UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 6-K
Report of Foreign Private Issuer
Pursuant to Rule 13a-16 or 15d-16 of
the Securities Exchange Act of 1934
For the quarterly period ended September 30, 2000
MILLENIUM SEACARRIERS, INC.
(Exact name of Registrant as specified in its charter)
Not Applicable
(Translation of Registrant's Name into English)
Cayman Islands
(Jurisdiction of incorporation or organization)
c/o Ugland House
South Church Street
Grand Cayman, Cayman Islands
(Address of principal executive offices)
(Indicate by check mark whether the registrant files or will file annual reports
under cover Form 20-F or Form 40-F.)
Form 20-F |X| Form 40-F |_|
(Indicate by check mark whether the registrant by furnishing the information
contained in this Form is also thereby furnishing the information to the
Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of
1934.)
Yes |_| No |X|
(If "Yes" is marked, indicate below the file number assigned to the registrant
in connection with Rule 12g3-2(b):82-_______ )
<PAGE>
MILLENIUM SEACARRIERS, INC.
REPORT ON FORM 6-K FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2000
INDEX
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PART I PAGE
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Item 1. Financial
Information.........................................................................................3
Consolidated Balance Sheets as of September 30, 2000
and December 31, 1999....................................................3
Unaudited Consolidated Statements of Operations
for the three-month periods ended September 30, 2000 and 1999
and the nine-month periods ended September 30, 2000 and 1999.............4
Unaudited Consolidated Statements of Cash Flows
for the nine-month periods ended September 30, 2000
and 1999.................................................................5
Consolidated Statement of Shareholders' Equity/(Deficiency)
for the year ended December 31, 1999 and nine-month
period ended September 30, 2000 (unaudited)..............................6
Notes to Consolidated Financial Statements........................................7
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations for the three and nine-month periods ended
September 30, 2000...............................................................12
PART II Other Information.........................................................................17
Item 1. Legal Proceedings..................................................................................17
Item 2. Changes in Securities..............................................................................17
Item 3. Defaults Upon Senior Securities....................................................................17
Item 4. Submission of Matters to a Vote of Security Holders................................................18
Item 5. Other Information..................................................................................18
Item 6. Exhibits and Reports on Form 6-K...................................................................18
Signature...................................................................................................18
</TABLE>
2
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PART I
ITEM 1. FINANCIAL INFORMATION
-----------------------------
MILLENIUM SEACARRIERS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS AS OF
SEPTEMBER 30, 2000 (UNAUDITED) AND DECEMBER 31, 1999
(Expressed in U.S. Dollars)
<TABLE>
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SEPTEMBER 30,
2000
ASSETS (UNAUDITED) DECEMBER 31, 1999
------
<S> <C> <C>
CURRENT ASSETS
Cash and cash equivalents $ 636,761 $ 6,903,645
Restricted cash 7,741,283 4,827,135
------------------ ------------------
8,378,044 11,730,780
Receivables :
Voyages 794,314 516,763
Claims and other 953,407 324,564
Inventories and prepaid expenses 1,479,783 1,479,206
------------------ ------------------
TOTAL CURRENT ASSETS 11,605,548 14,051,313
------------------ ------------------
FIXED ASSETS
Vessels, net of accumulated depreciation of
$10,670,951 and $7,164,750 at September 30, 2000 and
December 31, 1999, respectively 86,350,563 93,484,950
Other, net of accumulated depreciation 136,032 138,337
------------------ ------------------
TOTAL FIXED ASSETS 86,486,595 93,623,287
Other assets 5,037,598 5,012,248
------------------ ------------------
TOTAL ASSETS $ 103,129,741 $ 112,686,848
================== ==================
LIABILITIES AND SHAREHOLDERS'
-----------------------------
EQUITY/(DEFICIENCY)
-------------------
CURRENT LIABILITIES
Trade accounts payable $ 6,145,149 $ 5,705,471
Accrued liabilities 5,820,578 8,632,155
Charter revenue received in advance 1,037,042 504,290
------------------ ------------------
TOTAL CURRENT LIABILITIES 13,002,769 14,841,916
Notes 96,461,261 96,069,637
------------------ ------------------
TOTAL LIABILITIES 109,464,030 110,911,553
------------------ ------------------
Commitments and contingencies
SHAREHOLDERS' EQUITY
Common stock and paid in capital 22,900,000 22,900,000
Warrants 1,200,000 1,200,000
Accumulated deficit (30,434,289) (22,324,705)
------------------ ------------------
TOTAL SHAREHOLDERS' EQUITY/(DEFICIENCY) (6,334,289) 1,775,295
------------------ ------------------
TOTAL LIABILITIES AND SHAREHOLDERS'
EQUITY/(DEFICIENCY) $ 103,129,741 $ 112,686,848
================== ==================
</TABLE>
The accompanying notes are an integral part of these financial statements
3
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MILLENIUM SEACARRIERS, INC. AND SUBSIDIARIES
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE THREE AND NINE-MONTH PERIODS ENDED SEPTEMBER 30, 2000,
AND FOR THE THREE AND NINE-MONTH PERIODS ENDED SEPTEMBER 30, 1999
(Expressed in U.S. Dollars)
<TABLE>
<CAPTION>
THREE-MONTH THREE-MONTH NINE-MONTH NINE-MONTH
PERIOD ENDED PERIOD ENDED PERIOD ENDED PERIOD ENDED
SEPTEMBER 30, SEPTEMBER 30, SEPTEMBER 30, SEPTEMBER 30,
2000 1999 2000 1999
<S> <C> <C> <C> <C>
REVENUE
Freight and hire from voyages $ 10,744,397 $ 10,368,323 $ 31,331,823 $ 26,528,828
Voyage expenses (1,244,160) (944,657) (3,828,632) (1,556,371)
Commissions (414,456) (432,479) (1,165,512) (1,189,328)
----------------- ----------------- ------------------ ------------------
NET REVENUE 9,085,781 8,991,187 26,337,679 23,783,129
----------------- ----------------- ------------------ ------------------
EXPENSES
Vessel operating expenses 4,891,069 4,412,932 14,263,159 13,109,992
Management fees 1,284,833 1,021,201 3,959,430 2,459,143
General and administrative 1,028,518 199,501 1,613,149 497,689
Depreciation and amortization 1,632,271 1,921,421 4,820,158 5,217,987
Loss on sale/disposal of vessel 253,037 2,017,759 253,037 2,017,759
----------------- ----------------- ------------------ ------------------
9,089,728 9,572,814 24,908,933 23,302,570
----------------- ----------------- ------------------ ------------------
OPERATING (LOSS)/INCOME (3,947) (581,627) 1,428,746 480,559
----------------- ----------------- ------------------ ------------------
OTHER INCOME / (EXPENSE)
Interest expense (3,223,812) (3,196,743) (9,643,208) (9,478,421)
Other income/(expense) 23,219 (5,921) 104,878 535,213
----------------- ----------------- ------------------ ------------------
(3,200,593) (3,202,664) (9,538,330) (8,943,208)
----------------- ----------------- ------------------ ------------------
LOSS BEFORE INCOME TAXES (3,204,540) (3,784,291) (8,109,584) (8,462,649)
INCOME TAX PROVISION - -
----------------- ----------------- ------------------ ------------------
NET LOSS $ (3,204,540) $ (3,784,291) $ (8,109,584) $ (8,462,649)
================= ================= ================== ==================
LOSS PER SHARE, BASIC AND DILUTED $ (0.34) $ (0.40) $ (0.85) $ (0.89)
================= ================= ================== ==================
</TABLE>
The accompanying notes are an integral part of these financial statements
4
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MILLENIUM SEACARRIERS, INC. AND SUBSIDIARIES
UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE NINE-MONTH PERIODS ENDED SEPTEMBER 30, 2000 AND SEPTEMBER 30, 1999
(Expressed in U.S. Dollars)
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NINE-MONTH PERIOD NINE-MONTH PERIOD
ENDED SEPTEMBER ENDED SEPTEMBER
30, 2000 30, 1999
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss $ (8,109,584) $ (8,462,649)
Adjustments to reconcile loss to net cash provided by operating activities:
Loss on sale of vessel 253,037 2,017,759
Depreciation and amortization 4,820,158 5,217,987
Amortization of bond discount and deferred financing costs 901,728 855,310
Changes in operating assets and liabilities
Decrease/(Increase) in Receivables (248,947) 80,266
Increase in Inventories and prepaid expenses (577) (884,052)
(Decrease)/Increase in Trade accounts payable (172,299) (1,482,708)
Decrease in Accrued liabilities (2,811,577) (1,250,311)
Deferred dry-docking and special survey (1,303,409) (851,208)
Increase in Charter revenue received in advance 532,752 350,106
-----------------------------------------
NET CASH USED IN OPERATING ACTIVITIES (6,138,718) (4,409,500)
-----------------------------------------
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of vessels - (23,615,000)
Additions to vessels - (605,222)
Proceeds from sale of vessel 2,826,803 1,498,353
Purchase of other fixed assets (40,821) (103,646)
-----------------------------------------
NET CASH PROVIDED BY / (USED IN) INVESTING ACTIVITIES 2,785,982 (22,825,515)
-----------------------------------------
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from working capital facility - 250,000
Repayment of Proceeds from working capital facility - (250,000)
Escrow account and restricted cash (2,914,148) 26,707,374
-----------------------------------------
NET CASH (USED IN) / PROVIDED BY FINANCING ACTIVITIES (2,914,148) 26,707,374
-----------------------------------------
(DECREASE)/INCREASE IN CASH AND CASH EQUIVALENTS (6,266,884) 527,641
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 6,903,645 5,736,645
-----------------------------------------
CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 636,761 $ 5,209,004
=========================================
SUPPLEMENTARY CASH FLOW INFORMATION
Interest paid $ 11,641,080 $ 11,445,018
=========================================
</TABLE>
The accompanying notes are an integral part of these financial statements
5
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MILLENIUM SEACARRIERS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY/(DEFICIENCY)
FOR THE YEAR ENDED DECEMBER 31, 1999 AND
FOR THE NINE-MONTH PERIOD ENDED SEPTEMBER 30, 2000 (UNAUDITED)
(Expressed in U.S. Dollars)
<TABLE>
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COMMON STOCK
AND PAID-IN ACCUMULATED
CAPITAL WARRANTS DEFICIT TOTAL
<S> <C> <C> <C> <C>
BALANCE JANUARY 1, 1999 $ 22,900,000 $ 1,200,000 $ (3,526,869) $ 20,573,131
Net Loss for the year ended
December 31, 1999 (18,797,836) (18,797,836)
----------------- ---------------- ---------------- ---------------
BALANCE DECEMBER 31, 1999 22,900,000 1,200,000 (22,324,705) 1,775,295
Net Loss for the nine-month period
ended September 30, 2000 (unaudited) (8,109,584) (8,109,584)
----------------- ---------------- ---------------- ---------------
BALANCE SEPTEMBER 30, 2000 $ 22,900,000 $ 1,200,000 $(30,434,289) $(6,334,289)
================= ================ ================ ===============
</TABLE>
The accompanying notes are an integral part of these financial statements
6
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MILLENIUM SEACARRIERS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Expressed in US Dollars)
1. BUSINESS INFORMATION
On March 10, 1998, Millenium Seacarriers, Inc. ("Millenium") was formed (the
"Formation") to directly hold the capital stock of a group of subsidiaries
(collectively the "Company") each of which owns one of Millenium's vessels.
These consolidated financial statements give effect to the Formation pursuant to
which all of Millenium subsidiaries became wholly owned subsidiaries of
Millenium. Millenium owns and operates a fleet of dry-bulk carriers, primarily
of Handy-size type. As of September 30, 2000, the Company's fleet consisted of
19 vessels, with an aggregate tonnage of 532,126 dwt.
The Company is registered and incorporated in the Cayman Islands. Its principal
business is the acquiring, upgrading and operating of vessels. Millenium
conducts its operations through its subsidiaries whose principal activity is the
operation and ownership of dry-bulk vessels that will be under the exclusive
management of Millenium Management, Inc. ("MMI") and the sub-management of
Millenium Maritime Services Ltd. and Millenium Maritime Services, Inc.
2. BASIS OF FINANCIAL STATEMENT PRESENTATION AND ACCOUNTING POLICIES
BASIS OF PRESENTATION
The accompanying consolidated financial statements are prepared in accordance
with accounting principles generally accepted in the United States. All
inter-company balances and transactions have been eliminated upon consolidation.
For a description of significant accounting policies, see the Notes to the
consolidated financial statements in the 1999 Form 20-F annual report.
USE OF ESTIMATES
The preparation of the consolidated financial statements in conformity with
accounting principles generally accepted in the United States requires
management to make estimates and assumptions that affect the reported amounts of
assets and liabilities, the disclosure of contingent liabilities at the date of
the consolidated financial statements, and the stated amount of revenues and
expenses during the reporting period. Actual results could differ from those
estimates.
REVENUE AND EXPENSE RECOGNITION
Revenue and expenses resulting from each voyage or time charter are accounted
for on the accrual basis and are recognized in the income statement on the
percentage of completed voyage basis. Chartered revenue received in advance is
recorded as a liability until charter services are rendered.
Operating expenses comprise all expenses relating to the operation of the
vessels, including crewing, repairs, and maintenance, insurance premiums, stores
and lubricants, and miscellaneous expenses, including communications. Voyage
expenses comprise all expenses relating to particular voyages, including
bunkers, port charges, canal tolls and agency fees.
COMPREHENSIVE INCOME
The Company has no components of comprehensive income, and as a result,
comprehensive income is equal to net income (loss) for all periods presented.
INCOME TAXES
The countries of the vessel-owning companies' incorporation do not impose taxes
on international shipping income. Minor registration and tonnage taxes must be
paid annually and have been included in the vessels' operating expenses in the
accompanying consolidated statements of operations. Pursuant to the Internal
Revenue Code of the United States (the Code), U.S. source income from the
international operations of ships is generally exempt from
7
<PAGE>
U.S. tax if the company operating the ships meets certain requirements. Among
other things, in order to qualify for this exemption, the company operating the
ships must be incorporated in a country which grants an equivalent exemption
from income taxes to U.S. citizens and U.S. corporations and must be more than
50% owned by individuals who are resident, as defined, in such country or
another foreign country that grants an equivalent exemption to U.S. citizens and
U.S. corporations. At September 30, 2000 the Company had met the requirement for
exemption from U.S. income tax.
FOREIGN CURRENCIES
The Company's functional currency is the U.S. dollar. Certain of the expenses
which are denominated in foreign currencies are remeasured into U.S. dollars at
exchange rates prevailing at the date of the transaction. Resulting exchange
gains and/or losses on settlement are included in operating expenses in the
accompanying consolidated statement of operations.
BASIC AND DILUTED LOSS PER ORDINARY SHARE
Basic and diluted loss per ordinary share have been computed by dividing net
loss by the average number of outstanding ordinary shares (9,500,000) following
the formation of the Company. There are also 500,000 warrants outstanding to
acquire 500,000 shares of common stock for $0.01 per share. Assumed exercise of
these warrants has been excluded from the calculation of loss per common share
as the effect of such exercise would be antidilutive.
CASH AND CASH EQUIVALENTS AND ESCROW ACCOUNTS
The Company considers time deposits or other certificates purchased with an
original maturity of three months or less to be cash equivalents. Restricted
cash includes deposits made towards contingencies and vessel upgrades, and also
includes proceeds from the sale of a vessel in 1999 and proceeds from insurance
for the total loss of a vessel in 2000, all of which have been placed in a
restricted Escrow account under the governing rules of the Indenture.
RECEIVABLES
Voyage receivables include balance freights and demurrages, contested charterers
hire deductions, advances to agents and unsubstantiated charterers deductions in
respect of vessels' disbursements at the various ports of call.
Claims and other receivables principally represent claims arising from hull and
machinery damages, or other insured risks, which have been submitted to
insurance underwriters and insurance adjusters or are currently being compiled.
INVENTORIES AND PREPAID EXPENSES
Inventories consist of bunkers, lubricants, spares and stores on board the
Company's vessels at the balance sheet date. Inventories are stated at the lower
of cost or market value. Cost is determined on a first-in, first-out method.
Inventories and prepaid expenses as of September 30, 2000 and December 31, 1999
were $1,479,783 and $1,479,206 respectively.
FIXED ASSETS
Vessels, net is stated at cost less accumulated depreciation. Vessels are
depreciated on a straight-line basis over their estimated remaining useful
lives, based on cost less scrap value. The useful lives have been estimated to
be 30 years from completion of construction. Depreciation is calculated on a
straight-line basis by reference to the vessels' cost, age and scrap value as
estimated at the date of acquisition which is $150 per ton.
OTHER ASSETS
Other assets include dry-docking, special survey and debt issue costs.
Dry-docking and special survey costs are deferred and amortized over the
estimated period to the next scheduled dry-docking or survey, which are
generally, two and a half years and five years, respectively. The amortization
of dry-docking and special survey costs are included in amortization in the
accompanying consolidated statement of operations and amounted to $300,846 in
the quarter ended September 30, 2000 and $221,235 in the quarter ended September
30, 1999.
Debt issue costs also include costs associated with the issuance of Notes and
the acquisition of the Millenium subsidiaries. These deferred financing costs
are amortized over the life of the Notes and is included in interest expense in
the accompanying consolidated statement of operations (see Note 4).
8
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ACCRUED LIABILITIES
Accrued liabilities primarily consists of accrued payroll, accrued interest and
other accrued expenses. These liabilities at September 30, 2000 were,
$1,477,032, $2,432,200 and $1,911,346 respectively, and at December 31, 1999
were $1,393,366, $5,330,600 and $1,908,189, respectively.
3. FIXED ASSETS
Fixed assets consists of the Company's fleet of dry bulk carriers and other
assets. Vessels owned by the Company are stated at cost, which comprises the
vessels' contract price, capital improvements, direct delivery and acquisition
expenses, and finance charges relating to the acquisition of vessels.
<TABLE>
<CAPTION>
Balance at Balance at
---------- ----------
September 30, 2000 December 31, 1999
------------------ -----------------
<S> <C> <C>
Vessels, at cost $ 97,021,514 $ 100,649,700
Less : accumulated depreciation (10,670,951) (7,164,750)
---------------------- ---------------------
Vessels, net $ 86,350,563 $ 93,484,950
====================== =====================
Other assets, at cost $ 216,055 $ 175,234
Less : accumulated depreciation (80,023) (36,897)
---------------------- ---------------------
Other assets, net $ 136,032 $ 138,337
====================== =====================
</TABLE>
4. LONG-TERM DEBT
<TABLE>
<CAPTION>
SEPTEMBER 30, DECEMBER 31,
LONG TERM DEBT IS AS FOLLOWS: 2000 1999
---- ----
<S> <C> <C>
12% First Priority Ship Mortgage Exchange Notes due 2005 (the
"Notes"). Interest on the Notes is payable semi-annually on January 15
and July 15 of each year, commencing January 15, 1999, at a rate of
12% per annum on the accreted value. The Notes will mature on July 15,
2005 and will be redeemable, in whole or part, at the option of the
Company at any time on or after July 15, 2003. $100,000,000 $100,000,000
Less : Unamortized portion of bond discount (3,538,739) (3,930,363)
------------------------------------------
Notes $ 96,461,261 $ 96,069,637
==========================================
</TABLE>
The gross bond discount of $4,607,000 at date of issuance is amortized using the
effective interest method over the life of the Notes (7 years). Amortization
recorded in connection with this discount is included in interest expense and
amounted to $136,087 and $119,957 in the three-month periods ended September 30,
2000 and September 30, 1999, respectively, and $391,624 and $345,203 in the
nine-month periods ended September 30, 2000 and September 30, 1999,
respectively. The deferred financing costs amortized in connection with the debt
issue is included in interest expense and amounted to $170,035 in each of the
three-month periods ended September 30, 2000 and 1999, and $510,105 in each of
the nine-month periods ended September 30, 2000 and 1999.
Semiannual interest payments are made on the Notes on January 15 and July 15 of
each year commencing on January 15, 1999. Cash interest payments are made to
holders of the Notes based on the Accreted Value of the Notes as defined in the
Indenture.
The Notes are fully and unconditionally guaranteed (the "Subsidiary
Guarantees"), jointly and severally, on a senior basis by each of the
subsidiaries of Millenium (the "Subsidiary Guarantors"). The Notes are currently
collateralized by First Priority Ship Mortgages on the Company's vessels. The
Company's bonds are registered by the United States Securities & Exchange
Commission pursuant to the United States Securities Act of 1933.
9
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The indebtedness evidenced by the Notes constitutes a general secured senior
obligation of the Company and is fully and unconditionally guaranteed by each of
the subsidiaries of the Company and will rank PARI PASSU in right of payment
with all future senior indebtedness of the Company and its subsidiary
guarantors. The Indenture, pursuant to where the Notes were issued (the
"Indenture"), contains certain covenants that among other things, limit the type
and amount of additional indebtedness that may be incurred by the Company and
imposes certain limitations on investments, loans and advances, sales or
transfers of assets, dividends and other payments, the ability of the Company to
enter into sale-leaseback transactions, certain transactions with affiliates and
certain mergers, consolidations and purchases of assets, and amendments to
security agreements. The Company is currently in compliance with the terms of
the Indenture at September 30, 2000.
5. RELATED PARTY TRANSACTIONS
Each of the Company's vessels receives management services from its equity
shareholder MMI pursuant to a Management Agreement among the Company's vessel
owning subsidiaries and MMI. Under the Management Agreement, MMI acts as the
fleet's technical manager and performs all commercial management functions,
including arranging chartering, advising the Company on the purchase and sale of
vessels and advising on obtaining insurance. As a technical manager, MMI (i)
provides qualified officers and crews on board vessels, (ii) manages day-to-day
vessel operations and maintains relationships with charterers, (iii) purchases
on behalf of the Company stores, spares, supplies and equipment for vessels,
(iv) performs general vessel maintenance, subcontracts for dry-dock facilities
for any major repairs and overhauls, (v) ensures regulatory and classification
society compliance, (vi) performs vessel operational budgeting and evaluations,
and (vii) provides accounting, treasury and finance functions (including cash
collections and disbursements on behalf of the Company). As remuneration for its
services, MMI receives a fixed management fee (payable monthly in advance)
ranging from $350 to $600 per day per vessel depending on the vessel type. In
addition, any visit to a vessel by a superintendent of MMI to evaluate and
supervise any repairs, dry-docking or other activities will entitle MMI to
expenses incurred and, from visits in excess of five days per annum per vessel,
its expenses incurred and an amount equal to $550 for each additional day. As
additional remuneration for its services, MMI receives commission of (i) 1.25%
on all gross time charter revenue, (ii) 1.75% on all gross freight revenue,
(iii) 1% on the gross sale or purchase price of a vessel and (iv) 2% of
insurance premiums for insurance placed, in each case as adjusted to reflect
fluctuations in market rates and practices.
MMI has sub-contracted certain of its technical and commercial management
services to Millenium Maritime Services Ltd. and Millenium Maritime Services,
Inc., both affiliates of MMI.
The Company records the management fee paid to MMI in operating expenses. As of
September 30, 2000, there is a payable to MMI which is reflected in Accrued
liabilities, amounting to $7,075. During the three-month periods ended September
30, 2000 and 1999, respectively, the Company incurred management fees of
$1,284,833 and $1,021,201 in connection with the aforementioned agreement.
6. CONTINGENCIES
From time to time the Company has been, and expects to continue to be, subject
to legal proceedings and claims in the ordinary course of its business,
principally personal injury and property claims. Such claims, even if lacking
merit, could result in the expenditure of significant financial and managerial
resources.
On March 28, 2000, an action was brought against the Company by Wayland
Investment Fund, LLC ("WIF") in the United States District Court, Southern
District of New York. In the First Amended Complaint filed on March 30, 2000,
WIF claimed that it is a beneficial holder of in excess of 25% of the 12% First
Priority Ship Mortgage Notes. The factual basis alleged to underlie the
proceeding concerns the calculation of interest due and owing on the 12% First
Priority Ship Mortgage Notes. WIF makes three claims in the First Amended
Complaint: the first is for mutual mistake; the second is for breach of
contract; and the third is for violations of Section 10(b) of the Exchange Act
and Rule 10b-5. WIF's first claim for relief is that the 12% First Priority Ship
Mortgage Notes be reformed to provide for interest on the principal amount at
maturity of the 12% First Priority Ship Mortgage Notes and that damages be paid
in the amount of $517,263.16. WIF's second claim for relief is damages in the
amount of $74,417,263.15. WIF's third claim for relief is that damages be paid
in the amount of $517,263.16. On April 19, 2000, the Company filed a Motion to
Dismiss WIF's second claim and answered WIF's first and third claims.
10
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On or about July 13, 2000, WIF filed a Second Amended Complaint repeating the
claims in its First Amended Complaint and adding a fourth claim for common law
fraud and a fifth claim for negligent misrepresentation. The Second Amended
Complaint changes the allegation concerning WIF's beneficial ownership; the
lawsuit now alleges that WIF is a beneficial holder of in excess of 25% of the
12% First Priority Ship Mortgage Exchange Notes. WIF's first claim for relief is
that the 12% First Priority Ship Mortgage Exchange Notes be reformed to provide
for interest on the principal amount at maturity of the 12% First Priority Ship
Mortgage Exchange Notes and that damages be paid in the amount of $605,801.34.
WIF's second claim for relief is damages in the amount of $74,505,801.34. WIF's
third claim for relief is that damages be paid in the amount of $605,801.34.
WIF's fourth claim for relief is that damages be paid in the amount of
$605,801.34. WIF's fifth claim for relief is that damages be paid in the amount
of $605,801.34. On or about July 27, 2000, the Company made a Motion to Dismiss
WIF's third, fourth, and fifth claims for relief and answered WIF's first claim.
By agreement of the parties, the Company's Motion to Dismiss the second claim
for relief in the First Amended Complaint was treated as a motion to dismiss the
second claim for relief in the Second Amended Complaint.
On or about August 22, 2000, WIF consented to the withdrawal of its fifth claim
for relief for negligent misrepresentation and agreed not to seek to replead
such claim. On or about August 31, 2000, the Company agreed to withdraw without
prejudice that portion of its Motion to Dismiss the third and fourth claims for
relief in the Second Amended Complaint. By decision dated September 7, 2000, the
Court granted the Company's Motion to Dismiss the second claim for relief in the
Second Amended Complaint for breach of contract.
On November 13, 2000, the Company and WIF entered into a settlement agreement
and a stipulation dismissing all of the claims in the action in their entirety,
without prejudice. Costs associated with this settlement agreement are reflected
in General and Administrative expenses.
7. SUBSEQUENT EVENT
In October 2000, the Company acquired the motor vessel ADAMAS (ex ADAMAS) at a
purchase price of $2,200,000,which was paid out of collateral.
11
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ITEM 2: MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
------- -----------------------------------------------------------------------
OF OPERATIONS FOR THE THREE AND NINE MONTH PERIODS ENDED SEPTEMBER 30, 2000
---------------------------------------------------------------------------
GENERAL
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The Company is an international shipping company that owns and operates a fleet
of drybulk carriers, primarily Handysize (generally classified as being in the
20,000-49,000 deadweight-ton range) drybulk carriers. As of September 30, 2000,
the Company's fleet consisted of 19 vessels totalling 532,126 deadweight-tons.
The Company was incorporated on March 10, 1998 in the Cayman Islands. The
Company began operations on July 24, 1998, with five vessels and subsequently
expanded its fleet to 21 vessels. All of these vessels were acquired from the
net proceeds of an offering of Units ("Units") consisting of $100 million
principal amount at maturity of Notes and $1.2 million of Warrants. The Company
also received an equity contribution of $24 million from Millenium Management,
Inc., MMI, the holder of 100% of the outstanding common stock of the Company.
Subsequently, the fleet size was reduced to 19 vessels after the Company sold
the Monica Marissa in September 1999, and disposed the Millenium Yama in a total
constructive loss due to engine damage in July 2000.
The following benchmarks are used by the Company to measure revenues: (i)
utilization as an index that indicates vessel earning days (on the basis that
350 calendar days per year equals 100% utilization), and (ii) the average daily
time charter equivalent (TCE) rate to analyze net revenues after commissions on
the basis of 350-days utilization.
The following table sets forth certain statement of operations and other
operating data for the Company.
<TABLE>
<CAPTION>
Three-month Three-month Nine-month Nine-month
------------ ------------ ----------- ----------
period ended period ended period ended period ended
------------- ------------- ------------- ------------
September 30, September 30, September 30, September 30,
-------------- -------------- -------------- -------------
2000 1999 2000 1999
---- ---- ---- ----
<S> <C> <C> <C> <C>
Net Revenue $ 9,085,781 $ 8,991,187 $26,337,679 $ 23,783,129
Vessel Operating Expenses (4,891,069) (4,412,932) (14,263,139) (13,109,992)
Management Fees (1,284,833) (1,021,201) (3,959,430) (2,459,143)
General and Administrative (1,028,518) (199,501) (1,613,149) (497,689)
------------------ ----------------- ------------------ ---------------
Adjusted Earnings before Interest,
Tax, Depreciation and Amortization
(Adjusted EBITDA) $ 1,881,361 $ 3,357,553 $6,501,961 $ 7,716,305
================= ================ ================= ================
Average utilization 93.7% 97.8% 95.3% 96.2%
================= ================ ================= ================
</TABLE>
Adjusted EBITDA consists of net income prior to deductions for interest expense,
income taxes, other income or expense net, depreciation and amortization, and
loss on sale-disposal of vessels. Adjusted EBITDA is not required by United
States generally accepted accounting principles, and should not be considered as
an alternative to net income as an indicator of the Company's operating
performance or to cash flows from operations as a measure of liquidity.
RESULTS OF OPERATIONS FOR THREE-MONTH PERIOD ENDED SEPTEMBER 30, 2000 VS.
SEPTEMBER 30, 1999
NET REVENUE
Net revenue for the three-month period ended September 30, 2000 was $9.1
million, compared to $9.0 million in the same 1999 period. The increase in net
revenue was attributable to improving charter rates. However, the increase was
offset by a reduction in fleet operating days of 1,773 days during the
three-month period ended September 30, 2000 compared to fleet operating days of
1,909 days during the same 1999 period. This decrease in fleet operating days is
attributed to a reduction in fleet size to 19 vesels compared to 21 vessels
during the same quarter in 1999. The Monica Marissa was sold in September 1999
while the Millenium Yama suffered a total loss in the second quarter of 2000,
thereby eliminating their revenue-streams. During the three-month period ended
September 30, 2000, 83% of the Company's gross revenues were earned from period
time charters compared to 95% in the same 1999 period. The fleet averaged an
utilization rate of 93.7% during the period ended September 30, 2000.
Contribution from freight income was higher during the period ended September
30,
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<PAGE>
2000 compared to the period ended September 30, 1999, due to an increase in spot
voyages. However, net revenue was impacted due to comparatively higher voyage
expenses in the quarter ended September 30, 2000 resulting from the costs
associated with the current state of the bunker market.
During the quarter ended September 30, 2000, the Millenium Osprey, Millenium
Condor, Millenium Falcon, Millenium Hawk, Millenium Eagle and the Millenium
Raptor were on their long-term period contracts with Fednav International. The
Millenium Harmony, the Millenium Aleksander, the Millenium Elmar, the Millenium
Leader, the Millenium Trader, the Millenium Dawn, the Millenium Express, and the
Millenium Amanda continue to be on their period charters which were contracted
for in 1999. The Millenium Majestic remains on a short-term period charter. The
Clipper Atlantic, Clipper Pacific, the Millenium Amethyst and the Millenium
Golden Hind traded on the spot market during the entire quarter ended September
2000.
VESSEL OPERATING EXPENSES
Vessel operating expenses, excluding management fees and depreciation and
amortization were $4.9 million for the three-month period ended September 30,
2000, compared to $4.4 million in the three-month period ended September 30,
1999. The quarter average vessel running costs for crewing, insurance,
lubricants, repairs and maintenances, registry and survey costs, and vessel
communications came to $2,759 per day compared to $2,312 per day during the
comparable period a year ago.
MANAGEMENT FEES
Management fees incurred to MMI for contracted technical and commercial
management services for the three-month period ended September 30, 2000 were
$1.3 million, compared to $1.0 million in the corresponding period ended
September 30, 1999.
Each of the Company's vessels receives management services from its equity
shareholder MMI pursuant to a Management Agreement among the Company's vessel
owning subsidiaries (the "Vessel Owning Subsidiaries") and MMI. Under the
Management Agreement, MMI acts as the fleet's technical and commercial manager.
As a technical manager, MMI, on behalf of the Vessel Owning Subsidiaries, (i)
provides qualified officers and crews on board vessels, (ii) manages day-to-day
vessel operations and maintains relationships with charterers, (iii) purchases
on behalf of the Company stores, spares, supplies and equipment for vessels,
(iv) performs general vessel maintenance, subcontracts for drydock facilities
for any major repairs and overhauls, (v) ensures regulatory and classification
society compliance, (vi) performs vessel operational budgeting and evaluations,
and (vii) provides accounting, treasury and finance functions (including cash
collections and disbursements on behalf of the Company). As remuneration for its
services, MMI receives a fixed management fee (payable monthly in advance)
ranging from $350 to $600 per day per vessel. The Company treats the management
fee paid to MMI as an operating expense.
Under commercial management services, MMI, on behalf of the Vessel Owning
Subsidiaries, primarily maintains and negotiates vessel charters, vessel
sale-and-purchase brokering, and places insurance covers for vessels. As
remuneration for its services, MMI receives a commission of 1.25% on all gross
time charter revenue and 1.75% on all gross spot charter revenue earned by each
vessel managed, 1% on the gross sale or purchase price of a vessel for brokerage
services, and 2% of all insurance covers placed per vessel managed.
MMI sub-contracts certain of its technical and commercial management services to
Millenium Maritime Services Ltd. and Millenium Maritime Services, Inc.
GENERAL AND ADMINISTRATIVE
These expenses totalled $1,028,518 for the three-month period ended September
30, 2000 compared to $199,501 in the same period ended September 30, 1999. A
portion of this increase is attributable to costs associated with the settlement
of the legal proceedings described herein. Other general and administrative
expenses for the three-month period ended September 30, 2000 included $383,825
in legal and professional expenses, advisory fees of $75,000 paid to Millenium
Advisors, L.L.C., and other expenses of $17,714.
DEPRECIATION AND AMORTIZATION
Total depreciation for the three-month period ended September 30, 2000 was
$1,331,424 compared to $1,583,764 for the same period ended September 30, 1999.
Vessel depreciation is calculated based on the remaining useful life of the
vessel, assuming a maximum life of 30 years, net of salvage value.
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<PAGE>
Deferred vessel costs, including deferred dry-docking expenses, are capitalized
and amortized over a period of two and a half years (30 months). During the
three-month period ended September 30, 2000, new deferred charges for
dry-docking and special surveys related expenses amounted to $156,589 which
included $110,529 for the Millenium Amanda and $46,060 for the Millenium Leader.
For the period ended September 30, 2000, total amortization of deferred vessel
charges, including deferred dry-docking expenses, were $300,847. For the
comparable period ended September 30, 1999, total amortization of deferred
vessel charges, including deferred dry-docking expenses, were $221,235.
Included in amortization in the the statement of operations for the three-month
period ended September 30, 1999, is $116,422 of amortization of goodwill. In
December 1999, the Company wrote off its entire goodwill balance, resulting in
no amortization in 2000.
INTEREST EXPENSE
For the three-month period ended September 30, 2000, the interest expense on the
Company's long-term debt was $2,917,690, compared to $2,906,751 in the
three-month period ended September 30, 1999. Interest expense in the statement
of operations for the quarter ended September 30, 2000 also includes
amortization of $136,087 recorded in connection with the bond discount relating
to the debt issue, and the amortization of $170,035 recorded in connection with
the deferred financing costs incurred relating to the debt issue. Comparable
amortization charges recorded in the quarter ended September 30, 1999 were
$119,957 and $170,035 respectively. During the three-months ended September 30,
2000, interest earned on cash balances was $51,826 compared to $61,065 in the
quarter ended September 30, 1999.
NET LOSS ON DISPOSAL OF VESSEL
During the quarter ended September 30, 2000, a total constructive loss was
declared on the Millenium Yama which had suffered engine damage. The full
insured value was recovered from the vessel's Hull & Machinery underwriters, and
the net event of loss proceeds are $2,826,803 which is in collateral as of
September 30, 2000. The disposal of this vessel resulted in a net loss of
$253,037.
NET LOSS
Net loss for the three-month period ended September 30, 2000 was $3.2 million
compared to $3.8 million in the same three-month period ended September 30,
1999.
RESULTS OF OPERATIONS FOR NINE-MONTH PERIOD ENDED SEPTEMBER 30, 2000 VERSUS
SEPTEMBER 30, 1999
NET REVENUE
Net revenue for the nine-month period ended September 30, 2000 was $26.3 million
compared to $23.8 million in the 1999 period. This increase was primarily due to
larger fleet operating days of 5,413 days during the nine-month period ended
September 30, 2000 compared to fleet operating days of 5,036 days during the
comparable 1999 period, as the Company's fleet was being expanded during the
comparable 1999 period. The Company also witnessed an improvement in charter
rates earned by its vessels.
During the nine-month period ended September 30, 2000, 77% of the Company's
gross revenues were earned from period time charters compared to 95% in the same
1999 period . The increase in the number of spot voyages performed by the
Company's vessels during the nine-month period ended September 30, 2000 resulted
in a consequent increase in contribution from freight income. However, due to
the steep escalation in bunker fuel prices prevalent during the period, the
voyage expenses also increased commensurately.
The fleet averaged an utilization rate of 95.3% during the nine-month period
ended September 30, 2000. The loss of revenue-earning days were primarily
attributable to the Millenium Yama sustaining a main engine damage which
consequently decommissioned the vessel. Additional revenue-earning days were
forgone due to dry-dockings of five vessels: the Millenium Leader, the Millenium
Dawn, the Clipper Pacific, the Millenium Golden Hind and the Millenium Amanda.
During the nine-months ended September 30, 2000, the number of the Company's
vessels in the spot market increased. This was mainly because of the Winter
redelivery by Fednav International ("Fednav") of the Laker-type vessels, which
14
<PAGE>
are vessels which ply in the Great Lakes trade. As per terms of the charter
contract, Fednav redelivers the Laker-type vessels, the Millenium Osprey,
Millenium Condor, Millenium Falcon, Millenium Hawk and Millenium Eagle, for
three months during the Winter when the Great Lakes freeze. These vessels
performed a substantial number of spot market voyages during this period in
2000. Fednav retook delivery of the Laker-type vessels once again in the Spring.
The Millenium Harmony, the Millenium Aleksander, the Millenium Elmar, the
Millenium Leader, the Millenium Raptor, the Millenium Trader, the Millenium
Dawn, the Millenium Express, and the Millenium Amanda continue to be on their
period charters which were contracted for in 1999. The Millenium Leader peformed
a positioning voyage before the vessel entered dry-dock following which the the
vessel reverted to its previously contracted period charter. The period charter
for the Millenium Golden Hind ended in June 2000 following which the vessel was
drydocked. The vessel then traded on the spot market during the third quarter.
The period charters for the Millenium Amethyst ended during the second quarter
following which the vessel performed spot voyages.The Clipper Atlantic and
Clipper Pacific were mostly in the spot market trades during the entire
nine-month period ended September 30, 2000. The Millenium Majestic remained on
short-term period charters. The charter for the Millenium Yama ended during the
second half of the nine-month period ended September 30, 2000 due to engine
damage to the vessel.
VESSEL OPERATING EXPENSES
Vessel operating expenses, excluding management fees and depreciation and
amortization were $14.3 million for the nine-month period ended September 30,
2000, compared to $13.1 million in the comparable nine-month period ended
September 30, 1999. The nine-month period ended September 30, 2000 consisted of
5,413 ship-operating days compared to 5,036 ship-operating days during the
corresponding period a year ago. The average vessel running costs for crewing,
insurance, lubricants, repairs and maintenances, registry and survey costs, and
vessel communications came to $2,635 per day for the nine-month period ended
September 30, 2000 compared to $2,603 per day during the comparable period a
year ago.
MANAGEMENT FEES
Management fees incurred to MMI for contracted technical and commercial
management services for the nine-month peiod ended September 30, 2000 were $4.0
million, compared to $2.5 million in the corresponding period ended September
30, 1999. For a detailed description of the type of services provided under the
management agreement, see the previous discussion section for the three-month
period ended September 30, 2000.
GENERAL AND ADMINISTRATIVE
These expenses totalled $1,613,149 for the nine-month period ended September 30,
2000 compared to $497,689 in the same period ended September 30, 1999. A portion
of this increase is attributable to costs associated with the settlement of the
legal proceedings described herein. Other general and administrative expenses
for the nine-month period ended September 30, 2000 included $751,164 in legal
and professional fees, advisory fees of $225,000 paid to Millenium Advisors,
L.L.C., marketing expenses of $50,725 and other expenses of $36,260.
DEPRECIATION AND AMORTIZATION
Total depreciation for the nine-month period ended September 30, 1999 was
$4,052,203 compared to $4,254,960 for the same period ended September 30, 1999.
Vessel depreciation is calculated based on the remaining useful life of the
vessel, assuming a maximum life of 30 years, net of salvage value.
Deferred vessel costs, including deferred dry-docking expenses, are capitalized
and amortized over a period of two and a half years (30 months). During the
nine-month period ended September 30, 2000, new deferred costs for dry-docking
and special surveys amounted to $1,303,409 which included $308,008 for the
Millenium Dawn, $403,559 for the Millenium Leader, $213,193 for the Clipper
Pacific, $268,120 for the Millenium Golden Hind, and $110,529 for the Millenium
Amanda. For the period ended September 30, 2000, total amortization of deferred
vessel charges, including deferred dry-docking expenses, were $767,955. For the
comparable period ended September 30, 1999, total amortization of deferred
vessel charges, including deferred dry-docking expenses, were $613,763.
Included in amortization in the the statement of operations for the nine-month
period ended September 30, 1999, is $349,263 of amortization of goodwill. In
December 1999, the Company wrote off its entire goodwill balance, resulting in
no amortization in 2000.
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<PAGE>
INTEREST EXPENSE
For the nine-month period ended September 30, 2000, the interest expense on the
Company's long-term debt was $8,741,480, compared to $8,623,111 in the
nine-month period ended September 30, 1999. Interest expense in the statement of
operations for the nine-month period ended September 30, 2000 also includes
amortization of $391,623 recorded in connection with the bond discount relating
to the debt issue, and the amortization of $510,105 recorded in connection with
the deferred financing costs incurred relating to the debt issue. Comparable
amortization charges recorded in the period ended September 30, 1999 were
$345,203 and $510,105 respectively. During the nine-month period ended September
30, 2000, interest earned on cash balances was $162,011 compared to $613,144 in
the period ended September 30, 1999.
NET LOSS
Net loss for the nine-month period ended September 30, 2000 was $8.1 million
compared to $8.5 million in the same nine-month period ended September 30, 1999.
LIQUIDITY AND CAPITAL RESOURCES
The Company is a holding company. As of September 30, 2000, it owns all of the
issued and outstanding shares of 19 Vessel Owning Subsidiaries. As of September
30, 2000, the Company's cash position consisted of $0.6 million in unrestricted
cash and cash equivalents. Restricted cash includes $1.6 million of proceeds
from the sale of the Monica Marissa, $2.8 million of net insurance proceeds from
the loss of the Millenium Yama and sundry interest earnings, all of which are in
the collateral account. Restricted cash also includes other deposits made toward
contingencies and vessel upgrades.
OPERATING ACTIVITIES
Net cash flows used in operations for the nine-month period ended September 30,
2000 were $6.1 million. As is common in the shipping industry, the Company
collects its hire for all time charters 15 days in advance. The Company also
continues to have well established long-term relationships with many suppliers
resulting in the Company receiving favorable credit terms.
INVESTING ACTIVITIES
The nine-month period ended September 30, 2000, saw negligible investing
activities.
FINANCING ACTIVITIES
The nine-month period ended September 30, 2000, saw negligible financing
activity. Such activity was limited to interest earnings on cash in escrow.
The Company believes that based upon the current level of operation, cash flow
from operations, together with other readily available sources of funds,
including the balance escrow cash, which was made available to the Company on
July 31, 1999, for use as working capital and other corporate purposes, it has
adequate liquidity to fund its working capital requirements, meet capital
expenditures for repairs and maintenance and make required payments of interest
on the Company's debt. The Company continues to review opportunities to expand
its fleet and this is dependent on its ability to raise capital through either
borrowing activities or from cash generated from operations, or from vessel sale
and purchase activities.
FOREIGN EXCHANGE RATE FLUCTUATIONS
All of the Company's revenue, and most of its expenses, are denominated in
United States dollars. For the period ended September 30, 2000, approximately 5%
of the Company's expenses were denominated in foreign currencies, primarily
Greek drachmae. The Company does not hedge its exposure to foreign currency
fluctuations.
INFLATION
The Company does not believe that inflation has had a material impact on its
operations during the periods presented, although certain of the Company's
operating expenses (e.g. crewing, insurance and drydocking costs) are subject to
fluctuations as a result of market forces. Inflationary pressures on bunker
costs are not expected to have a material effect on the Company's results from
operations and cash flows since such costs are paid by the charterers as the
majority of the Company's vessels are on period time charters.
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PART II
ITEM 1. LEGAL PROCEEDINGS
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From time to time the Company has been, and expects to continue to be, subject
to legal proceedings and claims in the ordinary course of its business,
principally personal injury and property claims. Such claims, even if lacking
merit, could result in the expenditure of significant financial and managerial
resources.
On March 28, 2000, an action was brought against the Company by Wayland
Investment Fund, LLC ("WIF") in the United States District Court, Southern
District of New York. In the First Amended Complaint filed on March 30, 2000,
WIF claimed that it is a beneficial holder of in excess of 25% of the 12% First
Priority Ship Mortgage Notes. The factual basis alleged to underlie the
proceeding concerns the calculation of interest due and owing on the 12% First
Priority Ship Mortgage Notes. WIF makes three claims in the First Amended
Complaint: the first is for mutual mistake; the second is for breach of
contract; and the third is for violations of Section 10(b) of the Exchange Act
and Rule 10b-5. WIF's first claim for relief is that the 12% First Priority Ship
Mortgage Notes be reformed to provide for interest on the principal amount at
maturity of the 12% First Priority Ship Mortgage Notes and that damages be paid
in the amount of $517,263.16. WIF's second claim for relief is damages in the
amount of $74,417,263.15. WIF's third claim for relief is that damages be paid
in the amount of $517,263.16. On April 19, 2000, the Company filed a Motion to
Dismiss WIF's second claim and answered WIF's first and third claims.
On or about July 13, 2000, WIF filed a Second Amended Complaint
repeating the claims in its First Amended Complaint and adding a fourth claim
for common law fraud and a fifth claim for negligent misrepresentation. The
Second Amended Complaint changes the allegation concerning WIF's beneficial
ownership; the lawsuit now alleges that WIF is a beneficial holder of in excess
of 25% of the 12% First Priority Ship Mortgage Exchange Notes. WIF's first claim
for relief is that the 12% First Priority Ship Mortgage Exchange Notes be
reformed to provide for interest on the principal amount at maturity of the 12%
First Priority Ship Mortgage Exchange Notes and that damages be paid in the
amount of $605,801.34. WIF's second claim for relief is damages in the amount of
$74,505,801.34. WIF's third claim for relief is that damages be paid in the
amount of $605,801.34. WIF's fourth claim for relief is that damages be paid in
the amount of $605,801.34. WIF's fifth claim for relief is that damages be paid
in the amount of $605,801.34. On or about July 27, 2000, the Company made a
Motion to Dismiss WIF's third, fourth, and fifth claims for relief and answered
WIF's first claim. By agreement of the parties, the Company's Motion to Dismiss
the second claim for relief in the First Amended Complaint was treated as a
motion to dismiss the second claim for relief in the Second Amended Complaint.
On or about August 22, 2000, WIF consented to the withdrawal of its
fifth claim for relief for negligent misrepresentation and agreed not to seek to
replead such claim. On or about August 31, 2000, the Company agreed to withdraw
without prejudice that portion of its Motion to Dismiss the third and fourth
claims for relief in the Second Amended Complaint. By decision dated September
7, 2000, the Court granted the Company's Motion to Dismiss the second claim for
relief in the Second Amended Complaint for breach of contract.
On November 13, 2000, the Company and WIF entered into a settlement agreement
and a stipulation dismissing all of the claims in the action in their entirety,
without prejudice.
ITEM 2. CHANGES IN SECURITIES
------- ---------------------
None.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
------- -------------------------------
None.
17
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ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
------- ---------------------------------------------------
None.
ITEM 5. OTHER INFORMATION
------- -----------------
None.
ITEM 6. EXHIBITS AND REPORTS ON FORM 6-K
------- --------------------------------
a. Exhibits
None
b. Reports on Form 6-K
None
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.
MILLENIUM SEACARRIERS, INC.
By: /s/ Vassilios M. Livanos
Name: Vassilios M. Livanos
Title: Chairman
Dated: November 15, 2000
18
