0001104659-08-031997.txt : 20080509 0001104659-08-031997.hdr.sgml : 20080509 20080509172245 ACCESSION NUMBER: 0001104659-08-031997 CONFORMED SUBMISSION TYPE: SC 13D/A PUBLIC DOCUMENT COUNT: 2 FILED AS OF DATE: 20080509 DATE AS OF CHANGE: 20080509 GROUP MEMBERS: JEFFERY D. GOW GROUP MEMBERS: STEVE WASSON FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: CRESCENT CAPITAL VI LLC CENTRAL INDEX KEY: 0001276514 IRS NUMBER: 912081553 STATE OF INCORPORATION: WA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A BUSINESS ADDRESS: STREET 1: 11624 SE 5TH ST STREET 2: SUITE 200 CITY: BELLEVUE STATE: WA ZIP: 98005 BUSINESS PHONE: 5255867700 SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: COWLITZ BANCORPORATION CENTRAL INDEX KEY: 0000894267 STANDARD INDUSTRIAL CLASSIFICATION: STATE COMMERCIAL BANKS [6022] IRS NUMBER: 911529841 STATE OF INCORPORATION: WA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A SEC ACT: 1934 Act SEC FILE NUMBER: 005-56847 FILM NUMBER: 08819764 BUSINESS ADDRESS: STREET 1: 927 COMMERCE AVE CITY: LONGVIEW STATE: WA ZIP: 98632 BUSINESS PHONE: 2064239800 MAIL ADDRESS: STREET 1: 927 COMMERCE AVENUE CITY: LONGVIEW STATE: WA ZIP: 98632 SC 13D/A 1 a08-14036_1sc13da.htm SC 13D/A

	UNITED STATES
	SECURITIES AND EXCHANGE COMMISSION
	Washington, D.C. 20549

	SCHEDULE 13D

Under the Securities Exchange Act of 1934

(Amendment No. 2)*

Cowlitz Bancorporation

(Name of Issuer)

Common Stock, no par value

(Title of Class of Securities)

223767

(CUSIP Number)

Jeffery D. Gow

11624 S.E. 5th Street, Suite 200

Bellevue, WA 98005

(425) 586-7700

(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)

May 9, 2008

(Date of Event Which Requires Filing of this Statement)

If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of §§240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following box. o

Note: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See Rule 13d-7 for other parties to whom copies are to be sent.

^* The remainder of this cover page shall be filled out for a reporting person’s initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page.

The information required on the remainder of this cover page shall not be deemed to be “filed” for the purpose of Section 18 of the Securities Exchange Act of 1934 (“Act”) or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes).

CUSIP No. 223767

	1.	Names of Reporting Persons Crescent Capital VI, L.L.C.

	2.	Check the Appropriate Box if a Member of a Group (See Instructions)
		(a)			o
		(b)			x

	3.	SEC Use Only

	4.	Source of Funds (See Instructions) WC, OO

	5.	Check if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e) o

	6.	Citizenship or Place of Organization State of Washington

Number of Shares Beneficially Owned by Each Reporting Person With			7.	Sole Voting Power 483,000*

			8.	Shared Voting Power 0

			9.	Sole Dispositive Power 483,000*

			10.	Shared Dispositive Power 0

	11.	Aggregate Amount Beneficially Owned by Each Reporting Person 483,000*

	12.	Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions) o

	13.	Percent of Class Represented by Amount in Row (11) 9.6%**

	14.	Type of Reporting Person (See Instructions) OO

* Crescent Capital VI, L.L.C., a Washington limited liability company (“Crescent”), owns 483,000 shares of the Issuer’s Common Stock. Steve Wasson individually owns 1,000 shares of the Issuer’s Common Stock. Crescent does not have any voting or dispositive power over Mr. Wasson’s shares and hereby disclaims beneficial ownership of the shares owned by Mr. Wasson.

** The calculation is based on a total of 5,054,507 shares of Common Stock outstanding as of March 31, 2008, as reported by the Issuer in its Proxy Statement filed with the Securities and Exchange Commission on April 24, 2008.

CUSIP No. 223767

	1.	Names of Reporting Persons Jeffery D. Gow

	2.	Check the Appropriate Box if a Member of a Group (See Instructions)
		(a)			o
		(b)			x

	3.	SEC Use Only

	4.	Source of Funds (See Instructions) WC, OO

	5.	Check if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e) o

	6.	Citizenship or Place of Organization United States

Number of Shares Beneficially Owned by Each Reporting Person With			7.	Sole Voting Power 483,000*

			8.	Shared Voting Power 0

			9.	Sole Dispositive Power 483,000*

			10.	Shared Dispositive Power 0

	11.	Aggregate Amount Beneficially Owned by Each Reporting Person 483,000*

	12.	Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions) o

	13.	Percent of Class Represented by Amount in Row (11) 9.6%**

	14.	Type of Reporting Person (See Instructions) IN

CUSIP No. 223767

	1.	Names of Reporting Persons Steve Wasson

	2.	Check the Appropriate Box if a Member of a Group (See Instructions)
		(a)			o
		(b)			x

	3.	SEC Use Only

	4.	Source of Funds (See Instructions) PF

	5.	Check if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e) o

	6.	Citizenship or Place of Organization United States

Number of Shares Beneficially Owned by Each Reporting Person With			7.	Sole Voting Power 1,000*

			8.	Shared Voting Power 0

			9.	Sole Dispositive Power 1,000*

			10.	Shared Dispositive Power 0

	11.	Aggregate Amount Beneficially Owned by Each Reporting Person 1,000*

	12.	Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions) o

	13.	Percent of Class Represented by Amount in Row (11) 0.0%**

	14.	Type of Reporting Person (See Instructions) IN

Explanatory Note

This Schedule 13D, as amended (“Schedule 13D”), relates to shares of Common Stock, no par value (“Common Stock”), of Cowlitz Bancorporation, a Washington corporation (the “Issuer”). This statement is being filed by Crescent Capital VI, L.L.C., a limited liability company organized under the laws of the State of Washington (“Crescent”), Jeffery D. Gow, an individual (“Gow”), and Steve Wasson, an individual (“Wasson”). Crescent, Gow, and Wasson are hereinafter sometimes referred to together as the “Reporting Persons”.

Item 1.		Security and Issuer


Item 2.		Identity and Background
(a)		This statement is being filed by Crescent, Gow and Wasson.
(b)-(c) Crescent is a private investment entity that seeks appreciation of its assets for the benefit of its owners. The address of Crescent’s principal place of business and principal office is 11624 S.E. 5th Street, Suite 200, Bellevue, WA 98005. Gow, a natural person, is Chief Executive Officer of Polygon Northwest Company, a real estate development company. Gow is the managing member of Crescent. The address of his principal office and principal place of business is 11624 S.E. 5th Street, Suite 200, Bellevue, WA 98005. The executive officers and persons controlling Crescent are set forth on Exhibit 99.1. Wasson, a natural person, is an investor. The address of his principal office and principal place of business is 916 SW King Avenue, Portland, OR 97205. The executive officers and persons controlling Crescent are set forth on Exhibit 99.1, attached hereto and incorporated herein by reference. Exhibit 99.1 sets forth the following information with respect to each such person: (i) name; (ii) business address; (iii) present principal occupation or employment and the name, principal business and address of any corporation or other organization in which such employment is conducted; and (iv) citizenship. (d)-(e) During the last five years, neither the Reporting Persons nor any person named in Exhibit 1 has been (i) convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors) or (ii) a party to a civil proceeding of a judicial or administrative body of competent jurisdiction and as a result of such proceeding was or is subject to a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding any violation with respect to such laws. (f) Gow and Wasson are citizens of the United States.
Item 3.	Source and Amount of Funds or Other Consideration


Item 4.	Purpose of Transaction
The Reporting Persons have acquired the shares of the Issuer reported herein in order to profit from appreciation of the Common Stock. On July 27, 2007, Crescent sent a written offer (the “Offer”) to the Issuer’s Chairman and President and CEO pursuant to which Crescent would acquire for cash all of the outstanding shares of Common Stock of the Issuer that Crescent does not already own (the “Transaction”) at a price of $15.00 per share. A copy of the Offer was attached as Exhibit 99.5 to Amendment No. 1. On September 5, 2007, the Issuer announced in a press release that its Board of Directors had unanimously rejected the Offer as not in the long-term best interests of shareholders, since, among other concerns, the $15.00 per share offer was significantly inadequate.

On March 6, 2008, Steve Wasson met with Phillip Rowley, Chairman of the Cowlitz Board of Directors, and discussed, among other topics, appointing a representative of Crescent to the Board of Directors. On April 21, 2008, Mr. Rowley informed Mr. Wasson that the Board declined to appoint a Crescent representative to the Board. On May 9, Mr. Gow sent to the Cowlitz Board of Directors the letter attached as Exhibit 99.6 and incorporated herein by reference. As disclosed in the May 9th letter, Crescent intends to purchase additional shares of common stock of the Issuer, and to seek regulatory approval to permit Crescent to purchase additional shares of the Issuer to increase its percentage ownership in excess of ten percent (10%). The Reporting Persons intend to monitor developments at the Issuer and may communicate with members of the board of directors and management of the Issuer relating to the Offer and such other matters that the Reporting Persons deem relevant to their investment in the Issuer. Depending upon market conditions and other factors that the Reporting Persons may deem material to their investment decisions, the Reporting Persons may purchase additional securities of the Issuer in the open market or in private transactions, or may dispose of all or a portion of the securities of the Issuer that the Reporting Persons own or hereafter may acquire. At the present time, other than the actions described in the preceding paragraphs, the Reporting Persons have no specific plans or proposals that would relate to or result in any of the actions referred to in paragraphs (a) through (j) of Item 4 of Schedule 13D.

Item 5.	Interest in Securities of the Issuer


Item 6.	Contracts, Arrangements, Understandings or Relationships with Respect to Securities of the Issuer


Item 7.	Material to be Filed as Exhibits

Exhibit No.		Description
99.1		Name, business address and present principal occupation of each executive officer or person controlling Crescent Capital VI, L.L.C. (incorporated herein by reference to Exhibit 1 to the Reporting Persons’ Schedule 13D, filed with the Securities and Exchange Commission on February 1, 2006)
99.2		Form of Salomon Smith Barney Client Agreement (incorporated herein by reference to Exhibit 2 to the Reporting Persons’ Schedule 13D, filed with the Securities and Exchange Commission on January 22, 2004)
99.3		Dates and prices of purchases of Common Stock (incorporated herein by reference to Exhibit 99.3 to the Reporting Persons’ Schedule 13D, filed with the Securities and Exchange Commission on May 4, 2007)
99.4		Joint Filing Agreement dated May 4, 2007 (incorporated herein by reference to Exhibit 99.4 to the Reporting Persons’ Schedule 13D, filed with the Securities and Exchange Commission on May 4, 2007)
99.5		Letter delivered by Crescent Capital VI, LLC to Issuer on July 27, 2007 (incorporated herein by reference to Exhibit 99.5 to the Reporting Persons’ Schedule 13D, Amendment No. 1, filed with the Securities and Exchange Commission on July 7, 2007)
99.6		Letter delivered by Crescent Capital VI, LLC to Issuer on May 9, 2008

Signatures

After reasonable inquiry and to the best of the knowledge and belief of the undersigned, each of the undersigned certifies that the information set forth in this statement is true, complete and correct.

Dated: May 9, 2008
	Crescent Capital VI, L.L.C.

	By:	/s/ Jeffery D. Gow
	Name: Jeffery D. Gow
	Title: Managing Member

	/s/ Jeffery D. Gow
	Jeffery D. Gow

	/s/ Steve Wasson
	Steve Wasson

EX-99.6 2 a08-14036_1ex99d6.htm EX-99.6

Exhibit 99.6

[Crescent Capital VI letterhead]

May 9, 2008

Via Fed Ex and Email

Board of Directors

Cowlitz Bancorporation

927 Commerce Ave.

Longview, Washington 98632

Re: Duties of Directors

Ladies and Gentlemen:

Almost exactly one year ago, Crescent Capital VI, LLC publicly disclosed that it owned approximately 9.8% of the outstanding shares of Cowlitz Bancorporation. At the time, Cowlitz’ common stock was trading at $17.32 per share. Cowlitz common stock closed yesterday at $10.25.

In our Schedule 13D filed on May 4, 2007, we indicated that Crescent intended to engage in dialogue with management of Cowlitz to discuss our ideas concerning Cowlitz’ business plan, including possible collaboration between Crescent and Cowlitz.

On June 19, 2007, Steve Wasson and I met with Phillip Rowley, Chairman of the Board of Directors, Richard Fitzsimmons, Chief Executive Officer, and Ernie Ballou, Vice President. At that meeting, we disclosed Crescent’s vision of Cowlitz remaining independent, while pursuing a growth strategy and expanding into high potential markets such as Portland and Seattle. We were, and remain, convinced that we could assist Cowlitz in accomplishing these goals, while creating significant long-term shareholder value. At the meeting, we outlined our ideas on how to keep Cowlitz independent and retain existing management by permitting Crescent to have a greater ownership stake (up to 25% of Cowlitz’ common stock), and allowing Crescent to take a greater role at Cowlitz (through representatives on the board of directors and creating a three person committee to direct and monitor growth initiatives).

On July 24, 2007, Mr. Fitzpatrick informed Steve Wasson that the Cowlitz Board of Directors had unanimously rejected our ideas.

On July 27, 2007, Crescent offered to acquire for cash all of Cowlitz’ outstanding shares at a price of $15.00 per share.

On September 7, 2007, Cowlitz rejected Crescent’s $15.00 offer, noting that Crescent’s proposal was not in the long-term best interests of its shareholders, citing, among other concerns, the fact that $15.00 per share was “significantly inadequate.” The letter noted that continuing the Company’s strategic plan and remaining independent presented the best opportunity for increased shareholder value going forward.

On January 25, 2008, Cowlitz reported a net loss of $3.1 million for the fourth quarter of 2007, with net income for the year of $86,000. Cowlitz recorded a provision for credit losses of $6.8 million in the fourth quarter of 2007. The common stock dropped to a low of $7.57 on March 17^th.

On March 6, 2008, Steve Wasson met with Phillip Rowley and discussed the current banking environment, deposit pricing, housing, interest rates and related topics. Mr. Rowley, while disappointed with Cowlitz’ overall results, defended Cowlitz’ and management’s performance in difficult circumstances, noting that management had done the best they could. Mr. Wasson questioned his assessments, noting that while assets, loans, deposits and expenses had all grown between 16% and 20% in 2007, net interest income had not grown at all and Cowlitz had lost money. Further, he noted that Cowlitz’s loan loss provision grew 295% in 2007, while non-performing assets grew by 740%. Mr. Wasson questioned management’s capabilities to manage through this business cycle, because they had allowed these problems to occur, instead of avoiding them.

Mr. Wasson noted that more than 50% of stockholders (including Crescent) are unhappy with Cowlitz’s results, especially with the stock price falling 47%, from $14.48 to $7.57 in less than six months. He observed that Crescent’s involvement at the Board level would have brought substantial experience in the residential building industry and greater insight into the real estate market and home builder risks, something that is sorely lacking on the Board. Mr. Wasson renewed his request that the Board consider appointing a representative of Crescent to the board of directors.

On April 21, 2008, Mr. Rowley called Mr. Wasson to inform him that the Board had considered Crescent’s renewed request and again declined to appoint a Crescent representative to the Board, stating that it was not appropriate or in the long term interest of the shareholders.

We are deeply disturbed by the Board’s rejection of a large shareholder’s invitation to provide greater insight and expertise at the board level, especially in light of the dismal performance of the bank over the past 12 months.

The current real estate and credit issues affecting the bank’s profitability caught Cowlitz by surprise. That’s a shame. Warning signs were clearly visible, as real estate markets across the country were in free fall months before impacting Cowlitz’ markets. Management apparently ignored the warning signs, and failed to take appropriate action. And, where was the board of directors? Where was the oversight that shareholders expect directors to exercise?

Now, the stock is down 43% over the past year. And yet, the Board rejected out-of-hand an offer from Crescent last summer at $15.00 per share, a 50% premium to the current market price (and a 98% premium to the stock price in March). Further, Cowlitz’ proxy discloses that the executive officers received cash bonuses for 2007 ranging from 21% to 28% of base salary despite recent losses and a 43% stock decline. Incentives paid to executive officers at a time when the company has demonstrated such poor performance reflects the Board’s failure to advance shareholder interests, especially at a time when shareholder value has so dramatically declined. What is the Board’s plan going forward? Cowlitz’ first quarter earnings are 31% below 2007 first quarter earnings. With a slowing economy (and likely recession), as well as weak real estate markets, how does Cowlitz propose to return to the net income levels of one year ago? How can the Board have any confidence that, after the second half performance of 2007, management can avoid further pitfalls?

From our perspective, the Board has not exercised its fiduciary responsibility to all shareholders by its:

· Failure to adequately consider Crescent’s offer of $15.00 per share

· Unwillingness to consider alternative viewpoints

· Failure to monitor portfolio risks Cowlitz was incurring

· Failure to mitigate risks of the current economic climate and real estate downturn

These failures have had an obvious effect: the dismal financial performance of Cowlitz in the past year and the diminished value of the company.

While directors are not guarantors of shareholder value, directors do have duties to shareholders. Directors must exercise good judgment, be adequately informed, and take actions to improve shareholder value. We believe the Board’s failures are apparent.

As a result, we intend to seek regulatory approval to permit Crescent to purchase additional shares and thereby potentially increase our influence on the Board of Directors.

Sincerely,

Crescent Capital VI, LLC


/s/ Jeffery D. Gow
Jeffery D. Gow, Managing Member