10-Q 1 y41877e10-q.txt MARINE TRANSPORT CORPORATION 1 UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q (X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES AND EXCHANGE ACT OF 1934. For the quarterly period ended SEPTEMBER 30, 2000 OR ( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES AND EXCHANGE ACT OF 1934. For the period from____________________________ to ________________________ COMMISSION FILE NUMBER 000-11573 MARINE TRANSPORT CORPORATION (Exact name of registrant as specified in its charter) DELAWARE 13-2625280 (State or other jurisdiction (I.R.S. Employer incorporation or organization) Identification No.) 1200 HARBOR BOULEVARD, C-901, WEEHAWKEN, NJ 07082-0901 (Address of principal (Zip Code) executive offices) Registrant's telephone number, including area code 201-330-0200 Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15 (d) of the Securities and Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [ X ] No [ ] INDICATE THE NUMBER OF SHARES OUTSTANDING OF EACH OF THE ISSUER'S CLASSES OF COMMON STOCK, AS OF NOVEMBER 3, 2000: Common Stock, par value $.50 per share, 6,555,368 shares 2 MARINE TRANSPORT CORPORATION AND SUBSIDIARIES INDEX

2 3 PART 1: ITEM 1: FINANCIAL INFORMATION MARINE TRANSPORT CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (IN THOUSANDS, EXCEPT PER SHARE DATA) (UNAUDITED)

See notes to Condensed Consolidated Financial Statements. 3 4 MARINE TRANSPORT CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (IN THOUSANDS)

(1) The balance sheet as of December 31, 1999 has been derived from the audited financial statements as of that date, but does not include all the information and footnotes required by generally accepted accounting principles for complete financial statements. See notes to Condensed Consolidated Financial Statements. 4 5 MARINE TRANSPORT CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY (IN THOUSANDS) (UNAUDITED)

6 MARINE TRANSPORT CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (IN THOUSANDS) (UNAUDITED)

See notes to Condensed Consolidated Financial Statements. 6 7 MARINE TRANSPORT CORPORATION AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) NOTE 1 - DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION Marine Transport Corporation ("MTC" or the "Company"), formerly OMI Corp., is a U.S.-based company that owns and charters a fleet of ocean-going vessels which it operates in domestic and international markets. The Company also manages vessels for other shipowners. On June 17, 1998 OMI Corp. distributed to its shareholders, in a tax-free distribution (the "Distribution"), all of the shares of its wholly owned subsidiary Universal Bulk Carriers, Inc. ("UBC"). UBC operated the Company's former foreign-flagged shipping businesses, and continues to operate those businesses as OMI Corporation ("New OMI") under the Company's previous management. Prior to the Distribution, OMI Corp. acquired all of the outstanding common stock of Marine Transport Lines, Inc.("MTL"), a U.S.-based company that owns, operates and manages U.S. and foreign-flagged vessels, in exchange for the consideration described in Note 2 (the "Acquisition"). The Company is currently managed by certain former officers and directors of MTL and additional new directors. The Company trades under the symbol "MTLX" and is listed on the NASDAQ National Market. The accompanying unaudited Condensed Consolidated Financial Statements have been prepared in accordance with the instructions to Form 10-Q and, therefore, do not include all information and footnotes necessary for a fair presentation of financial position, results of operations and cash flows in conformity with generally accepted accounting principles. However, in the opinion of the management of the Company, all adjustments (comprising only normal recurring accruals) necessary for a fair presentation of operating results have been included in the statements. Certain accounts have been reclassified in the 1999 financial statements to conform to their 2000 presentation. Reference is made to MTC's Form 10-K for the year ended December 31, 1999 and the Form S-1 filed on May 15, 1998 for additional information. NOTE 2 - ACQUISITION AND DISTRIBUTION As consideration for the Acquisition: (a) OMI Corp. issued common stock of OMI Corp. with a market value of $5,000,000 to the shareholders of MTL; (b) the Company issued a certain number of shares of newly-issued common stock to the shareholders of MTL; and (c) shareholders of MTL became entitled to additional shares of the Company's newly-issued common stock, determined by the outcome of certain post-transaction calculations. The Acquisition was valued at approximately $11,886,000 representing the estimated fair value of MTL at the date the transaction was completed plus the fair value of additional shares issued as a purchase price adjustment for working capital amounts in excess of pre-established levels per the Acquisition Agreement. The Acquisition has been accounted for as a purchase. As part of the Distribution, MTC is party to certain agreements with New OMI, including the following: Distribution Agreement-The Distribution Agreement provides for, with certain exceptions, assumptions of liabilities and cross-indemnities designed principally to place financial responsibility for the domestic-related liabilities with MTC and the foreign-related assets and liabilities with New OMI. New OMI, however, assumed the obligations of the Company with respect to the Company's 10.25 percent Senior Notes due November 1, 2003 in exchange for a note in the amount of $6,400,000 7 8 (repaid in February 2000 at discount), which was equivalent in value to the principal amount of the Senior Notes then outstanding. The Distribution Agreement also provides that each of MTC and New OMI will indemnify the other in the event of certain liabilities arising under the Federal securities laws. Each of MTC and New OMI have sole responsibility for claims arising out of respective activities after the Distribution. The Distribution Agreement also provides that, except as otherwise set forth therein or in any other agreement, all costs or expenses incurred on or prior to the date of the Distribution in connection with the Distribution will be charged to and paid by the party incurring such costs or expenses. Except as set forth in the Distribution Agreement or any related agreement, each party shall bear its own costs and expenses incurred after the date of the Distribution. As part of the Distribution Agreement, New OMI has, subject to certain exceptions, provided indemnity to MTC for all taxes attributable to the Distribution and to certain corporate restructuring transactions preceding the Distribution. Tax Cooperation Agreement-Prior to the Distribution, MTC and New OMI entered into a Tax Cooperation Agreement which sets forth each party's rights and obligations with respect to Federal, state, local and foreign taxes for periods prior to and after the Distribution and related matters such as filing of tax returns and conducting audits and other proceedings. In general, the Tax Cooperation Agreement provides that New OMI will be liable for taxes and be entitled to refunds for each period covered by any such return which are attributable to New OMI and its subsidiaries. Though valid as between the parties thereto, the Tax Cooperation Agreement is not binding on the IRS and does not alter either party's tax liability to the IRS. Acquisition Agreement-The Acquisition Agreement provided for an adjustment in the purchase price of MTL based on working capital amounts as of the date of the Acquisition compared to certain pre-established levels. The purchase price adjustment was made by increasing the number of shares of the Company which were exchanged for MTL's shares. In December 1998, MTC issued approximately 312,000 shares of its common stock to former MTL shareholders pursuant to this provision. NOTE 3 - EARNINGS PER COMMON SHARE The computation of basic earnings per share is based on weighted average number of common shares outstanding of 6,205,000 and 6,205,000 for the nine months ended September 30, 2000 and 1999, respectively; and 6,205,000 and 6,205,000 for the three months ended September 30, 2000 and 1999, respectively. The computation of diluted earnings per share, which assumes the exercise of all dilutive stock options using the treasury method, is based on the weighted average number of common shares outstanding of 6,214,000 and 6,245,000 for the nine months ended September 30, 2000 and 1999, respectively; and 6,205,000 and 6,261,000 for the three months ended September 30, 2000 and 1999, respectively. NOTE 4 - LONG-TERM DEBT AND CREDIT ARRANGEMENTS At September 30, 2000 Long-Term Debt consisted of the following (in thousands): Term loan $ 12,272 Revolving credit 1,000 Promissory note due to New OMI 225 Title XI debt 18,983 ------ Total debt 32,480 Less current portion 5,983 ------ Long-term portion $ 26,497 ------

8 9 All debt at September 30, 2000, with the exception of the Title XI debt, was created or amended and restated concurrently with the Acquisition. The term loan and revolving credit facilities of the Company accrue interest at a floating rate based on LIBOR (the London Interbank Offering Rate) plus a margin (which can range from 1.25% to 2.25%) that is determined by certain financial ratios (the spread at September 30, 2000 was 1.75%). The Company pays a commitment fee each quarter on the portion of the revolving credit agreement facilities that is unused and available during the quarter. At September 30, 2000 the unused and available revolving credit facilities totaled $2,000,000. The promissory note bears interest at 8% and is payable in semi-annual installments of principal and interest through May 1, 2003, with principal payments equaling approximately $37,000. The Company uses interest rate swaps to manage interest costs and those risks associated with changing interest rates. At September 30, 2000 the Company had outstanding an interest rate swap with a notional amount of $14,135,079 which effectively fixed the base interest rate on the Company's term loans at 4.75% until December 17, 2001. The term loan is payable in twelve quarterly installments through June 18, 2003; the first eleven installments total $797,372 each; and the final installment totals $5,297,362. The revolving credit facilities reduce to $2,000,000 on June 18, 2001 and expire on June 18, 2003. On September 28, 1999 the vessels SMT Chemical Trader and SMT Chemical Explorer (formerly the Frances Hammer and Julius Hammer, respectively) were acquired by two wholly-owned subsidiaries of the Company. The acquisition price was $21,884,000 consisting of a cash payment of approximately $514,000 and the remaining principal on two loans guaranteed by the United States Department of Transportation Maritime Administration (the "Title XI debt"), which loans were assumed by the Company's subsidiaries. The Title XI debt, which has an interest rate of 8.125%, is payable in twelve semi-annual installments whose principal portions total $2,719,000 in 2001; $2,962,000 in 2002; $2,938,000 in 2003; $3,348,000 in 2004; $3,822,000 in 2005; and $3,194,000 in 2006. The Title XI debt imposes semi-annual declining penalties on any prepayment until September 2005. Occidental Petroleum Corporation, the former guarantor of the Title XI debt, continues to provide a reducing guaranty in favor of the United States of America of up to $6,000,000. The Company and Stolt-Nielsen S.A. ("Stolt") also severally guarantee all the Title XI debt with the Company providing a 75% guaranty and Stolt providing a 25% guaranty. The Company's Marketable Securities and Cash held in the Capital Construction Fund, which currently totals $4,510,000, has also been pledged as security for the Title XI debt and may, under certain circumstances, be employed to reduce the outstanding principal amount. The Company's debt obligations restrict its ability to pay or declare dividends and require the Company to maintain certain financial ratios, minimum cash balances, minimum asset values, and to reduce debt with the proceeds derived from the sale of any vessels. In addition, all Company assets (except for SMT Chemical Explorer and SMT Chemical Trader, which are encumbered by their own mortgages, and certain workboats owned by the Company's wholly-owned subsidiary, MTL Petrolink) are pledged as collateral to secure the debt outstanding under the term loan and revolving credit facility agreements. At September 30, 2000 the Company was in compliance with all covenants imposed by its debt agreements, as amended. NOTE 5 - COMMITMENTS AND CONTINGENCIES The Company is a party to a number of litigation and arbitration proceedings arising from its operations. Such actions are covered by insurance or, in the opinion of management are of such a nature that the 9 10 ultimate liability, if any, would not have a material adverse effect on the operations or financial position of the Company. NOTE 6 - FINANCIAL INFORMATION RELATING TO SEGMENTS During the period ended September 2000 and 1999 the Company operated in following two distinct operating segments: Ship Management ("Management") Technical management of vessels owned by others, including vessels of the U.S. Maritime Administration ("MARAD"). Transportation Services for Energy and Chemicals ("Energy and Chemicals") Owned and chartered-in U.S.-based vessels operating under time and voyage charters with customers, which are primarily chemical and oil-production companies.

10 11 PART I: ITEM 2: MANAGEMENT'S DISCUSSION OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Marine Transport Corporation ("MTC" or "the Company"), formerly OMI Corp., was established in its present form through a series of transactions, culminating June 18, 1998, through which OMI Corp.: (a) acquired Marine Transport Lines, Inc. in a stock-for-stock exchange (the "Acquisition"); and (b) distributed to its shareholders the stock of a newly created Marshall Islands Corporation named OMI Corporation containing OMI Corp.'s international businesses (the "Distribution"). OMI Corp. then changed its name to Marine Transport Corporation. The information below and elsewhere in this document contains certain forward-looking statements, which reflect the current view of the Company with respect to future events and financial performance. Wherever used, the words "expect", "plan", "anticipate" and similar expressions identify forward-looking statements. Such statements are based on management's current expectations and are subject to a number of uncertainties and risks that could cause actual results to differ materially from those described in the forward-looking statements. The Company does not publicly update its forward-looking statements even if experience or future changes make it clear that any anticipated results expressed or implied therein will not be realized. The following presentation of management's discussion and analysis of the Company's financial condition and results of operations should be read in connection with the Condensed Consolidated Financial Statements, accompanying notes thereto and other financial information appearing elsewhere in this document, as well as the Form S-1 filed on May 15, 1998 which fully describes the Acquisition and Distribution, and the documents incorporated by reference thereto. MARKET OVERVIEW Prior to the Acquisition and Distribution, OMI Corp.'s major business was providing seaborne transportation services for crude oil and refined petroleum products in two distinct international market segments: Suezmax tankers and Handymax product tankers. These businesses were separated from the Company and distributed to its shareholders in the Distribution. In addition, as a separate domestic business segment, OMI Corp. provided lightering services in the Gulf of Mexico, operated four tank vessels in the U.S. Jones Act trade and provided ship management services to the US Government for its Ready Reserve fleet. These businesses were combined with those of MTL as a result of the Acquisition. The market for the Company's present businesses can be described as follows: Energy and Chemical Transportation: MTC operates a fleet of tankers used in carriage of liquid chemical and petroleum cargoes for contract customers and spot market movements in domestic and international trades. The Company owns ten vessels used in this trade (including the vessels SMT Chemical Explorer and SMT Chemical Trader discussed below) and in turn charters these vessels, or contracts for utilization of space aboard the vessels, with owners of the products moved by the vessels. The Company's primary customers are large oil and chemical companies or traders who sell products to large oil and chemical companies. Most of the Company's vessels operate in the protected U.S. Jones Act trades. In September of 1999, the Company purchased the U.S.-Flag vessels SMT Chemical Explorer and SMT Chemical Trader. These vessels are chartered to a joint venture, which is 75% owned by MTC, and 25% owned by Stolt-Nielsen Transportation Group, Inc. Operating results of this joint venture are consolidated with MTC's financial statements. These two 11 12 vessels presently operate in international markets. On March 6, 2000 Marine Transport Corporation acquired the ocean bulk transportation businesses of Mormac Marine Group, Inc.("Mormac"), a privately held company, in exchange for a: (a) cash payment in the amount of $100,000; and (b) series of fixed and contingent payments to be made over the next five years. The minimum amount payable to Mormac over the five-year period is approximately $7 million. By entering into bareboat charters for three vessels owned by Mormac and purchasing the stock of a Company engaged in the business of vessel management, MTC: (a) became liable for certain costs associated with the three vessels; (b) became entitled to the benefits of certain contractual arrangements to which these vessels are subject; and (c) assumed the rights and obligations arising from vessel management agreements with third parties. The Company also provides lightering services in the Gulf of Mexico through its subsidiary MTL Petrolink, Inc. ("Petrolink"). Petrolink charters in Aframax tankers and provides assist vessels to discharge large crude oil vessels offshore and deliver the cargo to U.S. ports in the Gulf of Mexico. Ship Management: MTC provides ship management services to industrial ship owners who use vessels in parts of their own businesses, and to the U.S. Government for its Ready Reserve Fleet. Ship management includes technical operation and maintenance, crewing, regulatory compliance and other aspects of ship operation. Including owned and managed vessels, MTC manages a total of 40 vessels, making it one of the largest U.S.-based fleets. Management contracts with outside customers have remaining terms of one to five years. RESULTS OF OPERATIONS The Company's vessels operate, or have operated in prior years, on time, bareboat or voyage ("spot") charters. Each type of charter denotes a method by which revenues are recorded and expenses are allocated. Under a time charter, revenue is measured based on a daily or monthly rate and the charterer assumes certain voyage expenses, such as fuel and port charges. Under a bareboat charter, the charterer assumes all voyage and operating expenses; therefore, the revenue rate is likely to be lower than a time charter. Under a voyage charter, revenue is calculated based on the amount of cargo carried, most expenses are for the shipowner's account and the length of the charter is one voyage. Revenue may be higher in the spot market, as the owner is responsible for most of the costs of the voyage. Other factors affecting net voyage revenues for voyage charters are waiting time between cargoes, port costs, and bunker prices. Vessel expenses included in net voyage revenues discussed above, include operating expenses such as crew payroll/benefits/travel, stores, maintenance and repairs, drydock, and insurance. These expenses are a function of the fleet size, utilization levels for certain expenses and requirements under laws, by charterers and Company standards. Insurance expense varies with the overall insurance market conditions as well as the insured's loss record, level of insurance and desired coverage. THREE MONTHS AND NINE MONTHS ENDED SEPTEMBER 30, 2000 COMPARED TO SEPTEMBER 30, 1999 Voyage revenues increased by $54.6 million for the nine months and $30.8 million for the three months ended September 30, 2000 as compared to the respective periods ended September 30, 1999. The following factors are reasons for the increase: the acquisition of the vessels SMT Chemical Trader and SMT Chemical Explorer at the end of the third quarter of 1999; the bareboat charter of three tankers from Mormac which commenced in the first quarter of 2000; and the record demand for MTC's lightering operations resulting from the high level of oil imports to U.S. 12 13 refineries. Other operating revenues for all periods primarily represent ship management services. The increase in the three and nine months ended September 30, 2000 as compared to respective periods in 1999 is primarily due to increases in the fees received to manage certain vessels and the addition of ship management fees for vessels managed by the operations acquired from Mormac in March 2000. Vessel and voyage operating expenses for the three and nine months ended September 30, 2000 versus the three and nine months ended September 30, 1999 increased primarily as a result of the vessels either purchased or bareboat chartered by MTC, fuel cost increases as described below and the increase in hire rates paid for the vessels chartered in by Petrolink to perform its lightering services in the U.S. Gulf of Mexico. Petrolink has recently experienced significant increases and volatility in the rates it must pay to charter vessels. The single largest cost in providing its lightering services. After several months of significant losses, Petrolink's income from lightering services and the cost of chartering in vessels stabilized in June and Petrolink operated profitably for the quarter ended September 30, 2000. Depending on a particular vessel's trade or customer, the impact of rising fuel prices on operating results varies. For example, vessels in spot market trading frequently see immediate spot market rate changes to compensate for changes in fuel prices. Many of the Company's contracts of affreightment contain fuel escalation clauses, which partially compensate for increases in fuel costs beyond a certain threshold. For those vessels on time charter or bareboat charter, fuel increases are the responsibility of the party chartering the vessel. Overall, the increases in fuel prices negatively affect voyage performance for MTC's vessels operating in the spot market. The increase in interest expense results from higher borrowings by the Company (arising from the assumption of the Title XI debt in connection with the acquisition of the vessels SMT Chemical Trader and SMT Chemical Explorer). LIQUIDITY AND CAPITAL RESOURCES At September 30, 2000 the Company had $2,000,000 available to borrow from the Company's revolving credit facilities. Concurrent with the Acquisition and Distribution, the Company entered into a new loan agreement and restructured the loan agreement to which MTL is a party. At September 30, 2000, the Company's total borrowings under these loan agreements plus the Title XI debt assumed to acquire SMT Chemical Explorer and SMT Chemical Trader aggregated approximately $32,250,000. Cash balances, existing credit facilities, and anticipated cash flow from operations are expected to be sufficient to meet the Company's normal operating requirements, including scheduled debt service payments. Four of the Company's vessels are due for drydocking during the next four months at total projected cost of at least $15,000,000. It is expected that each of these vessels will be out of service for four to eight weeks during the period. The Company also has plans to rebuild a vessel to join its chemical parcel business segment by mid-2001. The Company is discussing financing alternatives with several financial institutions to provide funds for the rebuilding project and provide increased working capital for its scheduled drydockings. 13 14 OTHER OPERATING MATTERS On January 27, 2000, the Company completed a transaction which allowed it to monetize $48,417,638 in future charter earnings to be generated by the vessel Marine Columbia pursuant to a time charter with BP Amoco. Of this amount, $23,417,638 was used to replace certain indebtedness associated with the vessel, $1,000,000 was used to settle a claim against an affiliate of MTC and the remaining $24,000,000 was transferred to an affiliate of MTC for current operations and growth, as well as for other projects. Of the proceeds received by the Company $1,000,000 was used to prepay a portion of the term loan indebtedness, and $4,000,000 was pledged as collateral to secure the Company's bank borrowings. At September 30, 2000 the amount pledged is classified as restricted cash on the Company's Balance Sheet. On February 7, 2000, MTC used a portion of the $24,000,000 to discharge a promissory note to OMI Corporation with an original face amount of $6,443,000. The outstanding balance of $5,918,000, as well as interest accrued to that date, was extinguished with a payment of $5,100,000. The resulting extraordinary after tax gain of approximately $649,000 ($.10 per share) is reported in the Company's financial statements for the nine months ended September 30, 2000. On March 6, 2000, Marine Transport Corporation acquired the ocean bulk transportation businesses of Mormac Marine Group, Inc. ("Mormac"). The total consideration to be paid by the Company for the Mormac businesses is based on a series of fixed and contingent payments over the next five years, with a minimum aggregate amount of approximately $7,000,000. The acquired operation includes ten U.S. flag vessels, including two crude oil tankers operated by MTC for another owner, three product carriers owned by Mormac subject to one time charter and a contract of affreightment, and five vessels operated for the U.S. Maritime Administration. The three Mormac product carriers are bareboat chartered by a subsidiary of MTC and traded as part of a "pooled" fleet with MTC's three similar product tankers, with the hope of enhancing overall utilization and providing more flexible service to customers. Mormac's government operation is maintained as a separate unit with its own Baltimore, Maryland office. The total consideration to be paid by MTC for the Mormac business is based on the performance of those businesses over a five-year period. In May, 2000 two subsidiaries of the Company were each awarded five-year term contracts to manage nine vessels for the U.S. Maritime Administration ("MARAD"), which contracts were due to expire in June 2000. MARAD subsequently extended the contracts for another 90 days. These contracts were activated by MARAD in two stages effective October 1, 2000 and November 1, 2000. AGREEMENTS As part of the Distribution, the Company is party to certain agreements with OMI Corporation (New OMI), its former subsidiary. Certain provisions of these agreements are summarized in Note 2 of the Condensed Consolidated Financial Statements included herein, and the agreements are included in the Company's Form S-1 dated May 15, 1998. EFFECTS OF INFLATION The Company does not consider inflation to be a significant risk to the cost of doing business in the foreseeable future. Inflation has a moderate impact on operating expenses, drydocking expenditures and corporate overhead. 14 15 PART II: OTHER INFORMATION There have been no material developments since the previously reported legal proceedings. Item 2. Changes in Securities. - None - Item 3. Exhibits and Reports on Form 8-K (a) Exhibits - None - (b) Reports on Form 8-K. During the period ended September 30, 2000, the Company filed the following reports on Form 8-K: Form 8-K dated August 30, 2000, reporting under Item 5 of Form 8-K, compliance with the net tangible minimum balance requirement prescribed by the Nasdaq marketplace rules. 15 16 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. Date: November 3, 2000 MARINE TRANSPORT CORPORATION By: /s/ Richard T. du Moulin ------------------------------------- Richard T. du Moulin President and Chief Executive Officer Date: November 3, 2000 By: /s/ Mark L. Filanowski ------------------------------------- Mark L. Filanowski Senior Vice President and Chief Financial Officer 16

MARINE TRANSPORT CORP 10-Q