Village corporation may not redeem shares as part of litigation settlement with shareholders.
Plaintiffs seek to enforce a settlement agreement. The superior court determined that the agreement is unenforceable because the agreement’s stock repurchase provision violates the Alaska Native Claims Settlement Act’s (ANCSA) prohibition on the alienation of shares. Because we conclude that transfer of ANCSA stock back to a Native corporation in exchange for stock in a newly created corporation violates ANCSA, we affirm.The Tetlin Native Corporation (TNC) is a village corporation formed pursuant to ANCSA and organized as an Alaska business corporation. On July 17, 1996, TNC transferred approximately 643,174 acres of its land to the Tetlin Tribal Council.[1] This left TNC with 100,000 acres of land.Subsequently, the appellants, Shirley Jimerson and Ramona David, conducted a campaign to recall TNC’s board of directors. The campaign was successful, and on January 12, 1999, Jimerson and David were elected to the board.
Adds precedent that influences how ANCSA corporations, regulators, and shareholders interpret governance rights and remedies.