Shareholders are asked to vote on the following resolutions, the purpose of which is for the Shareholders to ratify and approve the Amended and Restated Lease entered into by Haida Corporation and Haida Energy on August 8, 2016. The full text of the resolutions proposed by the Board of Directors for a vote of the shareholders is included within this annual meeting packet. The resolutions will appear on your proxy form as follows:
Haida Corporation’s Board placed this question on the ballot because the Restated Articles of Incorporation of Haida Corporation requires shareholder approval to encumber any interest in real property, which includes a lease.
The Haida Corporation Board of Directors consider the Lease to be in the best interest of the Corporation. It approved the Lease by adopting Resolutions No. 2017-23. The following directors oppose the Resolutions: Adrian LeCornu. The parties to the Lease are Haida Energy and Haida Corporation. Haida Energy has obtained a license from the Federal Energy Regulatory Commission for the construction of a hydroelectric project on Reynolds Creek, Alaska, now known as “Hiilangaay Hydropower Project.” Haida Energy is equally owned by Haida Corporation and AP&T.
The Lease allows Haida Corporation to lease less than one percent of Haida Corporation’s total land base to Haida Energy for a short term construction phase and for a long term operating phase when the Hiilangaay Hydroelectric Project is producing power.
Approval of the resolution is necessary to:
This transaction is exceptionally fair as the Corporation will obtain these substantial benefits while only encumbering a very small portion of its land. Furthermore, Haida Corporation has worked on developing this Project since the mid-1990s.
Please complete this section in your Proxy Packet and/or attend our Annual Meeting
December 2nd at 1pm
Embassy Suites Seattle in Lynnwood
20610 44th Avenue West
Lynnwood, WA 98036
Should Haida Corporation have leased to Haida Energy its right to the surface of the real property upon which a portion of the Hiilangaay transmission line will be located?
The Lease Resolution will be approved if it receives the affirmative vote of shares representing a majority of the shares present or represented by proxy at the annual meeting.
The Board of Directors recommends a “Yes” vote. __________ Yes __________ No
Progress: Significant progress on this project has been completed in recent years. Phase 1 and 2 work has completed. Phase 3 work is currently ongoing with installing powerhouse and other foundations. Transmission lines have been completed from Copper Harbor to the powerhouse site. Additional significant project milestones have been also met by 2017.
Phase 4 design is scheduled to begin in 2018. One of the final needs to be met by Haida Corporation Shareholders is an approval of a very important resolutions necessary to complete the construction and operation of the Hiilangaay Hydroelectric Project. Please see below:
Background: The Hiilangaay Hydroelectric Project (“Hiilangaay” or the “Project”) is a 5-megawatt hydroelectric resource currently under construction on Prince of Wales Island (POW), Alaska, approximately ten miles east of Hydaburg. The objective of the Project is to interconnect with the existing transmission grid on Prince of Wales Island, increasing the hydroelectric generation capability by 5 MW, eliminating the need for diesel generation, increasing the reliability of the electrical system, and allowing the interconnected portion of the island to have 100 percent renewable energy generation.
Pre-construction activities, funded in part by the Department of Energy (DOE) including construction planning, permit coordination and compliance, and final design have made it possible to move forward with construction of the Hiilangaay Project. Despite repeated delays to the schedule, persistence and long-term planning will culminate in the construction of the Project, and make Prince of Wales independent of diesel fueled energy by allowing the sale of clean energy on the Island. Further, the passage of the resolutions will ensure that Haida Corporation receives its initial investment back at the completion of the construction, and receive long-term rental and usage fees.
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