It's that time of the year again when the corporation conducts a proxy campaign and holds the annual meeting to elect candidates for the board of directors to serve you for the next three years. Over the years we have tried many different ways of communicating with shareholders during the proxy campaign, including multiple proxy mailings, candidate videos, special mailings, phone banks, and door-to-door visits. While most of these methods were successful in gathering more proxies, they did so at a cost. Some shareholders told us they were tired of the amount of mail flooding their mailboxes, and didn't really like having people show up at their doors or calling just when they were getting ready to sit down to dinner or to watch a good movie. Shareholders also told us they would like the corporation to try to reduce costs associated with the proxy campaign.

So your board and management took to heart your concerns and made a number of improvements to the election process. This year CIRI plans to send only two proxy mailings to shareholders and there will be no candidate video, no telephone workers, no door-to-door solicitation. Other changes to the election process actually began in 1996 when the CIRI board and the Shareholder Participation Committees made significant changes to open up the nominating process. The process has been working well and this year resulted in a good mix of two new shareholders and three experienced board members being selected for the slate.

This year, as in the past, besides the CIRI board-endorsed candidates there are also other candidates running for the board. Some of these candidates are, in our view, positive and others negative, and here is what we mean by that. To CIRI, a positive candidate is one who conveys a message to shareholders in a factual way, whether or not he or she agrees with what the corporation is doing or how it is run. As an example, Thomas Huhndorf, who is running a proxy campaign this year, has been factual and straightforward in his communications to shareholders. A negative candidate, on the other hand, in our mind is one who attempts to inflame or mislead shareholders through accusations, innuendo or telling only part of the story.

That brings me to Robert Rude and Delores Ashenfelter-Tuttle who, in the board's opinion, are running a negative campaign this year. CIRI has notified Mr. Rude and Ms. Ashenfelter-Tuttle that their proxy mailings contain what we believe are omissions and misleading statements, and we asked them to issue a correction. However, Mr. Rude and Ms. Ashenfelter-Tuttle have so far chosen to ignore our requests.

Your corporation has done very well over the past four years and especially well this past year. Profits are up and dividends are up. It's a shame that some individuals, like Mr. Rude, cannot be proud of what the corporation has done, but instead try to portray it as negative and carry on bitter grudges rooted in the past. I encourage you to question carefully the materials you receive from Mr. Rude and Ms. Ashenfelter-Tuttle. If something sounds incomplete or if you have questions, please call one of the board members, the Shareholder Relations department, or me and we will do our best to give you the accurate answer.

The board and I ask for your continued support of the board slate of candidates. I hope we will see you at the annual meeting. If you cannot attend in person, please send in your proxy. You make a big difference to our corporation. Thank you.

Prince William Sound Cruises & Tours began operation of the Columbia Glacier Cruise out of Valdez on May 1st. This long-standing favorite provides a view of the largest tidewater glacier in Southcentral Alaska and an abundance of wildlife viewing opportunities.

May 15th debuts the newest Prince William Sound Cruises & Tours offering, the Wilderness Explorer, a six-hour cruise from Whittier. This exciting route features areas of the Sound rich in marine wildlife and spectacular views of Esther Passage and the magnificent glaciers of western Prince William Sound. The Whittier tour will feature the newest addition to the Prince William Sound fleet ­ the M/V Tanaina ­ taken from an Athabascan word meaning "the people," ­ and serves a baked halibut lunch while cruising Prince William Sound.

Prince William Sound Cruises & Tours also offers daily scheduled service between Valdez and Whittier, beginning May 21st, as well as a longer cruise from Valdez with a stop at Growler Island Wilderness Camp for a buffet meal.

The Talkeetna Alaskan Lodge is the newest CIRI tourism endeavor and opened its doors to the public May 1st. Located at Mile 12.5 of the Talkeetna Spur Road, the main lodge sits atop a 35-acre site overlooking the Talkeetna River valley and is ideally located to view Mt. McKinley ­ the "Great One."

The main lodge includes 50 guest rooms; a restaurant open for breakfast, lunch, and dinner; the Base Camp Lounge; and a great room. Located nearby are four separate 12-plexes named for the nearby mountains of Brooks, Denali, Hunter and McKinley.

Visitors to the Lodge will find a variety of year-round activities and adventures available to them. Located within the lodge, the tour desk is available to book flightseeing trips, riverboat excursions, float trips and numerous other nearby activities.