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Revenue Flowchart for Real Estate Companies - PDF

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					    a n n u a l re p o r t 2009




   Remembering Our
Captain of the Kuskokwim
         8/14/33 - 1/7/10
co nte nt s

Annual Report Theme: Iyana Gusty .........................................................................1

About Our Corporation / TKC Villages .....................................................................2

TKC Organizational Flow Chart ....................................................................................3

Message from the President/CEO .......................................................................4 - 5

Message from the Chairman ..................................................................................6 - 7

TKC Subsidiary Reports ........................................................................................... 8 - 10

Conflicting Landscapes Book Overview ................................................................ 11

Land and Resources ............................................................................................... 12 - 13

Our Shareholders ..................................................................................................... 14 - 15

Kuskokwim Education Foundation (KEF).................................................. 16 - 17

TKC Board of Directors ................................................................................................... 18

Committees of the Board / TKC Staff..................................................................... 19

In Memory ............................................................................................................................. 20
i n m e m o r y o f i ya n a g u s t y
Respected Board member of TKC and lifelong resident of the Kuskokwim Region
Iyana Gusty, a lifelong resident of Stony River and board       from, shaping the dynamics of the corporation to what it is
member for the Kuskokwim Corporation died on January 7,         today and maintaining significance into the future.
2010 in Bethel, Alaska. Born and raised in Stony River, Iyana
was one of a handful of elderly leaders remaining in the        Chairman of the Board Leo Morgan said, “He was my friend
Kuskokwim region. The legacy he left behind reminds us of       and I miss him very much” . Iyana’s one-of a kind involvement
the significance in embracing the elders around us with an      with The Kuskokwim Corporation will be recognized for the
appreciation and value of importance in traditional ways of     good things he left behind to its people.
living.
                                                                Iyana has been preceded in death by his parents Gusty and
Iyana Gusty was sworn onto the TKC board on August 24,          Agrafina, his brother Constantine, his sisters Barbara, Lisa,
2007 to fill vacant seat I. He previously held a seat on the    Catherine, and Madrona, his wife Mary, daughter Lydia, and
board from 1978 to 2005 and in that time he made a unique       sons Greg and Iyana Jr. aka “Sonny.” He is survived by Ignatti,
contribution to the region. When it came to board meetings,     Amy, Mary, Brittany, Junior, Tiffany, Joe, Carey, Olivia, JoAnne,
Iyana had an optimistic and poignant manner of voicing          Precious, Samuel, Evan, and Logan.
himself to resolve matters that approached the board. His
positive and respectful demeanor led as an example. His
composure introduced a sense of accountability for one
another, inspiring those he met to work together and look
out for one another towards a common solution.

The Yupik Eskimo elder will be remembered by many
people of the region of the Kuskokwim River because of his
character and accomplishments throughout his life. He didn’t
know how to read or write yet it wasn’t something he was
ashamed of. Iyana was a walking reminder of where many of
the Kuskokwim’s region’s ancestors and relatives have come



                                         Iyana Gusty
                                       8/14/33 - 1/7/10
                           The following pages feature photos of Iyana
                        and quote excerpts from the Tundra Drums article
                       “Captain of the Kuskokwim” written by Mark Leary




                                                                                                                                    1
    a b o u t o u r co r p o rat i o n
    W h o We Are                                                      Vision
    The Kuskokwim Corporation (TKC) was formed in 1977                By 2015, TKC is shareholder-managed $100 million asset
    when ten Alaska Native Claims Settlement Act Village              value Alaska Village Corporation.
    (ANCSA) Corporations located along the middle region of             • We will support our shareholders through
    the Kuskokwim River merged. The villages include Lower                 scholarships, education/training opportunities,
    Kalskag, Upper Kalskag, Aniak, Chuathbaluk, Napaimute,                 dividends and employment.
    Crooked Creek, Red Devil, Georgetown, Sleetmute and                 • We will develop successful businesses in and
    Stony River.                                                           out of our region.
                                                                        • We will responsibly manage our land for both
    The ten villages pooled their cash resources and land                  modern and traditional uses.
    entitlements together which allowed TKC to focus on many            • We will strengthen ties with our shareholders.
    opportunities. TKC has many different areas of ANCSA
    responsibilities it must accomplish. TKC is a for-profit
    Native Corporation and we are governed by TKC’s Articles          P u rP o s e
    of Incorporation, Bylaws and Alaska State Laws. In addition,      To enhance our land, culture, and the lives of our people.
    TKC has over 950,000 acres of land to manage and over 3,200
    shareholders, with descendents enrolled.                          Co m m i tm e n t
                                                                         • Honoring our traditions: valuing and helping one
    TKC has a Board of Directors of twelve at-large seats. Our             another, celebrating and sharing our success, learning
    corporation is strategically driven from the Board’s directives        through stories and respectful communication
    as defined in our Corporation’s Mission, Vision, Core Values         • Integrity: being unified, truthful, and worthy of trust
    and Commitments.                                                     • Valuing our land and resources: being good stewards
                                                                           to provide for our future generations
                                                                         • Commitment: working hard to create results that
                                                                           benefit our shareholders




    t kc v i l l a g e s o n t h e ku s ko k w i m r i ve r




2
 t kc o rg a n i z at i o n a l f l ow c h a r t




“I’ve been working on the River for 20 years and I’m still learning!” said Iyana Gusty,
      Captain of the M/V Tammy and legend among the Kuskokwim River People.

 It wasn’t until many years later as a grown man that I understood what he meant:
The River is always teaching us, because it’s alive - always moving - always changing.
 If we’re respectful & observant it will always teach us something. It’s when we quit
      watching; start thinking that we know everything that it gets dangerous.

          Many times as he brought the barge up the River, people out doing
       subsistence gathering would flag him down and come over in their skiffs
   to drop off a fresh fish, piece of meat, or even aqutaq. He was known from the
        South Fork to the Bay. A true man of the River - the whole River.

                                                                                          3
    m e s s a g e f ro m t h e p re s i d e nt & ce o
                              Our corporation was blessed with       Suulutaaq, a civil construction company, is continuing with
                              success during 2009 by almost any      the Napa Valley Flood control project for the U.S. Army Corps
                              measure. Consolidated revenue          of engineers. This project will be worth over $67 million over
                              was over $86 million, almost 60%       its three year life. In addition, Suulutaaq management is
                              above our budget of $54 million.       actively recruiting shareholders to fill job openings on this
                              Net income after taxes was $4.9        and other projects. Eight shareholders are now employed
    mAVer C Ar e y            million, significantly higher than     by Suulutaaq and I am pleased to report that shareholder,
                              our original budget of $2.2 million.   Renee Fredericks has been appointed as President of the
    TKC began the year with $34.7 million in assets and ended        multi-million dollar subsidiary.
    the year with $54 million in assets. 2009 was clearly a growth
    year for the Kuskokwim Corporation. We are well on our way       TKC Aerospace, based in Charleston, South Carolina
    to achieving our goal of being a “$100 million company in        expanded operations into three more states and has plans
    asset base by the year 2015”.                                    for further expansion in 2010.

    In the midst of this exceptional growth we have been building    Our real estate operating company, Kuskokwim Properties,
    the organizational structure and operational capacity to         experienced positive cash flow despite lower occupancy
    continue this growth. Our revenue forecast for 2010 is to        rates in the Anchorage and Fairbanks residential rental
    move from this year’s $86 million to over $110 million.          markets. This was achieved by improving operations and
                                                                     reducing costs. At the same time we have been able to
    Suulutaaq and TKC Aerospace, our 8(a) subsidiaries, have         improve the desirability of our properties and attract better
    matured into profitable operating companies with total           tenants which in turn will continue to reduce our costs per
    revenues of $30 million and $52 million respectively.            rental unit.


                                   bAl AnCe sheet ACCo u n ts 2005 - 2009




                                                                     Assets         Liabilities        Shareholders’ Equity


4
Unfortunately we have not been totally immune to the           TKC continues to play a pivotal role in the development of
national decline in commercial real estate. Our passive real   the Alaska Native Village CEO Association (ANVCA). With over
estate investment portfolio saw income of $267,060, which      200 village corporations in the state, ANVCA is a key resource
was 53% lower than in 2008. We are monitoring these            in the effort to improve the profitability and reputation of
investments closely and considering strategies to improve      our native corporations. The ANVCA annual meeting was
these returns.                                                 attended by over 200 professionals in March 2008 and played
                                                               a significant part in the defense of the Federal 8(a) program.
In addition to our passive real estate investments TKC has
significant investments in stocks and bonds. 2008 and          Our mission is to maximize value to our shareholders both
2009 were tumultuous years in the equities markets yet our     now and in the future. We are doing that by continuing
investments did well. Our portfolio began the year at $6       to invest in our companies and people while setting high
million and ended at $8 million. Five of our funds performed   standards for professionalism and performance. I am pleased
better than market indices. Unfortunately one of our funds     to be the CEO of a company with such a bright future.
was a disappointment and we will be assessing how to move
forward with that fund during the spring of 2010.


             Proje C ted 2010 in Come




                                                 Net Income              Gross Revenue



    During those long days and nights on the barge with Iyana,
 I would spend as much time around him as I could. Even on trips
   where I worked a different shift than him, I would spend my
off-time, sitting in the wheel house listening to him and his old-time
 country music. Sometimes people would wave at him or call on the
         radio to request a song. Iyana would slide open one
        of the pilot house side windows, get out the bullhorn,
          and sing a Hank Williams song across the water
               as we passed by. He had a sweet voice.

                                                                                                                                5
    m e s s a g e f ro m t h e c h a i r m a n
                             $86.7 million dollars in consolidated   Several challenges lie before us in 2010. In many ways the
                             revenue!      What a year         the   decisions made this year by our shareholders and the Board
                             Kuskokwim Corporation has had!          of Directors will impact our Corporation for years to come.

                            Your Board of Directors take             Our shareholders will vote this year on whether or not to
                            seriously their responsibilities         increase the number of Class B shares in our corporation.
    leo mor gA n            as stewards of the resources             Whether you are for or against this plan it is critical that you
                            of our company. Over the past            make your voice heard by participating in the vote. It is
    few years we have carefully considered how best to invest        important that our shareholders decide how the shares of
    those resources for our shareholders. We have diversified        TKC will be structured in the future.
    our investments from passive investments and a simple
    stock and bond portfolio to include operating real estate        We are also very concerned with how the Donlin Creek mine
    and subsidiary companies. The financial performance of           will impact our shareholders and our lands. Your Board of
    our company over the past year is the result of that careful     Directors is committed to ensuring TKC shareholders receive
    stewardship. In addition to records revenues, our assets         a fair share of the employment opportunities and financial
    exceeded $54 million. Our goal of $100 million in assets         rewards of this major mining development. In addition we
    does not seem far away.                                          need to protect our lands for future generations. Managing
                                                                     TKC’s relationship with the Donlin Creek mine is one of our
    We understand the balance between future growth                  top priorities.
    through re-investment and the need for current returns
    by our shareholders. We remain committed to annual               Our investment in our 8(a) subsidiaries Suulutaaq and TKC
    dividend payments and paid 2009 dividends of $562,994            Aerospace has been very profitable. We hope to invest in
    to our shareholders. This was the 17th consecutive year          future 8(a) opportunities. We also recognize that the political
    of dividend payments and we expect 2010 to be the 18th           and economic environment is very dynamic and guiding our
    year. Our policy of paying 3-4% of shareholder equity            corporation through this changing landscape continues to
    remains in place.                                                be challenging.

    It is the role of the Board of Directors to guide the strategy
                                                                     These challenges are significant, yet we have a talented
    of TKC and position the company for the future. To that
                                                                     Board of Directors and have built an exceptional senior
    end we will continue to monitor the balance between our
                                                                     management team. I am honored to serve as the Chairman
    passive and operating investments, as well as investigate
                                                                     of the TKC Board of Directors.
    new opportunities.




                                                                      There were no navigation instruments, no GPS,
                                                                   no radar, not even a depth finder in those first years
                                                               that I worked with Iyana. He taught me about land markers
                                                               - he had hundreds along the Kuskokwim. Some were distinctly
                                                                      shaped trees; some were old cabins, or big rocks.
                                                                         Some are still there. Some are gone now.




6
                                      shAr e h o l d e r e q u i t y 1977 - 2009
       di Vidend distrib utions

Year           Paid       Per Share

1981           $121,800      1.00
1982         $243,600        2.00
1983         $243,400        2.00
1984           $121,700      1.00
1985          $152,125       1.25
1986          $152,000       1.25
1989          $121,500       1.00
1990         $364,500       3.00
1991            $66,770     0.55
1992           $821,878     6.77
1993          $127,470       1.05
1994        $303,500        2.50
1995         $300,000        1.45                    Shareholder Equity
1996         $325,000        1.45                    Dividends Paid Out
1997         $325,000        1.39                    Shareholder Equity if Dividends Were Not Paid Out
1998        $350,300         1.50
1999         $243,900        1.00
2000         $377,100        1.50
2002          $260,900       1.00
2003          $268,900       1.00     ComP r e h e n s iV e i nCo m e 1977 - 2009
2004        $345,750         1.25
2005         $422,850        1.50
2006         $590,200        2.00
2007          $684,000      2.25
2008         $749,370       2.33
2009         $562,994       1.75

TOTAL      $8,646,507      44.74




                                                                                                         7
    subsidiar y:
    Kuskokwim Properties LLC currently holds a majority interest    In 2008 we brought the vacancy from 30% down to 5% by
    in 6 large apartment complexes in the West Midtown district     the 4th quarter. This past year (2009) we have succeeded
    of Anchorage. The apartments are operated by our partners,      in reducing the vacancy to 3% by improving efficiency
    American Multiplex LLC. The apartments range in size from       and tenant quality. We have also continually been working
    small studio apartments to large 3 bedroom units. The rents     on improving maintenance and reducing operating costs.
    are mid-range for Anchorage ranging from $600 to $1139          We made big cost saving changes like doing a lot less
    per month.                                                      contracting out of plumbing, painting and general repairs
                                                                    and doing more with skilled maintenance people on staff.
                                                                    And we’ve made smaller cost saving changes that will make
                                                                    a big difference over the years like using water flow restrictors
                                                                    and replacing regular light bulbs with more efficient energy
                                                                    saving bulbs.

                                                                    We are also working to gain weatherization grants from
                                                                    the Municipality of Anchorage to obtain up to $94,000 per
                                                                    building in weatherization grants to help reduce utility costs
                                                                    for the partnership.
    Our clientele are primarily working people in construction
    and service industries. The location of the properties offers   All of these changes have resulted in improved operations
    our tenants easy access to downtown and walking access          and cash flow and will prepare us for growing this segment
    to stores, banks, restaurants and office buildings. This        of our business as conditions permit.
    outstanding location plus the dramatic improvement in
    management has proven a good formula for success.




                  During those years we spent working with Iyana, he
                taught us many things about the River, Her People, and
              how to treat both. His influence on me personally was great.
               I know others will say the same. I’m thankful that I was
                able to tell him this as his time here was growing short.




8
subsidiar y:
TKC Aerospace is based in Charleston, South Carolina and           TKC Aerospace has also been awarded a subcontract by Rolls-
employs a staff of logistics and aerospace professionals that      Royce, the global power systems company, to provide specific
are highly experienced with all aspects of aircraft acquisition,   engine management, planner/scheduler and documentation
sustainment, contractor logistics support, supply chain            roles at seven designated Air Force bases in the US. This five-
management, procurement, systems and services/support              year agreement is designed to improve efficiencies and cost-
operations.                                                        effectiveness for monitoring engine operational data and
                                                                   includes asset tracking and management in support of USAF
                                                                   airlift and aerial refueling missions. This subcontract is valued
                                                                   at approximately $1M per year.

                                                                   TKC Aerospace has been awarded two contracts totaling
                                                                   over $126 Million by the U.S. Department of State. The
                                                                   first contract, awarded 11 June 2009, is for the acquisition,
                                                                   maintenance, modification and initial provisioning for four
                                                                   aircraft to provide airlift in the Middle East. TKCA acquired
                                                                   the aircraft and immediately began an upgrade program
ContrACts                                                          to equip them with Aircraft Survivability Equipment which
We have grown the business from 4 to 7 contracts in the past       consists of Missile Warning System, Counter Measures
year. The contract for upgrading interceptor aircraft for the      Dispensing Systems (CMDS) and special communications
U.S. Border is moving along smoothly. The first three aircrafts    systems. TKCA is also providing spares to support aircraft
are progressing well in the modification program and we            operations in Afghanistan. This program was completed by
are currently working with the customer to enter the fourth        February 2010. The contract was valued at approximately
aircraft before the end of September. This contract provides       $26M. The second contract is a $100 Million IDIQ contract to
for modifying up to 10 aircraft at a price of approximately        acquire and lease aircraft and provide Engineering/Logistics/
$9.5M each. Our operation out of Reagan National Airport           Procurement Support. Under this contract TKCA will be
provides the senior staff at our agency customer with              performing a variety of acquisition and logistics tasks. This 5
safe and efficient transportation. This contract generates         year contract will provide a variety of tasks that will enhance
approximately $4.5M in annual revenues. In Florida, TKCA’s         and grow TKCA’s past performance as we continue to move
primary mission is to provide high quality, serviceable            toward more non-8(a) commercial and open competitive
aerospace ground equipment to the U.S. Air Force. This             contracts.
customer serves as the test and evaluation center for the
Air Force air delivered weapons, navigation and guidance           the Vision
systems, Command and Control (C2) systems, and Air Force           TKCA will be celebrating its sixth birthday in July. Our
Special Operations Command Systems. Our team here                  knowledgeable staff continues working hard to grow our
consists of 29 people, with an average of 26 years experience.     business. Our vision is to be a family of small companies
Annual revenue from this contract is approximately $3M.            with over $100 million in annual revenues by 2015. We are
Our other U.S. Air Force contract is operated out of our home      proud to carry the Kuskokwim name and are committed
office in Charleston, SC. This team sources, acquires, and         to delivering aerospace solutions that maximize customer
sustains a broad range of ground support equipment for the         success.
U.S. Air Force. The objective is to improve War fighter support,
lower the cost to the government, and ensure continued
utilization of small business manufacturers. This year’s orders
to date are approximately $5M.


                                                                                                                                       9
     subsidiar y:
     Suulutaaq is a civil construction company participating in         Suulutaaq had prospects to begin construction on a
     the federal 8(a) program.                                          series of doctor’s office buildings in South Carolina, where
                                                                        construction was scheduled to begin in November 2009. The
     trAnsition PlAn oVerVieW                                           project is currently held up due to unforeseen environmental
     Suulutaaq is entering its second transition year in the SBA        issues. Suulutaaq has also been reviewing 8(a) competitive
     program. The past year produced approximately 7% of non-           solicitations.
     8(a) work; our goal was 15% for the first transition year. In
     Mid-March 2009, Suulutaaq, Inc. replaced its management            We have modified our bid strategy to include contracts in the
     team, and is working to improve its strategic plan. Currently,     $3-5M dollar range that would narrow the field of competition.
     Suulutaaq has projected a need of $6 million of non-8(a)
     work to meet the requirements for the SBA’s Transition             loWer 48 ProjeCts
     Year One and Two (15% and 25% respectively). For Fiscal            Suulutaaq is managing two large scale projects; one in
     Year 08, the 15% non-8(a) revenue would equal $947,000.            California and one in Arizona, as well as more than a dozen
     Of this, Suulutaaq obtained $417,000 during 2008 and has           smaller DeCA Décor jobs in the Western US. With USACE
     acquired an additional $446,727; leaving just under $83,273        Flood Control project in Napa, California is in its first year of
     to meet the 15% for transition year one. The management            three and is projected to have potential gross revenue of
     team is utilizing its existing resources to the fullest extent.    $65M over the three year period. The IOCC project in Tucson,
     Management is currently reviewing private industry                 Arizona is a $10M project that will be completed in early 2010.
     construction bids in Alaska, California, South Carolina and        Both of these contracts were awarded late in 2008, which
     Arizona. Suulutaaq presently holds contractor’s licenses           contributed to a dramatic shortfall of non 8(a) revenue.
     in Alaska, California, South Carolina, and Arizona, and does
     not foresee any issues with acquiring additional licenses if       AlAsKA
     necessary for future business opportunities. Suulutaaq has         Suulutaaq has an IDIQ contract in place with the Alaska
     recently opened an office in Charleston, South Carolina so         Army Corp of Engineers and a MATOC with Alaska Army
     that we are able to submit proposals on the East Coast that        National Guard.
     require local presence. Suulutaaq has also employed two
     longtime local contractors/developers to assist in procuring       summAry
     both federal and private contracts. In the last quarter,           The new Suulutaaq management team is taking action to focus
     Suulutaaq has submitted four proposals in the Charleston           on increasing full and open bid projects in both the
     area. Suulutaaq’s bonding capacity will allow the company          federal and private construction arenas.
     to submit bids on both Federal and private projects.               This will allow Suulutaaq to meet and/
                                                                        or exceed the SBA requirements
     Future non 8(a) reVenue                                            until such time as Suulutaaq
     The new management team is reviewing projects that would           graduates from the 8(a) program.
     include commercial construction in South Carolina, construction    As typical in the construction
     work for municipalities and highway expansion; civil projects      arena, Suulutaaq’s prospects
     for the USACE in California; and possible subcontractor work       are subject to common
     for Kiewit. Suulutaaq has also made connections with other         issues of funding and
     companies to subcontract work that would fill the non-8(a)         timing, which can push
     requirement. Suulutaaq’s goal is that each project has potential   solicitations out to
     gross revenue of at least $1-2 million.                            later in the year.




10
                                                         Positively Changing the Lives
                                                          of Alaska Native Children
                                                    The Kuskokwim Corporation is proud to publish Conflicting
                                                    Landscapes written by Clifton Bates and Father Michael J.
                                                    Oleksa.. Conflicting Landscapes is a catalyst for a productive
                                                     conversation about collectively rethinking and restructuring
                                                     the mission of Alaska schools, to assure the success and well-
                                                     being of future generations of Alaska Native children. All
                                                      Alaska Native parents, school board members, rural teachers
                                                      and school administrators, as well as university professors,
                                                      state officials and legislators are encouraged to read and
                                                      consider seriously the message of this book.

                                                       This book is about how our native schools were taught in
                                                       the past, how they are taught now, and how it can benefit
                                                       the lives of Alaskan children in the future. The writers of this
                                                        book care deeply for the children, and offer some concrete
                                                        ways in which the situation might improve today, and the
                                                        next several years.

            The writers state, “We understand how hard it is to teach in rural Alaska. We need to face and understand
  the problems, not deny them, and then we’ll proceed toward resolution. We can prepare teachers better. We can
  develop closer with parents and community leaders. We can help schools become a positive place, together with
  churches, tribal cultural organizations, health care providers, state and federal agencies. We can build happier,
  healthier communities, where children grow up with a positive sense of their personal and cultural identities, and
  become productive citizens in the modern world.”

  The book is also available for purchase at both TKC’s offices in Aniak and Anchorage. TKC is proud to publish this
  book and looks forward to growth in marketing and distribution.




    Iyana was a deeply spiritual man, relying on his Faith to overcome cancer and the loss of
 his own children. In my own life, he always seemed to show up at the right time with the right
words. One time I was running the dozer on the beach at Napaimute and started thinking about
   him. Wondering how he was doing. I turned my head to look before backing up the machine.
    There was Iyana standing there! Hmm, funny, how he showed up just when I was thinking
          about him. I believe there was more to the Man than just what we could see.


                                                                                                                          11
     l a n d a n d re s o u rce s
     The most important asset to TKC Shareholders and the               do n l i n C r e eK
     Corporation are the lands surrounding TKC’s 10 villages. TKC       Donlin Creek LLC, a Barrick/NovaGold company, is looking
     is comprised of the 10 villages that have merged together          to develop a potential gold mine 13 miles north of
     and combined resources and surface estate.                         Crooked Creek.

     TKC owns over 950,000 acres of surface estate in the middle
     Kuskokwim region of Alaska. The Regional Corporation,
     Calista Corporation, owns the rights to the sub-surface estate
     of this land. Generally, the surface estate that the Corporation
     has title to lies along the Kuskokwim River and its tributaries
     and streams from about 20 miles below the Village of Lower
     Kalskag to 20 miles above the Village of Stony River. The
     Corporation has an obligation to manage these lands for
     the benefit of the shareholders. The TKC Board of Directors
     is committed to the responsible development of TKC’s land
     and resources.

     Each year the Full Board of Directors identifies land goals in a
     strategic plan, and puts measures in place for accomplishing
               the goals. The Board has designated a 5 member           TKC is the surface owner of most of the lands where the
                    Land Committee devoted to addressing land           proposed mine footprint will be located. Extensive exploration
                       issues, and has sound land policies and          drilling began in the early 1990s and has defined a large
                        procedures in place that are continually        gold resource estimated to be about 30 million ounces of
                         updated and approved.                          gold. Significant challenges facing the mine development
                                                                        include power and infrastructure. TKC entered into an initial
                                                                        surface use agreement with the mine developers in 1995.
                                                                        While we have disputes with Donlin Creek, LLC over the
                                                                        agreement and the use of TKC lands, TKC continues our firm
                                                                        commitment to the Donlin Project. We are asking Donlin to
                                                                        meet us on fair ground to build a relationship that will be
                                                                        mutually rewarding for both parties.




                                      Iyana was also representative of the ever-shrinking group of people
                                   that lived the true old-style subsistence life. Traditional life in the Upper
                                   Kuskokwim was especially hard and Iyana’s stories reflected that. With a
                                faraway look, he talked about hunger, the constant movement in search of food,
                                 some hard times. But the gleam would come back in his eyes as he told stories
                                 with pride about the ability to run down a moose on snow shoes or to eat good
                                 by snaring whitefish in the Swift River with nothing more than a willow pole.



12
geogrAPhiCAl inFormAtion system (gis)                             this unique settlement that puts more land control directly
TKC implemented a full blown internal geographical                into shareholders’ hands. Moving forward we are using this
information system that allows for better land management         model to accomplish our goals with land reconveyance to
through mapping and imagery technology. We have                   the villages that have yet to complete 14(C)(3).
recently utilized this technology for a public application of
the mapping program that our shareholders and the public          P e r m i t P r o g r Am
can access on the web. We are proud to be on the cutting          TKC continues to implement a permit program to protect
edge of this technology, and share information about our          and better manage our land and resources. TKC offers
land and resources. The mapping site and land information         several types of access permits; Recreational Use Permits,
can be linked through our website for public use.                 Houselog permits, as well as Land Entry Permits. Land Entry
                                                                  Permits are granted on a case by case basis for project work
Co m m unit y Pl Anning                                           that promotes growth in our region or directly benefits TKC
Under the section 14(C)(3) of the Alaska Native Claim             Shareholders. TKC also administers a campsite program for
Settlement Act, TKC is obligated to reconvey certain lands        Shareholders.
 to our village’s for community purposes. A strong priority
     has been placed on finalizing these conveyances.             As part of our permit program TKC has trained staff patrolling
     TKC is proud to have developed a unique model of             privately owned lands to inform hunters of policies and the
      settlement with a combination of 14(c)3 and direct          permit program during moose hunting season. The main
        transfer. The Native Village of Napaimute was the first   responsibility of TKC patrollers is to provide information,
            to utilize this model by our thinking “outside the    document trespass when necessary, and educate travelers
               box” and working together to come up with          about TKC land policies.




                                                                                                                                   13
     o u r s h a re h o l d e r s
     At the end of 2009 the Kuskokwim Corporation had 3,025                   it was “life estate” stock and could not be inherited or gifted.
     active shareholders. With the passage of ANCSA, TKC had                  When a Class B shareholder dies, his or her stock goes back
     1200 original shareholders holding Class “A” stock. In 1994              into the corporation. TKC shareholders face a similar vote
     TKC’s shareholders decided it was important to bring the                 this April. The Class B stock authorized in 1994 ran out more
     next generation into the Corporation and voted to extend                 than a year ago. The TKC Board of Directors voted to place
     two thousand shares to children born after 1971, giving                  the additional stock option on the ballot for shareholder
     them rights to TKC dividends and voting rights. The new                  vote. TKC shareholders will vote on the issuance of another
     stock was “Class B” stock. Unlike the original Class “A” stock,          200,000 shares at the 2010 Annual Shareholder’s Meeting.



     s hA r eholder demo gr AP hiCs


                                      Active         18-35                                Under 18                                            Residing in
         Ward                           49%                                             years of age
          33%                                     years of age                                                                               TKC Villages
                                                                                            33%                                                  37%
                                                      34%

                                                                                           60+
                                                                                       years of age
                Custodian                                        36-59                     8%                Not Residing in
                    18%                                       years of age                                    TKC Villages
                                                                   25%                                               62%

     TKC’s shareholders consist of primarily Yupik Eskimos and Athabascan Indians. At this time the largest demographic age
     group is 18-35 years and 62% of shareholders are not living in TKC villages. This has been a growing percentage and is the
     highest of our recorded numbers, showing a trend towards moving to more urban areas.




     2009 A nnuAl meeting in uPPer K AlsK Ag, Al AsK A




     George Morgan and Steven aka Bumboy Alexie    Brystal Carey and Shaydene Morgan                   Lucy Kelila and Stephanita Kameroff




14
2009 shA reholder AWArd Winners


                 Humanitarian Award ............................. Bob Aloysius, Kalskag
                 “Bob believes children are the future. By his actions and words, he does his best to make sure the impression
                 he leaves on them is respect for themselves, culture, heritage and traditional values; strength to see a better
                 tomorrow and the belief that it can happen.” - Sophia Aloysius (Bob’s daughter), St. Marys



                 Health Award .......................Bernice Heatherington, Kalskag
                 “She is very dedicated and caring to her clients and is a professional in her ethics towards everyone. Health is
                 not only physical needs but also emotional and spiritual needs that are not physically evident but needs to
                 addressed and actively worked on.” - Dunia Morgan, Kalskag



                 Education Award ........................................ Elsie Simeon, Aniak
                 “Elsie is for the children attending school doing her best to make sure the kids get the best education. She also
                 serves as a Board of Director for the Kuspuk School District, I am very proud of her she is doing a great job.”
                 - Marie Kameroff, Aniak



                 Non-Shareholder Award ..................... Eleanor Sanbei, Aniak
                 “Eleanor is known for her beautiful beadwork and fur sewing also her
                 delicious baked goods. Every year she donates her work to fundraising
                 activities which include school events, the Aniak Winter Carnival and to
                 the Church. She is always willing to teach the younger generation
                 of her gifted talent.” - Darlene Morgan, Aniak




             I had the privilege of working under Iyana on the River for
        several years as a young kid and he continued to be a mentor right up
       to his passing early this year. Even before those good years of traveling
              the River night and day with him, we all knew who he was.

    Whenever the barge stopped in a village or he was just simply out traveling up
 and down on his own business, word would quickly spread around town, “Iyana’s here”.
  People would make a point of seeking him out wherever he was visiting to say hello
   and catch some news from up or down the River. “Where are the King Salmon?”
   “How’s the moose Upriver?” “You ever see Nixie & Margie?” “How they doing?”

 Kids would ask “Who’s that man?” The adults always responded, “Oh, that’s Iyana
    Gusty. He’s from way Upriver and he knows the River better than anybody”.

                                                                                                                                     15
     ku s ko k w i m e d u c at i o n a l f o u n d at i o n
     The Kuskokwim Educational Foundation (KEF) offers a general scholarship and specialized scholarships to any TKC Shareholder
     or descendents of a shareholder. KEF consists of (5) five Board of Directors who oversee the scholarship program which
     awards students funding for education whether for college or vocational training through the KEF scholarship program.

     mA ry morg A n WolF m emori Al sChol A rshiP Fu n d                 ni C K m e l l iC K me m o r iA l s Ch o l A r s h iP F u n d
                       The purpose of the Mary Morgan Wolf                                    Nick (Nixie) Mellick Jr. Scholarship was
                       Memorial Scholarship Fund is to honor her                              formed to honor Nixie. Throughout his life,
                       life by making a two or four-year scholarship                          he was a bush pilot, fur trader, lodge owner,
                       available to a Native Student from the                                 fishing guide, Native leader, businessman
     Middle Kuskokwim Region who is entering into a health-              and historian. He has been described as particularly adept
     related field. Mary was a loving person who was, and will be        at walking in both the Native and non-Native worlds. Mr.
     treasured by all that knew her. She was able to overcome            Nixie Mellick studied business at Bowling Green University
     incredible obstacles, and pursue her dreams. She carried a          in Ohio. KEF is honoring his memory with this scholarship to
     saying in her wallet that we can all learn from. It read, “I felt   fund TKC Region shareholders and descendents in pursuit of
     charity enter into my soul and the need to forget myself and        their degree in a Business and other related fields.
     please others: since then I have been happy.”
                                                                         n At u r A l r e s o u rCe e d uC At i o n s C h o l A r s h i P F u n d
     s u u lutAAq sChol A rshi P Fund                                                           This scholarship was created by a donation
                      Suulutaaq (pronounced Soo-loo-dock)                                       from Barrick Gold, and is available to any
                      which means “Gold” in Yupik is a Small                                    TKC shareholder or descendent who wishes
                      Business Administration (SBA) certified 8(a)       to pursue a career in the mining, industrial, or related fields.
     Alaska Native Corporation (ANC) general contractor created
     by a partnership between TKC Development and Nugget                 Congratulations to all our students with their outstanding
     Construction, Inc. (Nugget). Suulutaaq was created to provide       educational endeavors throughout the year, through
     design/build, engineering, civil and marine construction, and       the commitments they have shown through education.
     environmental remediation services to clients throughout            Graduating from high school is not the end of their
     Alaska and the lower 48 States. This Scholarship is being           education but they continue with higher
     offered to any TKC shareholder or descendents that are              education to become prosperous leaders.
     pursuing a degree in the construction field and other related       KEF recipients inspire our future students
     fields. Upon completion students will be considered for any         to continue with college or vocational
     job openings with Suulutaaq, with preference given to those         training after high school. Students that
     with leadership abilities.                                          would otherwise have not had the
                                                                         opportunity to continue with
                                                                         their education were able to
                KEF held the 5th Annual Silent Auction                   with support of Kuskokwim
         in Anchorage November 12, 2009 which raised over                Educational      Foundation’s
        $7,000 for the scholarship fund. Many businesses and             scholarship program. These
            individuals donated items for this special event.            scholarships     are    from
                                                                         donations received from
                                                                         individuals, businesses, and
                                                                         corporate sponsors to KEF.




16
        2009 sChol Arshi P re Ci P ients                  Kuskokwim Imagination Library
             Eunice Alexie Career Academy               Children in 10 villages along the
        Derek Beans Yaqungviat Flight School            Kuskokwim River will be eligible
      Pauline Boratko UAF-KuC Bethel Campus             to receive a free book every month from Dolly Parton’s
     Anna Boyers University of Alaska Fairbanks         Imagination Library, thanks to a commitment from the
          Jeannie Butler Chapman University
                                                        Kuskokwim Education Foundation (KEF).
    Helena Cogan University of Alaska Anchorage
      Janeeka Corbett University of Oklahoma            Working with Best Beginnings, KEF will underwrite the cost
              Ryan Cox Liberty University
                                                        of the program and manage the database and enrollment.
     Levi Egoak University of Alaska Anchorage
                                                        The decision to sponsor Imagination Library in its villages
       Sophie Ekolook Alaska Pacific University
                    Alex Evan AVTEC                     represents a new direction for KEF, which until now has
  Samuel Guzauskas University of Alaska Anchorage       funded only scholarships for post-secondary college and
           Amanda Hoffman Charter College               vocational education. Imagination Library mails a brand new,
 Harold Huntingtom University of Alaska Anchorage       age appropriate book each month to every child from birth
 Janelle Huntingtom University of Alaska Anchorage      to age 5 who signs up for the program in their community,
         Caleb Kristovich North Idaho College           regardless of family income. The Dollywood Foundation
       Melissa Kristovich George Fox University
                                                        manages the system to deliver the books to the home.
        Megan Leary UAF-KuC Bethel Campus
      Allison McIntyre UAF-KuC Bethel Campus               “For a relatively small investment, we can make a big
             Elsie Norback Charter College
         Pamela Notti University of Oklahoma
                                                          difference in children’s futures. It makes good sense to
      Ellen Parker University of Alaska Fairbanks        us to start our children on the path to literacy and love
          Janelle Shanagan Career Academy                of reading as early as possible. Children exposed to books
           Sydney Sherer University of Idaho                   early on are more likely to go to college later.”
       Bobby Simeon Alaska Technical Center
                                                               - KEF Board Member and TKC CEO Maver Carey
   Francine Simeon University of Alaska Fairbanks
        Thecla Takumjenak Indiana University            The KEF mission is to contribute to the future of its region
    Katya Wassilie University of Alaska Fairbanks       by providing effective educational assistance in order that
       There were 29 scholarships awarded               students obtain the tools, knowledge and skills to become
   totaling $30,750 for the 2009-10 school year.        successful and contributing members of their communities.




      One of the greatest influences Iyana had on me happened two years before I had started college.
Like most young men, I wanted to be home running around hunting, trapping and fishing. It was October while
we were pumping fuel in Aniak. Iyana and I were sitting on the bow of the barge chatting and telling stories.
     After a while he asked if I was going back to school. I said ”No, I don’t think so. It’s not for me.
                                   I just want to keep working on barges.”

Iyana looked at me hard and spoke the words that had a profound effect on the rest of my life. He told me
“No, -You go back to school. You need your education. Go finish. Then come back home and help the People”.

        Those words stuck hard - I did go back to school. I finished. I always tell my kids and anyone
else that will listen: Just because you have a formal education doesn’t mean you’re smarter than other people.
   Some of the smartest people I’ve known didn’t read or write English, but they could think, make something
                       out of nothing, persevere through anything - Iyana was one of them.

                                                                                                                       17
     t kc b o a rd o f d i re c to r s




     leo mor gA n            K At h l e e n h oF FmAn         d u n iA morg A n         mon A morroW          hermA n morg A n      A ngel A morg An
     Chairman                Vice Chairman                    Secretary / Treasurer




                    j Ay l e n e             WA s s i l i e K Am e r o F F   je FF nelson         lorr A ine egn At y     mArC e simeon
                    Peterson-nyren




        He taught us so many things, but I think most important was the respect he showed for the people from the head
     of the River to its mouth and the respect they showed him in return. Through Iyana I could see that we really are one
     people connected by the common bond of the water the flows before us. Sometimes we don’t always agree on issues such
       as fish and game allocations for different parts of the River or how to build an economy for our region, but Iyana,
         a man comfortable in Nikolai or Nunapitchuk, through the quiet demonstration of the way he lived, was able to
               show us that we can respect each other, get along, and that we can compromise for the greater good.


               In later years, I watched him use this
             skill on the Kuskokwim Corporation Board
          of Directors, to keep meetings focused on what
          was really important - the good of the People.




18
co m m i t te e s o f t h e b o a rd
E x E c u tiv E commit t EE                                                               L An d co m m i t tE E
Functions include monitoring and recommending changes                                     Functions include reviewing in detail 14(c)3, ensuring TKC
to TKC’s stock and bond portfolio, retain the service of an                               has sound land policies governing Corporation land use,
investment brokerage firm and review all issues which come                                executing transactions involving TKC lands per limits of
before the Committee.                                                                     Board policy and reviewing all land uses which come before
Leo Morgan ...............................................Chairman                        the Committee.
Kathleen Hoffman .................................Vice Chair                              Mona Morrow
Dunia Morgan..........................................Secretary/Treasure                  Herman Morgan
Marce Simeon                                                                              Jeff Nelson
Wassilie Kameroff                                                                         Lorraine Egnaty
                                                                                          Kathleen Hoffman
Au d i t commit tEE
Functions include providing oversight of TKC’s internal                                   P r ox y/c rEd E n t iA Ls co m m i t tE E
control structure, auditing practice and performance.                                     Functions include certifying candidates running for election
Angela Morgan                                                                             to the TKC Board of Directors, reviewing and ruling on any
Lorraine Egnaty                                                                           challenged or questioned proxies received prior to the
Dunia Morgan                                                                              annual shareholders meeting.
                                                                                          Leo Morgan
                                                                                          Marce Simeon
                                                                                          Dunia Morgan




t kc s t a f f




mAVer C Ar e y                r ACh e l K l e i n           d e l C l A rK                tA r A-jo broWn           C heryl tAnner            ni C hol A ruedy
President & CEO               Land Manager &                Chief Financial Officer       Senior Accountant         Accounting Assistant      Human Resource
                              Chief Operating Officer                                                                                         Manager




             dA i s y Ph i l li P s            AmAn dA s Ag m o e n          sA lly hoFFmA n          renee Frederi CK s          sAm boyle
             Marketing Assistant               Corporate Compliance          Aniak Office Manager     Suulutaaq, President       TKCA, President
                                               Specialist




                                                                                                                                                                 19
                     In Memory
        Alice Evan            Ignatti Ignatti
     Andrew Alexie Jr.       Joseph Nicoli Jr.
      Annie Waskey             Malania Nash
     Carolyn R. Crane       Mezak Kameroff Sr.
      Doris M. Grato          Nick Bobby Sr.
      Exenia Zaukar           Patricia Simeon
      Floyd J. Nook              Pete Alexie
     George C. Gregory        Pete Zaukar Sr.
                               Peter E. Wise
                            Philip W. Simeon Sr.
                             Rodney A. Sakar
                               Sarah Askoak
                               Simeon Boots




20
           A nC h o r Ag e oF Fi Ce
         4300 B Street, Suite 207
        Anchorage, Alaska 99503
          Phone: 907-243-2944
            Fax: 907-243-2984
Toll Free (in-state only): 1-800-478-2171

            l An d d ePA rtm e n t
                P.O. Box 227
            Aniak, Alaska 99557
          Phone: 907-675-4275
             Fax: 907-675-4276
Toll Free (in-state only): 1-800-478-4275



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