in their corporation.