Forum for Shareholders of Crowley Maritime Corporation

Forum Home Page

Resolution of Shareholder Interests

In March 2007, the controlling shareholder of Crowley Maritime offered $2,990 per share to buy out public investors, a price equal to 258% of the last traded price of shares when the Forum started in April 2004.

Crowley Home Page

Crowley Archive Reference


Proxy Voting: Glass Lewis & Co.

(May 2, 2005, revised May 9, 2005)

Glass Lewis & Co., a proxy adviser to institutional investors, has granted permission for the Forum's use of the explanatory section of its "Proxy Paper" report, as revised May 9, 2005, for Crowley Maritime Corporation's May 19, 2005 annual meeting, copied below, recommending that the firm's clients withhold votes for the reelection of four of the eight incumbent directors who are considered insiders or affiliates.  Glass Lewis made a similar recommendation in its Proxy Paper for the company's 2004 annual meeting.
The unopposed election of directors is the only matter presented for voting in the company's 2005 proxy statement.


P R O X Y   P A P E R
Sarah Nebel, Lead Analyst
Published: May 2, 2005

Crowley Maritime Corporation
Industry: Diversified Transportation Services
Meeting Date: May 19, 2005
Record Date: April 12, 2005


2005 Annual Meeting
Proposal Issue Board GL&Co.
1.00 Election of Directors For Split
1.01 Elect Philip Bowles For Withhold
1.02 Elect Molly Crowley For For
1.03 Elect Thomas Crowley, Jr. For Withhold
1.04 Elect Gary Depolo For Withhold
1.05 Elect Earl Kivett For For
1.06 Elect William Pennella For For
1.07 Elect Leland Prussia For For
1.08 Elect Cameron Wolfe, Jr. For Withhold


Revision: May 9, 2005. We have revised Proposal 1 to clarify shareholder wishes with respect to the Crowley situation summarized within that proposal. None of our recommendations have changed.
Indexed Stock Price
Name Up Age GLC Classification Committees Term
Attended at least 75%
of Meetings
Audit Comp
 Philip E. Bowles 53 Affiliated 1 1986 2005 Yes
 Molly M. Crowley 66 Affiliated 2     1994 2005 Yes
 Thomas B. Crowley, Jr. 38 Insider 3 1994 2005 Yes
 Gary L. Depolo 69 Independent C 1994 2005 Yes
 Earl T. Kivett 57 Independent 2002 2005 Yes
 William A. Pennella 60 Insider 4     2000 2005 Yes
 Leland S. Prussia 76 Independent 1994 2005 Yes
 Cameron W. Wolfe, Jr. 65 Affiliated 5   C 1989 2005 Yes
C = Chair
  1. Nephew of Molly Crowley and first cousin of Thomas Crowley.
  2. Mother of Thomas Crowley and aunt of Philip Bowles. Beneficial owner of 36.5% of the Company's common stock, 100% of the Company's class N common stock and 71.7% of the Company's series A preferred stock.
  3. Chairman, president and CEO. Company made premium payments for a life insurance policy valued at $141 million on behalf of the Crowley family until 2002. Son of Molly Crowley and first cousin of Philip Bowles. Beneficial owner of 64.4% of the Company's common stock, 100% of the Company's Class N common stock and 99.9% of the Company's series A preferred stock.
  4. Vice chairman and executive vice president.
  5. Partner of a law firm that provides legal services to the Company.

The board has nominated eight candidates to serve a one-year term each. If elected, their terms would expire at the Company's 2006 annual meeting of shareholders.

We note that five of the eight directors are either affiliated with the Company or are insiders. We believe this raises serious concerns about the objectivity and independence of the board and its ability to perform its proper oversight role. We prefer boards with a significantly lower percentage of affiliates and insiders. However, Thomas Crowley, Jr. beneficially owns 64.4% of the Company?s common stock, 100% of the Company's class N stock and 99.9% of the Company's series A preferred stock. Mr. Crowley has advised the Company that it intends to vote all of its voting common stock in favor of each of the eight director nominees and thus will ensure their election without action on the part of any other shareholder. We suspect that most, if not all, shareholders both understand and accept the nature and extent of Mr. Crowley's control over the Company and the composition of its board.

We believe it is important for shareholders to be mindful of the following issues:

In December 2004, three institutional investors (Frankling Resources, Oppenheimer + Close and Wynfield Capital) filed a class action and derivative lawsuit in Delaware alleging that the Company has breached its fiduciary duty by discriminating in favor of the controlling Crowley family against the interests of minority stockholders. The plaintiffs are understood to have participated in the Crowley Shareholder Forum, which was organized by corporate governance crusader Gary Lutin and It is also important to note that while some shareholders reportedly see a need for court intervention, most would prefer a more constructive resolution. (Crowley Clan Comes Under Investor Fire; TradeWinds, 12/3/04). According to the plaintiffs the Company has "engaged in a series of transactions designed to perpetuate and/or to enhance the Crowley family's control, to limit the information available to the company's public stockholders and to operate the company in a manner reflective of a closely-held family corporation and not a corporation with unaffiliated public stockholders" (TradeWinds, December 3, 2004). As proof, the lawsuit cites Company funded insurance policies on behalf of the Crowley family that date back at least to 1992 and by November 1998 reached a face value of $141million. The funding of the policies was stopped in 2002 over concerns that the paid premiums would not comply with Sarbanes Oxley. Since no decision has been rendered by the court, we refrain from recommending to withhold votes based on these allegations at this time. We will monitor this issue going forward.

In May 2004, the Company paid $6.3 million to settle asbestos-related illness claims by former seaman. Other claims, known since 1996, have yet to be resolved. In respone, the Company is pushing insurers to get back the $6.3 million (TradeWinds, August 17, 2004).

We recommend withholding votes from the following nominees up for election this year based on the following issues:

Nominee BOWLES serves as a member of the compensation committee. In our view, both the audit and compensation committees should consist solely of independent directors. In addition, to these issues of concern, due to the lack of a two-thirds independent board, we recommend withholding votes from this nominee based on his status as an affiliate.

Nominee THOMAS CROWLEY also serves as chairman, president and CEO and the board does not have an independent lead or presiding director. We view an independent chairman as better able to oversee the executives of the Company and set a pro-shareholder agenda without the management or other conflicts that an executive insider or affiliated director might face. This, in turn, leads to a more proactive and effective board of directors in our view. When the position of chairman of the board is held by either an insider or affiliate, we believe that it is the responsibility of the nominating and/or governance committee to appoint an independent lead or presiding director to ensure proper oversight. In the absence of a nominating and/or governance committee, however, we recommend withholding from the chairman of the board, Mr. Crowley, on this basis.

Nominee DEPOLO serves as the chairman of the audit committee. The audit committee did not put the selection of the auditor up for shareholder ratification at the 2005 annual meeting, an omission which we believe constitutes a failure to fulfill the committee's duty to shareholders. Given that audit fees are reasonable in proportion to non-audit fees, we recommend withholding votes only from the chair of the audit committee this year. We believe that the audit committee should allow shareholders to ratify its selection of the independent auditor going forward.

Nominee WOLFE is a partner of Orrick, Herrington & Sutcliffe, which provides legal services to the Company. We question the need for the Company to engage in professional services relationships with its directors. We view such relationships as potentially creating conflicts for directors, as they may be forced to weigh their own interests in relation to shareholder interests when making board decisions. In addition, a company's decision regarding where to turn for the best professional services may be compromised when doing business with the law firm of one of the company's directors.

In addition, Mr. Wolfe serves as chairman of the compensation committee. In our view, both the audit and compensation committees should consist solely of independent directors. In addition to these issues of concern, due to the lack of a two-thirds independent board, we recommend withholding votes from this nominee based on his status as an affiliate.

We do not believe there are substantial issues for shareholder concern as to any other nominee.

Accordingly, we recommend that shareholders vote:

WITHHOLD: Bowles; Crowley; Depolo; Wolfe

FOR: All other nominees



This proxy analysis is confidential and may not be reproduced in any manner without the written permission of Glass, Lewis & Co. This analysis is not intended to solicit proxies and has not been submitted to the Securities and Exchange Commission for approval. No warranty is made as to the completeness, accuracy or utility of this analysis. This analysis does not constitute investment advice and investors should not rely on it for investment or other purposes.

Glass Lewis does not provide consulting services to issuers. Some institutional investor affiliates of issuers have purchased a subscription to Glass Lewis' services, which is disclosed on the relevant Proxy Paper. In addition, advisors to issuers (such as law firms, accounting firms, ratings agencies and others) may subscribe to Glass Lewis? services. Glass Lewis does not discuss individual Proxy Papers with any entity prior to publication.

  Crowley Maritime Corporation Glass, Lewis & Co., LLC.



The Forum is open to all Crowley shareholders, whether institutional or individual, and to any fiduciaries or professionals concerned with their investment decisions.  Its purpose is to provide shareholders with access to information and a free exchange of views on issues relating to their evaluations of alternatives, as described in the Forum Summary.

There is no charge for participation.  As stated in the Conditions of Participation, participants are expected to make independent use of information obtained through the Forum, subject to the privacy rights of other participants.  It is a Forum rule that participants will not be identified or quoted without their explicit permission.

Inquiries and requests to be included in the Forum's distribution list may be addressed to

All material on this web site is published by Gary Lutin, who is responsible for conducting the Forum.