SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549
                                   FORM 10-KSB

|X|   Annual Report Pursuant to Section 13 or 15(d) of the Securities Exchange
      Act of 1934

For the fiscal year ended: December 31, 2005

|_|   Transition Report Pursuant to Section 13 or 15(d) of the Securities
      Exchange Act of 1934

      For the transition period from ______________to ______________

                        Commission File Number 000-50908

                               RAND LOGISTICS INC.
                 (Name of Small Business Issuer in Its Charter)

              Delaware                                      20-1195343
       (State of Incorporation)                       (Small Business Issuer
                                                    I.R.S. Employer I.D. Number)

       450 Park Avenue, 10th Floor                            10022
           New York, New York                               (zip code)
(Address of principal executive offices)

                                  212-644-3450
                (Issuer's Telephone Number, Including Area Code)

           Securities registered pursuant to Section 12(b) of the Act:
                                      None

           Securities registered pursuant to Section 12(g) of the Act:
   Units consisting of one share of Common Stock, par value $.0001 per share,
            and two Warrants Common Stock, $.0001 par value per share
                   Warrants to purchase shares of Common Stock

Check whether the Issuer is not required to file reports pursuant to Section 13
or 15(d) of the Exchange Act. |_|

Check whether the Issuer (1) has filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such
shorter period that the registrant was required to file such reports), and (2)
has been subject to such filing requirement for the past 90 days. Yes |X| No |_|

Check if there is no disclosure of delinquent filers in response to Item 405 of
Regulation S-B contained in this form, and no disclosure will be contained, to
the best of the registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-KSB or any
amendment to this Form 10-KSB. |X|

Indicate by check mark whether the registrant is a shell company (as defined in
Rule 12b-2 of the Exchange Act). Yes |_| No |X|

Issuer's revenues for the fiscal year ended December 31, 2005 were $0.

As of March 30, 2006, the aggregate market value of the common stock held by
non-affiliates of the Registrant was approximately $28,890,000.

As of March 30, 2006, there were 5,600,000 shares of Common Stock, $.0001 par
value per share, outstanding. Transitional Small Business Disclosure Format
(check one): Yes |_| No |X|

<PAGE>

                                     PART I

ITEM 1. DESCRIPTION OF BUSINESS

      Rand Logistics Inc. (formerly Rand Acquisition Corporation) was formed on
June 2, 2004 as a blank check company to effect a merger, capital stock
exchange, asset acquisition or other similar business combination with an
operating business. On November 2, 2004, we closed our initial public offering
of 4,000,000 units with each unit consisting of one share of our common stock
and two warrants, each to purchase one share of our common stock at an exercise
price of $5.00 per share. The units were sold at an offering price of $6.00 per
unit, generating gross proceeds of $24,000,000. On November 3, 2004, we sold an
additional 600,000 units pursuant to the underwriters' over-allotment option
raising additional gross proceeds of $3,600,000. After deducting the
underwriting discounts and commissions and the offering expenses, the total net
proceeds to us from the offering were approximately $24,605,000.

      On March 3, 2006, we acquired all of the outstanding shares of capital
stock of Lower Lakes Towing Ltd., a Canadian corporation which, with its
subsidiary Lower Lakes Transportation Company, provides bulk freight shipping
services throughout the Great Lakes region. As part of the acquisition of Lower
Lakes, we also acquired Lower Lakes affiliate, Grand River Navigation Company,
Inc. Prior to the acquisition, we did not conduct, or have any investment in,
any operating business. In this discussion of Rand's business, unless the
context otherwise requires, references to Rand include Rand and its direct and
indirect subsidiaries, and references to Lower Lakes' business or the business
of Lower Lakes mean the combined businesses of Lower Lakes, Lower Lakes
Transportation and Grand River.

      Rand's shipping business is operated in Canada by Lower Lakes and in the
United States by Lower Lakes Transportation. Lower Lakes was organized in March
1994 under the laws of Canada to provide marine transportation services to dry
bulk goods suppliers and purchasers operating in ports in the Great Lakes that
were restricted in their ability to receive larger vessels. Lower Lakes has
grown from its origin as a small tug and barge operator to a full service
shipping company with a fleet of eight cargo-carrying vessels. From its
exclusively Canadian beginnings, Lower Lakes has also grown to offer domestic
services to both Canadian and U.S. customers as well as cross-border routes.
Lower Lakes services the construction, electric utility and integrated steel
industries through the transportation of limestone, coal, iron ore, salt, grain
and other dry bulk commodities.

      We believe that Lower Lakes is the only company providing significant
domestic port-to-port services to both Canada and the United States in the Great
Lakes region. Lower Lakes maintains this operating flexibility by operating both
U.S. and Canadian flagged vessels in compliance with the Shipping Act, 1916, and
the Merchant Marine Act, 1920, commonly referred to as the Jones Act, in the
U.S. and the Coasting Trade Act (Canada) in Canada.

      Lower Lakes' fleet consists of four self-unloading bulk carriers in Canada
and three self-unloading bulk carriers as well as a tug and a self-unloading
barge in the U.S. Lower Lakes owns three of the four Canadian vessels and its
wholly-owned subsidiary, Port Dover Steamship Company Inc., owns the fourth and
charters it to Lower Lakes. Lower Lakes Transportation time charters the five
vessels in the U.S. from Grand River, which owns three of the U.S. flagged
vessels and charters the fourth and the barge from a third party under long term
charter arrangements.

      Lower Lakes is a leader in the provision of River Class bulk freight
shipping services throughout the Great Lakes, operating more than one-third of
all River Class vessels servicing the Great Lakes and the majority of
boom-forward equipped vessels in this category. Boom forward self-unloading
vessels - those with their booms located in front of the cargo holds - offer
greater accessibility for delivery of cargo to locations where only forward
access is possible. Seven of the vessels used in Lower Lakes' operations are
boom forward self-unloaders and one vessel is a boom aft self-unloader. River
Class vessels - which represent the smaller end of Great Lakes vessels with
maximum dimensions of approximately 650 feet in length and 72 feet in beam and
carrying capacities of 15,000 to 20,000 tons - are ideal for customers seeking
to move significant quantities of dry bulk product to ports which restrict

<PAGE>

non-River Class vessels due to size and capacity constraints. Of the 37 Canadian
self-unloading vessels currently in operation, seven are River Class, each of
which is boom forward. Lower Lakes operates three of these vessels. The U.S.
Great Lakes fleet includes 12 River Class vessels, four boom forward, eight boom
aft. Lower Lakes Transportation operates four of the boom forward vessels, one
of which is the barge.

Customers

      Lower Lakes services approximately 50 customers in a diverse array of end
markets by shipping dry bulk commodities such as construction aggregates, coal,
grain, iron ore and salt. Lower Lakes' top ten customers accounted for
approximately 71% of its revenue in fiscal 2005. Lower Lakes is the sole-source
shipping provider to several of its customers. Many of Lower Lakes' customers
are under long-term contracts with Lower Lakes, which typically average three to
five years in duration and provide for minimum and maximum tonnage, annual price
escalation features, and fuel surcharges.

Competition

      Lower Lakes faces competition from other marine and land-based
transporters of dry bulk commodities in and around the Great Lakes area. In the
River Class market segment, Lower Lakes generally faces two primary competitors:
Seaway Marine Transport and United Shipping Alliance. Seaway Marine Transport is
a Canadian traffic and marketing partnership, which owns 22 self-unloading
vessels, 4 of which are River Class boom forward vessels. United Shipping
Alliance operates in the U.S. and maintains a fleet of 22 vessels, 7 of which
are River Class. We believe that industry participants compete on the basis of
customer relationships, price, and service, and that the ability to meet a
customer's schedule and offer shipping flexibility is a key competitive factor.
Moreover, we believes that customers are generally willing to continue to use
the same carrier assuming such carrier provides satisfactory service with
competitive pricing.

Employees

      As of December 31, 2005, Lower Lakes had approximately 230 full-time
employees, 18 of whom were management and 212 were operational. Approximately
42% of Lower Lakes' employees (all U.S. based Grand River Navigation crew) are
unionized with the International Organization of Masters, Mates and Pilots,
AFL-CIO. Lower Lakes has never experienced a work stoppage as a result of labor
issues, and we believe that our employee relations are good. Laurence S. Levy,
our chairman of the board and chief executive officer, is Rand's only executive
officer, and Rand does not at present have any other employees.

Additional Information

      Additional information relating to Rand's and Lower Lakes' business is
included in Exhibit 99.1 to this Form 10-KSB, which is incorporated herein by
reference.

ITEM 2. DESCRIPTION OF PROPERTY

      Rand maintains its executive offices at 450 Park Avenue, 10th Floor, New
York, New York 10022 pursuant to an agreement with ProChannel Management LLC, an
affiliate of Laurence S. Levy, our chairman of the board and chief executive
officer. We pay ProChannel Management a monthly fee of $7,500 which is for
general and administrative services including office space, utilities and
secretarial support. We believe, based on rents and fees for similar services in
the New York City metropolitan area, that the fee charged by ProChannel
Management is at least as favorable as we could have obtained from an
unaffiliated person. ProChannel is not obligated to continue to provide such
office space and services to us, and there can be no assurance as to whether, or
for how long, ProChannel will continue to make such office space available.


                                       2
<PAGE>

      Lower Lakes' currently leases the following properties:

      o     Lower Lakes Towing has leased approximately 4,500 square feet of
            warehouse space at 207 Greenock Street, Port Dover, Ontario under a
            lease that expires October 2007.

      o     Lower Lakes Towing has leased approximately 1,000 square feet of
            office space at 625 Main Street, Port Dover, Ontario. The office
            space is leased to Lower Lakes on a month-to-month basis for
            $1370.25 per month by Scott Bravener, James Siddall, Franklin
            Bravener and Robert Pierson, each of whom is an employee of Lower
            Lakes. We believe that the lease is on terms consistent with leases
            negotiated at arms' length. The lease terminates on March 31, 2006.
            Lower Lakes has entered into a new lease with an unrelated third
            party for approximately 3,075 square feet of office space at 517
            Main St., Port Dover, Ontario that expires March 2013.

      o     Lower Lakes Transportation has leased approximately 100 square feet
            of office space at 1207 Delaware Avenue, Suite 217, Buffalo, New
            York under a lease that expires March 31, 2007.

      o     Grand River Navigation has leased approximately 440 square feet of
            office space at 197 West Erie Street, Rogers City, Michigan under a
            lease that expires on November 30, 2005.

      o     Grand River Navigation has leased approximately 1,000 square feet of
            space at 515 Moore Road, Suite 2, Avon Lake, Ohio under a lease that
            expires July 31, 2008.

      We consider our current office space adequate for our current operations.

ITEM 3. LEGAL PROCEEDINGS

      Rand is not involved in any legal proceedings which may have a significant
effect on its business, financial position, results of operations or liquidity,
nor are we aware of any proceedings that are pending or threatened which may
have a significant effect on our business, financial position, results of
operations or liquidity. From time to time, Lower Lakes may be subject to legal
proceedings and claims in the ordinary course of business, involving principally
commercial charter party disputes. It is expected that these claims would be
covered by insurance if they involve liabilities such as arise from collision,
other marine casualty, damage to cargoes, oil pollution, death or personal
injuries to crew, subject to customary deductibles. Those claims, even if
lacking merit, could result in the expenditure of significant financial and
managerial resources.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

None.

                                     PART II

ITEM 5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

Market Information

      Our units, common stock and warrants are traded on the Over-the-Counter
Bulletin Board under the symbols RAQCU, RAQC and RAQCW, respectively. The
following table sets forth the range of high and low closing bid prices for the
units, common stock and warrants for the periods indicated since the units
commenced public trading on October 28, 2004 and since the common stock and
warrants commenced public trading on November 10, 2004. The over-the-counter
market quotations reflect inter-dealer prices, without retail mark-up, mark-down
or commission and may not necessarily reflect actual transactions.


                                       3
<PAGE>

                               Common Stock        Warrants           Units
                             ---------------   ---------------   ---------------
Quarter Ended                 High      Low     High      Low      High     Low
------------------           ------   ------   ------   ------   ------   ------
December 31, 2004            $ 5.50   $ 4.50   $ 0.85   $ 0.60   $ 6.70   $ 5.95
March 31, 2005               $ 5.70   $ 5.07   $ 1.03   $ 0.69   $ 7.36   $ 6.50
June 30, 2005                $ 5.43   $ 5.10   $ 0.85   $ 0.68   $ 6.90   $ 6.32
September 30, 2005           $ 5.70   $ 5.55   $ 1.10   $ 1.05   $ 7.65   $ 7.65
December 31, 2005            $ 5.90   $ 5.39   $ 1.22   $ 0.85   $ 7.90   $ 7.05

Holders

      As of March 30, 2006, there was one holder of record of our units, five
holders of record of our common stock and one holder of record of our warrants.

Dividends

      We have not paid any dividends on our common stock to date and do not
intend to pay dividends on our common stock in the near future. The payment of
dividends in the future will be contingent upon our revenues, earnings, capital
requirements and general financial condition. The payment of dividends is within
the discretion of our board of directors. Other than dividends which our board
of directors may determine to pay on our preferred stock, it is the present
intention of our board of directors to retain all earnings for future investment
and use in our business operations. Accordingly, our board of directors does not
anticipate declaring any dividends in the foreseeable future on our common
stock. In addition, no dividends may be declared or paid on our common stock
unless all accrued dividends on our preferred stock have been paid.

ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

      Plan of Operation. The following presentation of the plan of operation of
Rand has been prepared by internal management and should be read in conjunction
with the financial statements and notes thereto included in, or referred to, in
this report. Some of the statements below discuss "forward-looking" information.
Those statements include statements regarding the intent, belief or current
expectations of Rand and its management team. You are cautioned that any such
forward-looking statements are not guarantees of future performance and involve
risks and uncertainties. These risks and uncertainties include but are not
limited to, those risks and uncertainties discussed in Exhibit 99.1 to this Form
10-KSB which is incorporated herein by reference. In light of the significant
risks and uncertainties inherent in the forward-looking statements included in
this report, the inclusion of such statements should not be regarded as a
representation by us or any other person that our objectives and plans will be
achieved.

      Rand was formed on June 2, 2004 to serve as a vehicle to effect an
acquisition, merger, capital stock exchange, asset acquisition or other similar
business combination with an unidentified operating business. On November 2,
2004, we closed our initial public offering of 4,000,000 units with each unit
consisting of one share of our common stock and two warrants, each to purchase
one share of our common stock at an exercise price of $5.00 per share. The units
were sold at an offering price of $6.00 per unit, generating gross proceeds of
$24,000,000. On November 3, 2004, we sold an additional 600,000 units pursuant
to the underwriters' over-allotment option raising additional gross proceeds of
$3,600,000. After deducting the underwriting discounts and commissions and the
offering expenses, the total net proceeds to us from the offering were
approximately $24,605,000.

      In connection with our initial public offering, we issued to the
representative of the underwriters, for $100, an option to purchase up to a
total of 300,000 units, with each unit consisting of one share of common stock
and two warrants. The units issuable upon exercise of the option are identical
to those issued in our initial public offering except that the warrants included
in the units underlying the option have an exercise price of $6.25 per share.


                                       4
<PAGE>

The option will be exercisable by the holder at $9.90 per unit commencing upon
our consummation of a business combination and will expire on October 26, 2009.
We accounted for the fair value of the option, inclusive of the receipt of the
$100 cash payment, as an expense of our initial public offering resulting in a
charge directly to stockholders' equity. We estimate that the fair value of this
option is approximately $558,000 ($1.86 per Unit) using a Black-Scholes
option-pricing model. The fair value of the option has been estimated as of the
date of grant using the following assumptions: (1) expected volatility of
47.79%, (2) risk-free interest rate of 3.34% and (3) expected life of 5 years.
The option may be exercised by the holder for cash or on a "cashless" basis, at
the holder's option, such that the holder may use the appreciated value of the
option (the difference between the exercise prices of the option and the
underlying warrants and the market price of the units and underlying securities)
to exercise the option without the payment of any cash.

      On March 3, 2006, Rand, through its wholly-owned subsidiary, LL
Acquisition Corp., acquired all of the outstanding shares of capital stock of
Lower Lakes Towing in accordance with the terms of the Stock Purchase Agreement,
dated September 2, 2005, by and among Rand, LL Acquisition Corp. and the
stockholders of Lower Lakes, as amended. Immediately following completion of the
acquisition, and in conjunction therewith, LL Acquisition Corp. and Lower Lakes
were amalgamated under Canadian law and the shares of capital stock of Grand
River and Lower Lakes Transportation owned by Lower Lakes at the time of the
amalgamation were transferred to Rand's wholly-owned subsidiary, Rand LL
Holdings Corp. Upon completion of such transfer, the outstanding shares of Grand
River not owned by Rand LL Holdings Corp. were redeemed in accordance with the
terms of the Redemption Agreement, dated September 2, 2006, between Grand River
and GR Holdings, Inc. Following completion of the foregoing transactions, as of
March 3, 2006, each of Lower Lakes, Grand River and Lower Lakes Transportation
became indirect, wholly-owned subsidiaries of Rand. In conjunction with the
foregoing transactions, as of March 3, 2006, Rand changed its name to Rand
Logistics Inc.

      In accordance with the terms of the Stock Purchase Agreement and
Redemption Agreement, respectively, Rand paid US$9,843,748 to the selling
shareholders of Lower Lakes and US$750,000 to GR Holdings, Inc., and arranged
for the repayment of the acquisition closing date indebtedness of such entities
of Cdn$43,732,749 and US$5,156,945, respectively. The amount paid to the Lower
Lakes selling shareholders reflects certain adjustments made on the acquisition
closing date in accordance with the Stock Purchase Agreement and such amount is
subject to further adjustment after the acquisition closing based Rand's
determination of the net working capital of Lower Lakes and its affiliates as of
January 15, 2006. Rand funded the acquisition closing date payments with the
approximately US$24,646,000 of proceeds of its initial public offering held in
trust, US$15,000,000 of proceeds of the acquisition closing date issuance of
Rand's newly created series A convertible preferred stock, and proceeds of the
new senior loan facility entered into on the acquisition closing date by Lower
Lakes, Grand River and Lowe Lakes Transportation.

      The shares of series A convertible preferred stock were issued pursuant to
the terms of the Preferred Stock Purchase Agreement, dated September 2, 2006, by
and among Rand and Knott Partners LP and certain of its affiliates, and Bay
Resource Partners L.P. and certain of its affiliates. In accordance with the
terms of the Preferred Stock Purchase Agreement, Rand issued 300,000 shares on
the acquisition closing date for $50 per share or an aggregate purchase price of
$15,000,000. The shares of series A convertible preferred stock were not
registered under the Securities Act of 1933, but the series A preferred
stockholders have the right to require the filing of a registration statement
with respect to shares of Rand common stock issuable upon conversion of the
shares of series A convertible preferred stock. The series A preferred
stockholders are prohibited from selling any shares of such common stock under a
registration statement prior to the six month anniversary of the acquisition
closing date or more than one half of all such shares of common stock held by
them as a group prior to the twelve month anniversary of the acquisition closing
date. The shares of series A convertible preferred stock: rank senior to Rand's
common stock with respect to liquidation and dividends; are entitled to receive
a cash dividend at the annual rate of 7.75% (based on the $50 per share issue
price), payable quarterly (subject to increases of 0.5% for each six month
period in respect of which the dividend is not timely paid, up to a maximum of
12%, subject to reversion to 7.75% upon payment of all accrued and unpaid
dividends); are convertible into shares of Rand common stock at any time at the
option of the series A preferred stockholder at a conversion price of $6.20 per


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<PAGE>

share (based on the $50 per share issue price and subject to adjustment) or
8.065 shares of common stock for each Series A Preferred Share (subject to
adjustment); are convertible into shares of Rand common stock (based on a
conversion price of $6.20 per share, subject to adjustment) at the option of
Rand if, after the third anniversary of the acquisition, the trading price of
Rand's common stock for 20 trading days within any 30 trading day period equals
or exceeds $8.50 per share (subject to adjustment); may be redeemed by Rand in
connection with certain change of control or acquisition transactions; will vote
on an as-converted basis with Rand's common stock; and have a separate vote over
certain material transactions or changes involving Rand.

      Rand's Certificate of Incorporation was amended and restated on the
acquisition closing date to, among other things, increase the number of shares
of common stock that Rand is authorized to issue from 20,000,000 shares to
50,000,000 shares, and to adopt certain amendments designed to ensure Rand's
compliance with the citizenship requirements of U.S. maritime laws, including
the Shipping Act, 1916, and the Merchant Marine Act, 1920, commonly referred to
as the Jones Act, after completion of the acquisition. The maritime law- related
amendments limit the aggregate percentage ownership of Rand's capital stock,
including common stock, by non-U.S. citizens to 23% of the outstanding shares of
Rand's capital stock and no more than 23% of the voting power of Rand. In
addition, these amendments give Rand's Board of Directors the authority to make
such determinations as may reasonably be necessary to ascertain such ownership
and to implement such limitations, including limiting transfers of shares and
redeeming shares held by anyone whose ownership of such shares would cause Rand
to be in violation of U.S. maritime laws.

      Rand intends to continue to pursue acquisition opportunities in an effort
to diversify its investments. Rand's strategy and business model as it relates
to Lower Lakes includes the following:

      o     Selected acquisitions. Since October 1999, Lower Lakes has added
            seven cargo-carrying vessels to its fleet, making Lower Lakes one of
            the most acquisitive shipping companies in the Great Lakes region.
            Rand's management believes that the acquisition of additional
            vessels would provide it with a larger share of the available River
            Class capacity, provide additional operating flexibility and extend
            the longevity of its fleet. Rand is actively pursuing acquisition
            opportunities but is not committed to any acquisitions at the
            present time;

      o     New customer relationships and long-term contracts. Rand believes
            that opportunities exists to enter into additional long-term
            contracts with new customers. Rand believes that Lower Lakes has
            historically built strong relationships with its customers, who Rand
            believes view Lower Lakes as a strategic supplier offering lower
            costs and greater flexibility than the larger shipping companies;
            and

      o     Expand existing customer relationships. In addition to gaining new
            customers, Rand believes opportunities exist for Rand to increase
            its business with existing customers.

      Lower Lakes' vessels require general maintenance and capital upgrades each
year to ensure the fleet operates efficiently during the shipping season and to
minimize downtime during the operating season. This work is completed during
January, February, and March each year when the vessels are not active. The age
of the vessels, combined with the prohibitive replacement cost of a vessel,
increases the importance of having an appropriate maintenance program.
Historically, the cost of winter work averages approximately $500,000 per
vessel. Between 40% and 60% of the winter work projects have been expensed as
maintenance expenditures, with the balance of winter work expenditures
capitalized. Capitalized winter work expenditures include items such as steel
replacement and engine overhauls.

      Every vessel on the Great Lakes must be dry docked, inspected, and
certified every four years in Canada and five years in the U.S., although
one-year extensions are frequently granted. This certification in the U.S. is
known as the five-year survey. Dry docking certification entails the visual
inspection and measurement of all parts of the vessel that are located
underwater. Certification also requires the inspection of the internal structure


                                       6
<PAGE>

of the vessel, all fuel tanks, the main deck, cargo holds, and several other
parts of the vessel. Any required repairs are made at this time. In addition, it
is normal to paint the underwater portion of the vessel's hull and make repairs
as required to any bow or stern thrusters during the certification process. Dry
docking expenses are capitalized when incurred and amortized over the benefit
period, which is either four to five years for Canadian vessels or five to six
years for U.S. vessels. Historically, the cost of the certification process for
each vessel has averaged approximately $625,000. Such costs could be
dramatically higher in the future depending on the nature of repairs required.

      Rand believes that its current cash on hand together with cash flows from
operations of Lower Lakes will be sufficient to satisfy Lower Lakes' and Rand's
cash requirements for the foreseeable future; provided, however, that there can
be no assurance that Rand will have sufficient cash to pay current dividends on
the series A preferred stock, in which case such dividends would accrue in
accordance with the terms of the series A preferred stock.

      Neither Rand nor Lower Lakes has any specific current plans to increase or
decrease the number of its employees or to purchase or sell any significant
equipment.. However, implementation of Rand's acquisition strategy could result
in a future increase in the number of its employees or future acquisitions of
equipment.

      Off-Balance Sheet Arrangements. Options and warrants issued in conjunction
with our initial public offering are equity linked derivatives and accordingly
represent off balance sheet arrangements. The options and warrants meet the
scope exception in paragraph 11(a) of FAS 133 and are accordingly not accounted
for as derivatives for purposes of FAS 133, but instead are accounted for as
equity. See the notes to the December 31, 2005 financial statements for a
discussion of outstanding options and warrants.

ITEM 7. FINANCIAL STATEMENTS

      This information appears following Item 14 of this Report and is
incorporated herein by reference.

ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE.

None.

ITEM 8A. CONTROL AND PROCEDURES

      An evaluation of the effectiveness of our disclosure controls and
procedures as of December 31, 2005 was made under the supervision and with the
participation of our management, including our chief executive officer. Based on
that evaluation, he concluded that our disclosure controls and procedures are
effective as of the end of the period covered by this report to ensure that
information required to be disclosed by us in reports that we file or submit
under the Securities Exchange Act of 1934 is recorded, processed, summarized and
reported within the time periods specified in Securities and Exchange Commission
rules and forms. Since our inception through December 31, 2005, there were no
significant changes in our internal controls over financial reporting that has
materially affected, or is reasonably likely to material affect our internal
controls over financial reporting.

ITEM 8B. OTHER INFORMATION

None.


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<PAGE>

                                    PART III

ITEM 9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS; COMPLIANCE
WITH SECTION 16(a) OF THE EXCHANGE ACT.

Directors and Executive Officers

      Our current directors and executive officers are as follows:

Name                          Age           Position
--------------------------------------------------------------------------------
Laurence S. Levy              49            Chairman of the Board and Chief
                                            Executive Officer, Rand; Director
                                            and Vice President, Lower Lakes,
                                            Lower Lakes Transportation and Grand
                                            River


Scott Bravener                41            President, Lower Lakes and Lower
                                            Lakes Transportation; Director, Rand
                                            and Lower Lakes

James Siddall                 41            Vice President - Marine Operations,
                                            Lower Lakes and Lower Lakes
                                            Transportation

Jeffrey Botham                39            Chief Financial Officer, Lower Lakes
                                            and Lower Lakes Transportation

Mark Rohn                     48            President, Grand River

Isaac Kier                    52            Director, Rand

Sandeep D. Alva               44            Director, Rand

      Laurence S. Levy has been Chairman of our Board of Directors and our Chief
Executive Officer since our inception. Mr. Levy founded the predecessor to Hyde
Park Holdings, LLC in July 1986 and has since served as its Chairman. Hyde Park
Holdings, LLC is an investor in middle market businesses. Mr. Levy serves as an
officer or director of many companies in which Hyde Park Holdings, LLC or its
affiliates invests. Presently, these companies include: Ozburn-Hessey Logistics
LLC, a national logistics services company, of which Mr. Levy is a director;
Derby Industries LLC, a sub-assembly business to the appliance, food and
transportation industries, of which Mr. Levy is Chairman; PFI Resource
Management LP, an investor in the Private Funding Initiative program in the
United Kingdom, of which Mr. Levy is general partner; Parking Company of America
Airports LLC, an owner and operator of airport parking garages, of which Mr.
Levy is a director; Regency Affiliates, Inc., a diversified publicly listed
company, of which Mr. Levy is Chairman, Chief Executive Officer and President;
Warehouse Associates L.P., a provider of warehouse and logistics services, of
which Mr. Levy is Chairman. In addition, from March 1997 to January 2001, Mr.
Levy served as Chairman of Detroit and Canada Tunnel Corporation, a company
which operates the toll tunnel between Detroit, Michigan and Windsor, Ontario,
and from August 1993 until May 1999, Mr. Levy served as Chief Executive Officer
of High Voltage Engineering Corporation, a diversified industrial and
manufacturing company. Mr. Levy received a Bachelor of Commerce degree and a
Bachelor of Accountancy degree from the University of Witwatersrand in
Johannesburg, South Africa. He is qualified as a Chartered Accountant (South
Africa). Mr. Levy received a Master of Business Administration degree from
Harvard University and graduated as a Baker Scholar.


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<PAGE>

      Captain Scott Bravener has served as Lower Lakes' President and Chief
Executive Officer since its inception in 1994, and until 2001 also served as the
captain of the Cuyahoga, a vessel owned by Lower Lakes. Captain Bravener has
worked in the Great Lakes shipping industry since 1982, serving in various
capacities for Canada Steamship Lines Inc. and P & H Shipping prior to the
formation of Lower Lakes. Captain Bravener is a director of the Canadian
Shipowners Mutual Assurance Association, is a certified Ships Master and is a
member of the American Bureau of Shipping. Captain Bravener is a graduate of
Marine Navigation Technology, Georgian College, Owen Sound, Ontario.

      Captain James Siddall joined Lower Lakes in 1994 and currently serves as
its Vice President of Marine Operations. Until 2001, Captain Siddall also served
as the relief captain of the Cuyahoga, a vessel owned by Lower Lakes. Captain
Siddall has worked in the Great Lakes Shipping industry since 1981, serving in
various capacities with Algoma Central Marine prior to the formation of Lower
Lakes. Captain Siddall sits on the Georgian College Marine Advisory Council. He
is a certified Ships Master as well as a graduate of Marine Navigation
Technology, Georgian College, Owen Sound, Ontario.

      Jeffrey Botham has served as the Chief Financial Officer of Lower Lakes
since 2003. Between 2002 and 2003, Mr. Botham served as Chief Financial Officer
of GolfNorth Properties, Inc., a privately held golf course consolidator. From
2000 to 2002, Mr. Botham served as Chief Financial Officer of EDJ Packaging,
Inc., an international equipment broker, based in Southwestern Ontario. During
2000, Mr. Botham served as Vice President of Finance and Chief Financial Officer
for Hip Interactive Corp., a publicly listed group of companies in the video
game distribution business. From 1995 to 2000, Mr. Botham served in roles of
increasing responsibilities including Vice President, Finance, Chief Financial
Officer and Secretary for Brick Brewing Co. Limited, a publicly listed regional
brewery. From 1989 to 1995, Mr. Botham served as Manager of Accounting and
Controller for privately held Algonquin Brewing Company. Mr. Botham earned his
B.A. at the University of Waterloo and is a Certified Management Accountant
(Canada).

      Mark Rohn has served as President of Grand River since 2001. Mr. Rohn has
worked in the Great Lakes shipping industry since 1978, serving in various
capacities with Oglebay Norton, Hanna Mining, Great Lakes Towing and N.M.
Paterson and Sons. Mr. Rohn earned a bachelor's degree in Business Management
from Cleveland State University.

      Isaac Kier has been a member of our Board of Directors since our
inception. Since February 2006 Mr. Kier has been the principal at Kier Global
LLC, a private equity and real estate investment firm. From 2000 to 2006, Mr.
Kier served as a general partner of Coqui Capital Partners L.P., a venture
capital firm. Since February 2004, he has also been the secretary and treasurer
and a member of the board of directors of Tremisis Energy Acquisition
Corporation, an OTC Bulletin Board-listed company which has signed an agreement
to purchase Ram Energy. Since June 2005, Mr. Kier has also been a director of
Paramount Acquisition Corporation, a company formed for the purpose of acquiring
an operating business in either the biotechnology or specialty pharmaceuticals
industry. Since April 2005, Mr. Kier has also been Chief Executive Officer and
director of MPLC, Inc., a publicly-traded company which currently does not have
any business operations but is pursuing business combination opportunities.
Since October 2004, Mr. Kier has served as a member of the board of directors of
Hana Biosciences Inc., (AMEX:HBX), a biopharmaceutical company. From 1987 to
1997, he served as the managing partner of the Alabama 8 market, a non-wireline
cellular licensee. From 1982 until its sale in 1995, Mr. Kier served as chairman
of the board and chief executive officer of Lida, Inc., a Nasdaq-listed company
engaged in textile production and printing. Mr. Kier received a B.A. in
Economics from Cornell University and a J.D. from George Washington University
Law School.

      Sandeep D. Alva has been a member of our Board of Directors since our
inception. In July 2000, Mr. Alva founded Falcon Investment Advisors, LLC, a
private equity investment firm providing subordinated debt and equity capital to
middle market companies, and has been its managing director since its formation.
From March 1991 to July 2000, Mr. Alva served as senior managing director and
Mezzanine and Private Equity Team Leader of the John Hancock Bond & Corporate
Finance Group, an affiliate of John Hancock Financial Services, Inc. Prior to
that, he was a principal at Joseph, Littlejohn & Levy, a private equity
investment firm, from December 1989 to March 1991. Mr. Alva received a Bachelor
of Commerce degree from Bombay University, India, and an M.B.A. from Cornell
University.


                                       9
<PAGE>

      Our board of directors is divided into three classes with only one class
of directors being elected in each year and each class serving a three-year
term. The term of office of the first class of directors, consisting of Sandeep
D. Alva, will expire at our first annual meeting of stockholders. The term of
office of the second class of directors, consisting of Isaac Kier, will expire
at the second annual meeting. The term of office of the third class of
directors, consisting of Laurence S. Levy and Scott Bravener, will expire at the
third annual meeting.

Special Advisor

      Edward Levy was a managing director of CIBC World Markets Corp. from
August 1995 through December 2004, and was co-head of CIBC World Markets Corp.'s
Leveraged Finance Group from June 2001 until December 2004. From February 1990
to August 1995, Mr. Levy was a managing director of Argosy Group L.P., a private
investment banking firm. Since June 1998, Mr. Levy has been a member of the
board of managers of Norcross Safety Products LLC, a reporting company under the
Securities Exchange Act of 1934 engaged in the design, manufacture and marketing
of branded products in the fragmented personal protection equipment industry.
From July 1999 until March 2005, he was also a director of Booth Creek Ski
Holdings, Inc., a reporting company under the Securities Exchange Act of 1934
that owns and operates six ski resort complexes encompassing nine separate
resorts. Mr. Levy is a member of the board of directors of a number of
privately-held companies. Mr. Levy received a B.A. from Connecticut College. Mr.
Levy is not related to Laurence S. Levy, our Chairman and Chief Executive
Officer.

Section 16(a) Beneficial Ownership Reporting Compliance

      Section 16(a) of the Securities Exchange Act of 1934 requires our
officers, directors and persons who own more than ten percent of a registered
class of our equity securities to file reports of ownership and changes in
ownership with the Securities and Exchange Commission. Officers, directors and
ten percent stockholders are required by regulation to furnish us with copies of
all Section 16(a) forms they file. Based solely on copies of such forms received
or written representations from certain reporting persons that no Form 5s were
required for those persons, we believe that, during the fiscal year ended
December 31, 2005, all filing requirements applicable to our officers, directors
and greater than ten percent beneficial owners were complied with.

Code of Ethics

      In November 2004, our board of directors adopted a code of ethics that
applies to our directors, officers and employees as well as those of our
subsidiaries. Requests for copies of our code of ethics should be sent in
writing to Rand Acquisition Corporation, 450 Park Avenue, 10th Floor, New York,
New York 10022.

ITEM 10. EXECUTIVE COMPENSATION

      During the fiscal year ended December 31, 2005, other than $7,500
per-month paid by Rand to ProChannel Management, an affiliate of Laurence S.
Levy for providing Rand with office space and certain office and secretarial
services, no compensation of any kind, including finders and consulting fees,
was paid to any of our executive officers or directors, or any of their
respective affiliates, for services rendered to Rand or any of its subsidiaries.
However, our executive officers and directors were entitled during such period
to be reimbursed for any out-of-pocket expenses incurred in connection with
activities on our behalf such as identifying potential target businesses and
performing due diligence on suitable business combinations.


                                       10
<PAGE>

      Since our formation, we have not granted any stock options or stock
appreciation rights or any awards under long-term incentive plans.

ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

      The following table sets forth information regarding the beneficial
ownership of Rand's common stock as of March 30, 2006 by:

      o     each person known by Rand to be the beneficial owner of more than 5%
            of Rand's outstanding shares of common stock;

      o     each of Rand's officers and directors; and

      o     all of Rand's officers and directors as a group.

      Unless otherwise indicated, Rand believes that all persons named in the
table have sole voting and investment power with respect to all shares of common
stock beneficially owned by them.

      All of the shares of our outstanding common stock owned by our founders
prior to our initial public offering have been placed in escrow with Continental
Stock Transfer & Trust Company, as escrow agent, pursuant to an escrow agreement
described below.

                                                      Amount and
                                                       Nature of
                                                      Beneficial      Percent of
Name and Address of Beneficial Owner                   Ownership        Class
-----------------------------------------------   -----------------   ----------

Laurence S. Levy(1)                                  1,594,286(2)       24.9%

Rand Management LLC(1)                                 794,286(2)       14.2%

Isaac Kier(3)                                          957,000(4)       15.4%

Kier Family, L.P.(3)                                   300,000(5)        5.2%

David M. Knott(6)                                    3,487,177(7)       41.9%
Dorset Management Corporation

Hummingbird Management, LLC(8)                         509,100(9)        9.0%

MHR Capital Partners Master Account LP(10)           1,449,080(11)      21.9%

MHR Advisors LLC(10)                                 1,640,652(12)      24.3%
MHR Fund Management LLC
Mark H. Rachesky, M.D.

Sapling, LLC(13)                                       335,000(14)       6.0%

Amarath Global Equities Master Fund Limited(15)        300,000(16)       5.4%
Amarath Advisors L.L.C.
Nicholas M. Maounis

Sandeep D. Alva(17)                                    200,000(18)       3.5%

Bay Resources Partners L.P.(19)                      1,209,677(20)      17.7%
Bay II Resources Partners L.P.
Bay Resources Partners Offshore Fund Ltd.
Thomas E. Claugus

Scott Bravener(21)                                          --            --%

All directors and executive officers as a
group (3 individuals)                                2,751,286(22)      38.7%


                                       11
<PAGE>

(1)   Unless otherwise indicated, the business address of each of the following
      is 450 Park Avenue, 10th Floor, New York, New York 10022.

(2)   Represents 794,286 shares of common stock held by Rand Management LLC of
      which the sole member is the Laurence Levy Irrevocable Trust, a trust
      established for the benefit of Mr. Levy's three minor children. Mr. Levy
      is the trustee for the trust. Includes 800,000 shares of common stock
      issuable upon exercise of warrants held by Mr. Levy. This information was
      based on a Schedule 13D filed with the Securities and Exchange Commission
      on March 30, 2006.

(3)   The business address of both Mr. Kier and Kier Family, L.P. is Coqui
      Capital Partners, L.P., 1775 Broadway, Suite 604, New York, New York
      10019.

(4)   In addition to shares held directly, includes 17,000 shares of common
      stock held by Mr. Kier's wife and 100,000 shares of common stock held
      through a Kier Family, L.P. of which Mr. Kier is the general partner. Also
      includes 607,000 shares of common stock issuable upon exercise of
      warrants. This information was based on a Schedule 13D filed with the
      Securities and Exchange Commission on March 30, 2006.

(5)   Represents 100,000 shares of common stock and 200,000 shares of common
      stock issuable upon exercise of warrants. This information was based on a
      Schedule 13D filed with the Securities and Exchange Commission on March
      30, 2006.

(6)   The business address of Mr. Knott and Dorset Management Corporation is 485
      Underhill Boulevard, Suite 205, Syosett, New York 11791.

(7)   This information is based on (i) a Schedule 13D filed with the Securities
      and Exchange Commission on March 16, 2006. Includes 1,505,000 shares of
      common stock issuable upon exercise of warrants and 1,209,677 shares of
      common stock issuable upon conversion of 150,000 shares of Series A
      convertible preferred stock.

(8)   The business address of Hummingbird Management, LLC is 460 Park Avenue,
      12th Floor, New York, New York 10022.

(9)   The foregoing information was derived from a Schedule 13D/A filed with the
      Securities and Exchange Commission on November 3, 2005.

(10)  The business address of these entities and this individual is 40 West 57th
      Street, 24th Floor, New York, New York 10019.

(11)  This information is based on (i) a Schedule 13D filed with the Securities
      and Exchange Commission on March 10, 2006. Comprised of 429,373 shares of
      Common Stock and 1,019,707 shares of Common Stock issuable upon exercise
      of warrants.


                                       12
<PAGE>

(12)  This information is based on a Schedule 13D filed with the Securities and
      Exchange Commission on March 10, 2006. Comprised of (i) 429,373 shares of
      Common Stock held for the account of MHR Capital Partners Master Account
      LP; (ii) 1,019,707 shares of common stock issuable upon exercise of
      warrants held for the account of MHR Capital Partners Master Account LP;
      (iii) 53,027 shares of Common Stock held for the account of MHR Capital
      Partners (100); and (iv) 138,545 shares of Common Stock issuable upon
      exercise of warrants held for the account of MHR Capital Partners (100).
      MHR Advisors LLC is the general partner of MHR Capital Partners Master
      Account LP and MHR Capital Partners (100). Dr. Rachesky is the managing
      member of MHR Advisors LLC. MHR Fund Management LLC is the management
      company for MHR Capital Partners Master Account LP and MHR Capital
      Partners (100).

(13)  The business address of Sapling, LLC is 535 Fifth Avenue, 31st Floor, New
      York, New York 10017.

(14)  This information was derived from a Schedule 13G filed with the Securities
      and Exchange Commission on March 31, 2005.

(15)  The business address of these entities and individuals is c/o Amarath
      Advisors L.L.C., One American Lane, Greenwich, Connecticut 06831.

(16)  This information was derived from a Schedule 13G filed with the Securities
      and Exchange Commission on February 10, 2006.

(17)  The business address of Mr. Alva is Falcon Investment Advisors, LLC, 60
      Kendrick Street, Needham, Massachusetts 02494.

(18)  Includes 100,000 shares of Common Stock and 100,000 shares underlying
      warrants, which warrants became exercisable on March 3, 2006. This
      information is derived from a Form 3 and a Form 4 filed on October 28,
      2004 and August 20, 2005, respectively.

(19)  The business address of these entities and this individual is 2100
      RiverEdge Pkwy, Suite 840, Atlanta GA 30328. This information is based on
      the number of shares of Rand's series A convertible preferred stock issued
      to such entities. Information as to the beneficial ownership of these
      shares is not available at the time of this report.

(20)  Comprised of 1,209,677 shares underlying Rand's series A convertible
      preferred stock. This information is based on the number of shares of
      Rand's series A convertible preferred stock issued to such entities.
      Information as to the beneficial ownership of these shares is not
      available at the time of this report.

(21)  The business address for Mr. Bravener is 625 Main Street Port Dover,
      Ontario Canada NOA 1NO.

(22)  Include 1,507,000 shares of common stock issuable upon exercise of
      warrants which warrants became exercisable on March 3, 2006.

      Laurence S. Levy, Rand Management LLC, Isaac Kier and Falcon Partners
Holdings, LLC may be deemed to be our "parents" and "promoters," as these terms
are defined under the Federal securities laws.

ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

      In June 2004, we issued 875,000 shares of our common stock to the
following individuals for $25,000 in cash, at an average purchase price of
approximately $0.029 per share as set forth below:


                                       13
<PAGE>

Name                                Number of Shares      Relationship to Us

Laurence S. Levy                         395,000          Chairman of the Board
                                                          and Chief Executive
                                                          Officer
Natalie Lynn Levy                        100,000          Stockholder
Irrevocable Trust
Michael Benjamin Levy                    100,000          Stockholder
Irrevocable Trust
Jessica Rose Levy                        100,000          Stockholder
Irrevocable Trust
Isaac Kier                                87,500          Director
Falcon Partners Holdings, LLC             87,500          Director
Jane Levy                                  5,000          Stockholder

      Each of Laurence S. Levy, the Natalie Lynn Levy Irrevocable Trust, Michael
Benjamin Levy Irrevocable Trust and Jessica Rose Levy Irrevocable Trust
subsequently transferred their shares to Rand Management LLC, an entity of which
the sole member is the Laurence Levy Irrevocable Trust, a trust established for
the benefit of Laurence Levy's three minor children. In October 2004, Rand's
Board of Directors authorized a stock dividend of 0.1428571 shares of common
stock for each outstanding share of common stock, effectively lowering the
purchase price to approximately $0.025 per share.

      Pursuant to an escrow agreement between Rand, Rand's initial stockholders
and Continental Stock Transfer & Trust Company, all of the shares owned by
Rand's initial stockholders were placed in escrow, with Continental acting as
escrow agent, pursuant to an escrow agreement, until the earliest of:

      o     October 27, 2007;

      o     Rand's liquidation; or

      o     the consummation of a liquidation, merger, stock exchange or other
            similar transaction which results in all of Rand's stockholders
            having the right to exchange their shares of common stock for cash,
            securities or other property subsequent to Rand's consummating a
            business combination with a target business.

      During the escrow period, these shares cannot be sold, but the initial
stockholders will retain all other rights as stockholders, including, without
limitation, the right to vote their shares of common stock and the right to
receive cash dividends, if declared. If dividends are declared and payable in
shares of common stock, such dividends will also be placed in escrow. If Rand
was unable to effect a business combination and required to liquidate, none of
Rand's initial stockholders would have received any portion of the liquidation
proceeds with respect to common stock owned by them prior to Rand's initial
public offering.

      Rand also entered into a registration rights agreement with the initial
stockholders pursuant to which the holders of the majority of the initial
stockholders' shares will be entitled to make up to two demands that Rand
register these shares. The holders of the majority of these shares may elect to
exercise these registration rights at any time after the date on which these
shares of common stock are released from escrow. In addition, these stockholders
have certain "piggy-back" registration rights on registration statements filed
subsequent to the date on which these shares of common stock are released from
escrow. Rand will bear the expenses incurred in connection with the filing of
any such registration statements.

      Each of Rand's initial stockholders also entered into a letter agreement
with Rand and EarlyBirdCapital pursuant to which, among other things:

      o     each agreed to vote all of his Shares owned in accordance with the
            majority of the shares issued in Rand's initial public offering if
            Rand solicits approval of its stockholders for a business
            combination;


                                       14
<PAGE>

      o     if Rand fails to consummate a business combination by April 27, 2006
            (or by October 27, 2006 under certain limited circumstances), each
            agreed to take all reasonable actions within his power to cause Rand
            to liquidate as soon as reasonably practicable;

      o     each waived any and all rights he may have to receive any
            distribution of cash, property or other assets as a result of such
            liquidation with respect to his shares acquired prior to Rand's
            initial public offering;

      o     each agreed to present to Rand for Rand's consideration, prior to
            presentation to any other person or entity, any suitable opportunity
            to acquire an operating business, until the earlier of Rand's
            consummation of a business combination, Rand's liquidation or until
            such time as he ceases to be an officer or director of ours, subject
            to any pre-existing fiduciary obligations he might have;

      o     each agreed that Rand could not consummate any business combination
            which involves a company which is affiliated with any of the initial
            stockholders unless Rand obtains an opinion from an independent
            investment banking firm reasonably acceptable to EarlyBirdCapital
            that the business combination is fair to Rand's stockholders from a
            financial perspective;

      o     each agreed that he and his affiliates will not be entitled to
            receive and will not accept any compensation for services rendered
            to Rand prior to the consummation of Rand's business combination;
            and

      o     each agreed that he and his affiliates will not be entitled to
            receive or accept a finder's fee or any other compensation in the
            event he or his affiliates originate a business combination.

      ProChannel Management LLC, an affiliate of Laurence S. Levy, Chairman of
Rand's Board and Chief Executive Officer, has agreed that, through the
acquisition of a target business, it will make available to Rand a small amount
of office space and certain office and secretarial services, as Rand may require
from time to time. Rand has agreed to pay ProChannel Management $7,500 per month
for these services. ProChannel is not obligated to continue to provide such
office space and services to us, and there can be no assurance as to whether, or
for how long, ProChannel will continue to make such office space available.

      During 2004, Laurence S. Levy advanced $70,000 to Rand to cover expenses
related to Rand's initial public offering. The loan was payable without interest
on the earlier of June 10, 2005 or the consummation of Rand's initial public
offering. This loan was repaid in November 2004.

      Scott Bravener, along with three employees of Lower Lakes, lease office
space at 625 Main Street, Port Dover, Ontario to Lower Lakes on a month-to-month
basis for $1370.25 per month. We believe that the lease is on terms consistent
with leases negotiated at arms' length. The lease terminates on march 31, 2006.

      Rand will reimburse its officers and directors for any reasonable
out-of-pocket business expenses incurred by them in connection with certain
activities on Rand's behalf such as identifying and investigating possible
target businesses and business combinations.

      All ongoing and future transactions between Rand and any of its officers
and directors or their respective affiliates, will be on terms believed by Rand
to be no less favorable than are available from unaffiliated third parties and
will require prior approval in each instance by a majority of the members of
Rand's Board who do not have an interest in the transaction.

ITEM 13. EXHIBITS.

The following Exhibits are filed as part of this report.


                                       15
<PAGE>

Exhibit No.    Description
-----------    -----------

2.1            Stock Purchase Agreement, dated as of September 2, 2005, among
               Rand Acquisition Corporation, LLP, Acquisition Corp. and the
               stockholders of Lower Lakes Towing Ltd. (Omitted: Appendices-
               Seller Disclosure Schedule and Purchase Seller Disclosure
               Schedule; Exhibits - 1) Allocation among Sellers, 2) Employment
               Agreement, 3) Escrow Agreement, 4) Release, 5) Opinion of
               Sellers' Counsel, 6) Opinion of Rand's and Purchaser's Counsel,
               7) Section 116 Escrow Agreement, 8) Company Indebtedness, 9)
               Seller's Addresses, 10) Working Capital Statement, 11) Management
               Bonus Program, 12) Sellers Several Liability Allocation, 13)
               Financing Commitments (filed separately), 14) Bonus Program
               Participant Agreement and 15) Redemption Agreement). (1)

2.2            Amendment to Stock Purchase Agreement, dated December 29, 2005.
               (2)

2.3            Amendment to Stock Purchase Agreement, dated January 27, 2006.
               (3)

2.4            Amendment to Stock Purchase Agreement, dated February 27, 2006.
               (4)

3.1            Certificate of Incorporation. (5)

3.1.1          Amended and Restated Certificate of Incorporation, filed with the
               Secretary of State of the State of Delaware on March 3, 2006.(7)

3.1.2          Certificate of Designations, filed with the Secretary of State of
               the State of Delaware on March 3, 2006.(7)

3.2            By-laws. (5)

4.1            Specimen Unit Certificate. (5)

4.2            Specimen Common Stock Certificate. (5)

4.3            Specimen Warrant Certificate. (5)

4.4            Form of Unit Purchase Option granted to EarlyBirdCapital, Inc.
               (5)

4.5            Form of Warrant Agreement between Continental Stock Transfer &
               Trust Company and the Registrant. (5)

10.1           Letter Agreement among the Registrant, EarlyBirdCapital, Inc. and
               Laurence S. Levy. (5)

10.2           Letter Agreement among the Registrant, EarlyBirdCapital, Inc. and
               Isaac Kier. (1)

10.3           Letter Agreement among the Registrant, EarlyBirdCapital, Inc. and
               Sandeep D. Alva. (5)

10.4           Letter Agreement among the Registrant, EarlyBirdCapital, Inc. and
               Falcon Partners Holdings, LLC. (5)

10.5           Letter Agreement among the Registrant, EarlyBirdCapital, Inc. and
               Natalie Lynn Levy Irrevocable Trust. (5)

10.6           Letter Agreement among the Registrant, EarlyBirdCapital, Inc. and
               Michael Benjamin Levy Irrevocable Trust. (5)

10.7           Letter Agreement among the Registrant, EarlyBirdCapital, Inc. and
               Jessica Rose Levy Irrevocable Trust. (5)

10.8           Letter Agreement among the Registrant, EarlyBirdCapital, Inc. and
               Jane Levy. (5)

10.9           Form of Investment Management Trust Agreement between Continental
               Stock Transfer & Trust Company and the Registrant. (5)

10.10          Form of Stock Escrow Agreement between the Registrant,
               Continental Stock Transfer & Trust Company and the Founders. (5)

10.11          Form of Letter Agreement between ProChannel Management LLC and
               Registrant regarding administrative support. (5)

10.12          Promissory Note, dated June 10, 2004, in the principal amount of
               $70,000 issued to Laurence S. Levy. (5)

10.13          Registration Rights Agreement among the Registrant and the
               Founders. (5)

10.14          Form of Warrant Purchase Agreements among each of Laurence S.
               Levy, Isaac Kier and Sandeep D. Alva and EarlyBirdCapital, Inc.
               (5)

10.15          Letter Agreement among the Registrant, EarlyBirdCapital, Inc. and
               Rand Management LLC. (5)


                                       16
<PAGE>

10.16          Preferred Stock Purchase Agreement, dated September 2, 2005, by
               and between Knott Partners LP, Matterhorn Offshore Fund Ltd.,
               Anno LP, Good Steward Fund Ltd., Bay II Resources Partners, Bay
               Resource Partners L.P., Bay Resource Partners Offshore Fund Ltd.,
               Thomas E. Claugus and Rand Acquisition Corporation. (1)

10.17          Financing Commitment, dated August 22, 2005, between GE
               Commercial & Industrial Finance, Inc. and Rand Acquisition
               Corporation. (1)

10.18          Credit Agreement, dated as of March 3, 2006, among Lower Lakes
               Towing Ltd., Lower Lakes Transportation Company, Grand River
               Navigation Company, Inc, the other Credit Parties signatory
               hereto, General Electric Capital Corporation as a US Lender and
               as Agent for the Secured Parties and the other Lenders signatory
               hereto from time to time, and GE Canada Finance Holding Company,
               as a Canadian Lender and the other Lenders signatory hereto from
               time to time.(7)

10.19          Employment Agreement, dated March 3, 2006, between Scott Bravener
               and Rand Acquisition Corporation.(7)

10.20          Employment Agreement, dated March 3, 2006, between James Siddall
               and Rand Acquisition Corporation.(7)

10.21          Management Bonus Plan, dated March 3, 2006.(7)

14             Code of Ethics. (6)

21             Subsidiaries of Rand. (8)

31             Certification of Chief Executive Officer pursuant to Section 302
               of the Sarbanes-Oxley Act of 2002.(8)

32             Certification of Chief Executive Officer pursuant to Section 906
               of the Sarbanes-Oxley Act of 2002.(8)

99.1           Risk Factors to Annual Report of Form 10-KSB for period ending
               December 31, 2005.(8)

(1)   Incorporated by reference to the Registrant's Amended Quarterly Report on
      Form 10-QSB/A, filed with the Securities and Exchange Commission on
      January 20, 2006.

(2)   Incorporated by reference to the Registrant's Current Report on Form 8-K,
      filed with the Securities and Exchange Commission on January 3, 2006.

(3)   Incorporated by reference to the Registrant's Current Report on Form 8-K,
      filed with the Securities and Exchange Commission on January 31, 2006.

(4)   Incorporated by reference to the Registrant's Current Report on Form 8-K,
      filed with the Securities and Exchange Commission on March 1, 2006.

(5)   Incorporated by reference to the Registrant's Registration Statement on
      Form S-1 (SEC File No. 333-117051).

(6)   Incorporated by reference to the Registrant's Annual Report on Form
      10-KSB, filed with the Securities and Exchange Commission on March 31,
      2005.

(7)   Incorporated by reference to the Registrant's Current Report on Form 8-K,
      filed with the Securities and Exchange Commission on March 9, 2006.

(8)   Filed herewith.

ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES.

      The firm of Goldstein, Golub, Kessler LLP ("GGK") acts as our principal
accountant. Through September 30, 2005, GGK had a continuing relationship with
American Express Tax and Business Services Inc. (TBS), from which it leased
auditing staff who were full time, permanent employees of TBS and through which
its partners provide non-audit services. Subsequent to September 30, 2005, this
relationship ceased and the firm established a similar relationship with RSM
McGladrey, Inc. ("RSM"). GGK has no full time employees and therefore, none of
the audit services performed were provided by permanent full-time employees of
GGK. GGK manages and supervises the audit and audit staff, and is exclusively
responsible for the opinion rendered in connection with its examination. The
following is a summary of fees paid or to be paid to GGK and RSM for services
rendered.


                                       17
<PAGE>

Audit Fees

During the fiscal year ended December 31, 2004, we paid our principal accountant
$25,000 for the services they performed in connection with our initial public
offering, including the financial statements included in the Current Report on
Form 8-K filed with the Securities and Exchange Commission on November 2, 2004;
$2,000 in connection with the review of our Quarterly Reports on Form 10-QSB,
and $10,000 in connection with the December 31, 2004 audit and 10-KSB.

During the fiscal year ended December 31, 2005, we paid or expect to pay our
principal accountant $15,000 for the services they performed in connection with
the December 31, 2005 audit and 10-KSB and the financial statements included in
the Current Report on Form 8-K filed with the Securities and Exchange Commission
on March 9 2006; $19,000 in connection with the reviews of our Quarterly Reports
on Form 10-QSB, and $3,000 in connection with the December 31, 2004 10-K/A.

Audit-Related Fees

During 2005, our principal accountant did not render assistance and related
services reasonably related to the performance of the audit or review of
financial statements.

Tax Fees

      During 2005, we paid TBS $1,500 for services rendered for tax compliance
for the year ended December 31, 2004.

All Other Fees

      During 2005, there were no fees billed for products and services provided
by the principal accountant other than those set forth above.


                                       18
<PAGE>

                                   SIGNATURES

      Pursuant to the requirements of the Section 13 or 15 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 on the
31st day of March 2006.

                                             RAND ACQUISITION CORPORATION


                                             By: /s/ Laurence S. Levy
                                                 -------------------------------
                                                 Laurence S. Levy
                                                 Chairman of the Board and Chief
                                                 Executive Officer (Principal
                                                 Executive and Financial and
                                                 Accounting Officer)

In accordance with the Securities Exchange Act of 1934, this report has been
signed below by the following persons on behalf of the registrant and in the
capacities and on the dates indicated.

Name                                       Title                      Date
----                                       -----                      ----


/s/ Laurence S. Levy          Chairman of the Board and Chief    March 31, 2006
----------------------        Executive Officer (Principal
Laurence S. Levy              Executive and Financial and
                              Accounting Officer)

/s/ Isaac Kier                Director                           March 31, 2006
----------------------
Isaac Kier


/s/ Sandeep D. Alva           Director                           March 31, 2006
----------------------
Sandeep D. Alva


/s/ Scott Bravener            Director                           March 31, 2006
----------------------
Scott Bravener


                                       19

<PAGE>

                                                             RAND LOGISTICS INC.
                                        (A CORPORATION IN THE DEVELOPMENT STAGE)

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM                      F-2

                            (a) Financial Statements

    Balance Sheet                                                            F-3
    Statement of Operations                                                  F-4
    Statement of Stockholders' Equity                                        F-5
    Statement of Cash Flows                                                  F-6

NOTES TO FINANCIAL STATEMENTS                                           F-7-F-10

<PAGE>

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors
Rand Logistics, Inc. (formerly Rand Acquisition Corporation)

We have audited the accompanying consolidated balance sheets of Rand Logistics,
Inc. (formerly Rand Acquisition Corporation) and Subsidiaries (a development
stage company) as of December 31, 2005 and 2004, and the related consolidated
statements of operations, stockholders' equity and cash flows for the cumulative
period from June 2, 2004 (inception) to December 31, 2005, the year ended
December 31, 2005 and the period from June 2, 2004 (date of inception) to
December 31, 2004. These financial statements are the responsibility of the
Company's management. Our responsibility is to express an opinion on these
financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the consolidated financial position of Rand
Logistics, Inc. and Subsidiaries as of December 31, 2005 and 2004 and the
results of their operations and their cash flows for the cumulative period from
June 2, 2004 (inception) to December 31, 2005, the year ended December 31, 2005
and the period from June 2, 2004 (inception) to December 31, 2004 in conformity
with U.S. generally accepted accounting principles.

As described in Note 8, on March 3, 2006, Rand Logistics, Inc. acquired the
capital of Lower Lakes Towing Ltd., issued Series A preferred stock and entered
into a senior loan facility.


/s/ Goldstein Golub Kessler LLP

GOLDSTEIN GOLUB KESSLER LLP
New York, New York

March 3, 2006

<PAGE>

                                           Rand Logistics, Inc. and Subsidiaries
                                         (formerly Rand Acquisition Corporation)
                                        (a corporation in the development stage)

                                                                   Balance Sheet

<TABLE>
<CAPTION>
===========================================================================================
                                                               December 31      December 31
                                                                  2005             2004
-------------------------------------------------------------------------------------------
<S>                                                           <C>              <C>
Assets
Current assets:
  Cash and cash equivalents                                   $    176,945     $    802,667
  Investments held in Trust Fund (Note 1)                       24,511,698       23,804,261
  Prepaid expenses                                                  17,815           57,750
                                                              ------------     ------------
Total current assets                                            24,706,458       24,664,678
  Deferred Acquisition Costs (Note 1)                            2,083,097               --
                                                              ------------     ------------
Total assets                                                  $ 26,789,555     $ 24,664,678
                                                              ============     ============
Liabilities and Stockholders' Equity
Current liabilities:
  Accrued expenses (Note 4)                                   $  1,885,644     $     12,000
  Taxes Payable (Note 5)                                            55,523           34,357
  Deferred Interest                                                155,108           13,645
                                                              ------------     ------------
          Total liabilities                                      2,096,275           60,002
                                                              ------------     ------------
Common stock, subject to possible redemption,
  919,540 shares at redemption value (Note 1)                    4,744,826        4,744,826
                                                              ------------     ------------
Commitments (Notes 3 and 8)
Stockholders' equity (Notes 1, 2, 6, 7 and 8)
  Preferred stock, $.0001 par value, Authorized
    1,000,000 shares; none issued                                       --               --
  Common stock, $.0001 par value
    Authorized 50,000,000 shares
    Issued and outstanding 5,600,000 shares (which
      includes 919,540 subject to possible redemption)                 560              560
  Additional paid-in capital                                    19,884,465       19,884,465
  Surplus/( Deficit) accumulated during development stage           63,429          (25,175)
                                                              ------------     ------------
    Total stockholders' equity                                  19,948,454       19,859,850
                                                              ------------     ------------
Total liabilities and stockholders' equity                    $ 26,789,555     $ 24,664,678
                                                              ============     ============
</TABLE>

                 See accompanying notes to financial statements.


                                      F-3
<PAGE>

                                           Rand Logistics, Inc. and Subsidiaries
                                         (formerly Rand Acquisition Corporation)
                                        (a corporation in the development stage)

                                                         Statement of Operations

<TABLE>
<CAPTION>
===================================================================================================================
                                                        Period from                               Period from
                                                        June 2, 2004        For the               June 2, 2004
                                                        (inception) to      Year Ended            (inception) to
                                                        December 31, 2005   December 31, 2005     December 31, 2004
-------------------------------------------------------------------------------------------------------------------
<S>                                                      <C>                  <C>                  <C>
Income:
  Interest Income                                        $   638,123          $   581,555          $    56,568
                                                         -----------          -----------          -----------
Expenses:
  Franchise and capital-based taxes                           81,055               46,698               34,357
  Professional fees                                           85,676               69,383               16,293
  Rent and office                                            106,209               90,000               16,209
  Insurance                                                   68,333               58,833                9,500
  Other formation and operating costs                         64,172               58,788                5,384
                                                         -----------          -----------          -----------
    Total Expenses                                           405,445              323,702               81,743
                                                         -----------          -----------          -----------
Income (loss) before provision for income taxes              232,678              257,853                   --
Provision for income taxes                                   169,249              169,249                   --
                                                         -----------          -----------          -----------
Net income (loss)                                        $    63,429          $    88,604          $   (25,175)
                                                         ===========          ===========          ===========
Net loss per share basic and diluted                                          $       .02          $      (.01)
                                                                              ===========          ===========
Weighted average shares outstanding                                             5,600,000            2,584,634
                                                                              ===========          ===========
</TABLE>

                 See accompanying notes to financial statements.


                                      F-4
<PAGE>

                                           Rand Logistics, Inc. and Subsidiaries
                                         (formerly Rand Acquisition Corporation)
                                        (a corporation in the development stage)

                                               Statement of Stockholders' Equity

<TABLE>
<CAPTION>
===================================================================================================================================
                                                                                      Additional    Surplus (Deficit)
                                                             Common Stock              Paid-In      accumulated during the
                                                         Shares         Amount         Capital      development stage       Total
-----------------------------------------------------------------------------------------------------------------------------------
<S>                                                     <C>          <C>             <C>              <C>              <C>
Sale of 1,000,000 shares of common stock to
  initial stockholders as of June 2, 2004
  at $.025 per share                                    1,000,000    $        100    $     24,900               --     $     25,000

Sale of 4,000,000 units, net of underwriters'
  discount and offering expenses (includes
  799,600 shares subject to possible redemption)        4,000,000             400      21,310,351               --       21,310,751

Proceeds of exercise of overallotment option
  by underwriters                                         600,000              60       3,293,940                         3,294,000
Proceeds subject to possible redemption of
  919,540 shares                                               --              --      (4,744,826)              --       (4,744,826)

Proceeds from issuance of option                               --              --             100               --              100

Net loss                                                       --              --              --          (25,175)         (25,175)
                                                        ---------    ------------    ------------     ------------     ------------

Balance, December 31, 2004                              5,600,000             560      19,884,465          (25,175)      19,859,850

Net income                                                     --              --              --           88,604           88,604

-----------------------------------------------------------------------------------------------------------------------------------
Balance, December 31, 2005                              5,600,000    $        560    $ 19,884,465     $     63,429     $ 19,948,454
                                                        =========    ============    ============     ============     ============
</TABLE>

                 See accompanying notes to financial statements.


                                      F-5
<PAGE>

                                                            Rand Logistics, Inc.
                                         (formerly Rand Acquisition Corporation)
                                        (a corporation in the development stage)

                                                         Statement of Cash Flows

<TABLE>
<CAPTION>
====================================================================================================================================
                                                                         Period from                               Period from
                                                                         June 2, 2004         For the              June 2, 2004
                                                                         (inception to)       Year Ended           (inception) to
                                                                         December 31, 2005    December 31, 2005    December 31, 2004
------------------------------------------------------------------------------------------------------------------------------------
<S>                                                                        <C>                  <C>                    <C>
Cash Flows from Operating Activities
    Net Income (loss)                                                      $     63,429         $     88,604           $    (25,175)
    Adjustments to reconcile net income (loss) to net cash
      used in operating activities
    Interest Accrued on Treasury Bill                                          (775,697)            (707,436)               (68,261)
    Increase (Decrease) in prepaid expenses                                     (17,815)              39,935                (57,750)
    Increase in accrued expenses                                                 42,178               30,178                 12,000
    Increase (Decrease) in income tax payable                                    55,523               21,166                 34,357
    Increase in deferred interest                                               155,108              141,463                 13,645
                                                                           ------------         ------------           ------------
      Net cash used in operating activities                                    (477,274)            (386,090)               (91,184)
                                                                           ------------         ------------           ------------

Cash Flows from Investing Activities
    Cash placed in Trust Fund                                               (23,736,000)                  --            (23,736,000)
    Payment of deferred acquisition costs                                      (239,632)            (239,632)                    --
                                                                           ------------         ------------           ------------
      Net cash used in investing activities                                 (23,975,632)            (239,632)           (23,736,000)
                                                                           ------------         ------------           ------------

Cash Flows from Financing Activities
    Gross proceeds                                                           27,600,000                   --             27,600,000
    Proceeds from notes payable, stockholder                                     70,000                   --                 70,000
    Payment of note payable, stockholder                                        (70,000)                  --                (70,000)
    Proceeds from sale of shares of common stock                                 25,000                   --                 25,000
    Proceeds from issuance of option                                                100                   --                    100
    Payment of costs of public offering                                      (2,995,249)                  --             (2,995,249)
                                                                           ------------         ------------           ------------
      Net cash provided by financing activities                              24,629,851                   --             24,629,851
                                                                           ------------         ------------           ------------

Net increase (decrease) in cash                                                      --             (625,722)                    --
Cash at beginning of period                                                          --              802,667                     --
                                                                           ------------         ------------           ------------
Cash at end of the period                                                  $    176,945         $    176,945           $    802,667
                                                                           ============         ============           ============
Supplemental schedule of non-cash investing activities:
    Accrual of deferred acquisition costs                                  $  1,843,465         $  1,843,465           $         --
                                                                           ============         ============           ============
</TABLE>


                                      F-6
<PAGE>

                                           Rand Logistics, Inc. and Subsidiaries
                                         (formerly Rand Acquisition Corporation)

                                                   Notes to Financial Statements
================================================================================

1. Organization                 Rand Acquisition Corporation was incorporated in
   and                          Delaware on June 2, 2004 as a blank check
   Business                     company whose objective was to acquire an
   Operations                   operating business (a "Business Combination").
                                As described in Note 8 (Subsequent Events), on
                                March 3, 2006, Rand Acquisition Corporation
                                consummated a Business Combination and changed
                                its name to Rand Logistics, Inc.

                                The consolidated financial statements include
                                the accounts of Rand Logistics, Inc. and its
                                wholly owned subsidiaries (collectively, the
                                "Company"). All significant intercompany
                                transaction and balances have been eliminated.

                                The registration statement for the Company's
                                initial public offering ("Offering") was
                                declared effective October 27, 2004. The Company
                                consummated the offering on November 2, 2004 and
                                received net proceeds of approximately
                                $21,311,000 (Note 2). On November 3, 2004, the
                                underwriters exercised their allotment option
                                resulting in further proceeds to the Company of
                                $3,294,000. The Company's management had broad
                                discretion with respect to the specific
                                application of the net proceeds of the Offering,
                                although substantially all of the net proceeds
                                of the Offering were intended to be generally
                                applied toward consummating a Business
                                Combination. A portion of the net proceeds,
                                originally $23,736,000, was placed in an
                                interest-bearing trust account ("Trust Fund")
                                until the earlier of (i) the consummation of a
                                Business Combination or (ii) liquidation of the
                                Company. Under the agreement governing the Trust
                                Fund, funds were only be invested in United
                                States government securities (Treasury Bills)
                                with a maturity of 180 days or less. This amount
                                was invested in a Treasury Bill. The Treasury
                                Bill has been accounted for as a trading
                                security, which is recorded at its market value
                                of approximately $24,512,000 at December 31,
                                2005 (and $23,804,000 at December 31, 2004). The
                                excess of market value over cost, exclusive of
                                the deferred interest described further below,
                                is included in interest income in the
                                accompanying statement of operations. The
                                remaining net proceeds were available to the
                                Company to pay for business, legal and
                                accounting due diligence on prospective
                                acquisitions and continuing general and
                                administrative expenses.

                                The Company, after signing a definitive
                                agreement for its first Business Combination,
                                was required to submit the Business Combination
                                for stockholder approval. To be approved, the
                                Business Combination required the approval of
                                holders of a majority of the shares issued in


                                      F-7
<PAGE>

                                           Rand Logistics, Inc. and Subsidiaries
                                         (formerly Rand Acquisition Corporation)

                                                   Notes to Financial Statements
================================================================================

                                the Offering ("Public Stockholders"). When
                                voting the Business Combination, all of the
                                Company's stockholders prior to the Offering,
                                including all of the officers and directors of
                                the Company ("Initial Stockholders"), agreed to
                                vote their 1,000,000 founding shares of common
                                stock in accordance with the vote of the holders
                                of majority of the shares issued in the
                                Offering. On February 28, 2006, the Business
                                Combination discussed in Note 8 (Subsequent
                                Events) was approved by Public Stockholders
                                holding a majority of the shares of common stock
                                issued in the Offering.

                                Public Stockholders who voted against the
                                Business Combination could also demand that the
                                Company redeem their shares if the Business
                                Combination is consummated. The per share
                                redemption price would equal the amount in the
                                Trust Fund as of the record date for
                                determination of stockholders entitled to vote
                                on the Business Combination divided by the
                                number of shares of common stock held by Public
                                Stockholders at the consummation of the
                                Offering. Under the terms of the Company's
                                Certificate of Incorporation, the Company could
                                not consummate a Business Combination if holders
                                of more than 19.99% of the shares of common
                                stock issued in the Offering demanded redemption
                                of their shares. Accordingly, a portion of the
                                net proceeds from the offering (19.99% of the
                                amount originally held in the Trust Fund) has
                                been classified as common stock subject to
                                possible redemption in the accompanying December
                                31, 2005 and December 31, 2004 balance sheets
                                and 19.99% of the related interest earned on the
                                Treasury Bill has been recorded as deferred
                                interest. The Company further conditioned the
                                Business Combination discussed in Note 8
                                (Subsequent Events) on holders of not more than
                                5% of the shares of common stock issued in the
                                Offering demanding redemption. No Public
                                Stockholders demanded redemption of their shares
                                in connection with the Business Combination
                                discussed in Note 8 (Subsequent Events) and as
                                such the common stock subject to redemption will
                                be reclassified to stockholders equity and the
                                deferred interest will be recognized as income
                                in the first quarter of 2006.

                                The Company's Certificate of Incorporation also
                                required mandatory liquidation of the Company,
                                without stockholder approval, in the event that
                                the Company did not consummate a Business
                                Combination within 18 months from the date of
                                the consummation of the Offering, or 24 months
                                from the consummation of the Offering if certain
                                extension criteria were satisfied.


                                      F-8
<PAGE>

                                           Rand Logistics, Inc. and Subsidiaries
                                         (formerly Rand Acquisition Corporation)

                                                   Notes to Financial Statements
================================================================================

                                The voting requirements, redemption rights and
                                mandatory liquidation discussed above are not
                                applicable after consummation of a Business
                                Combination.

                                For purposes of the statement of cash flows, the
                                Company considers all highly liquid debt
                                instruments with an original maturity of three
                                months or less to be cash equivalents.

                                The Company maintains cash in bank deposit
                                accounts which, at times, exceed federally
                                insured limits. The Company has not experienced
                                any losses on these accounts.

                                Deferred acquisition costs consist of legal,
                                consulting and other costs incurred through
                                December 31, 2005 that are directly related to
                                the acquisition or financing described in Note
                                8.

                                Deferred income taxes are provided for the
                                differences between the bases of assets and
                                liabilities for financial reporting and income
                                tax purposes. A valuation allowance is
                                established when necessary to reduce deferred
                                tax assets to the amount expected to be
                                realized.

                                Basic income (loss) per share is computed by
                                dividing net loss by the weighted-average number
                                of shares of common stock outstanding during the
                                period. Diluted income (loss) per share gives
                                effect to dilutive options, warrants and other
                                potential common stock outstanding during the
                                periods. Diluted income (loss) per share does
                                not include the Redeemable Common Stock Purchase
                                Warrants (see Note 2) to purchase an aggregate
                                of 9,200,000 shares of common stock at $5.00 per
                                share and the underwriters' option (see Note 2)
                                to purchase 300,000 Units at an exercise price
                                of $9.90 per Unit (with 600,000 underlying
                                warrants at $6.25 per share), respectively, that
                                were outstanding at December 31, 2005 and 2004
                                because the shares underlying the conversion of
                                the warrants are contingently issuable at
                                December 31, 2005 and 2004 and the exercise
                                price of the underwriters' option is in excess
                                of the related market value of the Units.

                                In 2006, diluted earnings per share will require
                                consideration of the Redeemable Common Stock
                                Purchase Warrants because the contingency was
                                satisfied upon the completion of the transaction
                                described in Note 8.

                                The preparation of financial statements in
                                conformity with accounting principles generally
                                accepted in the United States of America


                                      F-9
<PAGE>

                                           Rand Logistics, Inc. and Subsidiaries
                                         (formerly Rand Acquisition Corporation)

                                                   Notes to Financial Statements
================================================================================

                                requires management to make estimates and
                                assumptions that affect the reported amounts of
                                assets and liabilities at the date of the
                                financial statements and the reported amounts of
                                expenses during the reporting period. Actual
                                results could differ from those estimates.

                                Management does not believe that any recently
                                issued, but not yet effective, accounting
                                standards if currently adopted would have a
                                material effect on the accompanying financial
                                statements.
2. Initial Public
   Offering                     On November 2, 2004, the Company sold a total of
                                4,600,000 units ("Units") in the Offering and
                                the underwriters' exercise of their
                                overallotment option. Each Unit consists of one
                                share of the Company's common stock, $.0001 par
                                value, and two Redeemable Common Stock Purchase
                                Warrants ("Warrants"). Each Warrant will entitle
                                the holder to purchase from the Company one
                                share of common stock at an exercise price of
                                $5.00 commencing the later of the completion of
                                a Business Combination (See Note 8) with a
                                target business or one year from the effective
                                date of the Offering and expiring four years
                                from the date of the prospectus. The Warrants
                                will be redeemable, upon prior written consent
                                of EarlyBirdCapital, Inc., at a price of $.01
                                per Warrant upon 30 days' notice after the
                                Warrants become exercisable, only in the event
                                that the last sale price of the common stock is
                                at least $8.50 per share for any 20 trading days
                                within a 30 trading day period ending on the
                                third day prior to the date on which notice of
                                redemption is given.

                                In connection with this Offering, the Company
                                issued an option, for $100, to the
                                representative of the underwriters to purchase
                                300,000 Units at an exercise price of $9.90 per
                                Unit. Each Unit included within this option
                                consists of one share of common stock and two
                                warrants. The Units issuable upon exercise of
                                the option are identical to those issued in the
                                Offering except that the Warrants included in
                                the Units underlying the option have an exercise
                                price of $6.25 per share. The option will be
                                exercisable by the holder at $9.90 per Unit
                                commencing upon the consummation of a business
                                combination by the Company and will expire on
                                October 26, 2009. The Company has accounted for
                                the fair value of the option, inclusive of the
                                receipt of the $100 cash payment, as an expense
                                of the Offering resulting in a charge directly
                                to the stockholders' equity. The Company
                                estimates that the fair value of this option is
                                approximately $558,000 ($1.86 per Unit) using a
                                Black-Scholes option-pricing model. The fair
                                value of the option granted to the
                                Representative has been estimated as of the date


                                      F-10
<PAGE>

                                           Rand Logistics, Inc. and Subsidiaries
                                         (formerly Rand Acquisition Corporation)

                                                   Notes to Financial Statements
================================================================================

                                of grant using the following assumptions: (1)
                                expected volatility of 47.79%, (2) risk-free
                                interest rate of 3.34% and (3) expected life of
                                5 years. The option may be exercised for cash or
                                on a "cashless" basis, at the holder's option,
                                such that the holder may use the appreciated
                                value of the option (the difference between the
                                exercise prices of the option and the underlying
                                Warrants and the market price of the Units and
                                underlying securities) to exercise the option
                                without the payment of any cash.

3. Commitment                   The Company presently occupies office space
                                provided by an affiliate of an Initial
                                Stockholder. Such affiliate has agreed that it
                                will make such office space, as well as certain
                                office and secretarial services, available to
                                the Company, as may be required by the Company
                                from time to time. The Company has agreed to pay
                                such affiliate $7,500 per month for such
                                services commencing on the effective date of the
                                Offering. The statement of operations for the
                                period from inception to December 31, 2005 and
                                the period ended December 31, 2004 includes
                                $106,209, $90,000 and $16,209, respectively,
                                related to this agreement.

                                In connection with the Business Combination
                                described in Note 8, in March 2006 the Company
                                entered into employment agreements with two
                                individuals (See Note 8).

4. Accrued Expenses             Accrued expenses consists of the following:

                                                               December 31,
                                                            2005          2004
                                                         ----------     --------
                                Professional fees in     $1,843,465           --
                                connection with the
                                transaction described
                                in Note 8

                                Other Professional Fees      33,500     $ 12,000

                                Other                         8,679           --
                                                         ----------     --------

                                                         $1,885,644     $ 12,000
                                                         ==========     ========


                                      F-11
<PAGE>

                                           Rand Logistics, Inc. and Subsidiaries
                                         (formerly Rand Acquisition Corporation)

                                                   Notes to Financial Statements
================================================================================

5. Taxes Payable                The provision for income taxes consists of the
                                following:

                                                                    Period from
                                                       Year ended   Inception to
                                                       December 31  December 31
                                                       2005          2004
                                                       -----------  ------------
                                Current:
                                   Federal               104,285           --
                                   State and Local        64,964           --
                                Deferred:
                                   Federal                    --           --
                                   State and Local            --           --
                                                       ---------    ---------

                                                       $ 169,249    $      --
                                                       =========    =========

                                The total provision for income taxes differs
                                from that amount which would be computed by
                                applying the U.S. Federal income tax rate to
                                income before provision for income taxes as
                                follow:

                                                                    Period from
                                                     Year ended     Inception to
                                                     December 31    December 31
                                                     2005           2004
                                                     -----------    -----------

               Statutory federal income tax rate           34%           (34%)
                 State income taxes                      16.6%            --
                 Valuation allowance                       15%            34%
                                                        -----          -----
                 Effective income tax rate               65.6%            --
                                                        =====          =====

                                The tax effect of temporary differences that
                                give rise to the net deferred tax asset is as
                                follows:

                                                                 December 31,
                                                                --------------
                                                                2005      2004
                                                                ----      ----
                                Asset:

                                Deferred Interest Income       70,400     6,200
                                Other                           1,100     1,400
                                Federal NOL                        --    22,100
                                State and Local NOLs               --     5,600
                                                              -------   -------
                                Total deferred tax asset      $71,500   $35,300
                                                              =======   =======

                                Liability:

                                Prepaid Expense                $8,100   $25,700
                                                             --------   -------
                                Total Deferred Tax Liability   $8,100   $25,700
                                                             --------   -------

                                Net Deferred Asset            $63,400   $ 9,600
                                Valuation Allowance          ($63,400)  ($9,600)
                                                             --------   -------
                                                              $    --   $    --
                                                             ========   =======


                                      F-12
<PAGE>

                                           Rand Logistics, Inc. and Subsidiaries
                                         (formerly Rand Acquisition Corporation)

                                                   Notes to Financial Statements
================================================================================

                                During the year ended December 31, 2005, the
                                Company paid $160,424 of income and State
                                Franchise taxes (exclusive of Delaware).

6. Preferred Stock              The Company is authorized to issue 1,000,000
                                shares of preferred stock with such
                                designations, voting and other rights and
                                preferences as may be determined from time to
                                time by the Board of Directors.

7. Common Stock                 On October 7, 2004, the Company's Board of
                                Directors authorized a stock dividend of
                                0.1428571 shares of common stock for each
                                outstanding share of common stock. All
                                references in the accompanying financial
                                statements to the number of shares of stock have
                                been retroactively restated to reflect this
                                transaction.

                                At December 31, 2005, 10,100,000 shares of
                                common stock were reserved for issuance upon
                                exercise of redeemable warrants and the
                                underwriters' unit purchase option.

8. Subsequent Events -
   Unaudited                    On March 3, 2006, Rand Acquisition Corporation,
                                through its wholly-owned subsidiary, LL
                                Acquisition Corp., acquired all of the
                                outstanding shares of capital stock of Lower
                                Lakes Towing Ltd. ("Lower Lakes") in accordance
                                with the terms of the Stock Purchase Agreement,
                                dated September 2, 2005, by and among Rand
                                Acquisition Corporation, LL Acquisition Corp.
                                and the stockholders of Lower Lakes, as amended.
                                Immediately following completion of the
                                acquisition, and in conjunction therewith, LL
                                Acquisition Corp. and Lower Lakes were
                                amalgamated under Canadian law and the shares of
                                capital stock of Grand River Navigation Company,
                                Inc. ("Grand River") and Lower Lakes
                                Transportation Company ("LLT") owned by Lower
                                Lakes at the time of the amalgamation were
                                transferred to Rand Acquisition Corporation's
                                wholly-owned subsidiary, Rand LL Holdings Corp.
                                Upon completion of such transfer, the
                                outstanding shares of Grand River not owned by
                                Rand LL Holdings Corp. were redeemed in
                                accordance with the terms of the Redemption
                                Agreement, dated September 2, 2005, between
                                Grand River and GR Holdings, Inc. Following
                                completion of the foregoing transactions, as of
                                March 3, 2006, each of Lower Lakes, Grand River
                                and LLT became indirect, wholly-owned
                                subsidiaries of Rand Acquisition Corporation. In
                                conjunction with the foregoing transactions, as
                                of March 3, 2006, Rand Acquisition Corporation
                                changed its name to Rand Logistics Inc.

                                Lower Lakes and LLT provide bulk freight
                                shipping services throughout the Great Lakes


                                      F-13
<PAGE>

                                           Rand Logistics, Inc. and Subsidiaries
                                         (formerly Rand Acquisition Corporation)

                                                   Notes to Financial Statements
================================================================================

                                region to, among others, the construction
                                aggregates, integrated steel, salt, agriculture
                                and electric utility industries. Lower Lakes'
                                operating fleet consists of four self-unloading
                                bulk carriers in Canada and three self-unloading
                                bulk carriers as well as a tug and a
                                self-unloading barge in the U.S. Lower Lakes
                                owns three of the Canadian flagged vessels and
                                its wholly-owned subsidiary, Port Dover
                                Steamship Company Inc., owns the fourth. LLT
                                time charters the U.S. flagged vessels from
                                Grand River. Grand River owns two of the U.S.
                                flagged vessels and a tug, and bareboat charters
                                two U.S. flagged vessels. The four vessels owned
                                or chartered by Grand River are used exclusively
                                in LLT's business.

                                In accordance with the terms of the Stock
                                Purchase Agreement and Redemption Agreement,
                                respectively, the Company paid $9,843,748 to the
                                selling shareholders of Lower Lakes and $750,000
                                to GR Holdings, Inc., and arranged for the
                                repayment of the acquisition closing date
                                indebtedness of such entities of Cdn $43,732,749
                                (approximately $37,522,000 at December 31, 2005)
                                and $5,156,945, respectively. The amount paid to
                                the Lower Lakes selling shareholders reflects
                                certain adjustments made on the acquisition
                                closing date in accordance with the Stock
                                Purchase Agreement and such amount is subject to
                                further adjustment after the acquisition closing
                                based the Company's determination of the net
                                working capital of Lower Lakes and its
                                affiliates as of January 15, 2006. The Company
                                funded the acquisition closing date payments
                                with the approximately $24,646,000 of proceeds
                                of its initial public offering held in trust,
                                $15,000,000 of proceeds of the acquisition
                                closing date issuance of the Company's newly
                                created series A convertible preferred stock,
                                and proceeds of the new senior loan facility
                                entered into on the acquisition closing date by
                                Lower Lakes, Grand River and LLT.

                                The shares of series A convertible preferred
                                stock were issued pursuant to the terms of the
                                Preferred Stock Purchase Agreement, dated
                                September 2, 2005, by and among the Company and
                                Knott Partners LP and certain of its affiliates,
                                and Bay Resource Partners L.P. and certain of
                                its affiliates. In accordance with the terms of
                                the Preferred Stock Purchase Agreement, the
                                Company issued 300,000 shares on the acquisition
                                closing date for an aggregate purchase price of
                                $15,000,000. The shares of series A convertible
                                preferred stock were not registered under the
                                Securities Act of 1933, but the series A
                                preferred stockholders have the right to require


                                      F-14
<PAGE>

                                           Rand Logistics, Inc. and Subsidiaries
                                         (formerly Rand Acquisition Corporation)

                                                   Notes to Financial Statements
================================================================================

                                the filing of a registration statement with
                                respect to shares of the Company's common stock
                                issuable upon conversion of the shares of series
                                A convertible preferred stock. The series A
                                preferred stockholders are prohibited from
                                selling any shares of such common stock under a
                                registration statement prior to the six month
                                anniversary of the acquisition closing date or
                                more than one half of all such shares of common
                                stock held by them as a group prior to the
                                twelve month anniversary of the acquisition
                                closing date. The shares of series A convertible
                                preferred stock: rank senior to the Company's
                                common stock with respect to liquidation and
                                dividends; are entitled to receive a cash
                                dividend at the annual rate of 7.75%, payable
                                quarterly (subject to increases of 0.5% for each
                                six month period in respect of which the
                                dividend is not timely paid, up to a maximum of
                                12%, subject to reversion to 7.75% upon payment
                                of all accrued and unpaid dividends); are
                                convertible into shares of the Company's common
                                stock at any time at the option of the series A
                                preferred stockholder based on a conversion
                                price of $6.20 per share (subject to
                                adjustment); are convertible into shares of the
                                Company's common stock (based on a conversion
                                price of $6.20 per share, subject to adjustment)
                                at the option of the Company if, after the third
                                anniversary of the acquisition, the trading
                                price of the Company's common stock for 20
                                trading days within any 30 trading day period
                                equals or exceeds $8.50 per share (subject to
                                adjustment); may be redeemed by the Company in
                                connection with certain change of control or
                                acquisition transactions; will vote on an
                                as-converted basis with the Company's common
                                stock; and have a separate vote over certain
                                material transactions or changes involving the
                                Company.

                                The Company's Certificate of Incorporation was
                                amended and restated on the acquisition closing
                                date to, among other things, increase the number
                                of shares of common stock that the Company is
                                authorized to issue from 20,000,000 shares to
                                50,000,000 shares, and to adopt certain
                                amendments designed to ensure the Company's
                                compliance with the citizenship requirements of
                                U.S. maritime laws, including the Shipping Act,
                                1916, and the Merchant Marine Act, 1920,
                                commonly referred to as the Jones Act, after
                                completion of the acquisition. The maritime law-
                                related amendments limit the aggregate
                                percentage ownership of the Company's capital
                                stock, including common stock, by non-U.S.
                                citizens to 23% of the outstanding shares of the
                                Company's capital stock and no more than 23% of
                                the voting power of the Company. In addition,
                                these amendments give the Company's Board of


                                      F-15
<PAGE>

                                           Rand Logistics, Inc. and Subsidiaries
                                         (formerly Rand Acquisition Corporation)

                                                   Notes to Financial Statements
================================================================================

                                Directors the authority to make such
                                determinations as may reasonably be necessary to
                                ascertain such ownership and to implement such
                                limitations, including limiting transfers of
                                shares and redeeming shares held by anyone whose
                                ownership of such shares would cause the Company
                                to be in violation of U.S. maritime laws.

                                The Credit Agreement governing the new senior
                                credit facility provides for (i) a revolving
                                credit facility under which Lower Lakes may
                                borrow up to Cdn $2,300,000 (approximately
                                $1,973,000 at December 31, 2005) and an
                                additional seasonal facility of $2,000,000,
                                subject to limitations, (ii) a revolving credit
                                facility under which LLT may borrow up to
                                $3,500,000 and an additional seasonal facility
                                of $2,000,000, subject to limitations, (iii) a
                                Canadian dollar denominated term loan facility
                                under which Lower Lakes may borrow Cdn
                                $21,200,000 (approximately $18,189,000 at
                                December 31, 2005), and (iv) a US dollar
                                denominated term loan facility under which Grand
                                River may borrow $4,000,000. Borrowings under
                                the new senior credit facility are required to
                                be used to refinance the borrowers' existing
                                senior credit facility, to finance working
                                capital and for the acquisition of the stock of
                                the borrowers and other general corporate
                                purposes. The full amount of both term loans was
                                extended to the borrowers on March 3, 2006. Rand
                                is neither a party to the Credit Agreement nor a
                                guarantor of any obligations under the Credit
                                Agreement.

                                Under the new senior credit facility, the
                                revolving credit facility expires on March 3,
                                2011. The outstanding principal amount of the
                                Canadian term loan borrowings will be repayable
                                as follows: (i) an aggregate of Cdn $2,120,000
                                (approximately $1,819,000 at December 31, 2005)
                                per annum shall be payable in four equal
                                quarterly installments during the first year,
                                (ii) an aggregate of Cdn $2,544,000
                                (approximately $2,183,000 at December 31, 2005)
                                shall be payable in four equal quarterly
                                installments in each of the next four years, and
                                (iii) a final payment in the outstanding
                                principal amount of the Canadian term loan shall
                                be payable upon the Canadian term loan
                                facility's maturity on March 3, 2011. The
                                outstanding principal amount of the US term loan
                                borrowings will be repayable as follows: (i) an
                                aggregate of $400,000 per annum shall be payable
                                in four equal quarterly installments during the
                                first year, (ii) an aggregate of $480,000 per
                                annum shall be payable in four equal quarterly
                                installments in each of the next four years, and
                                (iii) a final payment in the outstanding
                                principal amount of the US term loan shall be
                                payable upon the US term loan facility's
                                maturity on March 3, 2011.


                                      F-16
<PAGE>

                                           Rand Logistics, Inc. and Subsidiaries
                                         (formerly Rand Acquisition Corporation)

                                                   Notes to Financial Statements
================================================================================

                                Borrowings under the Canadian revolving credit
                                facility and Canadian term loan will bear an
                                interest rate per annum, at the borrowers'
                                option, equal to (i) the Canadian Prime Rate (as
                                defined in the new senior credit facility), plus
                                2% per annum or (ii) the BA Rate (as defined in
                                the new senior credit facility) plus 3% per
                                annum. The US revolving credit facility and the
                                US term loan will bear interest, at the
                                borrowers' option equal to (i) LIBOR (as defined
                                in the new senior credit facility) plus 3.00%
                                per annum, or (ii) the US Base Rate(as defined
                                in the new senior credit facility), plus 2% per
                                annum.

                                Obligations under the new senior credit facility
                                are secured by a first priority lien and
                                security interest on all of the borrowers'
                                assets, tangible or intangible, real, personal
                                or mixed, existing and newly acquired, and a
                                pledge by Rand LL Holdings Corp of all of the
                                outstanding capital stock of the borrowers. In
                                addition, all obligations under the new senior
                                credit facility will also be secured by a
                                pledge, with limited exception, of all the
                                outstanding capital stock of the borrowers'
                                subsidiaries. The indebtedness of each borrower
                                under the new credit facility is unconditionally
                                guarantied by each other borrower and by Rand LL
                                Holdings Corp. and such guaranty is secured by a
                                lien on substantially all of the assets of each
                                borrower and Rand LL Holdings Corp.

                                Under the new senior credit facility, the
                                borrowers will be required to make mandatory
                                prepayments of principal on term loan borrowings
                                (i) if the outstanding balance of the term loans
                                plus the outstanding balance of the seasonal
                                facilities exceeds the sum of 75% of the fair
                                market value of the vessels owned by the
                                borrowers, less the amount of outstanding liens
                                against the vessels with priority over the
                                Lenders' liens, in an amount equal to such
                                excess, (ii) in the event of certain
                                dispositions of assets and insurance proceeds
                                (all subject to certain exceptions), in an
                                amount equal to 100% of the net proceeds
                                received by the borrowers therefrom, and (iii)
                                in an amount equal to 100% of the net proceeds
                                to a borrower from any issuance of a borrower's
                                debt or equity securities.

                                The new senior credit facility contains certain
                                covenants, including those limiting borrowers'
                                and their subsidiaries' ability to incur
                                indebtedness, incur liens, sell or acquire
                                assets or businesses, change the nature or its
                                business, engage in transactions with related
                                parties, make certain investments or pay
                                dividends. In addition, the new senior credit
                                facility requires the borrowers to maintain
                                certain financial ratios. Failure of the
                                borrowers to comply with any of these covenants
                                or financial ratios could result in the loans
                                under the new senior credit facility being
                                accelerated.


                                      F-17
<PAGE>

                                           Rand Logistics, Inc. and Subsidiaries
                                         (formerly Rand Acquisition Corporation)

                                                   Notes to Financial Statements
================================================================================

                                The Company is in the process of allocating the
                                purchase price to the tangible and intangible
                                assets and liabilities as of the date of the
                                acquisition. The preliminary estimate of
                                goodwill in the acquisition is approximately $11
                                million.

                                In connection with the Lower Lakes acquisition,
                                the Company entered into employment agreements
                                with two employees. The employee agreements are
                                for an initial period of two years in the
                                aggregate amounts of Cdn $353,000 (approximately
                                $303,000 at December 31, 2005) per year, plus
                                bonuses, under terms defined in the employment
                                agreements.


                                      F-18

<PAGE>

                                           Rand Logistics, Inc. and Subsidiaries
                                         (formerly Rand Acquisition Corporation)

                                                   Notes to Financial Statements
================================================================================

      The following unaudited pro forma condensed consolidated balance sheet
combines the historical balance sheets of Lower Lakes and Rand as of December
31, 2005, giving effect to the transactions described in the Stock Purchase
Agreement as if they had occurred on December 31, 2005.

                                                                    Pro Forma
                                                                    Combined
                                                                 --------------
             ASSETS
CURRENT
   Cash and cash reserved
   for repairs and drydock
   expenditures                                                  $    5,965,994






   Accounts receivable, net                                           8,125,659
     Prepaid expenses and other
       current assets                                                 2,365,211
   Investments held in trust
   Deferred income taxes                                                123,378
-------------------------------------------------------------------------------
                                                                     16,580,242

CAPITAL ASSETS, NET                                                  37,490,439
DEFERRED INCOME TAXES                                                 5,335,159
DEFERRED ACQUISITION COSTS                                                   --
DEFERRED DRYDOCK AND FINANCING
  COSTS, NET                                                          5,679,051


INTANGIBLE ASSETS                                                    11,068,837
-------------------------------------------------------------------------------
                                                                 $   76,153,728
===============================================================================
LIABILITIES
CURRENT                                                          $   10,532,637


LONG-TERM DEBT
   Long-term debt - senior and
   subordinated                                                      20,236,142

   Long-term obligation - vessel
   lease                                                              1,758,132
   Deferred income taxes                                              5,183,537
   Common stock subject to
   conversion                                                                --
   Convertible notes                                                         --
-------------------------------------------------------------------------------

                                                                     27,177,811
-------------------------------------------------------------------------------
MINORITY INTEREST                                                            --
-------------------------------------------------------------------------------
SHAREHOLDERS' EQUITY
   Convertible preferred
   shares                                                            14,500,000

   Common stock par value                                                   560
   Share capital



   Due from shareholder                                                      --

   Additional paid in capital                                        24,629,291


   Accumulated deficit                                                 (686,571)


   Accumulated other
     comprehensive loss                                                      --
-------------------------------------------------------------------------------
                                                                     38,443,280
-------------------------------------------------------------------------------
                                                                 $   76,153,728
===============================================================================


                                      F-19
<PAGE>

                                           Rand Logistics, Inc. and Subsidiaries
                                         (formerly Rand Acquisition Corporation)

                                                   Notes to Financial Statements
================================================================================

      The following unaudited pro forma condensed consolidated statements of
operations combine (i) the historical statement of operations of Rand for the
twelve months ended December 31, 2005 and the historical statement of operations
of Lower Lakes for the twelve months ended December 31, 2005 giving effect to
the acquisition as if it had occurred on January 1, 2005.

                                                                 Pro Forma
                                                                  Combined
                                                              --------------
REVENUE                                                       $   61,240,535
----------------------------------------------------------------------------
EXPENSES
Outside voyage charter fees                                        7,379,638
Vessel operating expenses                                         40,628,366
Winter costs                                                       1,625,671
Administration                                                     3,276,188
Depreciation                                                       3,939,420
Amortization of deferred drydock                                   1,033,339
costs
Foreign exchange gain                                               (276,251)
Loss on asset disposal                                               113,405
----------------------------------------------------------------------------
                                                                  57,719,776
----------------------------------------------------------------------------
INCOME (LOSS)  FROM OPERATIONS                                     3,520,759
----------------------------------------------------------------------------

OTHER INCOME AND EXPENSES
Interest                                                           1,996,750
Other income                                                        (598,018)
Loss on debt extinguishment                                           52,130
Amortization of deferred financing costs                             864,264
----------------------------------------------------------------------------
                                                                   2,315,126
----------------------------------------------------------------------------
INCOME (LOSS) BEFORE INCOME TAXES AND
   MINORITY INTEREST                                               1,205,633
----------------------------------------------------------------------------

PROVISION FOR INCOME TAXES                                           750,433
MINORITY INTEREST                                                         --
----------------------------------------------------------------------------
NET INCOME                                                    $      455,200
----------------------------------------------------------------------------

Pro forma net income (loss) per share:
Pro forma weighted average outstanding shares - basic and
diluted                                                            5,600,000
                                                              --------------
Pro forma net loss per share                                  $        (0.13)(a)
                                                              --------------

(a)   There is a pro forma loss per share due to the effect of convertible
      preferred stock dividends.


                                      F-20