Forum for Shareholders of Crowley Maritime Corporation

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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.

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Note: The reporter of the article below, at his own initiative,  informed the Forum manager that TradeWinds would run a correction in the following week's edition.  The correction appears above the original article.

Among other things, the article incorrectly reported that there had been an offer or bid for Crowley stock that was rejected by employees, and that there was a dissident "group" of shareholders associated with the "Forum" program.  It should be noted that, as stated at the bottom of every page on the Forum's web site and in more detail in its publicly posted "Conditions of Participation," each of the participating shareholders has been expected to act independently in its use of information obtained.  Specifically, the four shareholders that have filed an SEC Form 13-D reporting their agreement to act in concert as litigation co-plaintiffs are doing so independently of other Forum participants.

For reference, this had been the Forum manager's full response to the reporter's questions about the views of Crowley Maritime's public shareholders:

"While some of the company's shareholders have sued the directors to force them to be more respectful of investor interests, I think most of Crowley Maritime's public shareholders are very happy with the way things are going.  They can reasonably assume that Mr. Crowley will eventually want to take the company private, and since he's doing such a great job running the business the price he's going to have to pay minority shareholders keeps going up.  A year ago, he probably could have got most of the public investors to accept a buyout at somewhere in the range of $1600 per share, and today he'd probably need to offer more than $2500.  With a better than 50% annual rate of increase, nobody's asking me to encourage an immediate deal."




Correction to Crowley story
106 words
30 June 2006
(c) 2006 TradeWinds

An article on these pages last week regarding the share price of Crowley Maritime Corp contained inaccurate headlines wrongly suggesting that Crowley had offered to buy out dissident shareholders' shares.

The headlines also mistakenly confused a group of employees acquiring shares with the group of dissident shareholders.

The text of the body of the story was accurate.

TradeWinds regrets the errors and any confusion the headlines may have caused.

Separately, TradeWinds has been asked to point out that the dissident shareholders referred to in the story act independently of one another and do not constitute a group in a legal sense.

Document TRADEW0020060629e26u0003d




'Dissidents' hold off on Crowley bid
Bob Rust Stamford
557 words
23 June 2006
(c) 2006 TradeWinds

Crowley workers are rejecting the company's offer to buy back shares.

Crowley Maritime Corp says the fair market value of its unlisted stock has hit $1,913 per share. But even this price is too low to satisfy a group of dissident shareholders of Crowley, which is by some measures the largest US domestic or "Jones Act" shipowner.

New York investment banker Gary Lutin, spokesman for the Crowley shareholder forum, tells TradeWinds the company would now have to pay around $2,500 per share to buy out its dissidents. They might have accepted $1,600 per share a year back, says Lutin.

The dissidents do not pose a threat to control of the company, in which Oakland-based president, chief executive officer and chairman Tom Crowley Jr holds a majority of shares and votes.

However, they have been pursuing litigation against management over what they consider the neglect of their rights as shareholders. The $1,913 per share mentioned by Crowley was determined by independent assessors in connection with a fresh issue of unregistered shares for purchase by an employee stock ownership plan (ESOP).

The transaction disclosed this week in a filing with the US Securities and Exchange Commission (SEC) is dated 15 June.

The valuation is "based on a non-marketable minority interest" in common shares, says Crowley in the filing. Crowley dissidents are said to regard this as a damning admission of their own contention that management policies have contributed to illiquidity and depressed the value of their shares.

The new price represents a 36% increase over last summer's price of $1,402. The Pink Sheets listing of over-the-counter traded stocks lists the annual low and high of the rare share at $1,800 and $1,805, respectively.

Crowley set up its ESOP last August with an initial issuance of 1,000 shares. This year, the employee scheme bought 2,000 more shares at the new price for some $3.8m. The money to purchase the shares was borrowed from Crowley for 10 years at a fixed 5% per year. Shares offered only to an ESOP need not be registered with the SEC. Plan provisions mean many ESOP shares could revert to the company.

According to earlier filings, the ESOP releases shares to employees as principal on the company loan is paid. Shares vest with eligible employees after they have been employed for five years. The employees then have a put option, allowing them to sell shares to the company at fair market value as determined by the ESOP.

Crowley says the ESOP now owns 3,000 of Crowley's 90,744 outstanding shares of common stock. The dissident group was thought to control around 10% of voting power in the lightly traded Crowley share before the new ESOP share issue.

Some members of the group have been involved in Delaware litigation with Crowley over allegations that management neglected its fiduciary duty towards minority shareholders through policies designed to entrench and perpetuate the principal shareholder's control.

Crowley is legally a public company in the sense that it is subject to SEC disclosure rules but it notes in its financial filings and on its website that it is predominantly owned by Crowley family members and employees and is not publicly traded.

Document TRADEW0020060622e26n0002j





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.

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