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By Richard Griego, PhD
Announcement in New Mexico Business Weekly
The August 23, 2005 New Mexico Business Weekly announced that Westland Corporation was "prepping" the 57,000 acres of the Atrisco land grant for sale to an undisclosed company for $159 million (the company has since been revealed to be ANM Holdings). The proposed sale was news to the shareholder/heirs of Westland Development Company, which is the corporate arm of the historic Town of Atrisco. Five days prior to the public announcement the Westland Board of Directors had filed with the SEC to sell the corporation. No attempt had been made to inform the shareholders of the sale before the New Mexico Business Weekly article.
The stage is set for a battle between Westland's leadership, who wants to sell the land, and dissident heirs/shareholders, who oppose the sale. The pro-sale side says that it is seeking a good deal for shareholder (and especially the leadership, I might add - see below) and the anti-sale side accuses the leadership of mismanagement and these dissidents fear the loss of a 300-year heritage and their ties to the land.
State Representative Miguel García has lodged a complaint (NM Business Weekly, Oct. 21) with the Securities Division of New Mexico in which he says that Westland has misled shareholder about the sale and that the process has been shrouded in secrecy and without input from shareholders. García also alleges that Westland's directors have engaged in inside trading by soliciting to buy stock at $25 per share ($5 more than the market value), while not informing stockholders of the proposed sale at $200 per share. Barbara Page, CEO of Westland denies the charge. She says the offers to buy the shares were made before Westland had been approached to sell Westland's assets. The month of December 2005 will be decisive in determining which way the fight goes because a proxy vote of the shareholders to approve or oppose the sale will likely be held this month.
Origins of Atrisco
The name Atrisco comes from the Náhuatl word Atlixco, which means "place on the surface of a body of water". It is likely that Náhuatl-speaking Indians among the 1598 Juan de Oñate colonizing expedition settled the valley between Isleta and Sandia pueblos which became to be known as El Valle de Atrisco. The history of the earliest settlements in present day Atrisco is lost in the mists of time, but most probably the above mentioned Tlaxcalan Indians (Tlaxcaltecas, in Spanish) settlers first apppeared in Atrisco around 1640; Spanish/Mexican settlers soon followed. In 1680 the Pueblo Revolt drove the Spanish/Mexicans out of New Mexico, but they returned under the leadership of Diego de Vargas in 1692. That same year de Vargas, acting as the Governor of New Mexico, approved a petition by Captain Fernando Durán y Chávez for land in Atrisco on which his family had lived prior to the Pueblo Revolt. The Atrisco land grant consisted of 41,500 acres.
A History of Conflict
The recent conflict is only one in a long series of battles over the Atrisco land grant. Between 1759 and 1766 the settlers of Nuestra Señora de San Francisco y San Blas del Río Puerco land grant west of the Atrisco grant complained of encroachment on their territory by Atrisqueños and on occasion drove off the trespassers by force. On the other hand, the settlers of Atrisco claimed the disputed land was vacant and that they needed additional land to graze their livestock. Subsequently, the Atrisqueños petitioned Governor Pedro Fermín de Mendinueta for additional land to be added to their original land grant and in 1768 the request was granted. The Atrisco land grant was extended by 26,000 acres and after this time the Atrisco land grant comprised land from the Río Grande on the east to the Río Puerco on the west.
There were various disputes among Atrisqueños over boundaries, genealogies and land titles. Sometimes land documents were lost and new documents had to be notarized as a basis for future legal ownership. The 1804 census counted 224 Atrisqueños, among whom were settlers who were distantly related, or not at all, to the original Durán y Chávez family, but who had acquired an interest in Atrisco lands. Overall, laws dealing with land ownership and transferal were well established and observed during the Spanish colonial period.
In 1821 Mexico gained its independence from Spain and New Mexico became a part of the nation-state of Mexico. The Mexican government encouraged colonization of its northern frontier by anyone who would swear allegiance to the Mexican government, become a Roman Catholic and bring in new settlers. This policy applied to foreigners also, causing some consternation among Nuevomexicanos. However, these policies had little effect on Atrisco since it was a land grant from the Spanish period. Atrisqueños conveyed their land much as before.
The "Town of Atrisco" is Incorporated in 1905
A new flag, a new government, new laws, and a new language came to the people of Atrisco with the American conquest of New Mexico. The war between Mexico and the United States was concluded by the Treaty of Guadalupe Hidalgo of 1848. Guarantees granted by the Treaty to the newly acquired Mexican citizens often were not enforced. In particular, land grant rights were violated and huge losses of land were suffered by Nuevomexicanos through corruption. Atrisqueños presented the Territorial Surveyor General a petition to retain the historical land os the Atrisco and Río Puerco land grants. While the Surveyor General George Julian in 1886 approved recognition of the land grants, the Commissioner of the General Land Office of the U.S. Department of Interior rejected the claim due to lack of original documents for the 1692 and 1768 grants (they had been lost), unclear boundaries and an incomplete list of heirs. However, in 1891 the New Mexico Territorial Legislative Assembly passed a law providing for the incorporation of community land grants. A Court of Private Land Claims was also established to adjudicate land grant claims. This paved the way for the settlers of Atrisco to have their historical land claims officially recognized.
The Town of
Atrisco Grant, 82,728.72 Acres
In January of 1892 a petition with 225 named incorporators and 90 signatures was submitted for incorporation of the Town of Atrisco that would hold title to the land grants of 1692 and 1768. The Court of Private Land Claims issued a decree approving the petition in September 1894. Finally, on May 5, 1905 President Theodore Roosevelt signed a United States Patent conveying 82,728.72 acres to the Town of Atrisco.
Patent for the Town of
Atrisco Signed by President Roosevelt 1905
I myself am an Atrisco heir and a shareholder in Westland through my maternal grandmother Adelaida Martín de Mercado. Her mother María de los Ángeles Sánchez de Martín and grandfather Manuel Sánchez y Anaya were original incorporators of the Town of Atrisco. So, I have an interest in what befalls Atrisco and Westland. My economic stake is not very high since I own just a few shares, but my grandmother's tales about the land our family once owned (in common with the other Atrisqueños) and the corruption surrounding the Atrisco land grant still resonate in my being.
There were questions as to who were the actual heirs of Atrisco. Hence, in 1935 the U.S. District Court called for the determination of all legal heirs and this process continued until 1952.
Challenges of Economic Development and Shady Dealings
Atrisqueños sought means by which the land could be used for economic development for the benefit of the people. In 1959 4000 acres were sold to Hoffman Homes for $1,250,000 (what a cheap price!) in order to establish the Westgate commuity. Atrisqueños complained that the fruits of this purchase did not accrue to the heirs at large.
In 1967 a New Mexico law allowed for land grants to be reorganized as for-profit corporations in which the legal heirs would become holders of stock in the corporation. A close vote of 583 to 528 by heirs approved the creation of Westland Development Company, Inc. to serve as the corporate arm of the Town of Atrisco. Heirs received shares in Westland in proportion to their ancestors' interests in the Town of Atrisco's lands. However, Sósimo Padilla, chair of the Westland Board of Directors since 1989, has said that "There are no more heirs. They became stockholders when Westland was formed in 1967. I can say that I'm an heir of Westland, but I'm not. I'm a stockholder. It's that simple." Well, actually he's wrong. Westland is just the corporate arm of the Town of Atrisco. The Town itself has not been disincorporated. There are heirs who are not shareholders, some who have sold their shares and others never got them in the first place for some reason. Of course, they get nothing from Westland. Padilla is the voice of corporate America. He sees nothing but assets, shares, shareholders, profits and dividends. He has also taken very good care of his position within the company as we can see below.
Unfortunately, the transition to a shareholding cororation did not end Atrisqueños' problems. Abuses by the Westland Board of Directors led to charges and recriminations. Westland President Gil Cordova, former President of the University of Albuquerque was found guilty of violating federal racketeering laws for purchasing shares from three shareholders and not disclosing to them the true value of Westland assets. Portions of Córdova's conviction were overturned on apppeal, but the three plaintiff shareholders received $56,972 in damages. Subsequently, Córdova was ousted as president of Westland in February 1989. Alberto Candelaria became Acting President, but he was replaced by Barbara Page (Gallegos) in July of the same year and she continues as the current President and CEO of Westland.
The Current Board - More of the Same
Currently, a dissident group, Concerned Heirs of Atrisco (of which I am a member), claims that the current Board and Ms. Page are guilty of many of the same abuses committed by previous boards. However, the stakes have gone up now that Page, herself a Director, and the other 8 members of the Board of Directors intend to sell the land assets of Westland to ANM Holding Inc., a corporation that was formed in September 2005 specifically for purposes of acquiring the lands and which has ties to Arizona developer Philip Aries. Page has known Aries for several years, so they share a history that has not been revealed. James Aranda, a member of Concerned Heirs and a stockholder, claims that the articles of incorporation of Westland prohibit the sale of common lands of the old Atrisco land grant. (Section III, Articles of Incorporation of Westland Development Co., State Corporation Commission, 1967). However, at a stockholder's meeting in 1997 the provision prohibiting sale of the lands was struck out, ths opening the way for Westland to do with the land what it wants. The process by which Westland has arrived at such decisions as the modification of the prohibition against selling the land has been questioned by Concerned Heirs of Atrisco.
Westland sold 2,000 acres to $30 million to the U.S. Park Service for establishment of the Petroglyph National Monument in 1990, before the amendment to the no-sale article. The former Atrisco lands make up almost a third of the monument. I have no reliable information as to how this money was spent, but I can tell you that it was not for dividends for the shareholders, because I didn't get anything much of a dividend check (the highest dividend tht has been paid is $1.07 per share in 2004). Most likely, the money was reinvested in the properties of Westland and for bonuses for directors and employees.
Aranda also says the land is worth much more than the offered price of $159 million. Indeed, a New Mexcio Business Journal article refers to Westland as a "billion dollar plum ripe for the picking." The price being offered by ANM amounts to about $2800 per acres, much less (as Aranda points out) than the average cost of $60,000 for residential land and $86,000 to $129,000 per acre for commercial land. Jaime Chávez, an heir/shareholder and longtime critic of the Westland leadership, claims that Ms. Page ran for the Board of Directors on a platform of reform that would empower shareholders and stop the sale of the lands. Also, it is claimed Page herself has settled a number of lawsuits both in and out of court for securities fraud throughout the 1990's. (Deposition of Alfredo Sánchez; Westland and Gil Córdova vs. Kenneth T. Romero, et al. No. CV-87-8518. Second Judicial District Court, Oct. 25, 1994)
Board Mismanagment and Self-Enrichment
Aside from the charge that the sale of the land is at far too low a price (and that it whould not be up for sale in the first place), major charges leveled by Concerned Heirs against Barbara Page and the Board of Directors are ones of malfeasance, fraud, insider trading and general mismanagement.
James Aranda, who is a master's degree candidate in Community Planning at UNM, claims that Westland depends on the sale of lands to generate income. For example. land sales account for 88% of fiscal 2002 revenues and rental, 12%. Aranda says this a shortsighted strategy since it depletes the sole asset of land.
The income earned by Westland officers and Board Members is out of proportion to the dividends paid to shareholders. In 2004 each share received a dividend of $1.07. In all 6021 shareholders were paid $797,159 based on corporate earnings of $1,060,211. At the same time, compensation for Westland officers has been quite high as the following shows (based on 2005 SEC Report) - total compensation does not include dividends from shares for those officers who are also heirs/shareholders.
Barbara Page, CEO 2003 Total compensation $272,347
2004 Total compensation $153,583
2005 Total compensation $153,583
Leroy Chávez, V.P. 2003 Total compensation $114,461
of Development 2004 Total compensation $153,295
2005 Total compensation $158,402
Brent Lesley, V.P. 2003 Total compensation $108,122
of Marketing 2004 Total compensation $148,587
2005 Total compensation $161,864
Linda Blair, V.P. 2003 Total compensation $ 94,017
2004 Total compensation $103,295
2005 Total compensation $107,951
Fred Ambrogi, V.P. 2003 Total compensation $ 95,646
of Marketing 2004 Total compensation $129,973
2005 Total compensation $138,696
Sósimo Padilla, 2003 Total compensation $131,091
Chair of Board 2004 Total compensation $ 75,381
of Directors 2005 Total compensation $ 97,362
(Mr.
Padilla is paid a Director’s fee of $1,800 per month plus his annual
consultant fee of $50,000
These are very high compensations
for the amount of return for the
shareholders.
Only lineal descendants of the
incorporators of the Town of Atrisco are
eligible to own No Par Value Common Stock, of which as of 2005 there
are 709,827 shares owned by 6083 shareholders. However, the Board
also controls Class B shares that allegedly were originally meant for those
heirs that somehow did not receive shares when Westland was first
established in 1967. To date the Directors have given Class B shares only
to each other, essentially as stock options, perverting the original intent
of these shares. 85,100 shares have been allocated so far, some to past
directors. The Board of Directors has control over a total of 491,112
authorized Class B shares. There are 51 Class B holders. Also, each time
the Board assigns a Class B stock, a No Par stock is diluted in its value.
Golden Parachutes for
Directors and Officers of Westland
According to the SEC report
that Westland filed in 2005, Board members
would receive thousands of Class B stocks "when there is a threat of
change of control with three or more director seats threatened" or when
there is "an offer to acquire a majority of all issued and outstanding
shares of Westland common stock" (i.e., as in a sale). Directors who have
served 10 or more years (Page, Padilla, Chávez and Castillo) would receive
a bonus of 5000 Class B shares and those who have served less than 10
years (Peña, Sánchez, Mares, Benavídez and Baca) would receive 2500
shares. Wow! If the sale at $200 a share goes through, Directors would
receive either $1 million or $500,000, and even if we are successful in
throwing them off the board they still get the 5000 or 2500 Class B
shares. Talk about taking care of yourself! Here are the estimated
earnings from shares they already own (i.e., not counting the above
bonuses of 5000 and 2000 shares) that Directors would earn in the
event the sale goes through at $200 per shares.
Estimated Share Earnings
for Directors from Sale at $200
Per Share - not counting Class B shares to be given upon the sale
Yr.Apptd No Par Share Class B Share Total
Class A Directors
Barbara Page 1989 $529,400 $1,960,000 $2,489,400
Charles Peña 1996 $20,000 $100,000 $120,000
Randolph Sánchez 2004 $2,800 $2,800
Class B Directors
Sósimo Padilla 1971 $461,600 $4,140,000 $4,601,600
Joe S. Chávez 1995 $62,600 $40,000 $102,600
Ray Mares, Jr. 2004 $150,200 $67,000 $217,200
Class C Directors
Troy Benavídez 2004 $20,000 $20,000
Josie Castillo 1984 $147,600 $1,900,000 $2,047,600
Georgia Baca
2004 $247,200 $247,200
*Based on
2005 SEC Report No Par Shares = common shares owned by heirs
Class B Shares = shares controlled by Board; not accessible to ordinary
shareholders.
Furthermore, Westland
officers are to earn up to six times their annual salaries if
they are “involuntarily terminated”. The 2005 report states about Barbara Page:
"Since December of 1991 Ms. Page has been employed as the Company's President
under a renewable five-year employment agreement. If Ms. Page is involuntarily
terminated during the term of the agreement she shall be paid, in addition to
any
salary earned to the date of such termination, an amount of cash equal to six
times the amount of her annual salary plus the cash value of all other
employment benefits that have accrued on the date of termination". The same
provision applies to Sósimo Padilla, Linda Blair, Leroy Chávez and Brent Lesley.
Poor Fred Ambrogi only gets one year’s worth of salary; his employment
agreement is only for three years.
Again, this is a case of the Company enriching
itself at the expense of the
shareholders. Even if we get the chance to fire these
people, they make out like
bandits. So, the Board of Directors of Westland has
planned golden parachutes for
themselves and the Officers. Westland seems to
be trying to emulate big name
corporations who have done pulled similar stunts
on their shareholders. None of
these tidy arrangements are mentioned in the
shareholders Annual Report; this
kind of information was obtained by going to
the SEC report via the internet.
One can see why the Directors are not anxious
to have the shareholders become
aware of these business practices.
Charges of Insider
Trading and Stock Manipulation
As mentioned before, State Representative Miguel García has filed a complaint
with the New Mexico Securities Division that Westland’s directors have been
buying up shares at $25 per share (the market value is $20) without informing
the shareholders, who would sell their shares, of the pending sale to ANM at
$200 per share. If this charge is true and if it is proved, then the
perpetrators of
this scheme could be guilty of insider trading. Ms. Page denies the charges of
insider trading. One heir says that he had initially bought 50 shares a few
months ago. Being new to transactions with Westland, he called Barbara Page
and offered her his services as a computer systems technician for free (as a way
of helping out the company, so they would not have to pay for these services).
Page rather coldly declined the offer of help and said that the company paid for
these sorts of things; no thanks for the offer of help; nothing. Later, he came
into
some money from a real estate
transaction and he wanted to purchase some
shares. He was told by Westland’s broker that some shares were available (in
amounts of 1000, 161, 45 and 30
shares). In subsequent phone calls the broker
was quite unresponsive and the broker at first said that shares were no longer
available and then later that there were to be no more transactions with regard
to shares because of the pending sale. This heir figures that the broker had
been
told to be wary of him; the heir feels that Westland is suspicious of anyone who
expresses an interest in the workings of Westland and was thereby frozen out.
In actuality, shares should be able to be bought (even at the proposed sale
price
of $200 per share), even if a sale
is pending. It is also alleged that on September
6, 2005 Barbara Page informed a
shareholder who was attempting to acquire
stock that all stock transactions
had been frozen upon announcement of the
proposed sale. Supposedly no
stocks could be sold, bought or transferred. Yet,
according to an SEC file, Ms. Page
transferred 1,000 shares to her daughter and
granddaughters on September 8, two
days after the time that everything was
said by her to be frozen. Ms. Page
told the New Mexico Business Weekly that she
was simply trying to do some
family financial housekeeping (estate planning)
with the transfers.
Proxy Vote Slated Soon
A proxy vote will be held in
December 2005 (normally held in November each year)
(as of April 1, 2006 Westland has NOT announced a meeting)
to determine if shareholders give
Westland the authority to sell the
land to ANM
Holdings. The whole proxy
process is of concern to James Aranda and the Concerned
Heirs of Atrisco. It is
alleged that the proxy vote process is flawed and subject to
abuses. For
example,
says Aranda, in the past votes have been cast in the name of
people who have
died. It is claimed also that Westland does not count some of the
votes that go
counter to Westland policy are not counted. Westland itself handles the
proxy
process, including the vote counting.
A two-thirds majority vote of outstanding common shares need to be in favor
of changing Westland bylaws to allow non-heirs to buy shares, thereby
allowing ANM to buy out all Westland shares. A shareholder’s vote depends on
how many shares the shareholder has. If a shareholder has 10 shares, then the
shareholder has 10 votes; if 1000 shares, then 1000 votes. Given the lack of
information that Westland has issued regarding the sale, there are worries on
the part of the Concerned Heirs that shareholders will not have adequate
knowledge about the details of the sale. There are also worries as to how the
proxy statement will be phrased and whether it will be clear for what share-
holders are voting.
The concerns about the gathering and counting of votes have led the Concerned
Heirs to ask for assistance from the League of Women Voters. The League has
agreed to offer its services to assure a fair and equitable voting process, but
if
Westland objects to the participation of the League, then it will opt out. A
letter
will be delivered to Westland soon asking as to how the process is to be handled
and, perhaps, to ask the League for its help.
What’s at Stake – Powerful Forces in Favor of the Sale
What’s at stake is simply the future of Alburquerque. The City has only one way
to grow – to the west. If Alburquerque were to have the Atrisco lands closed to
Alburquerque’s development, it would be in serious trouble. The Concerned Heirs
are not against development (if it is planned and controlled development); but
they do want the lands maintained under the control of the heirs of the
historical Town of Atrisco and
they also want Westland reformed to be more
accountable and to get a better return for the shareholders.
Another possibility is to have Westland dissolved and replaced with an
alternative structure. James Aranda has spoken of Senate Bill 22 and its
provision to allow a Chapter 49 status to land grants whereby they would be
classified as political subdivisions. Twenty two of the 40 land grants in New
Mexico have this status. This means that they have access to public monies for
economic and other development. They can do their own zoning and land use
planning, but they also have to abide by open meetings laws and to hold open
elections. Also, it is possible for such a land grant to purchase land grant
land
that has gone to other hands, but is then place on the tax block. A Chapter 49
land grant can have right of first refusal for purchasing any such lost land.
Thus, even if the proxy vote is in favor of the sale of the common lands of
Atrisco, it would be possible for the Town of Atrisco (which has never been
disincorporated) to gain Chapter 49 status and begin the slow process of
reorganizing itself and possibly buying back some of its lands. Aranda puts it
this
way: “We have to create our own community – it’s no longer about running back
to the farm. It’s about generating capital and developing our own communities
in a substantial manner that respects our history and culture.”
Make no mistake about it – powerful forces are at work to make sure that Atrisco
lands are placed in the hands of developers. Fred Mondragón, Albuquerque
Economic Development Director has stated (NM Business Weekly, August 23,
2005) that “a new owner could be good for the city, if it is someone with the
resources to develop the land with an eye toward quality development and
who is willing to work with the city and have the development become part of
Albuquerque. … Westland would be well served by finding a master developer.”
However, most of Westland’s properties lie within Bernalillo County and not
the city of Alburquerque. So, it is not at all assured that the 57,000 acres
}entailed in the sale would be incorporated into Alburquerque. Page herself
says, “(ANM) may want to make a separate city.”
Mayor Martin Chávez also has a vital personal interest in the development of the
Atrisco lands. His father Lorenzo Chávez served as the lawyer for Atrisco for
many
years; in fact, it was he who oversaw the institution of Westland as the
for-profit
corporate arm of Atrisco. Martin Chávez has also served as a Westland lawyer.
The elder Chávez received shares and land for his work. Thus, Martin Chávez
has Westland shares and Atrisco land too. The San Juan Chama water project,
for which Mayor Chávez worked so hard, will open up the Westside for
development. It is claimed that Chávez has explored installing waterlines behind
the Petroglyphs. Westland contributed $5250 to the Mayor’s recent campaign.
Also, it is well known that Chávez has close ties to and the support of Westside
developers, and he himself has pushed issues that facilitate the development of
the Westside. All citizens of Alburquerque have a vital interest in what happens
with Atrisco’s lands. The Concerned Heirs of Atrisco want rational planning and
controlled development on the Westside. Would ANM Holdings feel the same way?
A Community Fights for Its Heritage
On Monday, December 5 an informational vigil was held in front of the Westland
Development Company headquarters on south Coors Boulevard. About 50
Concerned Heirs of Atrisco (including me and my wife Genara) marched
around with placards and shouted out their opposition to the sale of the land
that our ancestors handed down to us. Our little demonstration was covered by
five television channels and by the Journal. Westland officials steadfastly
refused to speak to the media, just as they have refused to speak to the
dissident
shareholders. Ramón Chávez, an elder of Atrisco, expressed his agony at the
prospect of losing the land because we would lose all rights – mineral and
water rights, as well as cultural rights and a heritage that we should hand
down to our young ones. In speaking to Channel 41, the local affiliate of the
Spanish language Univisión network, Jaime Chávez said, “Esto es un acto de
genocidio cultural.
Estamos preocupados
por nuestra morada en la merced que
es una de las más viejas del estado. Y Westland está proponiendo hasta vender
los camposantos donde descansa nuestra gente.”
– This is an act of cultural
genocide. We are worried
about our morada (Penitente house of worship) on
the land grant that is one of the oldest in the state. And Westland is even
proposing to sell the cemeteries where our ancestors rest.
Thus, the issue of sale of the land is not only an economic one for Atrisqueños.
With the loss of the land Atrisqueños feel they will lose their sense of
community,
heritage and identity. Jaime Chávez also proclaims that it is ironic that on the
eve of Alburquerque’s tricentennial, we are on the brink of the destruction of a
more than 300 year old heritage. Many of the protest signs at the vigil
declared,
“Atrisco vive. La tierra santa no se vende.” – Atrisco lives. Our holy
tierra is not for
sale. We will see whether this is a vain hope or not.
Don Ramón Chávez (on the right)
Jaime
Chávez and Janet Aranda
Richard Griego Bearing La Virgen de Guadalupe
