FII Survey Questionnaire – 2006

 

After a reasonable amount of discussion, the Frye Island Board of Directors have determined to make the survey results available to all Islanders to review via the Frye Island website. The Board was split on the wording to be used to introduce the survey results. In order to give the Stockholders the complete view, both a Majority Report and a Minority Report are included. Survey Details are provided in the attached document

Majority Report

Approved by Ed Charrette, Bob Hannah and Joe Potts

On May 13, 2006 the FII Board of Directors sent out a survey to FII Stockholders. The purpose was to provide the Board some guidance on a number of actions regarding FII-owned real estate. The primary driver for the survey was a sale/buy-back concept that four of the five Directors on the FII Board were supporting. A nine page white paper was included with the survey to provide the Stockholder with an understanding of the sale/buy-back concept; two of the nine pages provided views of the one Board Director that opposed the sale/buy-back concept.

The deadline for returning the completed survey was set at June 15, 2006. A very precise technique was designed to tally the results of the survey in an Excel spreadsheet. A great deal of effort was taken to insure that each of the surveys submitted was recorded accurately. In many cases, the stockholder annotated the survey questionnaire with questions and comments. All of those annotations were captured in the tally.

There is one share of stock associated with each Frye Island lot owned, except for lots owned by Frye Island Incorporated (FII) and the Town of Frye Island; they have no stockholder status. There are 848 stockholder votes possible in FII. There were 283 completed questionnaires returned, a 33.4% of stockholder votes.

Now that the survey questionnaire process has been completed, it is unfortunate to report that the design of the survey wording and the process used to mail out the surveys have some serious faults. The following bullets summarize these faults:

The FII Board of Directors has concluded that the tabulated results of the questions in Part II of the survey are of questionable value. Since the Board feels strongly about complete transparency and full communication to the FII stockholders, we are providing a complete copy of the survey results on the Frye Island website; to maintain stockholder privacy, any reference to lot number or stockholder name was removed from the posted results. It does include all of the annotated comments from the stockholders. We caution the use of the results of any of the Part II questions in making future decisions.

Minority Report

Approved by David Gleeson and Phil Perry

On or about May 13, 2006 the FII Board of Directors mailed a survey to FII Stockholders. The survey's primary purpose was to gain insight and seek guidance from the stockholders on a Sale-Buy Back proposal as well as to obtain their views on other real estate owned by FII. The deadline for returning the survey was set at June 15, 2006.

As you read the survey results, please be aware that certain elements of the survey were the subject of intense scrutiny by a few stockholders. These concerns were voiced and are recorded in the July 1st 2006, FII Stockholder Minutes. They are as follows:

(A)         A majority of the Board had established a different agenda, and subsequently different ideas from the somewhat coordinated agendas and general understanding between the different Boards on the Island.

(B)         The questions were constructed in such a way as to produce a certain bias.

(C)         Used the survey to violate the expectations that all stockholders entrusted the FII Board to pass assets to the Town, to offset various building and other capital improvements as may be required from time to time.

(D)         The manner in which the survey was presented was done in such a way that the stockholders had little or no idea what it was that they were participating in.

(E)         Other concerns expressed concern regarding potential tax liability issues associated with the Sale-Buy Back proposal.

The former FII board believed they were acting in the best interests of the majority of the stockholders in proposing a possible way to reduce the overall number of houses on the island (and thus reduce the strain on island infrastructure). Others believe that there are better ways to utilize FII assets.

The entire matter of the Sale-Buy Back proposal has been deferred until the FII board meets on August 11, 2006.

In order to more fully understand the proposal’s basic tenets, we urge you take the time to review the FII Real Estate Policy of September 2004 (available on line at the town website) before studying the survey results.

 

Posted: 08/16/2006