<PAGE> 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 EXCHANGE ACT OF 1934
For the Quarterly Period Ended September 30, 2000
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE EXCHANGE ACT OF 1934
Commission file number 333-38157
FIRST WAVE MARINE, INC.
(Exact name of Registrant as specified in its charter)
DELAWARE 76-0461352
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
2102 BROADWAY
HOUSTON, TEXAS 77012
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (713) 847-4600
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 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
Number of shares of common stock outstanding as of November 10, 2000:
11,756,955.
================================================================================
<PAGE> 2
FIRST WAVE MARINE, INC.
INDEX TO FORM 10-Q
FOR THE NINE MONTH PERIOD ENDED
SEPTEMBER 30, 2000
<TABLE>
<CAPTION>
PAGE
<S> <C> <C>
PART I: FINANCIAL INFORMATION
Item 1. Financial Statements
Consolidated Balance Sheets - September 30, 2000 and
December 31, 1999 1
Consolidated Statements of Operations for the Three Month
and Nine Month Periods Ended September 30, 2000 and 1999 2
Consolidated Statements of Cash Flows for the Nine Month
Periods Ended September 30, 2000 and 1999 3
Notes to Unaudited Consolidated Financial Statements 4
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations 5
Item 3. Quantitative and Qualitative Disclosures about Market Risk 9
PART II: OTHER INFORMATION
Item 1. Legal Proceedings 10
Item 6. Exhibits and Reports on Form 8-K 10
</TABLE>
<PAGE> 3
PART I: FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
FIRST WAVE MARINE, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS, EXCEPT PER SHARE DATA)
ASSETS
<TABLE>
<CAPTION>
September 30, December 31,
2000 1999
------------- ------------
(Unaudited)
<S> <C> <C>
Current assets:
Cash and cash equivalents $ 219 $ 8,379
Accounts receivable, less allowance of $224 in 2000
and $160 in 1999 18,213 12,691
Inventories 886 1,042
Costs and estimated earnings in excess of billings on
uncompleted contracts 6,090 5,096
Prepaids and other 631 1,112
Income tax receivable 326 1,841
Deferred income taxes 995 755
--------- ---------
Total current assets 27,360 30,916
Property and equipment, net 72,564 72,675
Financing costs, net 3,394 3,765
Goodwill and other intangibles, net 14,299 14,702
Shareholder lines of credit 841 783
Deposits and other 393 274
--------- ---------
$ 118,851 $ 123,115
========= =========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 2,596 $ 4,834
Accrued liabilities 7,149 8,073
Billings in excess of costs and estimated earnings on
uncompleted contracts 584 235
Accrued interest payable 1,827 4,611
Current portion of long-term debt and capital lease obligation 846 894
Notes payable and short-term borrowings 6,810 182
--------- ---------
Total current liabilities 19,812 18,829
Long-term obligations 7,185 7,205
Subordinated debt 6,328 6,328
Senior notes 90,000 90,000
Deferred income taxes 1,834 2,234
Other liabilities 2,145 1,510
Commitments and contingencies -- --
Stockholders' equity:
Preferred stock, $.01 par value, 2,000 shares
authorized, no shares issued -- --
Common stock, $.01 par value, 21,000 shares authorized,
11,757 shares issued and outstanding
at September 30, 2000 and December 31, 1999 118 118
Additional paid-in capital 3,490 3,490
Retained earnings (deficit) (12,061) (6,599)
--------- ---------
Total stockholders' equity (deficit) (8,453) (2,991)
--------- ---------
$ 118,851 $ 123,115
========= =========
</TABLE>
The accompanying notes are an integral part of these statements.
1
<PAGE> 4
FIRST WAVE MARINE, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE THREE AND NINE MONTH PERIODS ENDED SEPTEMBER 30,
(IN THOUSANDS, EXCEPT PER SHARE DATA) (UNAUDITED)
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
September 30, September 30,
2000 1999 2000 1999
-------- -------- -------- --------
<S> <C> <C> <C> <C>
Revenues:
Repair and upgrades $ 19,950 $ 12,070 $ 56,192 $ 46,100
New construction 1,026 6,811 7,864 14,407
Environmental services 879 953 2,821 3,291
-------- -------- -------- --------
21,855 19,834 66,877 63,798
Cost of revenues 17,909 19,319 57,012 58,561
-------- -------- -------- --------
Gross profit 3,946 515 9,865 5,237
General and administrative expenses 3,034 3,275 8,048 9,369
-------- -------- -------- --------
Income (loss) from operations 912 (2,760) 1,817 (4,132)
Interest expense - net 2,875 2,568 8,458 7,606
-------- -------- -------- --------
Income (loss) before income taxes (1,963) (5,328) (6,641) (11,738)
Income tax expense (benefit) (305) (1,896) (1,179) (4,157)
-------- -------- -------- --------
Net income (loss) $ (1,658) $ (3,432) $ (5,462) $ (7,581)
======== ======== ======== ========
Basic and diluted earnings per share:
Net income (loss) $ (0.14) $ (0.29) $ (0.46) $ (0.64)
======== ======== ======== ========
Weighted-averaged shares:
Basic and diluted 11,757 11,757 11,757 11,757
======== ======== ======== ========
</TABLE>
The accompanying notes are an integral part of these statements.
2
<PAGE> 5
FIRST WAVE MARINE, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
For the Nine Month Periods Ended September 30,
(In thousands)
(Unaudited)
<TABLE>
<CAPTION>
2000 1999
-------- -------
<S> <C> <C>
Cash flows from operating activities:
Net income (loss) $ (5,462) $(7,581)
Adjustments to reconcile net income (loss) to net cash provided by
(used in) operating activities:
Depreciation and amortization 4,799 4,836
Accretion of discounts on investments held-to-maturity -- (33)
Provision for doubtful accounts 64 91
Loss (gain) on sale of property and equipment 5 13
Write-off of property and equipment 144 623
Deferred income tax provision (640) (2,179)
Changes in operating assets and liabilities:
Accounts receivable (5,586) 6,343
Inventories 156 41
Costs and estimated earnings in excess of billings on uncompleted contracts (994) 657
Other assets 481 (1,425)
Income tax receivable 1,515 (1,610)
Deposits and other (177) (77)
Accounts payable (2,238) 1,169
Accrued liabilities (685) 1,198
Billings in excess of costs and estimated earnings on uncompleted contracts 349 512
Accrued interest payable (2,784) (2,061)
Other liabilities 635 66
-------- -------
Net cash provided by (used in) operating activities (10,418) 583
-------- -------
Cash flows from investing activities:
Acquisition of property and equipment (3,827) (4,783)
Proceeds from maturity of investments held-to-maturity -- 6,274
Proceeds from sales of investments available-for-sale -- 2,123
Proceeds from sales of property and equipment 100 165
-------- -------
Net cash provided by (used in) investing activities (3,727) 3,779
-------- -------
Cash flows from financing activities:
Payments on long-term debt and notes payable (656) (91)
Net borrowings (repayments) on revolving line of credit 6,641 --
-------- -------
Net cash provided by (used in) financing activities 5,985 (91)
-------- -------
Net increase (decrease) in cash and cash equivalents (8,160) 4,271
Cash and cash equivalents at beginning of period 8,379 1,654
-------- -------
Cash and cash equivalents at end of period $ 219 $ 5,925
======== =======
</TABLE>
The accompanying notes are an integral part of these statements.
3
<PAGE> 6
FIRST WAVE MARINE, INC. AND SUBSIDIARIES
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
(In thousands, except per share data)
Note 1 In the opinion of management the accompanying unaudited
consolidated financial statements reflect all adjustments necessary
to present fairly the financial position of First Wave Marine, Inc.
("First Wave" or the "Company") as of September 30, 2000, the
results of operations for the three and nine month periods ended
September 30, 2000 and 1999, and cash flows for the nine month
periods ended September 30, 2000 and 1999. All such adjustments are
of a normal recurring nature. These interim financial statements
should be read in conjunction with the audited financial statements
and related notes included in the Company's Annual Report on Form
10-K for the year ended December 31, 1999.
Note 2 The consolidated financial statements include the accounts of
First Wave and its wholly-owned subsidiaries. All material
intercompany transactions are eliminated in consolidation.
Note 3 The results of operations for the three and nine month periods
ended September 30, 2000 are not necessarily indicative of the
results to be expected for the entire year.
4
<PAGE> 7
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
This report on Form 10-Q contains "forward-looking statements" within
the meaning of Section 27A of the Securities Act of 1933, as amended,
and Section 21E of the Securities Exchange Act of 1934, as amended. All
statements other than statements of historical facts included in this
Form 10-Q, including statements in this "Management's Discussion and
Analysis of Financial Condition and Results of Operations," as well as
statements as may be made by management, orally or in writing related
thereto, are forward-looking statements. Forward-looking statements
generally are accompanied by words such as "anticipate", "believe",
"estimate", "expect" or similar statements. Such forward-looking
statements are subject to certain risks, uncertainties and assumptions,
including (i) risks of reduced levels of demand for the Company's
services resulting from reduced levels of capital expenditures of the
Company's customers in the offshore drilling rig, offshore support
vessel, offshore barge, ship and inland marine industries, (ii) risks
related to the expansion of operations, (iii) operating risks relating
to conversion and repair of drilling rigs, offshore support vessels,
offshore barges, ships and inland marine vessels, (iv) contract bidding
risks, (v) risks related to dependence on significant customers, (vi)
risks related to the highly leveraged posture of the Company, and (vii)
risks related to regulatory and environmental matters. Additionally,
the Company's Report on Form 10-K for the year ended December 31, 1999
should be consulted for an expanded discussion of risk factors. Should
one or more of these risks or uncertainties materialize, or should
underlying assumptions prove incorrect, actual results may vary
materially from those anticipated, estimated or projected. Although the
Company believes that the expectations reflected in such
forward-looking statements are reasonable, no assurance can be given
that such expectations will prove to have been correct.
The following discussion of the Company's financial condition, results
of operations, liquidity and capital resources should be read in
conjunction with the Company's Consolidated Financial Statements and
the Notes to the Consolidated Financial Statements included elsewhere
in this report.
GENERAL
The Company's business is primarily derived from providing repair and
upgrade services to inland and offshore marine vessels, including
barges, boats, drilling rigs and ships. To a lesser extent the Company
engages in new construction of such inland and offshore marine vessels.
First Wave currently operates three shipyards in the Houston, Texas
area (Brady Island, Greens Bayou and Pasadena) and three in the
Galveston, Texas area (East Pelican Island, West Pelican Island and
Galveston Island). The Company also provides related environmental
services, including cleaning, degassing and wastewater treatment. The
Company currently employs approximately 1,045 employees at its six
shipyards.
RECENT DEVELOPMENTS
In August 2000, enforcement officers from the multi-agency
environmental task force that regularly patrols the Houston Ship
Channel entered the premises of two of the Company's subsidiaries'
facilities. The officers obtained photographs, videotape, and water
samples. The Company, with the advice and assistance of outside
counsel, immediately investigated the circumstances surrounding
blasting operations at the two facilities, and, at one facility,
terminated several employees for violations of the Company's policies
regarding sandblasting operations. The Company has been cooperative
with the government's investigation. At this time, the Company cannot
estimate the impact that could result from enforcement action, if any,
related to the government's investigation. The Company does not believe
that any of the matters described above will subject the parent
company, First Wave Marine, Inc., to criminal charges or liability.
James D. Cole, one of the Company's directors, resigned from the Board
in October 2000. Mr. Cole's resignation was not the result of any
disagreements relating to the Company's operations, policies or
practices. Additionally, in May 2000, Mr. Paul E. O'Neill, also a
director, resigned from the Board. Mr. O'Neill's resignation was not
the result of any disagreements relating to the Company's operations,
policies or practices.
5
<PAGE> 8
RESULTS OF OPERATIONS
Comparison of the three months ended September 30, 2000 to the three
months ended September 30, 1999.
Revenues increased 10% to $21.9 million in the 2000 period, compared
with $19.8 million in the 1999 period, primarily as a result of a $7.9
million increase in repair and upgrade revenues offset by a $5.8
million decrease in new construction revenues. The increase in repair
and upgrade revenues can be largely attributed to the upturn in
exploration and production activity in the Gulf of Mexico resulting
from increased oil prices in 1999. The decrease in new construction
activity was primarily due to the completion of barge construction
contracts at the Company's Galveston Island facility in early 2000.
Cost of revenues as a percentage of total revenues was 82% in the 2000
period compared to 97% in the 1999 period. The cost of revenue
percentage decreased primarily as a result of the change in mix of
work.
Gross Profit increased 666% to $3.9 million in the 2000 period from
$515,000 in the 1999 period. The gross profit margin increased to 18%
in the 2000 period from 3% in the 1999 period, due primarily to an
increase in higher margin repair and upgrade work and a decrease in
lower margin new construction work.
General and administrative expenses decreased 7% to $3.0 million in the
2000 period from $3.3 million in the 1999 period primarily due to
several unusual items reflected in the 1999 period. General and
administrative expenses as a percentage of revenues for the 2000 period
represented 14% of total revenues, as compared to 17% for the 1999
period.
During late 1999, the Company undertook a study of its cost
classification system. The study included an account by account
analysis as well as a review of industry practices. Based on the
results of the study, reclassifications have been made between general
and administrative expenses and cost of revenues for all 1999 periods
presented.
Net interest expense increased to $2.9 million in the 2000 period from
$2.6 million in the 1999 period primarily due to increased interest
expense related to increased borrowings on the Company's revolving
credit and term loan facility entered into in October 1999.
During the 2000 period, the Company recognized an income tax benefit of
approximately 16%, as compared to an income tax benefit during the 1999
period of approximately 36%. The benefit recognized in the current
period reflects a projected effective tax rate to be applicable for the
full fiscal year of 2000.
Comparison of the nine months ended September 30, 2000 to the nine
months ended September 30, 1999.
Revenues increased 5% to $66.9 million in the 2000 period, compared
with $63.8 million in the 1999 period, primarily as a result of a $10.1
million increase in repair and upgrades revenue which was offset by a
decrease in new construction revenue of $6.5 million. The increase in
repair and upgrade revenues can be largely attributed to the upturn in
exploration and production activity in the Gulf of Mexico resulting
from increased oil prices in 1999. The decrease in new construction
revenue is due to the completion of barge construction contracts at the
Company's Galveston Island facility in the first quarter of 2000.
Cost of revenues as a percentage of total revenues was 85% in the 2000
period compared to 92% in the 1999 period. The cost of revenue
percentage decreased primarily as a result of the change in mix of
work.
Gross profit increased 88% to $9.9 million in the 2000 period from $5.2
million in the 1999 period. The gross profit margin increased to 15% in
the 2000 period from 8% in the 1999 period, due primarily to an
increase in higher margin repair and upgrade work and a decrease in
lower margin new construction revenue.
General and administrative expenses decreased 14% to $8.0 million in
the 2000 period from $9.4 million in the 1999 period. General and
administrative expenses as a percentage of revenues for the 2000 period
represented 12% of total revenues, as compared to 15% for the 1999
period. The decrease in general and administrative expenses was due to
a decrease in unusual expenditures. In the 2000 period, the Company
recognized an asset
6
<PAGE> 9
impairment loss of $115,000 related to the disposal of a dry-dock
at one of the Company's subsidiaries, and expensed $98,000 in legal
fees related to the settlement of the environmental investigation at
the Brady Island facility which was reached late in the first quarter
of 2000. During the comparable period in 1999, the Company recognized
unusual expenses of approximately $992,000 related to an unsuccessful
acquisition attempt, an impairment loss on a specialized piece of
equipment, an asset write-down on the cancellation of the purchase of a
piece of equipment, and legal fees related to the environmental
investigation at the Brady Island facility. During the 2000 period,
corporate expenses decreased approximately $300,000 from the comparable
1999 period as travel expenses related to acquisition attempts
decreased, expenses related to the development of the marketing program
decreased, and certain job functions were consolidated.
During late 1999, the company undertook a study of its cost
classification system. The study included an account by account
analysis as well as a review of industry practices. Based on the
results of the study, reclassifications have been made between general
and administrative expenses and cost of revenues for all 1999 periods
presented.
Net interest expense rose to $8.5 million in the 2000 period from $7.6
million in the 1999 period primarily due to an increase in interest
expense related to increased borrowings on the Company's revolving
credit and term loan facility entered into in October 1999.
During the 2000 period, the Company recognized an income tax benefit of
approximately 18%, as compared to an income tax benefit of
approximately 35% during the 1999 period. The benefit recognized in the
current period reflects an assumed tax rate for the full fiscal year of
2000.
INFLATION AND CHANGING PRICES
The Company does not believe that general price inflation has had a
significant impact on the Company's results of operations during the
periods presented. To the extent that the effects of inflation are not
offset by improvements in manufacturing and purchasing efficiency and
labor productivity, the Company generally has been able to take such
effects into account in pricing its contracts with customers. There can
be no assurance, however, that inflation will not have a material
effect on the Company's business in the future.
LIQUIDITY AND CAPITAL RESOURCES
The Company's ongoing liquidity requirements arise primarily from its
need to service debt, fund working capital, and make capital
improvements to its facilities.
Under its indenture entered into in 1998 in connection with the $90
million Senior Notes offering, the Company is permitted to borrow up to
the greater of $20 million or 85% of its accounts receivable, plus up
to an additional $5 million. In October 1999, the Company entered into
a $20 million revolving credit and term loan facility (the "Facility")
that matures on October 14, 2003. The revolving portion of the
Facility, initially $16 million, is secured by accounts receivable of
all but one of the Company's subsidiaries. The initial interest rate on
the revolving portion of the Facility was 0.50% per annum in excess of
The Wall Street Journal prime rate. The term portion of the Facility
("Term Loan"), $4 million, is secured by certain dry-docks and real
estate. The initial interest rate on the Term Loan was 1.00% per annum
in excess of The Wall Street Journal prime rate. The Term Loan requires
monthly principal payments of $56,000, with the unpaid balance due at
the maturity of the Facility. The Facility initially required that
cumulative net losses of the Company as defined in the agreement after
October 1, 1999 not exceed $3.0 million. The Company is required to pay
a fee of 0.25% per annum on the unused portion of the total Facility,
based on a minimum total loan amount of $5 million, and certain other
administrative costs.
In April 2000, the Company entered into an amendment to the Facility.
The amendment provided for a 2% per annum increase to each of the
Facility interest rates in exchange for an increase to $4.5 million of
the cumulative net loss covenant commencing January 1, 2000. The
increased interest rates will be reduced to
7
<PAGE> 10
the original Facility interest rates upon the Company reporting a
positive net income. The rates will adjust quarterly thereafter,
remaining at the original Facility interest rates for each quarter the
Company reports a positive net income.
In September 2000, the Company was notified by its lender that the
Facility was being acquired by another lender. Effective October 2,
2000, the Facility was acquired by the new lender. All terms of the
Facility remain the same with the new lender. The Company is engaged in
discussions with the new lender regarding changes to the Facility to
include in the revolving portion of the Facility the receivables of the
remaining subsidiary not originally included.
As of November 9, 2000, the Company had outstanding borrowings of
approximately $6.4 million on the revolving portion of the Facility.
In July 2000, one of the Company's subsidiaries, Newpark Shipbuilding -
Pelican Island, Inc., entered into a 24 month bareboat charter of a
liftbarge with a purchase option. The charter required an initial
payment of $680,000, plus seven monthly payments of $40,000 beginning
in the eighteenth month. If the purchase option is exercised a final
payment of $420,000 is due. The Company has accounted for this charter
as a capital lease.
Net cash (used in) provided by operating activities for the nine month
periods ended September 30, 2000 and 1999 was $(10.4) million and
$583,000, respectively. The decrease in cash provided by operating
activities was primarily due to the increase in accounts receivables,
and the decreases in accounts payable and accrued interest payable.
Net cash (used in) provided by investing activities was $(3.7) million
and $3.8 million for the nine month periods ended September 30, 2000
and 1999, respectively. During the 2000 period, cash used in investing
activities was for asset additions.
Net cash provided by (used in) financing activities was $6.0 million
and $(91,000) for the nine month periods ended September 30, 2000 and
1999, respectively. Cash provided by financing activities was obtained
from borrowings on the Company's line of credit, partially offset by
payments on long-term debt and notes payable.
Based on current financial projections, management believes that cash
generated from operations and borrowings under the Company's line of
credit will provide sufficient resources to meet its anticipated
requirements for working capital, capital expenditures, and debt
service for the remainder of fiscal year 2000.
However, management is uncertain that such sources will be sufficient
to meet debt service requirements under its senior notes in the first
quarter of 2001. Recent increased borrowings under the Company's
Facility have reduced its available and unused borrowing capacity.
Additionally, it is uncertain whether the Company will remain in
compliance with a financial covenant of its Facility into the first
quarter of 2001. Accordingly, the Company is continuing to aggressively
pursue new equity as well as the sale of non-strategic assets.
Furthermore, the Company is in discussions with its new lender on the
Facility and has engaged an outside adviser to assist in discussions
with holders of the senior notes.
No assurance can be given that these efforts will be successful.
Furthermore, if capital requirements increase or revenue declines
materially from our current expectations, or if unforeseen
circumstances occur, the Company will require additional funds sooner
than anticipated. There is no assurance that funds from additional debt
or equity financing or asset sales will be available on terms
acceptable to the Company, if at all.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
The Company is exposed to interest rate risk in connection with its
variable rate debt instruments. The Company does not enter into market
risk sensitive instruments for trading purposes. The information below
summarizes the Company's interest rate risk associated with its
principal variable rate debt instruments outstanding at September 30,
2000, and should be read in conjunction with the audited financial
statements and related notes included in the Company's Annual Report on
Form 10-K for the year ended December 31, 1999. Borrowings under the
Company's Revolving Credit and Term Loan Facilities bear interest at
variable rates equal to the prime rate as quoted in The Wall Street
Journal plus the applicable margin. Because The Wall Street Journal
rate may increase or decrease at any time, the Company is exposed to
market risk as a result of the
8
<PAGE> 11
impact that changes in this rate may have on the interest rate
applicable to borrowings under the Revolving Credit and Term Loan
Facilities. Increases in the interest rate applicable to borrowings
under the Revolving Credit and Term Loan Facilities would result in
increased interest expense and a reduction in the Company's net income
and after tax cash flow. At September 30, 2000, there was approximately
$3.4 million indebtedness outstanding under the term portion and $6.6
million outstanding indebtedness under the revolving portion of the
Revolving Credit and Term Loan Facilities, or approximately 9% of the
Company's outstanding debt obligations on that date, bearing interest
at variable rates.
The Company attempts to mitigate the interest rate risk resulting from
its variable interest rate long-term debt instruments by also issuing
fixed rate long-term debt instruments and maintaining a balance over
time between the amount of variable rate and fixed rate indebtedness.
In the event of an increase in interest rates, the Company may take
further actions to mitigate its exposure. The Company can give no
assurances that actions that it may take to mitigate this risk will be
feasible or that these actions, if taken, will be effective.
9
<PAGE> 12
PART II: OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS.
In August 2000, enforcement officers from the multi-agency
environmental task force that regularly patrols the Houston Ship
Channel entered onto the premises of two of the Company's
subsidiaries' facilities. The officers obtained photographs,
videotape, and water samples. The Company, with the advice and
assistance of outside counsel, immediately investigated the
circumstances surrounding blasting operations at the two facilities
and, at one subsidiary's facility, terminated several employees for
violations of the Company's policies regarding sandblasting
operations. The Company has been cooperative with the government's
investigation. At this time, the Company cannot estimate the impact
that could result from enforcement action, if any, related to the
government's investigation. The Company does not believe that any of
the matters described above will subject the parent company, First
Wave Marine, Inc., to criminal charges or liability.
ITEM 2-5. NOT APPLICABLE.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.
(a) Exhibits
Exhibit
Number Description
------ -----------
*27.1 Financial Data Schedule.
* Filed herewith.
(b) Reports on Form 8-K
None
10
<PAGE> 13
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) 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.
FIRST WAVE MARINE, INC.
November 14, 2000 /s/ Frank R. Pierce
--------------------------
Frank R. Pierce
Senior Vice President and
Chief Financial Officer
November 14, 2000 /s/ Dale E. Schexnayder
---------------------------
Dale E. Schexnayder
Corporate Controller
11
<PAGE> 14
EXHIBIT INDEX
Exhibit
Number Description
------ -----------
*27.1 Financial Data Schedule.
