<PAGE>

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                       SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549
                             ---------------------

                                   FORM 10-K

<Table>
<S>          <C>
 (Mark One)
    [X]             ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)
                        OF THE SECURITIES EXCHANGE ACT OF 1934



                     FOR THE FISCAL YEAR ENDED DECEMBER 28, 2001



                                   OR




    [ ]           TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
                        OF THE SECURITIES EXCHANGE ACT OF 1934

             FOR THE TRANSITION PERIOD FROM ____________ TO ____________.
</Table>

                        Commission file number 333-62227

                             ---------------------

                         AMERICAN COMMERCIAL LINES LLC
             (Exact Name of Registrant as Specified in Its Charter)

<Table>
<S>                                            <C>
                  DELAWARE                                      52-2106600
        (State or Other Jurisdiction                           (IRS Employer
      of Incorporation or Organization)                     Identification No.)
</Table>

<Table>
<S>                                            <C>
           1701 EAST MARKET STREET
           JEFFERSONVILLE, INDIANA                                 47130
  (Address of Principal Executive Offices)                      (Zip Code)
</Table>

                                 (812) 288-0100
              (Registrant'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: NONE

     Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes  [X]     No  [ ]

     Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K.  [X]

     State the aggregate market value of the voting and non-voting common equity
held by nonaffiliates of the registrant. The aggregate market value shall be
computed by reference to the price at which the common equity was sold, or the
average bid and asked prices of such common equity, as of a specified date
within 60 days prior to the date of filing. NOT APPLICABLE.
      AS OF DECEMBER 28, 2001, THE REGISTRANT HAD 100 MEMBERSHIP INTERESTS
                                  OUTSTANDING.
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<PAGE>

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

     This Annual Report on Form 10-K contains certain forward-looking statements
about ACL's financial position and results of operations. These statements
include words such as "believe," "expect," "anticipate," "intend," "estimate" or
other similar words. Any statements that express or involve discussions as to
expectations, beliefs or plans are not historical facts and involve known and
unknown risks, uncertainties and other factors that may cause the actual results
to materially differ from those considered by the forward-looking statements.
Such factors include:

     - substantial leverage and ability to service debt;

     - changing market, labor, legal and regulatory conditions and trends in the
       barge and inland shipping industries;

     - general economic and business conditions, including a prolonged or
       substantial recession in the United States or certain international
       commodity markets such as the market for grain exports; and

     - annual worldwide weather conditions, particularly those affecting North
       and South America.

     Although we believe that our plans, intentions and expectations reflected
in or suggested by such forward-looking statements are reasonable, actual
results could differ from a projection or assumption in any of our
forward-looking statements. Our future financial condition and results of
operations, as well as any forward-looking statements, are subject to change and
inherent risks and uncertainties discussed under Item 1. "Business -- Risks
Associated With Our Business" and elsewhere in this Annual Report on Form 10-K
as well as in our other filings with the Securities and Exchange Commission. The
forward-looking statements contained in this Annual Report on Form 10-K are made
only as of the date hereof and ACL does not have or undertake any obligation to
update or revise any forward-looking statements whether as a result of new
information, subsequent events or otherwise, unless otherwise required by law.

                                     PART I

ITEM 1.  BUSINESS

HISTORY

     American Commercial Lines LLC ("ACL"), a Delaware limited liability
company, was formed in April 1998 in connection with the conversion by merger of
its predecessor American Commercial Lines, Inc. ("ACL Inc."), a Delaware
corporation, into a limited liability company. ACL Inc. was formed in 1953 as
the holding company for a family of barge transportation and marine service
companies with an operating history beginning in 1915.

     In 1998, ACL was recapitalized by its owners pursuant to a Recapitalization
Agreement, dated April 17, 1998, among CSX Corporation ("CSX"), Vectura Group
Inc., a Delaware corporation now Vectura Group LLC ("Vectura"), a Delaware
limited liability company, ACL's parent American Commercial Lines Holdings LLC
(the "Parent"), a Delaware limited liability company, ACL and National Marine,
Inc., a Delaware corporation now National Marine LLC ("National Marine"), a
Delaware limited liability company, whereby the Parent completed a
recapitalization in a series of transactions (the "Recapitalization") and
combined the barging operations of Vectura, National Marine and their
subsidiaries with that of ACL.

     To finance the Recapitalization, ACL incurred secured debt under a Credit
Agreement, dated June 30, 1998, with certain lenders and J.P. Morgan Chase Bank
(formerly, The Chase Manhattan Bank), as administrative agent (the "Senior
Credit Facilities"), consisting of a $200.0 million Tranche B Term Loan due
June, 2006, a $235.0 million Tranche C Term Loan due June, 2007 (collectively
the "Term Loans") and a revolving credit facility providing for revolving loans
and the issuance of letters of credit for the account of ACL in an aggregate
principal amount of up to $100.0 million due June, 2005 (the "Revolving Credit
Facility"). ACL also issued $300.0 million of unsecured 10 1/4% Senior Notes due
June 2008 (the "Senior

                                        1
<PAGE>

Notes"), pursuant to an indenture (the "Indenture") with United States Trust
Company of New York, as trustee.

POTENTIAL ACQUISITION AND RECAPITALIZATION OF ACL

     As previously reported, ACL has been pursuing strategic financial
restructuring alternatives. On March 15, 2002, ACL entered into a definitive
recapitalization agreement (the "Recapitalization Agreement") regarding the
acquisition and recapitalization of ACL (the "Danielson Recapitalization") by
Danielson Holding Corporation ("Danielson"). Under the terms of the Danielson
Recapitalization, Danielson would acquire 100% of the membership interests of
the Parent. ACL's present indirect preferred equity holders would receive
approximately $7.0 million in cash. ACL's management will receive approximately
$1.7 million of restricted Danielson common stock. In addition, Danielson will
deliver $25.0 million in cash and approximately $58.5 million of ACL's Senior
Notes, to ACL Holdings in connection with the transaction. Danielson currently
expects to fund the acquisition through a rights offering to its existing
security holders, upon terms and conditions to be determined. However,
consummation of the Recapitalization Agreement is not conditioned on the
successful completion of the rights offering.

     The Danielson Recapitalization will result in a reduction of ACL's senior
secured bank debt incurred under the Senior Credit Facilities and the
restructuring of the Senior Notes pursuant to an exchange offer and consent
solicitation in which $236.5 million of the existing Senior Notes (all notes
held by parties other than Danielson) would be exchanged for $120.0 million of
new 11 1/4% senior notes due January 1, 2008 ("New Senior Notes") and
approximately $116.5 million of new 12% pay-in-kind senior subordinated notes
due July 1, 2008 ("PIK Notes"). Senior Notes held by Danielson would be retired
in conjunction with the Danielson Recapitalization. ACL would also issue
additional New Senior Notes in an aggregate principal amount equal to the
accrued and unpaid interest on its existing Senior Notes, other than those held
by Danielson, through the effective date of the transaction up to $20.0 million,
and to the extent that such accrued and unpaid interest exceeds $20.0 million,
additional PIK Notes in an amount equal to such excess would be issued.

     The Recapitalization Agreement provides that the exchange offer and consent
solicitation will be made in reliance on a registration exemption provided by
Section 3(a)(9) under the Securities Act of 1933, conditioned on the minimum
participation of 95% of the outstanding principal amount of ACL's outstanding
Senior Notes, as to which noteholders holding more than two-thirds of the
outstanding principal amount of such notes have agreed to tender. In the event
that the exchange offer and consent solicitation is not consummated by June 15,
2002, the Recapitalization Agreement provides for the implementation of the
Danielson Recapitalization through a voluntary prepackaged bankruptcy plan under
Chapter 11 of the Bankruptcy Code, as to which noteholders holding more than
two-thirds of the outstanding principal amount of ACL's outstanding Senior Notes
have agreed to accept.

     In order to assist in the consummation of the Danielson Recapitalization,
ACL has received forbearance agreements from its senior secured lenders pending
the negotiation and execution of definitive documentation relating to the
amendment of ACL's Senior Credit Facilities satisfactory to the parties.

GENERAL

     ACL is an integrated marine transportation and service company, providing
barge transportation and ancillary services. The principal cargoes carried are
steel and other bulk commodities, grain, coal and liquids including a variety of
chemicals, petroleum and edible oils. ACL supports its barging operations by
providing towboat and barge design and construction and terminal services. ACL,
through its domestic barging subsidiary American Commercial Barge Line LLC
("ACBL"), is the leading provider of river barge transportation throughout the
inland United States and Gulf Intracoastal Waterway Systems, which include the
Mississippi, Illinois, Ohio, Tennessee and the Missouri Rivers and their
tributaries and the Intracoastal Canals that parallel the Gulf Coast
(collectively, the "Inland Waterways"). In addition, since expanding its barge
transportation operations to South America in 1993, ACL has become the leading
provider of barge transportation services on the Orinoco River in Venezuela and
the Parana/Paraguay River system serving

                                        2
<PAGE>

Argentina, Brazil, Paraguay, Uruguay and Bolivia. ACL's position as a leader in
South American barging was expanded on October 24, 2000, when an ACL 80% owned
subsidiary, ACBL Hidrovias, Ltd. ("ACBLH") entered into an agreement with UP
River (Holdings) Ltd. ("Ultrapetrol") to combine the inland river barge
transportation divisions of Ultrapetrol and ACBLH which operate on the
Parana/Paraguay River system in South America. ACBLH has a 50% ownership
interest in the newly formed company, UABL Limited ("UABL"). UABL operates 20
towboats and a combined fleet of 374 dry cargo and tank barges. UABL serves
commodity shippers in Argentina, Bolivia, Brazil, Paraguay and Uruguay.

     At year end, ACBL's combined barge fleet was the largest in the United
States, consisting of 3,859 covered and 659 open barges, used for the
transportation of dry cargo, and 436 tank barges used for transportation of
liquid cargo. ACBL's barge fleet is supported by the largest towboat fleet in
the United States, consisting of 187 towboats at year end. ACBL has a strong and
diverse customer base consisting of several of the leading industrial and
agricultural companies in the United States.

     ACBL has numerous long-standing customer relationships, with 19 of its top
25 customers having been customers of ACBL for over 20 years. In many cases,
these relationships have resulted in multi-year contracts with these customers.
Certain long-term contracts provide for minimum tonnage or requirements
guarantees, which allow ACBL to plan its logistics more effectively.
Historically, a majority of ACBL's contracts for non-grain cargoes are at a
fixed price, increasing the stability and predictability of operating revenue.

     ACL, through its Jeffboat LLC ("Jeffboat") subsidiary, designs and
manufactures towboats and barges for ACBL, other ACL subsidiaries and
third-party customers. Through its American Commercial Terminals LLC ("ACT")
subsidiary, which operates two river terminal sites along the Inland Waterways,
ACL supports its barging operations with transfer and warehousing capabilities
for coal and liquid commodity products moving between barge, truck and rail.
Other terminal locations are owned or operated by Global Materials Services LLC
("GMS"), a joint venture between ACT and Mid-South Terminal Company, L.P., an
unaffiliated third party. Through its Louisiana Dock Company LLC ("LDC")
subsidiary, ACL maintains facilities throughout the Inland Waterways that
provide fleeting, shifting, cleaning and repair services for both towboats and
barges, primarily to ACL but also to third-party customers.

     ACL's objective is to achieve stable earnings growth in its core barging
business as well as its shipbuilding and terminals operations. Through effective
coordination of its barging, shipbuilding, terminals, fleeting and services, ACL
reduces costs while maintaining each business unit's ability to generate
third-party revenue. In addition, ACL believes it is a technology leader in the
barging industry. ACL has made significant investments that allow it to maximize
operating efficiency through technologies such as real-time cargo tracking. This
investment in technology strengthens ACL's ability to compete by lowering its
cost structure and enhancing the quality of the services and products provided.

     Over the past several years, ACL has been able to successfully complete and
integrate multiple large acquisitions, including SCNO Barge Lines, Inc., Hines
American Lines, Inc., The Valley Line Company, and the barging operations of
Continental Grain Company, National Marine and Peavey Barge Line and the assets
of the other inland marine transport divisions of ConAgra, Inc. ("Peavey").
Based upon the success of these acquisitions, combined with ACL's ability to
provide long-term, reliable service to its customers, ACL believes that it is
particularly well-positioned to continue to grow through strategic acquisitions
in its core business lines.

     In recent years, ACL also has become the leading provider of river barge
transportation in South America. ACL conducts its international operations
mainly through American Commercial Lines International LLC and its foreign
subsidiaries, ACBL de Venezuela, C.A., ACBL Domincana SA and ACBL Hidrovias,
Ltd. (collectively, "ACL International"), and through its investment in UABL.
ACL International's fleet consisted at year end of six covered and 113 open
hopper barges, three tank barges, seven deck barges and six towboats. Through
UABL, ACL International participates in the operation of an additional 298
covered hoppers, 40 open hopper barges, 36 tank barges and 20 boats. ACL
International entered the South American market in 1993 by establishing
operations to serve a new customer's shipping needs along the Orinoco River in
Venezuela. Since then, the focus of ACL International's strategy has been to
serve customers that require reliable, low-cost marine transportation abroad.
ACL International works closely with
                                        3
<PAGE>

current and potential customers to establish mutually beneficial long-term
contracts to serve these needs. By following this strategy, ACL International
has become the leading provider of barge transportation on the Orinoco River in
Venezuela and, through UABL, the leading provider of barge transportation on the
Parana/ Paraguay River system serving Argentina, Brazil, Paraguay, Uruguay and
Bolivia. Through formation of the ACBL Dominicana SA subsidiary in 2001, ACL
International also began operations on the Higuamo River in the Dominican
Republic. Because demand for transportation in South America is expected to grow
and there are several consolidation opportunities in the South American market,
ACL International has the opportunity to broaden the scope of its operations
over the long term.

INDUSTRY

     Domestic barging focuses on four core commodity groups: steel/other bulk
commodities, grain, coal and liquids. Because barging provides a low-cost
transportation alternative for high mass/high volume cargoes, many bulk
commodity shippers choose barging as their preferred mode of transportation.
Coal is the barging industry's largest transport commodity from a tonnage
standpoint, while grain is a material driver for the industry's overall freight
rate structure for dry cargo movements due to the effect the varying levels of
grain export demand has on capacity and rates. Chemicals are the primary liquid
cargo handled by liquid barge carriers, along with petroleum products, edible
oils, molasses and ethanol. Safety and quality control are essential factors in
serving this market.

     The barging industry uses two types of equipment to move freight: towboats,
providing the power source, and barges, providing the freight capacity. Each
standard dry cargo barge is capable of transporting approximately 1,500 tons of
cargo with the most common tank barges being either 10,000 barrel or 30,000
barrel capacity. The combination of a towboat and barges is called a tow, and
usually consists of one towboat and from 5 to 40 barges. The number of barges in
a tow will depend upon the horsepower of the towboat, the river capacity and
conditions, the load and empty mix of the tow, the direction of travel and the
commodity carried.

     Since 1980, the industry has been consolidating as acquiring companies have
moved towards attaining the widespread geographic reach necessary to support
major national customers. ACL's management believes the consolidation process
will continue. Following Ingram Industry Inc.'s (which operates 1,700 barges and
62 towboats) acquisition of Midland Enterprises Inc. (which operates 2,300
barges and 80 towboats) on January 24, 2002, there are five major domestic
barging companies that operate more than 1,000 barges. There are also 13
mid-sized operators that operate over 200 barges, and approximately 14% of the
barging capacity is held by small carriers that operate fewer than 200 barges.
As the industry continues to consolidate, ACL believes that it will be
well-positioned to realize cost savings and synergies by merging smaller
operators into its existing network.

COMPANY OPERATIONS

  DOMESTIC BARGING

     In 2001, ACBL maintained its position as the leading provider of barge
transportation in the United States, operating over nearly 11,000 miles of the
Inland Waterways and transporting a wide variety of commodities, including
steel/other bulk commodities, grain, coal and liquids. ACBL is ranked first in
the United States in terms of revenues, barges operated and gross tons hauled.
In terms of annual riverborne tonnage, ACBL is the leading grain transporter in
the industry, and is the second largest liquids transporter. As of year end,
ACBL's fleet consisted of 4,518 dry cargo hopper barges and 436 double-skinned
tank barges. ACBL operated 1,652 of these dry cargo hopper barges and 41 of
these tank barges pursuant to charter agreements. The charter agreements have
expiration dates ranging from one to fifteen years. ACBL expects generally to be
able to renew or replace such charter agreements as they expire. Although ACBL
does not expect to purchase a material number of new barges in the year 2002,
ACBL has a program to renew its fleet through which certain third party lenders
or entities will acquire new equipment from Jeffboat and lease that equipment to
ACBL. ACBL anticipates that it will obtain 165 new barges through this program
in 2002.

                                        4
<PAGE>

                    DOMESTIC FLEET PROFILE BY BARGE TYPE(1)

<Table>
<Caption>
                                                                          AVERAGE AGE
                                                                            (YEARS)
                                                            NUMBER OF   ---------------
BARGE TYPES                                                  BARGES     ACBL   INDUSTRY
-----------                                                 ---------   ----   --------
<S>                                                         <C>         <C>    <C>
Covered Hoppers...........................................    3,859      17       16
Open Hoppers..............................................      659      24       14
Tank Barges...............................................      436      20       21
                                                              -----      --       --
          Total...........................................    4,954      18       16
                                                              =====      ==       ==
</Table>

---------------

(1) Includes both owned and chartered equipment and excludes marine equipment
    used in international operations. See below, "International Barging."

     In addition, at year end ACBL operated 187 towboats with an average age of
approximately 25 years. No comparative industry data is available with respect
to towboats. At year end, forty-seven of these towboats were operated by ACBL
pursuant to charter agreements. The charter agreements have expiration dates
ranging from one to five years. ACBL expects to be able to renew such charter
agreements as they expire.

     The size and diversity of ACBL's towboat fleet allows it to deploy the
towboats to the portions of the Inland Waterways where they can most effectively
operate. For example, ACBL's towboats that have in excess of 9,000 horsepower
operate with tow sizes of as many as 40 barges along the Lower Mississippi River
where the river channels are wider and there are no restricting locks and dams.
ACBL's 5,600 horsepower towboats operate along the Ohio, Upper Mississippi and
Illinois Rivers where the river channels are narrower and restricting locks and
dams are more prevalent. ACBL deploys smaller horsepower towboats for shuttle
and harbor services.

                       DOMESTIC TOWBOATS BY HORSEPOWER(1)

<Table>
<Caption>
                                                              NUMBER OF   AVERAGE AGE
HORSEPOWER                                                    TOWBOATS      (YEARS)
----------                                                    ---------   -----------
<S>                                                           <C>         <C>
6,700 -- 10,500.............................................      15          24
5,000 --  6,500.............................................      59          26
1,950 --  4,900.............................................      32          27
1,800 and below.............................................      81          26
                                                                 ---          --
          Total.............................................     187          25
                                                                 ===          ==
</Table>

---------------

(1) Includes both owned and chartered equipment and excludes marine equipment
    used in international operations. See below, "International Barging."

     ACBL's barging operations encompass four core commodity groups: steel/other
bulk commodities, grain, coal and liquids. In terms of tonnage and revenue,
grain and coal are ACBL's largest transport commodities with steel/other bulk
commodities and liquids second and third, respectively.

                  ACL DOMESTIC BARGING OPERATIONS BY COMMODITY

<Table>
<Caption>
                                     2001                                2000                                1999
                       ---------------------------------   ---------------------------------   ---------------------------------
                       REVENUE     %     TONNAGE     %     REVENUE     %     TONNAGE     %     REVENUE     %     TONNAGE     %
                       -------   -----   -------   -----   -------   -----   -------   -----   -------   -----   -------   -----
                                                           (DOLLARS AND TONNAGE IN MILLIONS)
<S>                    <C>       <C>     <C>       <C>     <C>       <C>     <C>       <C>     <C>       <C>     <C>       <C>
Grain/Coal...........   $270      42.4    40.9      56.5    $229      38.7    37.2      55.0    $219      39.5    37.6      55.2
Bulk/Steel...........   $167      26.3    23.2      32.0    $153      25.8    22.1      32.7    $137      24.7    21.5      31.6
Liquids..............   $111      17.5     8.3      11.5    $113      19.1     8.3      12.3    $104      18.8     9.0      13.2
Other(1).............   $ 88      13.8      --       0.0    $ 97      16.4      --       0.0    $ 94      17.0      --       0.0
         Total.......   $636     100.0    72.4     100.0    $592     100.0    67.6     100.0    $554     100.0    68.1     100.0
                        ====     =====    ====     =====    ====     =====    ====     =====    ====     =====    ====     =====
</Table>

---------------

(1) Includes towing and demurrage.

                                        5
<PAGE>

     To support its domestic barging operations, ACL maintains shore-based
facilities throughout the Inland Waterways that provide fleeting, shifting,
cleaning and repair services for both towboats and barges, including five
towboat dry-docks and nine barge dry-docks.

  INTERNATIONAL BARGING

     ACL launched its international barging operations in South America in 1993.
ACL International currently operates on the Orinoco River, with headquarters in
Puerto Ordaz, Venezuela, and through UABL on the Parana/Paraguay River system,
with headquarters in Buenos Aires, Argentina. ACL International also operates on
the Higuamo River in the Dominican Republic with headquarters in Santa Domingo.
International operations generated 5% of ACL's 2001 operating revenue, and
management expects revenues from international operations to increase in the
coming years. ACL International's expansion in South America has been
accomplished by introducing new equipment and technology to the South American
river systems, utilizing systems used in the United States, developing new
processes to meet local requirements and consolidating operations to improve
efficiencies. ACL International expects to use its expertise to expand its
barging operations into new regions.

           INTERNATIONAL FLEET PROFILE BY BARGE TYPE (EXCLUDES UABL)

<Table>
<Caption>
                                                              NUMBER OF   AVERAGE AGE
BARGE TYPES                                                    BARGES       (YEARS)
-----------                                                   ---------   -----------
<S>                                                           <C>         <C>
Covered Hoppers.............................................       6          16
Open Hoppers................................................     113          17
Tank Barges.................................................       3          29
Deck Barges.................................................       7           9
                                                                 ---          --
          Total.............................................     129          17
                                                                 ===          ==
</Table>

     At year end, ACL International operated 20 dry cargo barges pursuant to
charter agreements with expiration dates of one year. ACL International expects
generally to be able to renew such charter agreements as they expire. In
addition, ACL International operated six towboats.

BARGE AND TOWBOAT DESIGN AND MANUFACTURING

     Jeffboat manufactures both towboats and barges for ACBL, ACL International,
Vessel Leasing LLC ("Vessel Leasing," which is a joint venture between ACL and
Vectura) and other customers primarily for inland river service, and also
produces coastal and offshore equipment and other special purpose vessels such
as cruise boats, casino boats, and U.S. Army Corps of Engineers vessels.
Jeffboat has long been recognized as a leader in inland marine technology,
incorporating designs and propulsion systems derived from ongoing model basin
studies. Jeffboat also provides around-the-clock vessel repair services,
including complete dry-docking capabilities, back-up support for emergency cargo
salvage and equipment recovery, and full machine shop facilities for repair and
storage of towboat propellers, rudders and shafts. In 2001, Jeffboat was the
leading producer of inland barges in the United States, producing more than half
of the new supply of inland barges for the barging industry.

     ACL believes that the relationship between its transportation operations
and Jeffboat provides a competitive advantage to ACL, permitting optimization of
construction schedules and asset utilization between ACL's internal requirements
and sales to customers. The relationship also gives Jeffboat's engineers an
opportunity to collaborate with ACL's barge operations on innovations that
optimize towboat performance and barge life.

TERMINALS

     ACL's terminal subsidiary, ACT, directly operates two facilities located on
the Inland Waterways at St. Louis, Missouri and Memphis, Tennessee. GMS, ACL's
terminal joint venture, operates 27 terminal or

                                        6
<PAGE>

warehouse facilities at Guntersville, Alabama; Jeffersonville and Evansville,
Indiana; Louisville, Kentucky; Omaha (two sites) and Nebraska City, Nebraska;
Cincinnati, Ohio (two sites); Decatur, Alabama (two sites); Osceola, Helena,
Pine Bluff (two sites), West Memphis (two sites) and Ft. Smith (two sites),
Arkansas; Chicago, Illinois; Industry, Pennsylvania (three sites); Memphis,
Tennessee (two sites); Houston, Texas; and Vlissingen, The Netherlands. GMS also
operates four service operations at Battle Creek, Michigan; Mingo Junction,
Ohio; Brooklyn Junction, West Virginia; and Vancouver, Canada.

CUSTOMERS

     ACBL's primary customers include many of the nation's major industrial and
agricultural companies. ACBL enters into a wide variety of short and long-term
contracts with these customers ranging from annual one-year contracts to
multi-year extended contracts with inflation adjustments. ACBL's top 25
customers accounted for 55% of ACL's fiscal 2001 operating revenue. One
customer, Cargill, Inc., accounted for more than 10% of ACL's fiscal 2001
consolidated operating revenue.

     ACBL operates a 24-hour planning center at its headquarters in
Jeffersonville, Indiana to provide around-the-clock customer contact and
planning capability. In addition to enhanced customer service, the planning
center has improved communication between vessels and office staff for more
efficient logistics and better asset utilization.

COMPETITION

     ACL's barging operations compete on the basis of price, service and
equipment availability. Primary competitors of ACL's barging operations include
other barge lines, railroads, trucks and pipelines. Barge transportation
provides the lowest unit cost of delivery of any major form of transportation
for high volume, bulk products, delivering 12% of the volume of U.S. freight for
2% of the total U.S. freight cost, according to data available from the U.S.
Department of Transportation. One standard hopper barge has the equivalent
carrying capacity of 15 railcars or 58 trucks. In areas where shippers have
access to water transportation, the rate per ton-mile is significantly less than
rail rates and approximately 80% to 90% lower than truck rates. While it is
generally less expensive to move large volumes of certain liquids by pipeline
when both the origin and destination have a direct connection to the pipeline,
barge transportation of liquids has greater flexibility with respect to the
origins and destinations that can be served.

     Competition within the barging industry for major commodity contracts is
intense. There are a number of companies offering transportation services on the
Inland Waterways. Carriers compete not only on the basis of commodity shipping
rates, but also with respect to value-added services, including more convenient
and flexible scheduling, more timely information and different equipment. ACL
believes its vertical integration provides it with a competitive advantage. ACL
utilizes its boat and barge repair and vessel fleeting facilities, Jeffboat's
shipbuilding capabilities and the geographically broad-based terminals of ACT
and GMS to support its core barging business and to offer a combination of
competitive pricing and high quality service to its customer base.

     ACL considers Trinity Industries Inc. to be a significant competitor to
Jeffboat. ACL believes that in addition to Trinity, Jeffboat's other significant
competitors include Bollinger Machine Shop and Shipyard, Inc. and Galveston
Shipbuilding Company for barges and Friede Goldman Halter, Inc. and Quality
Shipyards, Inc. for towboats, all of which are located primarily on the Gulf of
Mexico. These other competitors do not currently manufacture barges, however,
should market conditions change they could quickly ready their shipyards to
construct inland barges and related equipment.

PROPERTIES

     ACL owns or operates numerous land-based facilities that support its
overall marine operations. These facilities include a major construction
shipyard, two terminal facilities for cargo transfer and handling throughout the
river system, 12 locations (which include 19 separate facilities and service
operations) for the staging, fleeting, interchange and repair of barges and
towboats and a corporate office complex in Jeffersonville, Indiana. An
additional 27 terminal facilities and service locations are operated by GMS.
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     The significant ACL-owned facilities among these properties include:

     - The Jeffboat shipbuilding facility in Jeffersonville, Indiana is the
       largest single-site shipyard facility on the Inland Waterways. It is
       situated on 86 acres with 5,600 feet of frontage on the Ohio River across
       from Louisville, Kentucky. There are 38 buildings on the property
       comprising a total of 305,000 square feet under roof.

     - ACL's main office complex is located on 22 acres in Jeffersonville,
       Indiana. The main building has approximately 140,000 square feet, and
       five outlying buildings have a total of 25,000 square feet.

GOVERNMENT REGULATION

  GENERAL

     ACL's business is highly regulated and subject to government regulation in
the form of international treaties, conventions, national, state and local laws
and regulations, and laws and regulations of the flag nations of its vessels,
including laws relating to the discharge of materials into the environment.
Because such conventions, laws and regulations are regularly reviewed and
revised by the issuing governmental bodies, ACL is unable to predict the
ultimate costs or impacts of compliance. In addition, ACL is required by various
governmental and quasi-governmental agencies to obtain certain permits, licenses
and certificates with respect to its business operations. The kinds of permits,
licenses and certificates required depend upon such factors as the country of
registry, the commodity transported, the waters in which the vessel operates,
the nationality of the vessel's crew, the age of the vessel and the status of
ACL as owner, operator or charterer. ACL believes that it currently has all
permits, licenses and certificates necessary to permit its vessels to operate in
their current trades.

     ACL's domestic transportation operations are subject to regulation by the
U.S. Coast Guard, federal laws, state laws and certain international
conventions.

     ACL's inland tank barges are inspected by the U.S. Coast Guard and carry
certificates of inspection. ACL's towing vessels and dry cargo barges are not
subject to U.S. Coast Guard inspection requirements.

  JONES ACT

     The Jones Act is a federal cabotage law that restricts domestic marine
transportation in the United States to vessels built and registered in the
United States. Furthermore, the Jones Act requires that the vessels be manned by
U.S. citizens and owned by U.S. citizens. For a limited liability company to
qualify as a U.S. citizen for the purpose of domestic trade, 75% of the
company's beneficial stockholders must be U.S. citizens. ACL presently meets all
of the requirements of the Jones Act for its owned vessels.

     Compliance with U.S. ownership requirements of the Jones Act is very
important to the operations of ACL, and the loss of Jones Act status could have
a significant negative effect for ACL. ACL monitors the citizenship requirements
under the Jones Act of its employees and beneficial equity holders and will take
action as necessary to ensure compliance with the Jones Act requirements.

     During the past several years, the Jones Act cabotage laws have been
challenged by interests seeking to facilitate foreign flag competition for trade
reserved for U.S. flag vessels under the Jones Act. These efforts have been
consistently defeated by large margins in the U.S. Congress. ACL believes that
continued efforts may be made to modify or eliminate the cabotage provisions of
the Jones Act. If such efforts are successful so as to permit foreign
competition, such competition could have an adverse effect on ACL.

  USER FEES AND FUEL TAX

     Federal legislation requires that inland marine transportation companies
pay a user fee in the form of a tax based on propulsion fuel used by vessels
engaged in trade along inland waterways that are maintained by the U.S. Army
Corps of Engineers. Such user fees are designed to help defray the costs
associated with replacing major components of the waterway system, including
dams and locks, and to build new projects. A

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<PAGE>

significant portion of the Inland Waterways on which ACL's vessels operate are
maintained by the Corps of Engineers.

     ACL presently pays a federal fuel tax of 24.4 cents per gallon. Legislation
has been proposed to repeal a portion (4.3 cents per gallon) of the federal fuel
tax. In the future, existing user fees may be increased, and additional user
fees imposed, to defray the costs of inland waterways infrastructure and
navigation.

ENVIRONMENTAL MATTERS

     ACL's operations are subject to federal, state and local environmental laws
and regulations which, among other things, specify requirements for the
management of oil, hazardous wastes, and hazardous substances and impose
liability for releases of these materials into the environment. ACL devotes
resources toward achieving and maintaining compliance with environmental
requirements. ACL believes, except as otherwise set forth herein, that it is in
material compliance with environmental requirements. However, there can be no
assurance that ACL will be at all times in material compliance with all
environmental requirements.

     As is the case with others in the maritime industry, a release of oil,
hazardous waste, hazardous substances or other pollutants into the environment
at or by its properties or vessels, as a result of ACL's current or past
operations, or at a facility to which ACL has shipped wastes, or the existence
of historical contamination at any of its properties, could result in material
liability to ACL. ACL conducts loading and unloading of dry commodities, liquids
and scrap materials in and near waterways. Such operations present a potential
that some such materials might be spilled into a waterway thereby exposing ACL
to potential liability. While the amount of such liability could be material,
ACL endeavors to conduct its operations in a manner that it believes reduces
such risks.

     Federal, state and local governments could in the future enact laws or
regulations concerning environmental matters that affect ACL's operations or
facilities, increase its costs of operation, or adversely affect the demand for
ACL's services. ACL cannot predict the effect that such future laws or
regulations could have on its business. Nor can ACL predict what environmental
conditions may be found to exist at its current or past facilities or at other
properties where ACL or its predecessors have arranged for the disposal of
wastes and the extent of liability that may result from the discovery of such
conditions. It is possible that such future laws or undiscovered conditions
could have a material adverse effect on ACL's business, financial condition and
results of operations.

     ACL is involved as a potentially responsible party ("PRP") or interested
party with respect to the clean-up of hazardous waste disposal sites (Superfund
sites) identified under the Comprehensive Environmental Response, Compensation
and Liability Act of 1980 ("CERCLA"), the federal Superfund clean-up statute,
and similar state laws. While CERCLA authorizes joint and several liability for
remediation costs at clean-up or remediation sites, as a practical matter, such
costs are typically allocated among the waste generators and other involved
parties.

     - Pursuant to the Recapitalization, ACL assumed liability under an order
       from the U.S. Environmental Protection Agency ("EPA") under CERCLA,
       regarding contamination at the former Dravo Mechling property in Seneca,
       Illinois. ACL has complied with the terms of the order, which requires
       performance of site sampling and certain remediation at the site. As a
       result of these remediation efforts, the site has been materially
       remediated. The EPA and the State of Illinois have issued "no further
       remediation" letters to ACL indicating that neither entity will require
       further remediation. In 2001, ACL sold the Seneca, Illinois property to a
       third party.

     - Jeffboat was named a PRP at the Third Site in Zionsville, Indiana.
       Jeffboat has also received notice of potential liability with regard to
       waste allegedly transshipped from the Third Site to the Four County
       Landfill in Rochester, Indiana. The EPA has conducted an environmental
       site assessment of this property and has approved a work plan to conclude
       remediation of the site.

     - A group of barge operators, including National Marine, had barges cleaned
       at the SBA Shipyard in Houma, Louisiana, which is now conducting
       voluntary environmental remediation. The SBA Shipyard owner who
       previously funded the cleanup effort has become insolvent and, as a
       result, the barge
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<PAGE>

       operators involved have formed a group to fund remediation. ACL assumed
       National Marine's liability in this matter pursuant to the
       Recapitalization. The barge operator group has removed the majority of
       liquid waste from the site and the EPA has preliminarily approved a work
       plan to remove the solid waste.

     - EPS, Inc., a wholly-owned subsidiary of Vectura, is the owner of Connex
       Pipe Systems' closed solid waste landfill located in Marietta, Ohio
       ("Connex"). Liability for the monitoring and potential clean-up of Connex
       was assumed by ACL pursuant to the Recapitalization. In 1986 Connex was
       subject to an Ohio consent judgment ("Consent Judgment") whereby it
       agreed to remediate and monitor the closed landfill for a period of three
       years. Connex complied with the Consent Judgment and in 1994 the Ohio
       Environmental Protection Agency ("Ohio EPA") issued a letter confirming
       Connex's compliance. However, the Ohio EPA changed its monitoring
       requirements in 1997 to require longer periods of monitoring for closed
       sites and attempted to apply those new rules to Connex. Connex, and other
       similarly situated companies, objected to the new rule which
       retroactively changed monitoring requirements. On November 30, 1998, the
       Ohio EPA issued a finalized guidance rule ("Final Guidance") applicable
       to Connex. ACL believes that the Final Guidance confirmed Connex's
       position that it had fully complied with the applicable monitoring
       requirements and owed no further monitoring. ACL believes that it has no
       further monitoring obligations at Connex and has requested written
       confirmation from the Ohio EPA that its monitoring responsibilities have
       ceased.

     - ACBL has received notice from the EPA that it is a PRP at the State
       Marine of Port Arthur ("State Marine") and the Palmer Barge Line
       Superfund Sites in Port Arthur, Texas in regard to approximately 50
       barges that were cleaned by State Marine and five barges cleaned by
       Palmer Barge Line for ACBL in the early 1980s. The EPA has requested that
       ACBL, and other potentially responsible companies, enter into
       negotiations for the performance of a Remedial Investigation and
       Feasibility Study, however, there has been no further action to pursue
       any response costs from ACBL as a PRP.

     Because CERCLA liability is retroactive, it is possible in the future that
ACL may be identified as a PRP with respect to other waste disposal sites, where
wastes generated by ACL have been transported and disposed.

     As of December 28, 2001, ACL had reserves of approximately $0.7 million for
environmental matters. ACL believes it has established reasonable and adequate
reserves to cover its known environmental liabilities. However, given the
uncertainties associated with such matters, there can be no assurance that
liabilities will not exceed reserves.

OCCUPATIONAL HEALTH AND SAFETY MATTERS

     ACL's domestic vessel operations are primarily regulated by the U.S. Coast
Guard for occupational health and safety standards. ACL's domestic shore
operations are subject to the U.S. Occupational Safety and Health Administration
regulations. While there can be no assurance that ACL is at all times in
complete compliance with all such regulations, ACL believes that it is in
material compliance with such regulations, and that any noncompliance is not
likely to have a material adverse effect on ACL. There can be no assurance,
however, that claims will not be made against ACL for work related illness or
injury, or that the further adoption of occupational health and safety
regulations in the United States or in foreign jurisdictions in which ACL
operates will not adversely affect its business, financial condition and results
of operations.

     ACL endeavors to reduce employee exposure to hazards incident to its
business through safety programs, training and preventive maintenance efforts.
ACL emphasizes safety performance in all of its operating divisions. ACL
believes that its safety performance consistently places it among the industry
leaders as evidenced by what it believes are lower injury frequency levels than
many of its competitors. ACL has been certified in the American Waterway
Operators Responsible Carrier Program which is oriented to enhancing safety in
vessel operations.

                                        10
<PAGE>

INTELLECTUAL PROPERTY

     ACL registers some of its material trademarks, tradenames and copyrights
and has acquired patent protection for some of its proprietary processes. ACL
has current trademark rights to conduct its business.

INSURANCE

     ACL maintains protection and indemnity insurance ("P&I") to cover
liabilities arising out of the ownership and operation of marine vessels. ACL
maintains hull and machinery insurance policies on each of its vessels in
amounts related to the value of each vessel. Each vessel is insured at its
current fair market value; however, damage claims are subject to an annual
aggregate deductible of $2 million. ACL maintains coverage for shore-side
properties, shipboard consumables and inventory, spare parts, worker's
compensation, and general liability risks. ACL maintains primary insurance and
third party guaranty agreements as to its statutory liabilities for discharges
of oil or hazardous substances under the federal Oil Pollution Act of 1990. In
the future, ACL may elect to self-insure such primary statutory liability
amounts; however, ACL currently maintains and expects to continue to maintain
excess coverage for pollution liability. All insurance policies have been
obtained and arranged through the Aon Insurance Brokerage Syndicate, other
brokers or direct placement with commercial insurers, and maintained with
underwriters in the United States, British and other markets.

     Insurance premiums for the coverages described above will vary from year to
year depending upon ACL's loss record and market conditions. In order to reduce
premiums, ACL maintains certain per occurrence deductible, annual aggregate
deductible and self-insured retention levels that it believes are prudent and
generally consistent with those maintained by other shipping companies.

EMPLOYEES

     As of December 28, 2001, on a consolidated basis, ACL employed 3,630
individuals. Of this total, 649 individuals were engaged in shore-side
management and administrative functions, 2,039 individuals were employed as boat
officers and crew members on its marine vessels, 920 individuals were engaged in
production and repair activities at ACL's shipyard facilities, and 22
individuals were employed in production and hourly work activities at ACL's
terminals. Seven hundred seventy eight of ACL's domestic shore-side employees
are represented by unions. Most of these unionized employees (approximately 756)
are represented by the International Brotherhood of Teamsters at ACL's Jeffboat
shipyard facility, where the contract with the union expires at the end of April
2002. Ninety two of ACL's South American employees are represented by unions.

RISK FACTORS

  RISKS ASSOCIATED WITH OUR BUSINESS

     The following risk factors could have a material adverse effect on ACL's
business, financial condition and results of operations.

COMPANY-SPECIFIC RISKS

  RISKS OF ADVERSE WEATHER AND RIVER CONDITIONS

     ACL's barging operations are affected by weather and river conditions.
Varying weather patterns can affect river levels and cause ice in Northern
United States river areas. For example, the Upper Mississippi River closes
annually from approximately mid-December to mid-March and ice conditions can
hamper navigation on the upper reaches of the Illinois River during the winter
months. In addition, adverse river conditions affect towboat speed, tow size and
loading drafts and can delay barge movements. Lock outages due to lock
maintenance and/or other interruptions in normal lock operation can also delay
barge movements. Jeffboat's waterfront location is subject to occasional
flooding. Jeffboat's manufacturing operations that are conducted outdoors are
also subject to weather conditions, which may adversely impact production
schedules. Terminals may also experience operational interruptions as a result
of weather and river conditions. It is likely that ACL's operations will be
subject to adverse weather or river conditions in the future and there can be no

                                        11
<PAGE>

assurance that such weather or river conditions will not have a material adverse
effect on ACL's business, financial condition and results of operations.

  EXPOSURE TO GRAIN EXPORTS

     ACL's dry cargo barging business in North America is significantly affected
by the level of grain export volume handled through the Gulf of Mexico ports.
Grain exports can vary due to, among other things, crop harvest yield levels in
the United States and abroad. Overseas grain shortages can increase demand for
U.S. grain, while worldwide over-production can decrease the demand for U.S.
grain. This variable nature of grain exports can result in temporary barge
oversupply which can drive down freight rates. There can be no assurance that
historical levels of North American grain export volume will be maintained in
the future and, to the extent supply imbalances were to prevail for a
significant period of time, they could have a material adverse effect on ACL's
business, financial condition and results of operations.

  SEASONALITY

     ACL's business is seasonal, and its quarterly revenues and profits
historically have been lower during the first and second fiscal quarters of the
year (January through June) and higher during the third and fourth fiscal
quarters (July through December) due to the North American grain harvest. In
addition, working capital requirements fluctuate throughout the year. Adverse
market or operating conditions during the last four months of the year could
have a greater effect on ACL's business, financial condition and results of
operations than during other periods.

  VARIABILITY

     Freight transportation rates may fluctuate from season to season and year
to year, which could result in varying levels of cash flow. The level of dry and
liquid cargoes requiring transportation on the Inland Waterways will vary due to
numerous factors, including global economic conditions and business cycles,
domestic agricultural production/demand as well as international agricultural
production/demand and the value of the U.S. dollar relative to other currencies.
In addition, the number of barges and towboats in the overall industry fleet
available to transport these cargoes will vary from year to year as older
vessels are retired and scrapped and new vessels are constructed and placed into
service. The resulting relationship between available cargoes and available
vessels will vary with periods of low vessel availability and high cargo demand
causing higher freight rates and periods of high vessel availability and low
cargo demand causing lower freight rates. Significant periods of high vessel
availability and low cargo demand could have a material adverse effect on ACL's
business, financial condition and results of operations.

     The foregoing factors can also affect market rates. As contracts expire and
terms are renegotiated at then current market rates, the level of revenue can
vary relative to prior years. This has become more evident as the industry has
shifted to shorter term contracts. The impact of these factors could be material
and there can be no assurance that the rates at which contracts are renewed will
not have a material adverse effect on ACL's business, financial condition or
results of operations.

  COMPETITION

     The barge business is highly competitive and there are few significant
barriers to entry. Certain of ACL's principal competitors have greater financial
resources and/or are less leveraged than ACL and may be better able to withstand
and respond to adverse market conditions within the barging industry. There can
be no assurance that such competition will not have a material adverse effect on
ACL's business, financial condition or results of operations or that ACL will
not encounter increased competition in the future, which also could have a
material adverse effect on its business, financial condition or results of
operations.

  EXPOSURE TO INTERNATIONAL ECONOMIC AND POLITICAL FACTORS

     ACL's operations may be affected by actions of foreign governments and
global or regional economic developments. For example, global economic events
such as foreign import/export policy or currency
                                        12
<PAGE>

fluctuations, could affect the level of imports and exports. Foreign
agricultural subsidies can also impact demand for U.S. agricultural exports. In
addition, foreign trade agreements and each country's adherence to the terms of
such agreements can raise or lower demand for U.S. imports and exports. National
and international boycotts and embargoes of other countries' or U.S. imports
and/or exports together with the raising or lowering of tariff rates will affect
the level of cargoes requiring transportation on the Inland Waterways. Changes
in the value of the U. S. dollar relative to other currencies will raise or
lower demand for U.S. exports as well as U.S. demand for foreign produced raw
materials and finished good imports. Such actions or developments could have a
material adverse effect on ACL's business, financial condition and results of
operations.

  RISK OF PROVIDING SERVICES ABROAD

     Demand for ACL's services may be affected by economic and political
conditions in each of the countries in which ACL provides services. ACL's
foreign operations are also subject to other risks of doing business abroad,
including fluctuations in the value of currencies (which may affect demand for
products priced in U.S. dollars as well as local labor and supply costs), import
duties, changes to import and export regulations (including quotas), possible
restrictions on the repatriation of capital and earnings, labor or civil unrest,
long payment cycles, greater difficulty in collecting accounts receivable and
the burdens and cost of compliance with a variety of foreign laws, changes in
citizenship requirements for purposes of doing business and government
expropriation of operations and/or assets. There can be no assurance that
foreign governments will not adopt regulations or take other actions that would
have a direct or indirect adverse impact on the business or market opportunities
of ACL or that the political, cultural or economic climate outside the United
States will be favorable to ACL's operations and growth strategy.

  EXPOSURE TO FUEL PRICES

     Fuel prices are subject to fluctuation as a result of domestic and
international events. There can be no assurance that ACL will not experience
increased fuel prices in the future, which could have a material adverse effect
on its business, financial condition and results of operations.

  REPLACEMENT NEEDS

     Barge and towboat replacement represents a significant cost for ACL, and
ACL expects to replace an average of 165 barges per year during the next four
years. Due to the variable nature of the barging industry and the freight
transportation industry in general and the relatively long life of marine
equipment, it is difficult for ACL and other barge companies to accurately
predict equipment requirements. Accordingly, no assurance can be given that ACL
will have sufficient equipment to satisfy market demand or that the industry
will not have an oversupply of equipment. An oversupply of equipment could have
a material adverse effect on ACL's business, financial condition and results of
operations.

  COMBINED OPERATIONS

     Pursuant to its strategy to pursue synergistic acquisitions in its core
business lines, ACL may expend substantial management time and financial and
other resources for the acquisition and integration of other barging operations.
These acquisitions may pose risks with respect to operations, customer service
and customer acceptance. While ACL's management has successfully combined other
barging operations and it believes that it has sufficient financial and
management resources to accomplish the rationalization and integration of other
barging operations, there can be no assurance that such operations can be
integrated successfully or that ACL will not experience difficulties with
customers, personnel or others. In addition, although ACL believes that the
other barging operations will enhance the competitive position and business
prospects of ACL, there can be no assurance that such benefits will be fully
realized.

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<PAGE>

  DEPENDENCE ON KEY PERSONNEL

     ACL is dependent on the continued services of its senior management team.
The loss of such key personnel could have a material adverse effect on ACL's
business, financial condition and results of operations.

  LABOR RELATIONS

     Although ACL believes that its relations with its employees and with the
recognized labor unions are generally good, there can be no assurance that ACL
will not be subject to work stoppages or other labor disruption and, if such
events were to occur, that there would not be a material adverse effect on ACL's
business, financial condition and results of operations.

  ENVIRONMENTAL, HEALTH AND SAFETY REQUIREMENTS

     ACL's operations are subject to extensive federal, state and local
environmental laws and regulations which, among other things, specify
requirements for the management of oil, hazardous wastes, and hazardous
substances and impose liability for releases of these materials into the
environment. A release of oil, hazardous waste, hazardous substances or other
pollutants into the environment at or by ACL's properties or vessels, as a
result of ACL's current or past operations, or at a facility to which ACL has
shipped wastes, or the existence of historical contamination at any of its
properties, could result in material liability to ACL. ACL has been identified
as a potentially responsible party ("PRP") with respect to the cleanup of
certain waste disposal sites.

     Federal, state and local governments could in the future enact laws or
regulations concerning environmental matters that affect ACL's operations or
facilities, increase its costs of operation, or adversely affect the demand for
its services. ACL cannot predict the effect that such future laws or regulations
could have on ACL. Nor can ACL predict what environmental conditions may be
found to exist at its current or past facilities or at other properties where
ACL or its predecessors have arranged for the disposal of wastes and the extent
of liability that may result from the discovery of such conditions. It is
possible that such future laws or undiscovered conditions could have a material
adverse effect on ACL's business, financial condition and results of operations.

     ACL's domestic vessel operations are primarily regulated by the U.S. Coast
Guard for occupational health and safety standards. ACL's domestic shore
operations are subject to the U.S. Occupational Safety and Health Administration
regulations. There can be no assurance that claims will not be made against ACL
for work related illness or injury, or that the further adoption of occupational
health and safety regulations in the United States or in foreign jurisdictions
in which ACL operates will not adversely affect its business, financial
condition and results of operations.

  OTHER GOVERNMENT REGULATION

     ACL's barging operations are subject to various laws and regulations,
including international treaties, conventions, national, state and local laws
and regulations and the laws and regulations of the flag nations of ACL's
vessels, all of which are subject to amendment or changes in interpretation.
Further, ACL is required by various governmental and quasi-governmental agencies
to obtain and/or maintain certain permits, licenses and certificates respecting
its operations. ACL's domestic towboats are in certain circumstances subject to
a significant federal fuel use tax, which may be increased. Any significant
changes in laws or regulations affecting ACL's operations, or in the
interpretation thereof, could have a material adverse effect on ACL's business,
financial condition and results of operations.

RISKS RELATING TO ACL'S DEBT OBLIGATIONS

  SUBSTANTIAL LEVERAGE

     ACL incurred significant debt in connection with the Recapitalization. The
degree to which ACL is leveraged could have important consequences to ACL's
business, including, but not limited to: (i) making it

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<PAGE>

more difficult for ACL to satisfy its obligations with respect to the Senior
Notes; (ii) increasing ACL's vulnerability to general adverse economic and
industry conditions; (iii) limiting ACL's ability to obtain additional financing
to fund future working capital, capital expenditures and other general corporate
requirements; (iv) requiring the dedication of a substantial portion of ACL's
cash flow from operations to the payment of principal of, and interest on, its
indebtedness, thereby reducing the availability of such cash flow to fund
working capital, capital expenditures or other general corporate requirements;
(v) limiting ACL's flexibility in planning for, or reacting to, changes in its
business and the industry in which it competes; and (vi) placing ACL at a
competitive disadvantage compared to less leveraged competitors. In addition,
the Indenture and the Senior Credit Facilities contain financial and other
restrictive covenants that limit the ability of ACL to, among other things,
borrow additional funds. Failure by ACL to comply with such covenants could
result in an event of default which, if not cured or waived, could have a
material adverse effect on ACL's business, financial condition and results of
operations. If ACL cannot generate sufficient cash to meet its obligations as
they become due or refinance such obligations, ACL may have to sell assets or
reduce capital expenditures. In addition, the degree to which ACL is leveraged
could prevent it from repurchasing all of the Senior Notes tendered to it upon
the occurrence of a change of control under the Indenture.

  POTENTIAL INABILITY TO REPAY DEBT

     ACL's ability to make scheduled payments of principal of, or to pay the
premium, if any, interest or liquidated damages, if any, on, or to refinance,
its indebtedness (including the Senior Notes), or to fund planned capital
expenditures will depend on its future performance, which, to a certain extent,
is subject to general economic, financial, competitive, legislative, regulatory
and other factors that are beyond its control. There can be no assurance that
ACL's business will generate sufficient cash flow from operations, that
anticipated revenue growth and operating improvements will be realized or that
future borrowings will be available under the Senior Credit Facilities or
otherwise in an amount sufficient to enable ACL to service its indebtedness,
including the Senior Notes, or to fund its other liquidity needs. ACL may be
required to refinance all or a portion of the principal of the Senior Notes on
or prior to maturity. There can be no assurance, however, that such refinancing
would be available on commercially reasonable terms or at all.

  RESTRICTIONS IMPOSED BY THE SENIOR CREDIT FACILITIES AND THE INDENTURE

     The Senior Credit Facilities and the Indenture limit ACL's financial
flexibility in a number of ways. The Senior Credit Facilities and Indenture
require ACL to maintain specified financial ratios and tests, among other
obligations, including a minimum interest expense coverage ratio, a maximum
leverage ratio, a maximum leverage ratio adjusted for rent, a minimum fixed
charge coverage ratio and a minimum net worth test. In addition, the Senior
Credit Facilities restrict, among other things, ACL's ability to incur
additional indebtedness, sell assets, create liens or other encumbrances, incur
guarantee obligations, repay the Senior Notes or amend the Indenture, make
certain payments, including dividends or other distributions, incur rent, make
investments, loans or advances and make acquisitions and capital expenditures
beyond a certain level. A failure to maintain specified financial ratios or
otherwise to comply with the restrictions contained in the Senior Credit
Facilities could lead to an event of default thereunder, which could result in
an acceleration of such indebtedness. In such event, the lenders under the
Senior Credit Facilities could elect to declare all amounts outstanding
thereunder, together with accrued and unpaid interest, to be immediately due and
payable, and, if ACL were unable to repay such amounts, such lenders would have
the right to proceed against the collateral granted to them to secure such
indebtedness and other amounts (which is expected to be substantially all of the
assets of ACL). Such an acceleration would constitute an event of default under
the Indenture relating to the Senior Notes. In addition, the Indenture
restricts, among other things, ACL's ability to incur additional indebtedness,
sell assets, create liens or other encumbrances, make certain payments,
including dividends or other distributions, or merge or consolidate. A failure
to comply with the restrictions in the Indenture could result in an event of
default under the Indenture.

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  ASSET ENCUMBRANCES

     In connection with the Senior Credit Facilities, the Parent granted the
lenders thereunder a first priority lien on all of the membership interests of
ACL owned by it as security for its guarantee of ACL's obligations under the
Senior Credit Facilities. In the event of a default under the Senior Credit
Facilities or such guarantee, the lenders under the Senior Credit Facilities
could foreclose upon the assets pledged to secure the Senior Credit Facilities,
including such membership interests, and the holders of the Senior Notes might
not be able to receive any payments until any payment default was cured or
waived, any acceleration was rescinded, or the indebtedness of the Senior Credit
Facilities was discharged or paid in full.

ITEM 2.  PROPERTIES

     The information with respect to ACL's properties appearing in Item 1 is
incorporated herein by reference.

ITEM 3.  LEGAL PROCEEDINGS

     ACL is named as a defendant in various lawsuits that have arisen in the
ordinary course of its business. Claimants seek damages of various amounts for
personal injuries, property damage and other matters. ACL believes that all
material claims asserted under lawsuits of this description and nature are
covered by insurance policies. ACL is not aware of any claims or litigation that
would be deemed, individually or in the aggregate, to be material to the
financial condition, results of operations or liquidity of ACL which are not
covered by insurance coverages and policies, other than the environmental
matters discussed in "Environmental Matters" included under Item 1 elsewhere
herein.

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

     None

                                    PART II

ITEM 5.  MARKET FOR THE REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER
MATTERS

     ACL's membership interests are not registered or traded on any stock
exchange.

                                        16
<PAGE>

ITEM 6.  SELECTED FINANCIAL DATA

<Table>
<Caption>
                                                        FISCAL YEARS ENDED
                                     --------------------------------------------------------
                                     DEC. 28,    DEC. 29,    DEC. 31,    DEC. 25,    DEC. 26,
                                       2001        2000        1999        1998        1997
                                     ---------   ---------   ---------   ---------   --------
                                                      (DOLLARS IN THOUSANDS)
<S>                                  <C>         <C>         <C>         <C>         <C>
STATEMENT OF OPERATIONS DATA(1):
Operating revenue..................  $ 788,501   $ 773,838   $ 739,136   $ 638,478   $618,233
Operating expense..................    723,140     717,530     664,544     575,729    559,600
Operating income...................     65,361      56,308      74,592      62,749     58,633
Other (income) expense(2)..........       (591)    (10,368)     (3,048)        587      1,930
Interest expense...................     70,932      70,813      71,275      40,981     12,472
(Loss) earnings before income
  taxes, extraordinary items and
  cumulative effect of accounting
  changes..........................     (4,980)     (4,137)      6,365      21,181     44,231
Income taxes (benefit).............        118       4,263       1,658     (64,263)    18,287
Extraordinary items(3).............     (1,885)        734          --          --         --
Cumulative effect of accounting
  changes(4).......................        490          --       1,737          --         --
Net (loss) earnings................     (3,703)     (9,134)      2,970      85,444     25,944
OTHER OPERATING DATA:
Towboats (at period end)...........        193         206         204         201        145
Barges (at period end).............      5,083       5,103       4,397       4,372      3,822
Tonnage (thousands, for period
  ended)...........................     75,546      71,224      71,903      68,749     65,998
OTHER FINANCIAL DATA:
EBITDA(5)..........................  $ 128,492   $ 117,503   $ 129,859   $ 116,457   $ 97,852
Depreciation and amortization......     55,497      56,014      51,222      46,337     41,149
Property additions.................     19,772      50,861      55,880      45,382     51,500
Net cash provided (used) by:
  Operating activities.............     24,588      30,782      94,602      78,665     52,069
  Investing activities.............      3,292     (24,192)    (59,156)    (62,572)   (49,300)
  Financing activities.............    (40,195)     22,137     (53,961)     26,338    (20,128)
STATEMENT OF FINANCIAL POSITION
  DATA:
Cash and cash equivalents..........  $  47,253   $  59,568   $  30,841   $  49,356   $  6,925
Working capital....................   (681,674)   (107,354)    (16,525)     37,687      7,445
Properties -- net..................    464,133     509,443     559,777     541,415    460,295
Total assets.......................    757,936     787,538     776,096     838,530    640,138
Long-term debt, including current
  portion..........................    608,519     658,055     712,807     758,900     48,230
Shareholder's equity/Member's
  deficit..........................   (142,943)   (139,659)   (132,072)   (130,395)   299,501
</Table>

---------------

(1) ACL acquired the barging operations of National Marine, Inc. in 1998 and
    purchased Peavey in 2000. The results of operations and cash flows of these
    companies have been included from the date of the respective acquisitions.

(2) Includes $11,418 gain from the sale of Waterways Communication System LLC
    ("Watercom") in 2000.

(3) ACL paid $734 for the early redemption premium on the Terminal Revenue bonds
    in 2000. ACL recorded extraordinary income of $1,885 in 2001 on the early
    retirement of $5,000 in Senior Notes.

(4) ACL adopted American Institute of Certified Public Accountants Statement of
    Position 97-3 in the first quarter 1999, with a cumulative effect adjustment
    of $1,737 in non-cash expense for workers' compensa-
                                        17
<PAGE>

    tion second injury funds. ACL adopted Financial Accounting Standards Board
    Statement No. 133 in 2001 with a cumulative effect adjustment of $490 in
    non-cash expense for an interest rate cap.

(5) EBITDA, as that term is defined in the Credit Agreement, as amended, which
    can be found in Exhibits 10.1, 10.14, 10.15, 10.16, 10.17 and 10.18 to
    previous filings by ACL with the U.S. Securities and Exchange Commission
    (the "Commission"), represents earnings before interest, income taxes,
    depreciation, amortization and, in 2001, the addition of $7,139 deferred
    profit, $652 interest rate cap loss and $1,164 expenses related to
    re-capitalization and the subtraction of $1,886 gain from the sale of
    terminals and Omaha condemnation proceeds and $110 earnings from investment
    in T.T. Barge, and in 2000, the addition of $734 extraordinary loss, $3,688
    deferred profit and $3,865 impairment loss on barges and the subtraction of
    $11,418 gain on sale of Watercom, and in 1998, the addition of $7,958 of
    non-recurring, non-cash compensation expense related to the
    Recapitalization. EBITDA is presented because management believes it is a
    widely accepted financial indicator used by certain investors and securities
    analysts to analyze and compare companies on the basis of operating
    performance. EBITDA is not intended to represent cash flows for the period,
    nor has it been presented as an alternative to operating income as an
    indicator of operating performance and should not be considered in isolation
    or as a substitute for measures of performance prepared in accordance with
    generally accepted accounting principles. ACL understands that while EBITDA
    is frequently used by securities analysts in the evaluation of companies,
    EBITDA, as used herein, is not necessarily comparable to other similarly
    titled captions of other companies due to potential inconsistencies in the
    method of calculation. See the historical financial statements of ACL and
    the related notes thereto included elsewhere herein.

                                        18
<PAGE>

ITEM 7.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
         OF OPERATIONS

     The following discussion and analysis should be read in conjunction with
Item 6. "Selected Financial Data" and the consolidated financial statements and
related notes included elsewhere in this Annual Report on Form 10-K. This Annual
Report on Form 10-K contains certain forward-looking statements about ACL's
financial position and results of operations. These statements include words
such as "believe," "expect," "anticipate," "intend," "estimate" or other similar
words. Any statements that express or involve discussions as to expectations,
beliefs or plans are not historical facts and involve known and unknown risks,
uncertainties and other factors that may cause the actual results to materially
differ from those considered by the forward-looking statements. Such factors
include:

     - substantial leverage and ability to service debt;

     - changing market, labor, legal and regulatory conditions and trends in the
       barge and inland shipping industries;

     - general economic and business conditions, including a prolonged or
       substantial recession in the United States or certain international
       commodity markets such as the market for grain exports; and

     - annual worldwide weather conditions, particularly those affecting North
       and South America.

     Although we believe that our plans, intentions and expectations reflected
in or suggested by such forward-looking statements are reasonable, actual
results could differ from a projection or assumption in any of our
forward-looking statements. Our future financial condition and results of
operations, as well as any forward-looking statements, are subject to change and
inherent risks and uncertainties discussed under Item 1. "Business -- Risks
Associated With Our Business" and elsewhere in this Annual Report on Form 10-K
as well as in our other filings with the Securities and Exchange Commission. The
forward-looking statements contained in this Annual Report on Form 10-K are made
only as of the date hereof and ACL does not have or undertake any obligation to
update or revise any forward-looking statements whether as a result of new
information, subsequent events or otherwise, unless otherwise required by law.

OVERVIEW

ACL'S BUSINESS

     ACL is an integrated marine transportation and service company, providing
barge transportation and ancillary services. ACL supports its barging operations
by providing marine vessel design and construction along with inter-modal cargo
transfer services to ACBL and third parties. ACBL is the leading provider of
river barge transportation throughout the Inland Waterways. In addition, since
expanding its barge transportation operations to South America in 1993, ACL
International has become the leading provider of barge transportation services
on the Orinoco River in Venezuela and, through UABL, on the Parana/Paraguay
River system serving Argentina, Brazil, Paraguay, Uruguay and Bolivia. ACL
International, also provides transportation services on the Higuamo River in the
Dominican Republic.

     ACL derives its revenues primarily from the barge transportation of other
bulk/steel, grain, coal and liquids in the United States and South America.
While ACL's customer base has remained relatively stable and certain of its
operations provide steady rate levels and profit margins, its results of
operations can be impacted by a variety of external factors. These factors
include fluctuations in rates for shipping grain, which in turn affect rates for
shipping other dry cargoes, weather and river conditions and fluctuations in
fuel prices. Although revenues from ACL's international operations are typically
denominated in U.S. dollars, its results could be impacted by currency
fluctuations.

     ACL seeks to enter into multi-year contracts at fixed prices (with
inflation-indexed escalation and fuel adjustment clauses) with its customers.
Approximately 60% of contracts in effect as of December 28, 2001 were for
periods of greater than one year.

     ACBL's top 25 customers accounted for 55% of ACL's fiscal 2001 operating
revenue. One customer, Cargill, Inc., accounted for more than 10% of ACL's
fiscal 2001 consolidated operating revenue.

                                        19
<PAGE>

POTENTIAL ACQUISITION AND RECAPITALIZATION OF ACL

     As discussed in Item 1, ACL has been pursuing strategic financial
restructuring alternatives and, on March 15, 2002, entered into a
recapitalization agreement with Danielson regarding the acquisition and
recapitalization of ACL by Danielson.

ACL'S STRATEGY

     Subject to the return of more favorable market and operating conditions and
the consummation of the Danielson Recapitalization, discussed in more detail in
the "Liquidity and Capital Resources" section of this Item 7, ACL intends to
continue to pursue a strategy of growth in its core business units. ACL's
pursuit of growth through strategic acquisitions has created value through
synergies and economies of scale that have enhanced ACL's long term results of
operations. ACL's previous acquisitions have included:

     - SCNO Barge Lines, Inc. in 1988, Hines American Lines, Inc. in 1991, The
       Valley Line Company in 1992, Continental Grain's barging operations in
       1996 and National Marine's barging operations in 1998;

     - On May 26, 2000 ACL entered into an agreement to purchase or lease
       substantially all of the long-term assets of Peavey. This added more than
       900 covered hopper barges to ACL's existing fleet of inland marine
       barges; and

     - On October 24, 2000, an ACL 80% owned subsidiary, ACBLH entered into an
       agreement with Ultrapetrol to combine the inland river barge
       transportation divisions of ACBLH and Ultrapetrol which operate on the
       Parana/Paraguay River system in South America. ACBLH has a 50% ownership
       interest in the newly formed company, UABL. UABL operates 20 towboats and
       a combined fleet of 374 dry cargo and tank barges. UABL serves commodity
       shippers in Argentina, Bolivia, Brazil, Paraguay and Uruguay. UABL seeks
       to further consolidate its position in the Parana/Paraguay River system
       market through acquisitions, and intends to pursue this strategy in 2002.

     Focusing on its core business units, ACL has also divested certain assets
in the past several years, including:

     - On September 6, 2000, ACL sold its 100% membership interest in Waterway
       Communications System LLC ("Watercom") to Mobex Network Services Company
       ("Mobex"). The sale of Watercom will not significantly affect ACL's
       expected future operating income or cash flow from operating activities.

     - On May 25, 2001, ACL entered into an agreement to sell seven of ACT's ten
       terminals, other than its coal transfer facility at St. Louis, Missouri
       and its tank storage facility at Memphis, Tennessee to GMS. An additional
       terminal site in Omaha, Nebraska was transferred on June 29, 2001.
       Subsequent to June 29, 2001, additional proceeds were received from the
       condemnation of Omaha Terminal.

ACL'S FLEET

     The size of ACL's combined domestic and international fleet, including
owned and leased barges, over the past three years is as follows:

                        DOMESTIC AND INTERNATIONAL FLEET
                               (NUMBER OF BARGES)

<Table>
<Caption>
                                                  DECEMBER 28,   DECEMBER 29,   DECEMBER 31,
                  BARGE TYPES                        2001*           2000           1999
                  -----------                     ------------   ------------   ------------
<S>                                               <C>            <C>            <C>
Covered hoppers.................................     3,865          3,965          3,079
Open hoppers....................................       772            673            839
Tank Barges.....................................       439            458            471
Deck Barges.....................................         7              7              8
                                                     -----          -----          -----
          Total.................................     5,083          5,103          4,397
                                                     =====          =====          =====
</Table>

---------------

* In addition ACL operates 298 covered hoppers, 40 open hoppers and 36 tank
  barges through its participation in UABL.

                                        20
<PAGE>

     The average age of ACL's domestic barge fleet is currently 18 years,
compared with an industry average of 16 years. These barges have an expected
life of approximately 25 to 30 years. In addition, at year end ACBL operated 187
towboats domestically, with an average age of 25 years. ACL International
operates 129 barges, with an average age of 17 years, six towboats and in
addition, through UABL, 374 barges with an average age of 16 years and 20
towboats.

TAXES

     ACL is a limited liability company and its operations are conducted mainly
through a series of limited liability company subsidiaries, and, as a result,
ACL will not itself generally be subject to U.S. federal or state income tax.
Taxable income will be allocated to the equity holders of the Parent and such
holders will be responsible for income taxes on such taxable income. ACL intends
to make distributions to the Parent which, in turn, will make distributions to
its equity holders to enable them to meet all or a portion of their tax
obligations with respect to taxable income allocated to them by ACL. The Amended
and Restated Limited Liability Company Agreement of the Parent (the "LLC
Agreement") reduces the amount of tax distributions to CSX (or its affiliate)
until 2005, which may make additional funds available for use by ACL, subject to
the discretion of the Parent. Notwithstanding the foregoing, in certain
circumstances the tax distribution provisions of the LLC Agreement permit
distributions which could exceed the combined federal, state, local and foreign
income taxes that would be payable with respect to taxable income of ACL for any
given period if it were a Delaware corporation filing separate tax returns. Such
distributions are permitted under the Indenture. See Item 13, "Certain
Relationships and Related Transactions."

RESULTS OF OPERATIONS

  YEAR ENDED DECEMBER 28, 2001 COMPARED WITH YEAR ENDED DECEMBER 29, 2000

     ACL follows a 52/53 week fiscal year ending on the last Friday in December
of each year.

     Operating Revenue.  Operating revenue for the year ended December 28, 2001
increased 2% to $788.5 million from $773.8 million for the year ended December
29, 2000. The revenue increase was due to higher barge freight volumes as a
result of the operation of the Peavey barges for the whole year 2001 as compared
to seven months in 2000 and higher freight rates on certain domestic barging
commodities largely due to the effect of contract, fuel price adjustment
clauses. The increase was partially offset by the impact of ice and flooding on
the domestic barging operation in the first half of the year, reduced volume at
Jeffboat and the sale of the ACT terminals.

     Domestic barging revenue increased $44.2 million to $636.0 million
primarily due to the addition of revenue from the Peavey barges, improved
barging freight rates for bulk and steel commodities and higher contract freight
rates from fuel price adjustment clauses. The increase was partially offset by
reduced loads per barge due to severe ice conditions on the Mississippi and
Illinois Rivers in the first quarter of 2001 and the closure of the upper
Mississippi River due to flooding during the second quarter of 2001.

     International revenues fell $0.3 million to $39.7 million primarily due to
ACL's share of the net earnings from UABL being reported, net of expenses, as an
other income item in 2001 according to the equity method, compared to the
consolidating of revenue from the Argentine operation during the first ten
months of 2000. This decrease was partially offset by increased revenue from
equipment charters to the UABL venture. Increased revenue from additional
bauxite freight revenue in Venezuela, additional revenue recognized in 2001 for
settlement of minimum contract tonnage in Venezuela, continuing revenue from a
terminal operation in Venezuela, that began in the fourth quarter of 2000, and
the start of barging operations in the Dominican Republic in 2001 also
contributed to offset the fall in revenue.

     Revenue at Jeffboat decreased $21.2 million to $102.9 million primarily due
to lower volume of hopper barge sales and an increase in the number of hoppers
completed for ACL's leasing program on which the profit on sales is deferred.
The profit on sales of equipment that was subsequently leased to ACL's barge
operating division, ACBL, has been deferred and will be recognized over the life
of the leases. An absence of towboat construction revenue in 2001 as compared to
revenue from the construction of one towboat in 2000

                                        21
<PAGE>

also contributed to the decline. Tank barge construction volume at Jeffboat
improved in 2001 as increased revenue from large tank barge (30,000 barrel tank
barges) sales was partially offset by a reduction in the sales of smaller tank
barges (10,000 barrel tank barges).

     Operating Expense.  Operating expense for the year ended December 28, 2001
rose 1% to $723.1 million from $717.5 million for the year ended December 29,
2000. Domestic barging expenses increased $34.4 million primarily due to
operating the Peavey barges for the full year 2001 and due to higher fuel prices
as a result of the timing of fuel price swap agreements. High proportions (75%)
of the Peavey barges were rented under operating leases, which were assumed by
ACL. The high proportion of Peavey-leased equipment has the impact of
disproportionately raising operating expense in relation to operating revenue as
compared to the fleet prior to the addition of Peavey. Although the timing of
fuel price swaps raised fuel prices, average fuel prices before user tax on
gallons of fuel consumed by vessels decreased 3 cents per gallon to 81 cents per
gallon in 2001. Operating expenses for 2001 include a $16.5 million gain on
property dispositions primarily from the sale of towboats and marine repair
shipyard assets and a $1.1 million favorable adjustment due to a change in
accounting estimate of the depreciable lives of towboats. Operating expenses for
2000 include a non-cash impairment loss on inactive barges of $3.8 million and a
$1.9 million gain on property dispositions primarily from the sale of towboats.

     International barging expenses fell $5.2 million to $33.9 million, largely
due to ACL's share of the net earnings from UABL being reported, net of
expenses, as an other income item in 2001 according to the equity method,
compared to the consolidating of expense from the Argentine operation during the
first ten months of 2000. The decrease was partially offset by increased expense
from the additional movement of bauxite in Venezuela, the operation of the
terminal in Venezuela and the start of barging operations in the Dominican
Republic.

     Jeffboat's expenses decreased $17.7 million to $98.1 million, due to the
lower hopper barge, small tank barge and towboat construction volumes, partially
offset by an increase in large tank barge construction volume. Lower steel
prices and improved productivity also contributed to the decline in expense at
Jeffboat.

     Operating Income.  Operating income for the year increased 16% to $65.4
million from $56.3 million for 2000, due to the reasons discussed above.

     Interest Expense.  Interest expense for 2001 increased to $70.9 million
from $70.8 million for 2000. The increase is due to higher interest rate spreads
as a result of the amendment to the Senior Credit Facilities, a higher
outstanding balance on the revolver in 2001 as compared to 2000 and higher debt
amortization as a result of fees associated with the amendment to the Senior
Credit Facilities. The increase was partially offset by lower London InterBank
Offered Rates ("LIBOR"), which are the basis for certain interest rate
adjustments under ACL's Senior Credit Facilities, lower Term Loan balances and
lower other debt balances.

     Gain on Sale of Watercom.  There was no inclusion of a gain on the sale of
ACL's membership interest in Watercom in 2001 as compared to $11.4 million in
2000.

     (Loss) Earnings Before Income Taxes, Extraordinary Item and Cumulative
Effect of Accounting Change.  The loss before income taxes, extraordinary item
and cumulative effect of accounting change for the year was $5.0 million
compared to a loss of $4.1 million in 2000, due to the reasons discussed above.

     Income Taxes.  Income taxes for the year decreased to $0.1 million from
$4.3 million for 2000 due to lower withholding tax on foreign source income.
ACL's domestic corporate subsidiaries, except ACL Capital Corp., are limited
liability companies. ACL passes its U.S. federal and substantially all of its
state taxable income to its Parent, whose equity holders are responsible for
those income taxes.

     (Loss) Earnings Before Extraordinary Item and Cumulative Effect of
Accounting Change.  The loss before extraordinary item and the cumulative effect
of an accounting change was $5.1 million for 2001 compared with a loss of $8.4
million for 2000, due to the reasons discussed above.

     Extraordinary Item -- Gain (Loss) on Early Extinguishment of Debt.  The
gain on early extinguishment of debt was $1.9 million for 2001 compared to a
loss of $0.7 million for 2000. The gain for 2001 is a result of ACL's purchase
in the open market of $5.0 million par value of a portion of ACL's Senior Notes
for a
                                        22
<PAGE>

discount. The loss for 2000 was due to the early redemption premium on certain
terminal revenue refunding bonds (the "Terminal Revenue Refunding Bonds").

     Cumulative Effect of Accounting Change.  The cumulative effect of
accounting change was a loss of $0.5 million for 2001 due to recognition of a
loss on the fair value of an interest rate cap as a result of ACL's adoption of
FASB Statement No. 133 as of December 30, 2000.

     Net (Loss) Earnings.  Net loss for 2001 was $3.7 million compared to net
loss of $9.1 million in 2000, due to the reasons discussed above.

  YEAR ENDED DECEMBER 29, 2000 COMPARED WITH YEAR ENDED DECEMBER 31, 1999

     ACL follows a 52/53 week fiscal year ending on the last Friday in December
of each year. 2000 was a 52 week year compared with prior year 1999 of 53 weeks.

     Operating Revenue.  Operating revenue for the year ended December 29, 2000
increased nearly 5% to $773.8 million from $739.1 million for the year ended
December 31, 1999. The revenue increase was due to higher barge freight volumes
as a result of the addition of Peavey and higher freight rates on certain
domestic barging commodities largely due to the effect of contract, fuel price
adjustment clauses. The increase was partially offset by lower contract coal
freight rates, one less week in the reporting period and reduced revenue due to
the sale of the Watercom business unit.

     Domestic barging revenue increased nearly 7% or $37.9 million from $553.9
million in 1999 to $591.8 million in 2000 despite the effect of the shorter
reporting period. The increase is primarily due to increased volume as a result
of the larger fleet, higher contract freight rates from fuel price adjustment
clauses, higher market rates for bulk, steel and liquid commodities and adverse
operating conditions in the year ago period. The increase was partially offset
by lost volume as a result of grain inspection delays in the fourth quarter of
2000 due to the introduction of a new type of genetically altered seed into the
U.S. corn supply and the closure of the Illinois River due to ice in December,
2000. Domestic fleet velocity was further reduced by customers holding barge
equipment at loading and unloading ports for longer than usual during the second
and third quarters of 2000.

     International revenues fell $0.1 million to $40.0 million as charter
revenue from the UABL joint venture offset volume shortfalls in Venezuela due to
a customer's unloading dock accident. A large portion of the Venezuelan volume
shortfall earlier in the year was recovered in the fourth quarter from cargo
transfer revenue and increased freight volumes attributable to ACL's start up of
a new crane barge cargo unloading facility.

     Revenue at Jeffboat, ACL's marine construction subsidiary, fell $0.3
million to $124.1 million, reflecting reduced hopper barge construction for
third-party customers, offset by increased construction of tank barges. The
profit on sales of equipment that was subsequently leased to the barge operating
division has been deferred and will be recognized over the life of the leases.

     Operating Expense.  Operating expense for the year ended December 29, 2000
rose 8% to $717.5 million from $664.5 million for the year ended December 31,
1999. Domestic barging expenses increased $51.8 million primarily due to
operating the Peavey barges and higher fuel prices. High proportions (75%) of
the Peavey barges were rented under operating leases. This has the impact of
disproportionately raising operating expense in relation to operating revenue as
compared to the fleet prior to the addition of Peavey. Average fuel prices
increased from 50 cents per gallon in 1999 to 84 cents per gallon in 2000. The
increase in operating expense due to the change in fuel price from the year ago
period was $35 million. The net impact of rising fuel prices offset by contract
revenue adjustments and hedging is estimated to be a $7 million reduction in
operating income vs. the year ago period. Record cold temperatures in the
mid-west resulted in an unusual, December closing of the Illinois River that
also contributed to the increase in 2000 operating expenses. Operating expenses
for 2000 include a non-cash impairment loss on inactive barges of $3.8 million.
Operating expenses for 1999 include charges of $1.6 million for a partially
deferred employment contract payment to a former ACL executive.

                                        23
<PAGE>

     International barging expenses fell $0.6 million to $39.1 million, largely
due to the contribution of the Argentine based operation to UABL and lower barge
freight volume in Venezuela.

     Jeffboat's expenses increased $3.8 million to $115.8 million, due to
increased tank barge construction. The volume related increase was partially
offset by improved productivity and lower steel prices.

     ACL implemented a number of internal changes in 2000, including staff
reductions that resulted in cost savings of approximately $1 million per year,
and reassignment of senior level responsibilities. Changes in health and benefit
plans, including the American Commercial Lines LLC Pension Plan, that affect
salaried employees covered by the plans, were also implemented and resulted in
annual cost savings of approximately $5 million. In 2000, management of ACL's
tank barge cleaning facility at Baton Rouge was assigned to a non-affiliated
third party whose core business is barge cleaning. ACL received a variable
monthly fee linked to the facility's operating profit in 2000. Management of
ACL's boat and barge repair yard in New Orleans and its fleeting facility in
Mobile were also assigned to non-affiliated third parties in 2000 with ACL
receiving monthly fees containing both fixed and variable components. ACL sold
its tank barge cleaning and boat and barge repair facilities to the third party
operators in 2001.

     Operating Income.  Operating income for the year decreased 25% to $56.3
million from $74.6 million for 1999, due to the reasons discussed above.

     Interest Expense.  Interest expense for 2000 decreased to $70.8 million
from $71.3 million for the same period in 1999. The decrease is due to lower
outstanding balances and lower LIBOR base interest on the Senior Credit
Facilities.

     Gain on Sale of Watercom.  The gain on the sale of the membership interest
in Watercom was $11.4 million. The gain results from a purchase price of $16.0
million, which consist of $13.6 million in cash and $2.4 million in Mobex
preferred stock, less $4.6 million which was the total of ACL's net investment
in Watercom and transaction related costs.

     (Loss) Earnings Before Income Taxes, Extraordinary Item and Cumulative
Effect of Accounting Change.  The loss before income taxes, extraordinary item
and cumulative effect of accounting change for the year was $4.1 million
compared to earnings of $6.4 million in 1999, due to the reasons discussed
above.

     Income Taxes.  Income taxes for the year increased to $4.3 million from
$1.7 million for 1999 due to additional withholding tax on foreign source
income. ACL's domestic corporate subsidiaries, except ACL Capital Corp., were
converted to limited liability companies as of June 30, 1998. ACL passes its
U.S. federal and state taxable income to its Parent, whose equity holders are
responsible for those income taxes.

     (Loss) Earnings Before Extraordinary Item and Cumulative Effect of
Accounting Change.  The loss before extraordinary item and the cumulative effect
of an accounting change was $8.4 million for 2000 compared with an earnings of
$4.7 million for the same period in 1999, due to the reasons discussed above.

     Extraordinary Item -- Loss on Early Extinguishment of Debt.  ACL recognized
$0.7 million as an extraordinary loss in the second quarter of 2000 reflecting
the redemption premium on the Terminal Revenue Refunding Bonds. This amount was
paid out of an escrow account previously established as an irrevocable trust.

     Cumulative Effect of Accounting Change.  ACL recognized $1.7 million in
non-cash expense related to a workers compensation secondary injury fund in
accordance with adoption of the American Institute of Certified Public
Accountants (AICPA) Statement of Position (SOP) 97-3, "Accounting by Insurance
and Other Enterprises for Insurance-Related Assessments" in the first quarter of
1999.

     Net (Loss) Earnings.  Net loss for 2000 was $9.1 million compared to net
earnings of $3.0 million in 1999, due to the reasons discussed above.

                                        24
<PAGE>

OUTLOOK

     Domestic barging demand for bulk, steel and liquid commodities is expected
to remain at 2001 levels throughout 2002. The U.S. Department of Agriculture
currently forecasts 2002 crop year corn exports of 1.975 billion bushels as
compared to 1.937 billion bushels for the 2001 crop year.

     In the first quarter of 2002, the average price of fuel consumed by ACBL
vessels is expected to decrease $0.07 per gallon from the fourth quarter of
2001. With the addition of boats required to move the Peavey barges, ACBL
vessels will consume approximately 110 million gallons annually and generally
ratably throughout the year. ACBL has contract price adjustment clauses and a
fuel-hedging program, which provide protection for approximately 75% of gallons
consumed. Contract adjustments are deferred one quarter.

     The preparation of financial statements in conformity with generally
accepted accounting principles ("GAAP") requires management to make estimates
and assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses for the same
period. Actual results could differ from those estimates.

CRITICAL ACCOUNTING POLICIES

     Critical accounting policies that affect the reported amounts of assets and
liabilities include barge transportation revenue being recognized
proportionately as shipments move from origin to destination, estimates of
harbor and towing service charges being made at the time such services are
received, and expense from insurance claim loss deductibles being recognized
based upon liability estimates that are made as claim incidents occur. The
proportion of barge transportation revenue to be recognized is determined by
applying a percentage to the contractual charges for such services. The
percentage is determined by dividing the number of miles from the loading point
to the position of the barge as of the end of the accounting period by the total
miles from the loading point as specified in the relevant freight contract. The
position of the barge at accounting period end is determined by locating the
position of the boat with the barge in tow through use of a global positioning
system. The recognition of revenue based upon the percent of voyage completion
results in a better matching of revenue and expenses. Harbor and towing service
charges are estimated by vendor based upon recent historical charges for the
same type of service. Liabilities for insurance claim loss deductibles are
estimated based upon historical experience with similar claim incidents. Routine
engine overhauls that occur on a one to three year cycle are expensed when they
are incurred. Repairs that extend the original economic life of an asset or that
enhance the original functionality of an asset are capitalized and amortized
over their estimated economic life. The costs of purchasing or developing
software are capitalized and amortized over the estimated economic life of the
software.

     See note 1 to the financial statements in Item 8 for a further discussion
of significant accounting policies.

LIQUIDITY AND CAPITAL RESOURCES

ACL INDEBTEDNESS

     As of December 28, 2001, ACL had outstanding indebtedness of $692.5
million, including $313.3 million drawn under its two Term Loans and $295.0
million aggregate principal amount of Senior Notes. ACL had other notes
outstanding of $0.2 million at year end. In addition, ACL had $5.9 million in
outstanding capital lease obligations and had securitized $51.0 million of the
trade receivables of two subsidiaries.

     ACL also has available borrowings of up to $100.0 million under the
Revolving Credit Facility. At the end of 2001, $15.4 million of letters of
credit had been issued under the facility and $84.0 million revolving loans were
outstanding. ACL had $47.3 million cash on deposit in bank accounts as of
December 28, 2001.

     The Senior Credit Facilities and the Indenture contain a number of
covenants with specified financial ratios and tests including, with respect to
the Senior Credit Facilities, maximum leverage ratios which could lead to an
event of default which could result in acceleration of the debt, higher interest
rates or other adverse consequences. The Indenture also contains certain cross
default provisions. Compliance with financial ratios is

                                        25
<PAGE>

measured at the end of each quarter. ACL's ability to meet the financial ratios
is affected by adverse weather conditions, seasonal market conditions and other
risk factors inherent in its business. These and other risk factors are
discussed in and incorporated by reference from "Risk Factors," Exhibit 99.1,
appended hereto.

IMPACT OF AMENDMENT TO SENIOR CREDIT FACILITIES

     Due to less than anticipated financial results relating to poor river
operating conditions in the domestic barging operation in the fourth quarter of
2000 and an adverse barging freight market largely due to the introduction of a
genetically altered seed into the U.S. corn supply which delayed barge
shipments, ACL completed an agreement with its lenders to amend the Senior
Credit Facilities effective December 29, 2000 through December 31, 2001
("Amendment No. 5"). The amendment added a rent adjusted consolidated leverage
ratio, a limitation on annual rent expense, reduced allowable capital
expenditures, increased the interest rates on the Term Loans and the Revolving
Credit Facility and required a $40.0 million reduction of the Term Loans by
October 30, 2001, to be funded primarily through the sale of assets.

     ACL was in compliance with the requirements of Amendment No. 5 as of the
end of fiscal year 2001. The outstanding balance on the Term Loans was reduced
by $40.0 million primarily by use of proceeds from the sale of certain ACT
terminals to GMS, from the sale of the property and assets of a marine repair
and tank barge cleaning operation located in Louisiana to a newly formed limited
liability company of which ACL has a minority interest, from the sale of the
assets located at a marine repair yard in Louisiana to an unaffiliated third
party, and from the sale of five towboats to unaffiliated third parties.

     Following December 31, 2001, the covenant requirements reverted to those
specified in the original Senior Credit Facilities which are more restrictive
than the amended covenants. Certain covenants added by Amendment No. 5 also
become more restrictive. ACL is currently not in compliance with certain
covenants in the Senior Credit Facilities and it is not likely that ACL will be
able to meet these covenant requirements in 2002, absent an additional amendment
to the Senior Credit Facilities and the consummation of the Danielson
Recapitalization. Failure to meet these covenants could have a material adverse
effect on the liquidity of ACL.

FAILURE TO PAY INTEREST ON SENIOR NOTES

     On December 31, 2001, ACL elected not to pay the interest due (the "Bond
Interest Payment") on its Senior Notes due to ongoing negotiations with its
lenders and noteholders regarding the restructuring of ACL's bank and bond debt.
Following the thirty (30) day grace period provided by the Indenture, ACL again
elected not to make the Bond Interest Payment. This election not to pay the Bond
Interest Payment constituted an event of default under the Indenture. However,
certain noteholders entered into forebearance agreements with ACL agreeing not
to accelerate the maturity of the Senior Notes or take additional adverse
actions against ACL. Acceleration of the Senior Notes under the Indenture would
have a material adverse effect on ACL's liquidity. Further, as a result of ACL's
failure to make the Bond Interest Payment, J.P. Morgan Chase Bank ("J.P.
Morgan") delivered a notice to ACL in January 2002 asserting that ACL was in
default of the Credit Agreement. Certain lenders party to the Credit Agreement
also entered into forebearance agreements with ACL, agreeing not to accelerate
the debt or take additional adverse actions against ACL. An acceleration of the
debt under the Senior Credit Facilities would have a material adverse effect on
ACL's liquidity.

     As a result of the events described above, PNC Bank, National Association
("PNC"), as Administrator under ACL's receivables facility with PNC (the
"Receivables Purchase Agreement"), asserted that ACL was in default under the
Receivables Purchase Agreement. ACL and PNC entered into a waiver of the
Receivables Purchase Agreement on February 11, 2002 (the "RPA Waiver") and a
modification to that waiver on February 25, 2002 (the "RPA Waiver"). The RPA
Waiver has the effect of waiving the default asserted by PNC, provided that ACL
enters into certain definitive agreements with Danielson relating to the
Danielson Recapitalization and refinances the Receivables Purchase Agreement on
or before April 30, 2002. The RPA Waiver also requires ACL to reduce its overall
borrowings under the facility to no more than $50.0 million. A default under the
Receivables Purchase Agreement or the RPA Waiver could have a material adverse
effect on ACL's liquidity.

                                        26
<PAGE>

DANIELSON RECAPITALIZATION

     As discussed in Item 1, ACL has entered into the Recapitalization Agreement
with Danielson which will result in an acquisition and recapitalization of ACL
by Danielson. Should the Danielson Recapitalization be consummated, ACL
anticipates that it will obtain a waiver of any current default under, and
certain amendments to, its Senior Credit Facilities and, with respect to holders
of Senior Notes who tender their Senior Notes in the exchange offer and consent
solicitation, the Indenture governing the Senior Notes.

NET CASH, CAPITAL EXPENDITURES AND CASH FLOW

     Net cash provided by operating activities was $24.6 million, $30.8 million
and $94.6 million for fiscal 2001, 2000 and 1999, respectively. The decrease in
net cash from operating activities in 2001 compared with 2000 was primarily due
to a small increase in inventories in 2001 compared to a large inventory
reduction in 2000 and due to two interest payments on the senior notes being
remitted in 2001 compared to one payment remitted in 2000. The decrease was
partially offset by the timing of cash disbursements related to accounts
payable. The decrease in net cash from operating activities in 2000 compared
with 1999 was primarily due to $50.0 million provided by the initial sale of the
trade receivables of two subsidiaries in 1999, the timing of cash disbursements
related to accounts payable and the lower net earnings. Net cash from operating
activities was used primarily for repayment of third-party debt and capital
expenditures.

     Capital expenditures were $25.6 million, $57.0 million and $55.9 million in
2001, 2000 and 1999, respectively. Expenditures in 2001 and 2000 include $5.8
million and $6.1 million, respectively, in expenditures associated with capital
leases. Cash expenditures included $0.4 million, $48.0 million and $23.9 million
for domestic marine equipment and $3.4 million, $2.9 million and $8.9 million
for foreign investments in 2001, 2000 and 1999, respectively. The remaining
$16.0 million in domestic cash capital expenditures in 2001 was primarily for
marine equipment maintenance.

     ACL expects capital expenditures in 2002 to be approximately $33 million
and to be primarily for fleet maintenance. Additional operating lease expense of
approximately $4 million will be incurred to provide fleet replacement
equipment. This will be partially offset by reductions in existing barge charter
rates.

     Management believes that cash generated from operations is sufficient to
fund its cash requirements, including capital expenditures for fleet
maintenance, working capital, interest payments and scheduled principal
payments. ACL may from time to time, borrow under the Revolving Credit Facility.
ACL currently plans to use excess cash provided by operations to pay down the
Revolving Credit Facility and the Term Loans.

     Demand for freight moved by ACL barges is influenced by the economic demand
for the cargoes. A decrease in that demand could adversely affect ACL's
operating cash flows. Some cargoes are more highly dependent upon general
economic conditions, such as certain liquid and steel cargoes which have
experienced a recent softening in demand.

     Cash flows from ACL's barging and manufacturing operations are also
affected by weather and river conditions. Extreme weather conditions can have a
materially adverse affect on ACL's operating cash flows.

     ACL has various environmental liabilities that could have an impact on its
financial condition and results of operations. These environmental matters are
discussed in Item 3, "Legal Proceedings," contained in this Annual Report on
Form 10-K.

     At December 28, 2001 and December 29, 2000 ACL had $51.0 million and $56.0
million, respectively, outstanding under the Receivables Purchase Agreement, its
accounts receivable securitization facility discussed above, and had $22.6
million and $15.3 million, respectively, of net residual interest in the
securitized receivables which is included in "Accounts Receivable, Net" in ACL's
consolidated financial statements. The fair value of the net residual interest
is measured at the time of the sale and is based on the sale of similar assets.
In 2001, ACL received gross proceeds of $30.8 million from the sale of
receivables and made gross payments of $35.8 million under the Receivables
Purchase Agreement.

                                        27
<PAGE>

CHANGES IN CREDIT RATINGS

     On January 2, 2002, the debt rating agency Standard & Poor's lowered its
rating on ACL's Senior Notes to 'D' from single-'B'-minus and ACL's corporate
credit rating to 'SD' from single-'B'-plus and removed both items from
CreditWatch, where they had been placed with negative implications on May 7,
2001. Also on January 2, 2002, the rating on ACL's Senior Credit Facilities was
lowered to single-'B'-plus from double-'B'-minus (on CreditWatch with negative
implications).

     On March 1, 2002, following the announcement of the potential Danielson
Recapitalization, Standard & Poor's reaffirmed its single-'B'-plus rating on
ACL's Senior Credit Facilities and that it remained on CreditWatch with negative
implications. Standard & Poor's also reaffirmed ACL's corporate credit rating of
'SD' and the 'D' rating on the Senior Notes. These rating changes could
adversely affect ACL's liquidity.

NON-CONSOLIDATED ENTITIES

     In 2001, ACL and Vectura invested in a new company named Vessel Leasing.
399 Venture Partners, Inc., the majority owner of ACL, also holds a majority
ownership interest in Vectura Holding Company LLC which holds a majority
ownership interest in Vectura.

     ACL accounts for its 50% ownership in Vessel Leasing by the equity method.
ACL's investment of $6.8 million in Vessel Leasing is included in other assets
on the consolidated statement of financial position. ACL's share of Vessel
Leasing's net loss is $.04 million in 2001 and is included in other income in
the consolidated statement of operations.

     Vessel Leasing's statement of financial position is not consolidated with
ACL. As of December 28, 2001 Vessel Leasing had total assets of $54.9 million
and total liabilities of $45.6 million including public long term debt of $42.6
million (including current portion) and $2.8 million in unearned revenue from
prepaid charter payments made by ACL's domestic barging subsidiary. Vessel
Leasing's long term debt is not guaranteed by ACL or any of ACL's subsidiaries.
ACL's domestic barge operating subsidiary has a long term operating lease
commitment to Vessel Leasing, which is guaranteed by ACL.

     ACL sold new barges for $47.8 million to Vessel Leasing in 2001. Profit on
sales of barges to Vessel Leasing is deferred by Jeffboat and recognized over
the life of the lease. All of these barges, except for those representing a
capital lease commitment of $3.9 million, were leased by Vessel Leasing to ACL
as operating leases which resulted in ACL charter expense of $1.7 million. ACL
also recorded $3.9 million in capital leases with Vessel Leasing in 2001.

     ACL also has fifty percent (50%) ownership interests in UABL and GMS, as
previously described, which are accounted for by the equity method.

                                        28
<PAGE>

CONTRACTUAL AND COMMERCIAL COMMITMENT SUMMARY

     A summary of ACL's contractual commitments under debt and lease agreements
appears below.

                            CONTRACTUAL OBLIGATIONS

<Table>
<Caption>
                                                               PAYMENTS DUE BY YEAR
                                           ------------------------------------------------------------
                                                      LESS THAN     ONE TO       FOUR TO     AFTER FIVE
CONTRACTUAL OBLIGATIONS                     TOTAL     ONE YEAR    THREE YEARS   FIVE YEARS     YEARS
-----------------------                    --------   ---------   -----------   ----------   ----------
                                                              (DOLLARS IN MILLIONS)
<S>                                        <C>        <C>         <C>           <C>          <C>
Long Term Debt...........................  $  608.5    $608.5       $   --        $  --        $   --
Revolving Credit Facility................      84.0      84.0           --           --            --
Capital Lease Obligations................      10.2       1.0          3.0          1.5           4.7
Operating Leases*........................     302.9      45.6        104.4         47.2         105.7
Unconditional Purchase Obligations.......        --        --           --           --            --
Other Long Term Obligations..............        --        --           --           --            --
                                           --------    ------       ------        -----        ------
Total Contractual Cash Obligations.......  $1,005.6    $739.1       $107.4        $48.7        $110.4
                                           ========    ======       ======        =====        ======
</Table>

---------------

* Operating leases having initial or remaining non-cancelable lease terms longer
  than one year.

     A summary of ACL's other commercial commitments appears below.

                             COMMERCIAL COMMITMENTS

<Table>
<Caption>
                                                    AMOUNT OF COMMITMENT EXPIRATION PER YEAR
                                          -------------------------------------------------------------
                                            TOTAL
                                           AMOUNTS    LESS THAN     ONE TO       FOUR TO     AFTER FIVE
OTHER COMMERCIAL COMMITMENTS              COMMITTED   ONE YEAR    THREE YEARS   FIVE YEARS     YEARS
----------------------------              ---------   ---------   -----------   ----------   ----------
                                                              (DOLLAR IN MILLIONS)
<S>                                       <C>         <C>         <C>           <C>          <C>
Lines of Credit.........................       --         --            --          --            --
Standby Letters of Credit...............     16.3        0.9          10.0          --           5.4
Guarantees..............................       --         --            --          --            --
Standby Repurchase Obligations..........       --         --            --          --            --
Other Commercial Commitments............       --         --            --          --            --
                                            -----       ----         -----          --          ----
Total Commercial Commitments............    $16.3       $0.9         $10.0          $--         $5.4
                                            =====       ====         =====          ==          ====
</Table>

     Additional disclosures regarding these obligations and commitments can be
found in notes 4 and 7 to the consolidated financial statements in Item 8.

FUEL HEDGING AND INTEREST RATE CAP

     ACL uses forward purchases of diesel fuel to provide protection against
increases in prices of diesel fuel used to operate ACL's vessels. The forward
purchases are swap agreements whereby ACL locks into a fixed future price at the
time of purchase. Diesel fuel is not delivered under these future purchases.
Instead the swap is settled when due and ACL pays or receives a dollar amount
based on the difference in the fixed future price and the actual price index for
the settlement month.

     The fair value of the net swap is the difference between the future price
of the fuel index as of the date of valuation and the fixed future price
established at the time each individual contract is purchased, multiplied by the
number of gallons purchased. ACL typically enters into one forward contract each
month for gallons associated with freight bookings that have fixed price
commitments with no contract fuel adjustment protection clauses.

                                        29
<PAGE>

     Due to the bankruptcy of Enron Corp., one of the trading partners to the
fuel swap, ACL has expensed the mark-to-market loss of $0.1 million as fuel
expense in the 2001 Consolidated Statement of Operations. Management believes
the other trading partner does not present credit risk to ACL.

                     FAIR VALUE OF CONTRACTS AT PERIOD END

<Table>
<Caption>
                                                              (DOLLARS IN MILLIONS)
<S>                                                           <C>
Fair value of contracts outstanding at the beginning of
  2001......................................................         $ 0.03
Contracts realized or otherwise settled during 2001.........         $(1.30)
Fair value of new contracts when entered into during the
  period....................................................         $ 0.00
Changes in fair value attributable to changes in valuation
  techniques and assumptions................................         $ 0.00
Other changes in fair values................................         $(0.40)
Fair value of contracts outstanding at the end of the
  period....................................................         $(0.40)
</Table>

<Table>
<Caption>
                                                              MATURITY LESS
                                                                THAN ONE
SOURCE OF FAIR VALUE                                              YEAR        TOTAL
--------------------                                          -------------   ------
<S>                                                           <C>             <C>
Prices provided by other external sources...................     $(0.40)      $(0.40)
</Table>

     ACL also has an interest rate cap agreement on a notional amount of $202
million in debt. The agreement expires August 11, 2003 and has a fair value of
$.04 million as of December 28, 2001. The fair value of the cap agreement has
been provided by an external source.

     For additional disclosures regarding non-exchange traded contracts, please
refer to note 9 to the consolidated financial statements included in Item 8.

RELATED PARTY TRANSACTIONS

     ACL has transactions with various related parties, primarily affiliated
entities accounted for by the equity method. ACL believes that the terms and
conditions of those transactions are in the aggregate not materially more
favorable or unfavorable to ACL than would be obtained on an arm's-length basis
among unaffiliated parties.

     In 2001 ACL received $12.0 million from GMS for the sale of terminals and
proceeds from the condemnation of a terminal, resulting in a gain of $1.9
million which is reported in Other Income.

     ACL recorded charter income from UABL of $11.1 million and $2.1 million in
2001 and 2000, respectively. ACL also recorded administrative fee expenses to
UABL of $7.7 million and $1.5 million in 2001 and 2000, respectively. ACL sold
used barges to UABL for $0.8 million in 2001. Charter rates are established at
fair market value based upon similar transactions. As of December 28, 2001 ACL
has recorded $13.4 million in accounts receivable and $8.4 million in other
current liabilities with UABL.

     ACL, through its subsidiary, Jeffboat, sold new barges for $47.8 million to
Vessel Leasing in 2001. Jeffboat recognizes the profit associated with the sales
of barges to Vessel Leasing over the life of the lease. All of these barges
except for $3.9 million were leased by Vessel Leasing to ACL as operating leases
which resulted in ACL charter expense of $1.7 million in 2001. ACL recorded $3.9
million in capital leases with Vessel Leasing in 2001. Charter rates and sales
of barges are established at fair market value based upon similar transactions.

     See also information contained under "Affiliate Agreements" included under
Item 13 in this Annual Report on Form 10-K.

BACKLOG

     ACL's backlog represents firm orders for barge transportation and marine
equipment. The backlog for barge transportation was approximately $760 million
and $1,124 million at December 28, 2001 and

                                        30
<PAGE>

December 29, 2000, respectively. This backlog ranges from one to eight years
with approximately 40% expected to be filled in 2002. The backlog for marine
equipment was approximately $69 million and $24 million at December 28, 2001 and
December 29, 2000, respectively. The backlog for marine equipment is one year
with 100% expected to be filled in 2002.

SEASONALITY

     ACL's business is seasonal, and its quarterly revenues and profits
historically have been lower during the first and second fiscal quarters of the
year (January through June) and higher during the third and fourth fiscal
quarters (July through December) due to the North American grain harvest. In
addition, working capital requirements fluctuate throughout the year. Adverse
market or operating conditions during the last four months of the year could
have a greater effect on ACL's business, financial condition and results of
operations than during other periods.

CHANGES IN ACCOUNTING STANDARDS

     In July 2001, the Financial Accounting Standards Board ("FASB") issued
Statements of Financial Accounting Standards No. 141 "Business Combinations"
("SFAS 141"), which provides that all business combinations should be accounted
for using the purchase method of accounting and establishes criteria for the
initial recognition and measurement of goodwill and other intangible assets
recorded in connection with a business combination. The provisions of SFAS 141
apply to all business combinations initiated after June 30, 2001 and to all
business combinations accounted for by the purchase method that are completed
after June 30, 2001. ACL will apply the provisions of SFAS 141 to any future
business combinations.

     In July 2001, the FASB issued Statement of Financial Accounting Standards
No. 142 "Goodwill and Other Intangible Assets" ("SFAS 142") which establishes
the accounting for goodwill and other intangible assets following their
recognition. SFAS 142 applies to all goodwill and other intangible assets
whether acquired singly, as part of a group, or in a business combination. SFAS
142 provides that goodwill should not be amortized but should be tested for
impairment annually using a fair-value based approach. In addition, SFAS 142
provides that intangible assets other than goodwill should be amortized over
their useful lives and reviewed for impairment in accordance with Statement of
Financial Accounting Standards No. 121, "Accounting for the Impairment of
Long-Lived Assets and for Long-Lived Assets to Be Disposed Of" ("SFAS 121").
SFAS 142 is effective beginning on December 29, 2001. Upon adoption, ACL will be
required to perform a transitional impairment test under SFAS 142 for all
goodwill recorded as of December 29, 2001. Any impairment loss recorded as a
result of completing the transitional impairment test will be treated as a
change in accounting principle. The impact of the adoption of SFAS 142 on ACL's
results of operations for all periods beginning on or after December 29, 2001
will be to eliminate amortization of goodwill. Management of ACL has not
performed a transitional impairment test under SFAS 142 and accordingly cannot
estimate the impact of the adoption of SFAS 142 as of December 29, 2001.

     In October 2001, the FASB issued Statement of Financial Accounting
Standards No. 144, "Accounting for the Impairment or Disposal of Long-Lived
Assets" ("FAS 144"). The Statement addresses financial accounting and reporting
for the impairment or disposal of long-lived assets. This Statement supercedes
SFAS 121, and the accounting and reporting provisions of Accounting Principles
Board Opinion No. 30, Reporting the Results of Operations -- Reporting the
Effects of Disposal of a Segment of a Business, and Extraordinary, Unusual and
Infrequently Occurring Events and Transactions, for the disposal of a segment of
a business (as previously defined in that Opinion). This Statement also amends
Accounting Research Bulletin No. 51, Consolidated Financial Statements, to
eliminate the exception to consolidation for a subsidiary for which control is
likely to be temporary. The objectives of SFAS 144 are to address significant
issues relating to the implementation of SFAS 121 and to develop a single
accounting model, based on the framework established in FAS 121, for long-lived
assets to be disposed of by sale, whether previously held and used or newly
acquired. The Company will adopt FAS 144 in the Company's first quarter 2002.
Management is currently evaluating the impact of FAS 144 on the Company's future
financial reporting.

                                        31
<PAGE>

ITEM 7A.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

     ACL is exposed to certain market risks which are inherent in its financial
instruments and which arise from transactions entered into in the normal course
of business. A discussion of ACL's primary market exposures in financial
instruments is presented below.

FUEL PRICE RISK

     Fuel consumed in 2001 represented approximately 13% of ACL's operating
expenses. Most of ACL's long-term contracts contain clauses under which
increases in fuel costs are passed on to customers thereby reducing the fuel
price risk. In addition, ACL has entered into fuel rate swap agreements for
short-term protection. As a result of ACL's fuel hedging strategy, it might not
fully benefit from certain fuel price declines.

     Based on ACL's 2002 projected fuel consumption, a one cent change in the
average annual price per gallon of fuel would impact ACL's annual operating
income by approximately $0.3 million (compared to the 2001 projection of $0.3
million), after the effect of escalation clauses in long-term contracts and fuel
rate swap agreements in place as of December 28, 2001. As of December 28, 2001,
ACL had hedged approximately 4% of its projected 2002 fuel requirements using
fuel rate swap agreements with an aggregate fair value of $0.4 million. ACL
estimates that at December 28, 2001, a 10% change in the price per gallon of
fuel would have changed the fair value of the existing fuel rate swap contracts
by $0.2 million.

     See ACL's disclosures relating to fuel hedging in "Fuel Hedging and
Interest Rate Cap" included under Item 7 elsewhere in this Annual Report on Form
10-K.

INTEREST RATE AND OTHER RISKS

     At December 28, 2001, ACL had $397.3 million of floating rate debt
outstanding, which represented the outstanding balance of the Senior Credit
Facilities. A 1% change in interest rates would change interest expense by $4.0
million annually.

     On August 11, 2000, ACL entered into an interest rate cap agreement which
limits ACL's base LIBOR to 7.5% on a notional amount of $201.8 million,
corresponding to that amount of floating rate debt outstanding which is based on
LIBOR. The agreement is designed to hedge ACL's exposure to future increases in
market interest rates. As of December 28, 2001 the fair value of the interest
rate cap agreement was $.04 million.

     At December 28, 2001, ACL had sold at a discount based upon commercial
paper rates, $51.0 million of the accounts receivable of two subsidiaries. ACL
has the right to repurchase these receivables. At this amount outstanding, a 1%
change in the commercial paper rates would change other expense by $0.5 million
annually.

FOREIGN CURRENCY EXCHANGE RATE RISKS

     As in 2000, all of ACL's significant transportation contracts in South
America are currently denominated in U.S. dollars. However, many expenses
incurred in the performance of such contracts, such as crew wages and fuel, are,
by necessity, denominated in a foreign currency. Therefore, ACL is affected by
fluctuations in the value of the U.S. dollar as compared to certain foreign
currencies. Additionally, ACL's investments in foreign affiliates subject it to
foreign currency exchange rate and equity price risks. Management does not
consider its exposure to exchange rate risks to be material and considers its
investments in foreign affiliates to be denominated in relatively stable
currencies and of a long-term nature. Accordingly, ACL does not typically manage
its related foreign currency exchange rate and equity price risks through the
use of financial instruments.

                                        32
<PAGE>

ITEM 8.  FINANCIAL STATEMENTS AND SUPPLEMENTAL DATA

                         AMERICAN COMMERCIAL LINES LLC

                      CONSOLIDATED STATEMENT OF OPERATIONS

<Table>
<Caption>
                                                                      FISCAL YEARS ENDED
                                                          ------------------------------------------
                                                          DECEMBER 28,   DECEMBER 29,   DECEMBER 31,
                                                              2001           2000           1999
                                                          ------------   ------------   ------------
                                                                    (DOLLARS IN THOUSANDS)
<S>                                                       <C>            <C>            <C>
OPERATING REVENUE
  Revenue...............................................    $729,692       $771,749       $739,136
  Revenue from related parties..........................      58,809          2,089             --
                                                            --------       --------       --------
                                                             788,501        773,838        739,136
OPERATING EXPENSE
  Materials, Supplies and Other.........................     341,606        334,872        306,763
  Rent..................................................      56,711         49,463         43,978
  Labor and Fringe Benefits.............................     166,041        163,251        182,225
  Fuel..................................................      93,560         88,094         53,307
  Depreciation and Amortization.........................      55,497         56,014         51,222
  (Gain) Loss on Property Dispositions, Net.............     (16,498)        (1,686)           384
  Taxes, Other Than Income Taxes........................      26,223         27,522         26,665
                                                            --------       --------       --------
                                                             723,140        717,530        664,544
                                                            --------       --------       --------
OPERATING INCOME........................................      65,361         56,308         74,592
OTHER EXPENSE (INCOME)
  Interest Expense......................................      70,932         70,813         71,275
  Other, Net............................................        (591)         1,050         (3,048)
  Gain on Sale of Watercom..............................          --        (11,418)            --
                                                            --------       --------       --------
                                                              70,341         60,445         68,227
                                                            --------       --------       --------
(LOSS) EARNINGS BEFORE INCOME TAXES, EXTRAORDINARY ITEM
  AND CUMULATIVE EFFECT OF ACCOUNTING CHANGE............      (4,980)        (4,137)         6,365
INCOME TAXES............................................         118          4,263          1,658
                                                            --------       --------       --------
(LOSS) EARNINGS BEFORE EXTRAORDINARY ITEM
  AND CUMULATIVE EFFECT OF ACCOUNTING
  CHANGE................................................      (5,098)        (8,400)         4,707
EXTRAORDINARY ITEM -- GAIN/(LOSS) ON EARLY
  EXTINGUISHMENT OF DEBT................................       1,885           (734)            --
CUMULATIVE EFFECT OF ACCOUNTING CHANGE..................        (490)            --         (1,737)
                                                            --------       --------       --------
NET (LOSS) EARNINGS.....................................    $ (3,703)      $ (9,134)      $  2,970
                                                            ========       ========       ========
</Table>

   The accompanying notes are an integral part of the consolidated financial
                                  statements.
                                        33
<PAGE>

                         AMERICAN COMMERCIAL LINES LLC

                      CONSOLIDATED STATEMENT OF CASH FLOWS

<Table>
<Caption>
                                                                      FISCAL YEARS ENDED
                                                          ------------------------------------------
                                                          DECEMBER 28,   DECEMBER 29,   DECEMBER 31,
                                                              2001           2000           1999
                                                          ------------   ------------   ------------
                                                                    (DOLLARS IN THOUSANDS)
<S>                                                       <C>            <C>            <C>
OPERATING ACTIVITIES
  Net (Loss) Earnings...................................    $ (3,703)      $ (9,134)      $  2,970
  Adjustments to Reconcile Net (Loss) Earnings to Net
     Cash Provided by (Used in) Operating Activities:
     Depreciation and Amortization......................      59,910         59,076         54,039
     Impairment of Barges...............................          --          3,865            230
     Gain on Property Dispositions......................     (16,498)        (1,686)           384
     Gain on Sale of Watercom...........................          --        (11,418)            --
     Proceeds from the Initial Sale of Accounts
       Receivable.......................................          --             --         50,000
     Other Operating Activities.........................      (3,852)        (6,580)         1,684
     Changes in Operating Assets and Liabilities:
       Accounts Receivable..............................     (12,010)        (2,547)         5,146
       Materials and Supplies...........................      (1,384)        13,890         (3,287)
       Accrued Interest.................................         413         10,557        (14,834)
       Other Current Assets.............................      (4,998)        (3,715)        (2,136)
       Other Current Liabilities........................       6,710        (21,526)           406
                                                            --------       --------       --------
       Net Cash Provided by Operating Activities........      24,588         30,782         94,602
INVESTING ACTIVITIES
  Property Additions....................................     (19,772)       (30,554)       (55,880)
  Purchase of Barging Assets............................          --        (31,500)            --
  Investment in Vessel Leasing LLC......................      (6,808)            --             --
  Proceeds from Property Dispositions...................      23,918          4,089          2,133
  Proceeds from Sale of Terminals.......................       7,818             --             --
  Proceeds from Property Condemnation...................       2,730             --             --
  Proceeds from Sale of Watercom........................          --         13,600             --
  Proceeds from Sale of Restricted Investments..........          --         25,288             --
  Other Investing Activities............................      (4,594)        (5,115)        (5,409)
                                                            --------       --------       --------
       Net Cash Provided by (Used in) Investing
          Activities....................................       3,292        (24,192)       (59,156)
FINANCING ACTIVITIES
  Short-Term Borrowings.................................      17,250         66,750             --
  Member Distribution...................................          --             --           (541)
  Long-Term Debt Repaid.................................     (47,937)       (54,752)       (53,046)
  Outstanding Checks Net of Deposits....................      (6,670)        10,075          1,029
  Debt Costs............................................      (3,463)            --             --
  Other Financing.......................................         625             64         (1,403)
                                                            --------       --------       --------
       Net Cash (Used in) Provided by Financing
          Activities....................................     (40,195)        22,137        (53,961)
Net (Decrease) Increase in Cash and Cash Equivalents....     (12,315)        28,727        (18,515)
Cash and Cash Equivalents at Beginning of Period........      59,568         30,841         49,356
                                                            --------       --------       --------
       Cash and Cash Equivalents at End of Period.......    $ 47,253       $ 59,568       $ 30,841
                                                            ========       ========       ========
Supplemental Cash Flow Information:
  Interest Paid.........................................    $ 65,504       $ 57,107       $ 84,084
  Income Taxes Paid.....................................       1,175          5,685          3,987
</Table>

   The accompanying notes are an integral part of the consolidated financial
                                  statements.
                                        34
<PAGE>

                         AMERICAN COMMERCIAL LINES LLC

                  CONSOLIDATED STATEMENT OF FINANCIAL POSITION

<Table>
<Caption>
                                                              DECEMBER 28,   DECEMBER 29,
                                                                  2001           2000
                                                              ------------   ------------
                                                                (DOLLARS IN THOUSANDS)
<S>                                                           <C>            <C>
                                         ASSETS
CURRENT ASSETS
  Cash and Cash Equivalents.................................   $  47,253      $  59,568
  Accounts Receivable, Net..................................      41,383         40,717
  Account Receivable -- Related Parties.....................      13,402          2,111
  Materials and Supplies....................................      31,335         29,773
  Other Current Assets......................................      29,633         23,660
                                                               ---------      ---------
     Total Current Assets...................................     163,006        155,829
PROPERTIES-Net..............................................     464,133        509,443
PENSION ASSET...............................................      26,067         24,512
OTHER ASSETS................................................     104,730         97,754
                                                               ---------      ---------
          Total Assets......................................   $ 757,936      $ 787,538
                                                               =========      =========

                                       LIABILITIES
CURRENT LIABILITIES
  Accounts Payable..........................................   $  29,737      $  29,730
  Accrued Payroll and Fringe Benefits.......................      17,206         14,003
  Deferred Revenue..........................................      11,890         12,011
  Accrued Claims and Insurance Premiums.....................      24,200         21,047
  Accrued Interest..........................................      18,659         18,246
  Short-Term Debt...........................................      84,000         66,750
  Current Portion of Long-Term Debt.........................     608,519         44,579
  Other Current Liabilities.................................      42,072         55,360
  Other Current Liabilities -- Related Parties..............       8,397          1,457
                                                               ---------      ---------
          Total Current Liabilities.........................     844,680        263,183
LONG-TERM DEBT..............................................          --        613,476
PENSION LIABILITY...........................................      18,907         21,389
OTHER LONG-TERM LIABILITIES.................................      37,292         29,149
                                                               ---------      ---------
          Total Liabilities.................................     900,879        927,197
                                                               ---------      ---------

                                    MEMBER'S DEFICIT
Member's Interest...........................................     220,074        220,074
Other Capital...............................................     166,580        163,799
Retained Deficit............................................    (527,740)      (523,048)
Accumulated Other Comprehensive Loss........................      (1,857)          (484)
                                                               ---------      ---------
          Total Member's Deficit............................    (142,943)      (139,659)
                                                               ---------      ---------
          Total Liabilities and Member's Deficit............   $ 757,936      $ 787,538
                                                               =========      =========
</Table>

   The accompanying notes are an integral part of the consolidated financial
                                  statements.
                                        35
<PAGE>

                         AMERICAN COMMERCIAL LINES LLC

                   CONSOLIDATED STATEMENT OF MEMBER'S DEFICIT

<Table>
<Caption>
                                                                           ACCUMULATED
                                                             RETAINED         OTHER
                                       MEMBER'S    OTHER     EARNINGS     COMPREHENSIVE
                                       INTEREST   CAPITAL    (DEFICIT)   EARNINGS (LOSS)     TOTAL
                                       --------   --------   ---------   ---------------   ---------
                                                          (DOLLARS IN THOUSANDS)
<S>                                    <C>        <C>        <C>         <C>               <C>
Balance at December 25, 1998.........  $220,047   $161,051   $(511,493)      $    --       $(130,395)
Comprehensive Income:
  Net earnings.......................        --         --       2,970                         2,970
  Foreign Currency Translation.......        --                     --          (337)           (337)
                                       --------   --------   ---------       -------       ---------
          Total Comprehensive
            Income...................        --                  2,970          (337)          2,633
Contribution of capital by CSX.......        --      1,054          --            --           1,054
Other................................        --         --      (4,850)           --          (4,850)
Issuance of membership interests.....        27         --          --            --              27
Cash distribution to partners........        --         --        (541)           --            (541)
                                       --------   --------   ---------       -------       ---------
Balance at December 31, 1999.........   220,074    162,105    (513,914)         (337)       (132,072)
Comprehensive Loss:
  Net loss...........................        --         --      (9,134)           --          (9,134)
  Foreign Currency Translation.......        --                     --          (147)           (147)
                                       --------   --------   ---------       -------       ---------
          Total Comprehensive Loss...        --                 (9,134)         (147)         (9,281)
Contribution of capital by CSX.......        --      1,694          --            --           1,694
                                       --------   --------   ---------       -------       ---------
Balance at December 29, 2000.........   220,074    163,799    (523,048)         (484)       (139,659)
Cumulative Effect of Accounting
  Change as of December 30, 2000.....        --                     --          (300)           (300)
Comprehensive Loss:
  Net loss...........................        --         --      (3,703)           --          (3,703)
  Net loss on fuel swaps designated
     as cash flow hedging
     instruments.....................        --                     --          (271)           (271)
  Net loss on interest rate swaps
     designated as cash flow hedging
     instruments.....................        --                     --          (747)           (747)
  Foreign Currency Translation.......        --                     --           (55)            (55)
                                       --------   --------   ---------       -------       ---------
          Total Comprehensive Loss...        --                 (3,703)       (1,073)         (4,776)
Contribution of capital by CSX.......        --      2,781          --            --           2,781
Consolidation of ACL Funding Corp....        --         --        (989)           --            (989)
                                       --------   --------   ---------       -------       ---------
Balance at December 28, 2001.........  $220,074   $166,580   $(527,740)      $(1,857)      $(142,943)
                                       ========   ========   =========       =======       =========
</Table>

   The accompanying notes are an integral part of the consolidated financial
                                  statements.
                                        36
<PAGE>

                         AMERICAN COMMERCIAL LINES LLC

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             (DOLLARS IN THOUSANDS)

NOTE 1.  SIGNIFICANT ACCOUNTING POLICIES

  NATURE OF OPERATIONS

     The operations of American Commercial Lines LLC ("ACL") (formerly American
Commercial Lines, Inc. which was converted to a limited liability company in the
second quarter of 1998) include barge transportation together with related
terminal, marine construction and repair along inland waterways. Barge
transportation services include the movement of steel and other bulk products,
grain, coal, and liquids in the United States and South America and account for
the majority of ACL's revenues. Marine construction, repair and terminal
services are provided to customers in marine transportation and other related
industries in the United States. ACL has long term contracts with some
customers.

     ACL was a wholly-owned subsidiary of CSX Corporation ("CSX") until June 30,
1998. On June 30, 1998 ACL's parent, American Commercial Lines Holdings LLC (the
"Parent") completed a recapitalization in a series of transactions in which the
barge business of Vectura Group, Inc. (now Vectura Group LLC, "Vectura") and its
subsidiaries ("NMI" or the "NMI Contribution") were combined with that of ACL.

  PRINCIPLES OF CONSOLIDATION

     The Consolidated Financial Statements reflect the results of operations,
cash flows and financial position of ACL and its majority-owned subsidiaries as
a single entity. All significant intercompany accounts and transactions have
been eliminated. Investments in companies that are not majority-owned are
accounted for under the equity method.

  FISCAL YEAR

     ACL follows an annual fiscal reporting period, which ends on the last
Friday in December. The consolidated financial statements presented are for the
fiscal years ended December 28, 2001 and December 29, 2000 and December 31,
1999.

  USE OF ESTIMATES

     The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates. ACL's
significant estimates include barge transportation revenue and expense
recognition, the carrying values and estimated useful lives of fixed assets,
allowances for doubtful accounts, insurance reserves, employee benefit plan
liabilities and others.

  CASH AND CASH EQUIVALENTS

     Cash and cash equivalents include short-term investments with a maturity of
less than three months when purchased. ACL has from time to time, cash in banks
in excess of federally insured limits.

                                        37
<PAGE>
                         AMERICAN COMMERCIAL LINES LLC

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

  ACCOUNTS RECEIVABLE

     Accounts Receivable, Net consist of the following:

<Table>
<Caption>
                                                               2001      2000
                                                              -------   -------
<S>                                                           <C>       <C>
Accounts Receivable.........................................  $43,014   $26,542
Note Receivable -- ACLF (See Note 3)........................       --    15,332
Allowance for Doubtful Accounts.............................   (1,631)   (1,157)
                                                              -------   -------
                                                              $41,383   $40,717
                                                              =======   =======
</Table>

     ACL maintains an allowance for doubtful accounts based upon the expected
collectibility of accounts receivable.

  MATERIALS AND SUPPLIES

     Materials and Supplies are carried at the lower of cost (average) or market
and consist of the following:

<Table>
<Caption>
                                                               2001      2000
                                                              -------   -------
<S>                                                           <C>       <C>
Raw Materials...............................................  $ 3,633   $ 2,805
Work in Process.............................................   13,029     9,764
Parts and Supplies..........................................   14,673    17,204
                                                              -------   -------
                                                              $31,335   $29,773
                                                              =======   =======
</Table>

  PROPERTIES

     Properties, at cost, consist of the following:

<Table>
<Caption>
                                                                2001       2000
                                                              --------   --------
<S>                                                           <C>        <C>
Land........................................................  $ 11,066   $ 12,813
Buildings and Improvements..................................    36,130     42,721
Equipment...................................................   789,567    800,041
                                                              --------   --------
                                                               836,763    855,575
Less Accumulated Depreciation...............................   372,630    346,132
                                                              --------   --------
                                                              $464,133   $509,443
                                                              ========   ========
</Table>

     Provisions for depreciation of properties are based on the estimated useful
service lives computed on the straight-line method. Buildings and improvements
are depreciated from 15 to 45 years. Equipment is depreciated from 5 to 42
years. Depreciation expense was $52,100 in 2001, $53,457 in 2000 and $49,779 in
1999.

     In the fourth quarter 2001, ACL changed the useful life of towboats from 30
to 42 years, which reduced the loss before extraordinary items and net loss by
$1,142 for the year ended December 28, 2001. This change in accounting estimate
was based on additional information about the useful life of the towboat fleet.

     Properties and other long-lived assets are reviewed for impairment whenever
events or business conditions indicate the carrying amount of such assets may
not be fully recoverable. Initial assessments of recoverability are based on
estimates of undiscounted future net cash flows associated with an asset or a
group of assets. Where impairment is indicated, the assets are evaluated for
sale or other disposition, and their carrying

                                        38
<PAGE>
                         AMERICAN COMMERCIAL LINES LLC

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

amount is reduced to fair value based on discounted net cash flows or other
estimates of fair value. There were no fixed asset impairment losses in 2001.
Fixed asset impairment losses of $3,865 and $230 were recorded in 2000 and 1999
respectively in Materials, Supplies and Other on the Consolidated Statement of
Operations. These losses affect the barging segment.

  GLOBAL MATERIALS SERVICES LLC

     ACL's ownership interest in Global Materials Services LLC ("GMS"), a joint
venture between American Commercial Terminals LLC ("ACT") a wholly owned
subsidiary of ACL, and Mid-South Terminal Company, L.P., or unaffiliated third
party, was 50% at December 28, 2001 and December 29, 2000. ACL accounts for this
investment by the equity method. ACL's investment in GMS at December 28, 2001
and December 29, 2000 of $10,208 and $9,124 respectively, is included in other
assets on the consolidated statement of financial position. Earnings related to
ACL's investment in GMS for the year ended December 28, 2001 and December 29,
2000 were $1,015 and $1,138, respectively, and are included in other income in
the consolidated statement of operations. During 2001, ACL contributed $1,200 in
cash to GMS. Other comprehensive loss related to ACL's investment in GMS for the
year ended December 28, 2001 and December 29, 2000 was $1,131 and $329,
respectively, related to interest rate swaps and foreign currency translation.

  UABL LIMITED

     On October 24, 2000, ACL contributed certain assets at book value to UABL
Limited ("UABL"), an Argentine company. ACL accounts for its 50% ownership in
UABL by the equity method. ACL's investment in UABL of $49,892 at December 28,
2001 and $49,686 at December 29, 2000, is included in other assets on the
consolidated statement of financial position. ACL's loss (net of minority
interest) of $2,960 and $1,440 for the years ended December 28, 2001 and
December 29, 2000, respectively, are included in other income in the
consolidated statement of operations. In 2001, ACL made additional investments
in UABL of $4,069.

  VESSEL LEASING LLC

     In 2001 ACL and Vectura invested in a new company named Vessel Leasing LLC
("Vessel Leasing"). 399 Venture Partners, Inc., the majority owner of ACL, also
holds a majority ownership interest in Vectura Holding Company LLC which holds a
majority ownership interest in Vectura.

     ACL accounts for its 50% ownership in Vessel Leasing by the equity method.
ACL's investment of $6,808 in Vessel Leasing is included in other assets on the
consolidated statement of financial position. ACL's share of Vessel Leasing's
net loss is $38 in 2001 and is included in other income in the consolidated
statement of operations. Vessel Leasing's statement of financial position is not
consolidated with ACL. As of December 28, 2001 Vessel Leasing had total assets
of $54,921 and total liabilities of $45,571 including public long term debt of
$42,580 (including current portion) and $2,830 in unearned revenue from prepaid
charter payments made by ACL's domestic barging subsidiary. Vessel Leasing's
long term debt is not guaranteed by ACL or any of ACL's subsidiaries. ACL's
domestic barge operating subsidiary has a long term operating lease commitment
to Vessel Leasing, which is guaranteed by ACL.

     ACL sold new barges for $47,757 to Vessel Leasing in 2001. Profit on sales
of barges to Vessel Leasing is deferred by Jeffboat and recognized over the life
of the lease. All of these barges, except for those representing a capital lease
commitment of $3,924 were leased by Vessel Leasing to ACL as operating leases
which resulted in ACL charter expense of $1,705. ACL also recorded $3,924 in
capital leases with Vessel Leasing in 2001.

                                        39
<PAGE>
                         AMERICAN COMMERCIAL LINES LLC

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

  DEBT AMORTIZATION

     ACL amortizes debt costs over the term of the debt. Amortization expense
was $4,413 in 2001, $2,801 in 2000 and $2,802 in 1999 and is included in
interest expense.

  REVENUE RECOGNITION

     Barge transportation revenue is recognized proportionately as shipments
move from origin to destination. The position of shipments is determined by boat
position tracking through use of a global positioning system. This method
results in a better matching of revenue and expense. Terminal, repair and other
revenue is recognized as services are provided. Marine construction revenue and
related expense is primarily recognized on the completed-contract method, due to
the short-term nature of contracts. Revenue from sale/leaseback transactions is
deferred in other liabilities and recognized over the life of the lease.

  SECOND INJURY FUND

     ACL recognized $1,737 in non-cash expense related to a workers compensation
second injury fund in accordance with adoption of the American Institute of
Certified Public Accountants (AICPA) Statement of Position (SOP) 97-3,
"Accounting by Insurance and Other Enterprises for Insurance-Related
Assessments" in the first quarter of 1999.

  RECLASSIFICATION

     Certain prior year amounts have been reclassified to conform to the current
year presentation.

NOTE 2.  PURCHASES AND DISPOSITIONS

     In 2001, ACL sold five towboats, a shipyard in Harahan, Louisiana, a
cleaning facility in Baton Rouge, Louisiana and other assets to meet the
requirements of the Senior Debt Facility amendments described in Note 4. This
resulted in a gain of $16,762 which is reported in gain on property dispositions
in the consolidated statement of operations.

     On May 25, 2001, ACL entered into an agreement to sell substantially all of
the terminals of ACT, other than its coal transfer facility at St. Louis,
Missouri and its tank storage facility at Memphis, Tennessee. The sale of seven
terminals was completed on May 25, 2001. An additional terminal site in Omaha,
Nebraska was transferred on June 29, 2001. Subsequent to June 29, 2001,
additional proceeds were received from the condemnation of Omaha Terminal. ACL
recorded a gain from these transactions of $1,886 in Other Income.

     On May 26, 2000, ACL purchased certain barging assets of the Peavey Barge
Line ("Peavey") from ConAgra, Inc. for $31,500 in cash. The purchase price was
financed with existing credit facilities and cash flows from operations. ACL
also assumed $3,800 in capital leases.

     ACL sold its 100% membership interest in Waterway Communications System LLC
("Watercom") on September 6, 2000 to Mobex Communications, Inc. ("Mobex") for
$13,600 in cash and $2,400 in Mobex preferred stock. The sale resulted in a gain
of $11,418. Cash proceeds were used to pay existing ACL debt.

NOTE 3.  ACCOUNTS RECEIVABLE SECURITIZATION

     At December 28, 2001 and December 29, 2000 ACL had $51,000 and $56,000,
respectively, outstanding under the accounts receivable securitization facility
agreement and had $22,603 and $15,332, respectively, of net residual interest in
the securitized receivables which is included in Accounts Receivable, Net in
ACL's consolidated financial statements. The fair value of the net residual
interest is measured at the time of the sale and is based on the sale of similar
assets. In 2001, ACL received gross proceeds of $30,800 from the sale of
receivables and made gross payments of $35,800 under this Agreement.
                                        40
<PAGE>
                         AMERICAN COMMERCIAL LINES LLC

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

     PNC Bank, National Association ("PNC"), as Administrator under ACL's
receivables facility with PNC (the "Receivables Purchase Agreement"), asserted
that ACL was in default under the Receivables Purchase Agreement. ACL and PNC
entered into a waiver of the Receivables Purchase Agreement on February 11, 2002
(the "RPA Waiver") and a modification to that waiver on February 25, 2002 (the
"RPA Waiver"). The RPA Waiver has the effect of waiving the default asserted by
PNC, provided that ACL enters into certain definitive agreements with Danielson
relating to the Danielson Recapitalization and refinances the Receivables
Purchase Agreement on or before April 30, 2002. The RPA Waiver also requires ACL
to reduce its overall borrowings under the facility to no more than $50.0
million. A default under the Receivables Purchase Agreement or the RPA Waiver
could have a material adverse effect on ACL's liquidity.

     In September 2000, the Financial Accounting Standards Board ("FASB") issued
Statement of Financial Accounting Standards No. 140, "Accounting for Transfers
and Servicing of Financial Assets and Extinguishment of Liabilities" ("SFAS
140"). The Statement is effective for transfers and servicing of financial
assets and extinguishments of liabilities occurring after March 31, 2001. ACL
adopted FAS 140 on April 1, 2001. The adoption required the consolidation of ACL
Funding Corp. ("ACLF"), a wholly-owned subsidiary, that was previously treated
as a non-consolidated Qualified Special Purpose Entity. The consolidation
resulted in a charge to Retained Earnings of $989 in the second quarter 2001.

NOTE 4.  DEBT

     Debt consists of the following:

<Table>
<Caption>
                                                                2001       2000
                                                              --------   --------
<S>                                                           <C>        <C>
Revolving Credit Facility...................................  $ 84,000   $ 66,750
$235 million Term Loan......................................   169,378    191,001
$200 million Term Loan......................................   143,951    162,328
$300 million Senior Notes...................................   295,000    300,000
Other Notes.................................................       190      4,726
                                                              --------   --------
                                                               692,519    724,805
Less, short-term debt.......................................    84,000     66,750
Less, current portion long-term debt........................   608,519     44,579
                                                              --------   --------
                                                              $    0.0   $613,476
                                                              ========   ========
</Table>

     ACL has a Revolving Credit Facility, which provides for revolving loans and
letters of credit not to exceed the aggregate principal amount of $100,000,
maturing in June, 2005, but each loan must be repaid within one year. The
Revolving Credit Facility bears an interest rate equal to LIBOR plus a margin
based on ACL's performance. Borrowings on the facility at December 28, 2001 and
December 29, 2000 were $84,000 and $66,750, respectively, with interest rates of
5.75% to 7.5% at December 28, 2001 and 8.75% at December 29, 2000. The borrowing
base was reduced by outstanding letters of credit of $16,260 and $17,857 at
December 28, 2001 and December 29, 2000, respectively.

     The $235,000 Term Loan matures in 2001 through 2007. The $200,000 Term Loan
matures in 2001 through 2006. The two Term Loans bear interest at a rate equal
to LIBOR plus a margin based on ACL's performance. The interest rate at December
28, 2001 was 6.3125% for the $235,000 and 6.0625% for the $200,000 term loans.
Interest on the Term Loans is payable quarterly. The Senior Notes require no
principal payments until maturity in 2008 and have a fixed interest rate of
10.25%. Interest is payable semi-annually. The Term Loans and Revolving Credit
Facility are collateralized by most of ACL's assets. The Senior Notes are not
collateralized. ACL has Other Notes totaling $190 which mature in 2002 with
rates of 6.75% and 4.9%.

                                        41
<PAGE>
                         AMERICAN COMMERCIAL LINES LLC

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

     The Term Loans, Revolving Credit Facility and Senior Notes contain a number
of covenants, including specified financial ratios. As of December 28, 2000 ACL
failed to meet the leverage ratio and the coverage ratio covenants as defined in
the Senior Credit Facility ("Amendment No. 5"). ACL entered into an agreement to
amend the covenants in the Senior Credit Facility. Under the terms of the
amendment, ACL sold $40,000 in certain identified assets and used the proceeds
to repay the Term Loans in 2001. ACL also purchased $5,000 par value of ACL
Senior Notes at a discount in 2001 which resulted in a gain of $1,885 in 2001
from the early extinguishment of debt and is reported as an extraordinary item
in the consolidated statement of operations. ACL also repaid $4,937 in Other
Notes in 2001.

     Following December 31, 2001, the covenant requirements reverted to those
specified in the original Senior Credit Facilities which are more restrictive
than the amended covenants. Certain covenants added by Amendment No. 5 also
become more restrictive. Due in part to reduced EBITDA as a result of the
closure of the upper Mississippi River because of flooding during the second
quarter of 2001, it is not likely that the Company will be able to meet these
covenant requirements in 2002, absent an additional amendment to the Senior
Credit Facilities and the consummation of the Danielson Recapitalization
discussed below. Failure to meet these covenants could have a material adverse
effect on the Company.

     On December 31, 2001, ACL elected not to pay the interest due (the "Bond
Interest Payment") on its Senior Notes due to ongoing negotiations with its
lenders and noteholders regarding the restructuring of ACL's bank and bond debt.
Following the thirty (30) day grace period provided by the Indenture, ACL again
elected not to make the Bond Interest Payment. This election not to pay the Bond
Interest Payment is an event of default under the Indenture, however, certain
Noteholders party thereto entered into forebearance agreements with ACL agreeing
not to accelerate the debt or take additional adverse actions against ACL.
Acceleration of the debt under the Indenture would have a material adverse
effect on ACL's liquidity. Further, as a result of ACL's failure to make the
Bond Interest Payment, J.P. Morgan Chase & Co. ("J.P. Morgan") delivered a
notice to ACL in January 2002 asserting that ACL was in default of the Credit
Agreement. Certain lenders party to the Credit Agreement also entered into
forebearance agreements with ACL, agreeing not to accelerate the debt or take
additional adverse actions against ACL. An acceleration of the debt under the
Credit Agreement would have a material adverse effect on ACL's liquidity.

     In accordance with these facts and circumstances, ACL has reclassified the
outstanding obligations under the Indenture and the Credit Agreement from long
term to current.

     ACL has been pursuing strategic financial restructuring alternatives. On
March 15, 2002, ACL entered into a definitive recapitalization agreement (the
"Recapitalization Agreement") regarding the acquisition and recapitalization of
ACL (the "Danielson Recapitalization") by Danielson Holding Corporation
("Danielson"). Under the terms of the Danielson Recapitalization, Danielson
would acquire 100% of the membership interests of the Parent. ACL's present
indirect preferred equity holders would receive $7,000 in cash. ACL management
will receive approximately $1,695 of restricted Danielson common stock. In
addition, Danielson will deliver $25,000 in cash and approximately $58,493 of
ACL's existing Series B 10 1/4% Senior Notes due June 2008 (the "Senior Notes")
issued pursuant to an indenture dated as of June 30, 1998 with the United States
Trust Company of New York (the "Indenture"), to ACL Holdings in connection with
the transaction. Danielson currently expects to fund the acquisition through a
rights offering to its existing security holders, upon terms and conditions to
be determined. However, consummation of the Recapitalization Agreement is not
conditioned on the successful completion of the rights offering.

     The Danielson Recapitalization will result in a reduction of ACL's senior
secured bank debt incurred under the Senior Credit Facilities and the
restructuring of the Senior Notes pursuant to an exchange offer and consent
solicitation in which $236,507 of the existing Senior Notes (all notes held by
parties other than Danielson) would be exchanged for $120,000 of new 11 1/4%
senior notes due January 1, 2008 ("New Senior Notes") and approximately $116,507
of new 12% pay-in-kind senior subordinated notes due July 1, 2008 ("PIK Notes").
Senior Notes held by Danielson would be retired in conjunction with the
Danielson
                                        42
<PAGE>
                         AMERICAN COMMERCIAL LINES LLC

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

Recapitalization. ACL would also issue additional New Senior Notes in an
aggregate principal amount equal to the accrued and unpaid interest on its
existing Senior Notes, other than those held by Danielson, through the effective
date of the transaction up to $20,000, and to the extent that such accrued and
unpaid interest exceeds $20,000, additional PIK Notes in an amount equal to such
excess would be issued.

     The Recapitalization Agreement provides that the exchange offer and consent
solicitation will be made in reliance on a registration exemption provided by
Section 3(a)(9) under the Securities Act of 1933, conditioned on the minimum
participation of 95% of the outstanding principal amount of ACL's outstanding
Senior Notes, as to which noteholders holding more than two-thirds of the
outstanding principal amount of such notes have agreed to tender. In the event
that the exchange offer and consent solicitation is not consummated by June 15,
2002, the Recapitalization Agreement provides for the implementation of the
Danielson Recapitalization through a voluntary prepackaged bankruptcy plan under
Chapter 11 of the Bankruptcy Code, as to which noteholders holding more than
two-thirds of the outstanding principal amount of ACL's outstanding Senior Notes
have agreed to accept.

     In order to assist in the consummation of the Danielson Recapitalization,
ACL has received forbearance agreements from its senior secured lenders pending
the negotiation and execution of definitive documentation relating to the
amendment of ACL's Senior Credit Facilities satisfactory to the parties.

     In June 1998, ACL deposited $26,128 into an escrow fund which, together
with future income earned on such amount, was used to repay $24,400 principal of
the Terminal Revenue Refunding Bonds ("Revenue Bonds") plus redemption premium
and interest in 2000. The redemption premium of $734 was reported as an
extraordinary item in the consolidated statement of operations.

     Long-term debt due in the next five years under the revised Term Loan
agreement, the Senior Notes and Other Notes is $608,519 in 2002, and $0
thereafter.

NOTE 5.  INCOME TAXES

     ACL and its subsidiaries (except for ACL Capital Corp., American Commercial
Lines Funding Corporation and the foreign subsidiaries) are organized as limited
liability companies. As such, ACL passes through its U.S. federal and
substantially all of its state (but not foreign) taxable income to its members
who are responsible for income taxes on such taxable income.

     Components of income tax expense (benefit) follow:

<Table>
<Caption>
                                                              2001    2000     1999
                                                              ----   ------   ------
<S>                                                           <C>    <C>      <C>
Currently payable:
  State.....................................................  $ 24   $   37   $  (27)
  Foreign...................................................    94    4,226    1,685
                                                              ----   ------   ------
                                                              $118   $4,263   $1,658
                                                              ====   ======   ======
</Table>

     Income tax computed at federal statutory rates reconciled to income tax
expense (benefit) follows:

<Table>
<Caption>
                                                              2001    2000     1999
                                                              ----   ------   ------
<S>                                                           <C>    <C>      <C>
State Income Taxes, Net.....................................  $ 24   $   37   $  (27)
Foreign Operations, Net.....................................    94    4,226    1,685
                                                              ----   ------   ------
     Total Income Tax Expense...............................  $118   $4,263   $1,658
                                                              ====   ======   ======
</Table>

                                        43
<PAGE>
                         AMERICAN COMMERCIAL LINES LLC

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

NOTE 6.  EMPLOYEE BENEFIT PLANS

     ACL sponsors or participates in defined benefit plans covering both
salaried and hourly employees. The plans provide for eligible employees to
receive benefits based on years of service and either compensation rates near
retirement or at a predetermined multiplier factor. Contributions to the plans
are sufficient to meet the minimum funding standards set forth in the Employee
Retirement Income Security Act of 1974 ("ERISA"), as amended. Plan assets
consist primarily of common stocks, corporate bonds and cash and cash
equivalents.

     As of January 31, 2000, the accrued benefit obligation under the American
Commercial Lines LLC Pension Plan ("ACL Pension Plan") was frozen. The past
service benefit obligation is complemented by a new prospective annual benefit
obligation. This change affects salaried employees covered by the ACL Pension
Plan and resulted in cost savings to ACL in 2001 and 2000. In 1999 the National
Marine Pension Plan was merged into the ACL Pension Plan.

     In addition to the defined benefit pension and related plans, ACL has a
defined benefit post-retirement plan covering most full-time employees. The plan
provides medical benefits and is contributory, with retiree contributions
adjusted annually, and contains other cost-sharing features such as deductibles
and coinsurance. The accounting for the health care plan anticipates future
cost-sharing changes to the written plan that are consistent with ACL's
expressed intent to increase the retiree contribution rate annually.

     A summary of the pension and post-retirement plan components at September
30 (valuation date) follows:

<Table>
<Caption>
                                              PENSION BENEFITS     POST-RETIREMENT PLAN
                                             -------------------   ---------------------
                                               2001       2000       2001        2000
                                             --------   --------   ---------   ---------
<S>                                          <C>        <C>        <C>         <C>
CHANGE IN BENEFIT OBLIGATION:
Benefit obligation, beginning of year......  $(84,050)  $(97,480)  $(11,161)   $(10,319)
Service cost...............................    (3,818)    (3,783)      (399)       (380)
Interest cost..............................    (6,408)    (6,092)      (826)       (807)
Plan participants' contributions...........        --         --       (261)       (206)
Amendments.................................        --     18,657         --          --
Actuarial (loss) gain......................        --         --     (1,176)       (480)
Liability gain (loss)......................    (2,913)       574         --          --
Benefits paid..............................     4,253      4,074      1,411       1,031
                                             --------   --------   --------    --------
Benefit obligation, end of year............  $(92,936)  $(84,050)  $(12,412)   $(11,161)
                                             ========   ========   ========    ========
CHANGE IN PLAN ASSETS:
Fair value of plan assets at beginning of
  year.....................................  $118,305   $114,446   $     --    $     --
Actual return on plan assets...............    (1,100)     7,919         --          --
Employer contribution......................        12         14      1,150         825
Plan participants' contributions...........        --         --        261         206
Benefits paid..............................    (4,253)    (4,074)    (1,411)     (1,031)
                                             --------   --------   --------    --------
Fair value of plan assets at end of year...  $112,964   $118,305   $     --    $     --
                                             ========   ========   ========    ========
</Table>

                                        44
<PAGE>
                         AMERICAN COMMERCIAL LINES LLC

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

<Table>
<Caption>
                                              PENSION BENEFITS     POST-RETIREMENT PLAN
                                             -------------------   ---------------------
                                               2001       2000       2001        2000
                                             --------   --------   ---------   ---------
<S>                                          <C>        <C>        <C>         <C>
FUNDED STATUS:
Funded status..............................  $ 20,027   $ 34,255   $(12,412)   $(11,161)
Unrecognized net actuarial loss (gain).....     7,193     (8,929)    (3,499)     (4,946)
Unrecognized prior service cost............   (21,094)   (23,110)    (1,153)     (1,441)
Net claims during 4th quarter..............         4         --        407         196
                                             --------   --------   --------    --------
Prepaid (accrued) benefit cost.............  $  6,130   $  2,216   $(16,657)   $(17,352)
                                             ========   ========   ========    ========
AMOUNTS RECOGNIZED IN THE CONSOLIDATED
  STATEMENT OF FINANCIAL POSITION CONSIST
  OF:
Prepaid benefit cost.......................  $ 26,067   $ 24,512   $     --    $     --
Accrued benefit liability..................   (20,108)   (22,614)   (16,657)    (17,352)
Other......................................       171        318         --          --
                                             --------   --------   --------    --------
Net amount recognized......................  $  6,130   $  2,216   $(16,657)   $(17,352)
                                             ========   ========   ========    ========
</Table>

     As of December 28, 2001, the American Commercial Vessel and Terminal
Employees' Pension Plan (the "ACV&T Plan") had an accumulated benefit obligation
of $10,181 and a fair value of assets of $9,277. With the merger of the ACV&T
Plan into the ACL Pension Plan on December 31, 2001, the fair value of the
assets of the combined plans exceeds the accumulated benefit obligations related
thereto.

  COMPONENTS OF NET PERIODIC BENEFIT COST:

<Table>
<Caption>
                                               PENSION PLANS            POST-RETIREMENT PLAN
                                       ------------------------------   ---------------------
                                         2001       2000       1999     2001    2000    1999
                                       --------   --------   --------   -----   -----   -----
<S>                                    <C>        <C>        <C>        <C>     <C>     <C>
Service cost.........................  $  3,818   $  3,783   $  6,682   $ 399   $ 380   $ 633
Interest cost........................     6,408      6,092      6,898     826     807     767
Expected return on plan assets.......   (11,937)   (11,169)   (10,093)     --      --      --
Transition obligation amortization...        --       (957)    (1,237)     --      --      --
Amortization of prior service
  costs..............................    (2,015)    (1,875)      (609)   (288)   (288)     --
(Gain)/loss Amortization.............      (172)      (220)       167    (348)     --      --
Recognized net actuarial gain........        --         --         --      --    (418)   (575)
                                       --------   --------   --------   -----   -----   -----
Net periodic benefit cost............  $ (3,898)  $ (4,346)  $  1,808   $ 589   $ 481   $ 825
                                       ========   ========   ========   =====   =====   =====
  WEIGHTED-AVERAGE ASSUMPTIONS AS OF SEPTEMBER 30:
Discount rate........................      7.50%      7.75%      7.75%   7.75%   7.50%   6.75%
Expected return on plan assets.......     10.00%     10.00%     10.00%     NA      NA      NA
Rate of compensation increase........      4.00%      4.00%      5.00%     NA      NA      NA
</Table>

     The net post-retirement benefit obligation was determined using the
assumption that the health care cost trend rate for retirees was 8.0% for
2000-2001, decreasing gradually to a 5.5% trend rate by 2008 and remaining at
that level thereafter. A 1% increase in the assumed health care cost trend rate
would have increased the accumulated post-retirement benefit obligation as of
December 28, 2001 by $875 and the aggregate of the service and interest cost
components of net periodic post-retirement benefit expense for 2001 by $125. A
1% decrease in the assumed health care cost trend rate would have decreased the
accumulated

                                        45
<PAGE>
                         AMERICAN COMMERCIAL LINES LLC

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

post-retirement obligation as of December 28, 2001 by $750 and the aggregate of
the service and interest cost components of net periodic post-retirement benefit
expense for 2001 by $105.

     ACL also sponsors certain contributory defined contribution plans covering
eligible employee groups. Contributions to such plans are based upon a
percentage of employee contributions and were $1,471, $1,456 and $2,028 in 2001,
2000 and 1999, respectively.

     Certain employees are covered by union-sponsored, collectively-bargained,
multi-employer defined benefit pension plans. Contributions to such plans, which
are based upon union contracts, were approximately $74, $84 and $76 in 2001,
2000 and 1999, respectively.

NOTE 7.  LEASE OBLIGATIONS

     ACL leases buildings, data processing hardware and operating equipment
under various operating leases and charter agreements, which expire from 2001 to
2017 and which generally have renewal options at similar terms. Certain vessel
leases also contain purchase options at prices approximating fair value of the
leased vessels. Rental expense under continuing obligations was approximately
$56,711 in 2001, $49,463 in 2000 and $43,978 in 1999.

     At December 28, 2001, ACL's operating leases with initial or remaining
noncancelable lease terms longer than one year and capital leases were as
follows:

<Table>
<Caption>
                                                                                          2007
                                       2002      2003      2004      2005      2006     AND AFTER
                                      -------   -------   -------   -------   -------   ---------
<S>                                   <C>       <C>       <C>       <C>       <C>       <C>
Operating Lease Obligations:
  Operating Leases..................   40,735    33,003    28,905    26,891    19,732     94,199
  Operating Leases -- Related
     Parties........................    4,849     5,378     5,317     4,930     4,930     33,984
                                      -------   -------   -------   -------   -------    -------
                                       45,584    38,381    34,222    31,821    24,662    128,183

Future Capital lease Obligations:
  Capital Leases....................      557       460       460       460       460        192
  Capital Leases -- Related
     Parties........................      432       586       568       455       455      5,087
                                      -------   -------   -------   -------   -------    -------
                                          989     1,046     1,028       915       915      5,279
</Table>

     ACL entered into capital leases of $3,924 and $6,163 in 2001 and 2000,
respectively. The 2001 capital lease was with a related party. ACL incurred
interest expense related to capital leases of $235 in 2001 and $112 in 2000.

     The total future minimum lease payments under capital leases of $10,172
less an interest amount of $4,245 results in a present value of net minimum
lease payments of $5,927.

NOTE 8.  RELATED PARTIES

     Prior to July 1, 1998, ACL was a wholly-owned subsidiary of CSX. ACL had a
new equipment charter with a CSX subsidiary and recorded expense of $1,070 in
1999 until the charter was bought out in 1999 for $2,419.

     In 2001 ACL received $11,969 from GMS for the sale of terminals and
proceeds from the condemnation of a terminal. ACL recognized a gain of $1,886
from these transactions.

     ACL recorded charter income from UABL of $11,052 and $2,089 in 2001 and
2000, respectively. ACL also recorded administrative fee expenses to UABL of
$7,709 and $1,457 in 2001 and 2000, respectively. ACL

                                        46
<PAGE>
                         AMERICAN COMMERCIAL LINES LLC

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

sold used barges to UABL for $790 in 2001. At December 28, 2001 ACL had
receivables of $13,402 and payables of $8,397 with UABL.

     In 2001, ACL and Vectura Group invested in Vessel Leasing; 399 Venture
Partners, Inc., the majority owner of ACL, also holds a majority ownership
interest in Vectura Holding Company LLC which holds a majority ownership
interest in Vectura Group.

     ACL accounts for its 50% ownership in Vessel Leasing by the equity method.
ACL's investment of $6,808 in Vessel Leasing is included in other assets on the
consolidated statement of financial position. ACL's share of Vessel Leasing's
net loss is $38 in 2001 and is included in other income in the consolidated
statement of operations.

     Vessel Leasing's statement of financial position is not consolidated with
ACL. As of December 28, 2001 Vessel Leasing had total assets of $54,921 and
total liabilities of $45,571 including public long term debt of $42,580
(including current portion) and $2,830 in unearned revenue from prepaid charter
payments made by ACL's domestic barging subsidiary. Vessel Leasing's long term
debt is not guaranteed by ACL or any of ACL's subsidiaries. ACL's domestic barge
operating subsidiary has a long term operating lease commitment to Vessel
Leasing, which is guaranteed by ACL.

     ACL sold new barges for $47,757 to Vessel Leasing in 2001. Profit on sales
of barges to Vessel Leasing is deferred by Jeffboat and recognized over the life
of the lease. All of these barges, except for those representing a capital lease
commitment of $3,924 million, were leased by Vessel Leasing to ACL as operating
leases which resulted in ACL charter expense of $1,705. ACL also recorded $3,924
in capital leases with Vessel Leasing in 2001.

NOTE 9.  FINANCIAL INSTRUMENTS AND RISK MANAGEMENT

     The carrying amounts and fair values of ACL's financial instruments are as
follows:

<Table>
<Caption>
                                                     2001                    2000
                                             ---------------------   ---------------------
                                             CARRYING                CARRYING
                                              AMOUNT    FAIR VALUE    AMOUNT    FAIR VALUE
                                             --------   ----------   --------   ----------
<S>                                          <C>        <C>          <C>        <C>
ASSETS:
Interest Rate Cap..........................  $     37    $     37    $    688    $    198
LIABILITIES:
Revolving Credit Facility..................  $ 84,000    $ 84,000    $ 66,750    $ 66,750
$235 million Term Loan.....................   169,378     169,378     191,001     191,001
$200 million Term Loan.....................   143,951     143,951     162,328     162,328
$300 million Senior Notes..................   295,000     147,500     300,000     229,500
Other Notes................................       190         187       4,726       4,735
Net unrealized (loss) gain on fuel hedge
  agreements...............................      (242)       (242)         --          29
</Table>

     The fair values of the Interest Rate Cap and Senior Notes payable are based
on quoted market values. The carrying values of the Term Loans, all of which
bear interest at floating rates, approximate their fair values. The fair value
of the Other Notes have been estimated using discounted cash flow analyses based
on ACL's current incremental borrowing rates for similar types of borrowing
arrangements.

  FUEL PRICE RISK MANAGEMENT

     ACL uses forward purchases to provide short-term protection against a sharp
increase in diesel fuel prices. These instruments generally cover a portion of
the company's forecasted diesel fuel needs for towboat

                                        47
<PAGE>
                         AMERICAN COMMERCIAL LINES LLC

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

operations over the next one to twelve months. ACL accounts for the forward fuel
purchases as cash flow hedges. In accordance with Statement of Financial
Accounting Standards No. 133, "Accounting for Derivative Instruments and Hedging
Activities" ("SFAS 133"), such financial instruments are marked-to-market with
the offset to other comprehensive income and then subsequently recognized as a
component of fuel expense when the underlying fuel being hedged is used. ACL
adopted SFAS 133 at the beginning of the first quarter of 2001.

     At December 28, 2001, ACL had forward fuel purchase contracts outstanding
with an aggregate notional value of approximately $2,806, and a fair value of
approximately $242 (loss), which has been recorded in other current liabilities
with the offset to other comprehensive earnings for $242 (loss) and an
additional fair value of $131 (loss) which has been recorded as other current
liabilities with the offset to fuel expense in the consolidated statement of
operations. The $242 loss will be recognized in earnings within the next ten
months. Under these agreements, ACL will pay fixed prices ranging from $0.51 to
$0.86 per gallon. There were 4.4 million gallons remaining on the contracts at
December 28, 2001. The agreements terminate October 31, 2002. Due to the
bankruptcy of Enron, one of the trading partners, ACL believes the hedge is no
longer effective and has expensed the mark-to-market loss of $131 as fuel
expense in the 2001 consolidated statement of operations. Management believes
that the other trading partner does not present a credit risk to ACL.

  INTEREST RATE RISK MANAGEMENT

     ACL entered into an interest rate cap agreement in the third quarter of
2000 to reduce the impact of potential rate increases on floating rate debt. The
interest rate cap has a notional amount of $202,000 and a fair value of $37 as
of December 28, 2001 and is effective through August 11, 2003. The Company
accounts for the interest rate cap as a cash flow hedge whereby the fair value
of the interest rate cap is reflected as an asset or liability in the
accompanying consolidated statement of financial position. The cap rate (hedging
instrument) is the same interest rate index as the base interest rate for the
floating rate debt (hedged item). When the interest rate index exceeds the
interest rate cap, a portion of the change in fair value of the instrument
represents a change in intrinsic value which is an effective hedge. This portion
of the change in value will be recorded as other comprehensive income. The
remaining change in fair value of $162 in 2001 is recorded as other expense
(income) on the consolidated statement of operations.

     ACL also records changes to other assets on the accompanying consolidated
statement of financial position, with the offset recorded as comprehensive
income (loss), for changes in the fair value of interest rate swap agreements
entered into by GMS, ACL recognized a comprehensive loss of $747 for its share
of these swaps in 2001.

NOTE 10.  CONTINGENCIES

     A number of legal actions are pending against ACL in which claims are made
in substantial amounts. While the ultimate results of pending litigation cannot
be predicted with certainty, management does not currently expect that
resolution of these matters will have a material adverse effect on the
consolidated results of operations, financial position and cash flows.

NOTE 11.  BUSINESS SEGMENTS

     ACL has two reportable business segments -- barging and construction. ACL's
barging segment includes barge transportation operations in North and South
America and domestic fleeting facilities that provide fleeting, shifting,
cleaning and repair services at various locations along the inland waterways.
The construction segment constructs marine equipment for ACL's domestic and
international fleets as well as external customers.

                                        48
<PAGE>
                         AMERICAN COMMERCIAL LINES LLC

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

     Management evaluates performance based on segment earnings, which is
defined as operating income before income taxes. The accounting policies of the
reportable segments are consistent with those described in the summary of
significant accounting policies. Intercompany sales are transferred at cost.

     Reportable segments are business units that offer different products or
services. The reportable segments are managed separately because they provide
distinct products and services to internal and external customers.

<Table>
<Caption>
                                               REPORTABLE SEGMENTS
                                             -----------------------    ALL OTHER
                                             BARGING    CONSTRUCTION   SEGMENTS(1)    TOTAL
                                             --------   ------------   -----------   --------
<S>                                          <C>        <C>            <C>           <C>
YEAR ENDED DECEMBER 28, 2001
Revenues from external customers...........  $675,697     $102,862       $ 9,942     $788,501
Intersegment revenues......................        --        1,563             4        1,567
Depreciation expense.......................    48,595        2,125         1,380       52,100
Segment earnings...........................    58,956        4,713         1,692       65,361
Segment assets.............................   672,057       59,676        26,203      757,936
Property Additions (Excluding $5,811 in
  capital leases, and related
  expenditures)............................    16,879        2,094           799       19,772

YEAR ENDED DECEMBER 29, 2000
Revenues from external customers...........  $631,748     $124,068       $18,022     $773,838
Intersegment revenues......................        --        2,917         4,308        7,225
Depreciation expense.......................    48,833        2,011         2,613       53,457
Segment earnings...........................    44,243        8,318         3,747       56,308
Segment assets.............................   698,446       52,704        36,388      787,538
Property Additions* (Excluding $6,163 in
  capital leases)..........................    48,005        1,922           934       50,861

YEAR ENDED DECEMBER 31, 1999
Revenues from external customers...........  $593,939     $124,423       $20,774     $739,136
Intersegment revenues......................        --       20,442         5,174       25,616
Depreciation expense.......................    44,787        1,911         3,081       49,779
Segment earnings...........................    57,670       12,387         4,535       74,592
Segment assets.............................   646,613       60,990        68,493      776,096
Property Additions.........................    52,387        1,790         1,703       55,880
</Table>

---------------

  * Barging includes $20,307 of purchased Barging Assets.

(1) Financial data for segments below the reporting thresholds are attributable
    to two operating segments -- a segment operating terminals along the U.S.
    inland waterways and a segment providing voice and data communications to
    marine companies operating on the U.S. inland waterways. The segment
    providing voice and data communications was sold in 2000.

                                        49
<PAGE>
                         AMERICAN COMMERCIAL LINES LLC

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

     The following is a reconciliation of ACL's revenues from external customers
and segment earnings to ACL's consolidated totals.

<Table>
<Caption>
                                                         2001       2000       1999
                                                       --------   --------   --------
<S>                                                    <C>        <C>        <C>
REVENUES
Revenues from external customers.....................  $788,501   $773,838   $739,136
Intersegment revenues................................     1,567      7,225     25,616
Elimination of intersegment revenues.................    (1,567)    (7,225)   (25,616)
                                                       --------   --------   --------
Operating revenue....................................  $788,501   $773,838   $739,136
                                                       ========   ========   ========
EARNINGS
Total segment earnings...............................  $ 65,361   $ 56,308   $ 74,592
Unallocated amounts:
  Interest expense...................................   (70,932)   (70,813)   (71,275)
  Other, net.........................................       591     (1,050)     3,048
  Gain on Sale of Watercom...........................        --     11,418         --
                                                       --------   --------   --------
(Loss) Earnings before income taxes, extraordinary
  item and cumulative effect of accounting change....  $ (4,980)  $ (4,137)  $  6,365
                                                       ========   ========   ========
</Table>

  GEOGRAPHIC INFORMATION

<Table>
<Caption>
                                                     REVENUES               PROPERTIES -- NET
                                          ------------------------------   -------------------
                                            2001       2000       1999       2001       2000
                                          --------   --------   --------   --------   --------
<S>                                       <C>        <C>        <C>        <C>        <C>
United States...........................  $748,837   $733,870   $699,072   $422,877   $469,714
South America...........................    39,664     39,968     40,064     41,256     39,729
                                          --------   --------   --------   --------   --------
Total...................................  $788,501   $773,838   $739,136   $464,133   $509,443
                                          ========   ========   ========   ========   ========
</Table>

     Revenues are attributed to countries based on the location of the service
provided. Properties represent the only long lived assets of ACL.

  MAJOR CUSTOMER

     Revenues from one customer of the barging segment represented approximately
15% in 2001, 14% in 2000 and 14% in 1999 of ACL's consolidated revenues.

NOTE 12.  QUARTERLY DATA (UNAUDITED)

<Table>
<Caption>
                                                                  2001
                                          ----------------------------------------------------
                                            1ST        2ND        3RD        4TH       TOTAL
                                          --------   --------   --------   --------   --------
<S>                                       <C>        <C>        <C>        <C>        <C>
Operating Revenue.......................  $173,098   $192,884   $207,341   $215,178   $788,501
Operating (Loss) Income.................   (10,434)    17,194     24,164     34,437     65,361
(Loss) Earnings Before Extraordinary
  Item and Cumulative Effect............   (29,618)       142      5,690     18,688     (5,098)
Net (Loss) Earnings.....................   (30,108)     2,027      5,690     18,688     (3,703)
</Table>

                                        50
<PAGE>
                         AMERICAN COMMERCIAL LINES LLC

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

<Table>
<Caption>
                                                                  2000
                                          ----------------------------------------------------
                                            1ST        2ND        3RD        4TH       TOTAL
                                          --------   --------   --------   --------   --------
<S>                                       <C>        <C>        <C>        <C>        <C>
Operating Revenue.......................  $167,477   $193,458   $205,738   $207,165   $773,838
Operating Income........................     7,971     16,122     18,217     13,998     56,308
(Loss) Earnings Before Extraordinary
  Item..................................    (8,097)    (2,116)     8,432     (6,619)    (8,400)
Net (Loss) Earnings.....................    (8,097)    (2,850)     8,432     (6,619)    (9,134)
</Table>

<Table>
<Caption>
                                                                  1999
                                          ----------------------------------------------------
                                            1ST        2ND        3RD        4TH       TOTAL
                                          --------   --------   --------   --------   --------
<S>                                       <C>        <C>        <C>        <C>        <C>
Operating Revenue.......................  $173,217   $189,961   $188,617   $187,341   $739,136
Operating Income........................     4,316     19,955     22,480     27,841     74,592
(Loss) Earnings Before Cumulative Effect
  of Accounting Change..................   (12,810)     2,788      5,240      9,489      4,707
Net (Loss) Earnings.....................   (14,547)     2,788      5,240      9,489      2,970
</Table>

     ACL's business is seasonal, and its quarterly revenues and profits
historically are lower during the first and second fiscal quarters of the year
(January through June) and higher during the third and fourth fiscal quarters
(July through December) due to the North American grain harvest.

     A loss of $490 was recorded in the first quarter of 2001 as the cumulative
effect of adopting SFAS 133. An extraordinary gain of $1,885 was recorded in the
second quarter of 2001 relating to the retirement of Senior Notes. In the fourth
quarter 2001, the estimated useful life of boats was changed from 30 to 42
years. This resulted in $1,142 less depreciation for the quarter. The year 2000
included a second quarter extraordinary item charge of $734 for the Terminal
Bond redemption premium, the gain on the sale of Watercom of $11,418 is included
in the third quarter and an impairment loss of $3,865 is included in the fourth
quarter. The first quarter of 1999 includes a non-cash charge of $1,737 for the
workers' compensation second-injury funds due to the adoption of Statement of
Position (SOP) 97-3.

NOTE 13.  CHANGES IN ACCOUNTING STANDARDS

     In July 2001, the FASB issued Statement of Financial Accounting Standards
No. 141, "Business Combinations" ("SFAS 141"), which provides that all business
combinations should be accounted for using the purchase method of accounting and
establishes criteria for the initial recognition and measurement of goodwill and
other intangible assets recorded in connection with a business combination. The
provisions of SFAS 141 apply to all business combinations initiated after June
30, 2001. ACL will apply the provisions of SFAS 141 to any future business
combinations.

     In July 2001, the FASB issued Statement of Financial Accounting Standards
No. 142, "Goodwill and Other Intangible Assets" ("SFAS 142"), which establishes
the accounting for goodwill and other intangible assets following their
recognition. SFAS 142 applies to all goodwill and other intangible assets
whether acquired singly, as part of a group, or in a business combination. SFAS
142 provides that goodwill should not be amortized but should be tested for
impairment annually using a fair-value based approach.

     In addition, SFAS 142 provides that other intangible assets other than
goodwill should be amortized over their useful lives and reviewed for impairment
in accordance with Statement of Financial Accounting Standards No. 121,
"Accounting for the Impairment of Long-Lived Assets to be Disposed Of" ("SFAS
121"). SFAS 142 is effective beginning on December 29, 2001. Upon adoption, ACL
will be required to perform a transitional impairment test under SFAS 142 for
all goodwill recorded as of December 29, 2001. Any impairment loss recorded as a
result of completing the transitional impairment test will be treated as a
change in accounting principle. The impact of the adoption of SFAS 142 on ACL's
results of operations for all periods beginning on or after December 29, 2001
will be to eliminate amortization of

                                        51
<PAGE>
                         AMERICAN COMMERCIAL LINES LLC

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

goodwill. Management of ACL has not performed a transitional impairment test
under SFAS 142 and accordingly cannot estimate the impact of the adoption SFAS
142 as of December 29, 2001.

     In October 2001, the FASB issued Statement of Financial Accounting
Standards No. 144, "Accounting for the Impairment or Disposal of Long-Lived
Assets" ("SFAS 144"). The Statement addresses financial accounting and reporting
for the impairment or disposal of long-lived assets. This Statement supersedes
SFAS 121, and the accounting and reporting provisions of Accounting Principles
Board Opinion No. 30, Reporting the Results of Operations -- Reporting the
Effects of Disposal of a Segment of a Business, and Extraordinary, Unusual and
Infrequently Occurring Events and Transactions, for the disposal of a segment of
business (as previously defined in that Opinion). This statement also amends
Accounting Research Bulletin No. 51, Consolidated Financial Statements, to
eliminate the exception to consolidation for a subsidiary for which control is
likely to be temporary. The objectives of SFAS 144 are to address significant
issues relating to the implementation of SFAS 121 and to develop a single
accounting model, based on the framework established in SFAS 121, for long-lived
assets to be disposed of by sale, whether previously held and used or newly
acquired. ACL will adopt SFAS 144 in ACL's first quarter 2002. Management is
currently evaluating the impact of SFAS 144 on ACL's future financial reporting.

NOTE 14.  SUMMARIZED FINANCIAL INFORMATION FOR SIGNIFICANT
50-PERCENT-OR-LESS-OWNED PERSONS

<Table>
<Caption>
                                                              DECEMBER 31,   DECEMBER 31,
                                                                  2001           2000
                                                              ------------   ------------
<S>                                                           <C>            <C>
Current assets..............................................     36,931         21,624
Noncurrent assets...........................................    149,593        130,508
Current liabilities.........................................     43,400         18,882
Noncurrent liabilities......................................     55,593         43,791
</Table>

<Table>
<Caption>
                                                                         YEARS ENDED
                                                          ------------------------------------------
                                                          DECEMBER 31,   DECEMBER 31,   DECEMBER 31,
                                                              2001           2000           1999
                                                          ------------   ------------   ------------
<S>                                                       <C>            <C>            <C>
Revenue.................................................    103,364         52,430         37,102
Operating income (loss).................................      3,117          3,830          6,205
(Loss) earnings before extraordinary item...............     (4,990)        (1,173)         2,896
     and cumulative effect of accounting................         --             --             --
     change.............................................         --             --             --
Net (loss) earnings.....................................     (4,990)        (1,173)         2,896
</Table>

NOTE 15.  GUARANTOR FINANCIAL STATEMENTS

     The $735,000 of debt issued by ACL and a revolving credit facility, which
provides for revolving loans and the issuance of letters of credit in an
aggregate amount up to $100,000, are guaranteed by ACL's wholly-owned domestic
subsidiaries, other than ACL Capital Corp. (which was formed in connection with
the transaction), any Accounts Receivable Subsidiary (as defined in the
Indentures with respect to such debt) and certain subsidiaries of ACL without
substantial assets or operations (collectively the "Guarantor Subsidiaries").
Such guarantees are full, unconditional and joint and several. Separate
financial statements of the Guarantor Subsidiaries are not presented because
management has determined that they would not be material to investors. The
following supplemental financial information sets forth on a combined basis,
combining statements of financial position, statements of earnings and
statements of cash flows for the Guarantor Subsidiaries, non-guarantor
subsidiaries and for ACL as of December 28, 2001 and December 29, 2000 and for
the fiscal years ended December 28, 2001, December 29, 2000 and December 31,
1999.

                                        52
<PAGE>

                         AMERICAN COMMERCIAL LINES LLC

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
     COMBINING STATEMENT OF OPERATIONS FOR THE YEAR ENDED DECEMBER 28, 2001

<Table>
<Caption>
                                                  GUARANTOR        OTHER                      COMBINED
                                                 SUBSIDIARIES   SUBSIDIARIES   ELIMINATIONS    TOTALS
                                                 ------------   ------------   ------------   --------
                                                                (DOLLARS IN THOUSANDS)
<S>                                              <C>            <C>            <C>            <C>
OPERATING REVENUE
  Revenue......................................    $701,081       $28,611        $    --      $729,692
  Revenue from related parties.................      47,757        11,052             --        58,809
                                                   --------       -------        -------      --------
                                                    748,838        39,663             --       788,501
OPERATING EXPENSE
  Materials, Supplies and Other................     319,093        22,513             --       341,606
  Rent.........................................      55,191         1,520             --        56,711
  Labor and Fringe Benefits....................     161,606         4,435             --       166,041
  Fuel.........................................      92,991           569             --        93,560
  Depreciation and Amortization................      50,364         5,133             --        55,497
  Gain on Property Dispositions, Net...........     (16,498)           --             --       (16,498)
  Taxes, Other Than Income Taxes...............      26,166            57             --        26,223
                                                   --------       -------        -------      --------
                                                    688,913        34,227             --       723,140
                                                   --------       -------        -------      --------
OPERATING INCOME...............................      59,925         5,436             --        65,361

OTHER EXPENSE (INCOME)
  Interest Expense.............................      70,932            --             --        70,932
  Interest Expense, Affiliate -- Net...........          --         6,364         (6,364)           --
  Other, Net...................................      (8,328)        1,373          6,364          (591)
                                                   --------       -------        -------      --------
                                                     62,604         7,737             --        70,341
                                                   --------       -------        -------      --------
LOSS BEFORE INCOME TAXES, EXTRAORDINARY ITEM
  AND CUMULATIVE EFFECT OF ACCOUNTING CHANGE...      (2,679)       (2,301)            --        (4,980)
INCOME TAXES...................................         (21)          139             --           118
                                                   --------       -------        -------      --------
LOSS BEFORE EXTRAORDINARY ITEM AND CUMULATIVE
  EFFECT OF ACCOUNTING CHANGE..................      (2,658)       (2,440)            --        (5,098)
EXTRAORDINARY ITEM -- GAIN ON EARLY
  EXTINGUISHMENT OF DEBT.......................       1,885            --             --         1,885
CUMULATIVE EFFECT OF ACCOUNTING CHANGE.........        (490)           --             --          (490)
                                                   --------       -------        -------      --------
NET LOSS.......................................    $ (1,263)      $(2,440)       $    --      $ (3,703)
                                                   ========       =======        =======      ========
</Table>

                                        53
<PAGE>

                         AMERICAN COMMERCIAL LINES LLC

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
     COMBINING STATEMENT OF OPERATIONS FOR THE YEAR ENDED DECEMBER 29, 2000

<Table>
<Caption>
                                                  GUARANTOR        OTHER                      COMBINED
                                                 SUBSIDIARIES   SUBSIDIARIES   ELIMINATIONS    TOTALS
                                                 ------------   ------------   ------------   --------
                                                                (DOLLARS IN THOUSANDS)
<S>                                              <C>            <C>            <C>            <C>
OPERATING REVENUE
  Revenue......................................    $733,870       $37,879        $    --      $771,749
  Revenue from related parties.................          --         2,089             --         2,089
                                                   --------       -------        -------      --------
                                                    733,870        39,968             --       773,838

OPERATING EXPENSE
  Materials, Supplies and Other................     315,275        19,597             --       334,872
  Rent.........................................      48,033         1,430             --        49,463
  Labor and Fringe Benefits....................     155,903         7,348             --       163,251
  Fuel.........................................      85,159         2,935             --        88,094
  Depreciation and Amortization................      49,104         6,910             --        56,014
  Gain on Property Dispositions, Net...........      (1,686)           --             --        (1,686)
  Taxes, Other Than Income Taxes...............      26,425         1,097             --        27,522
                                                   --------       -------        -------      --------
                                                    678,213        39,317             --       717,530
                                                   --------       -------        -------      --------
OPERATING INCOME (LOSS)........................      55,657           651             --        56,308

OTHER EXPENSE (INCOME)
  Interest Expense.............................      70,813            --             --        70,813
  Interest Expense, Affiliate -- Net...........          --         6,029         (6,029)           --
  Other, Net...................................      (4,745)         (234)         6,029         1,050
  Gain on Sale of Watercom.....................     (11,418)           --             --       (11,418)
                                                   --------       -------        -------      --------
                                                     54,650         5,795             --        60,445
                                                   --------       -------        -------      --------
EARNINGS (LOSS) BEFORE INCOME TAXES AND
  EXTRAORDINARY ITEM...........................       1,007        (5,144)            --        (4,137)
INCOME TAXES...................................         176         4,087             --         4,263
                                                   --------       -------        -------      --------
EARNINGS (LOSS) BEFORE EXTRAORDINARY ITEM......         831        (9,231)            --        (8,400)
EXTRAORDINARY ITEM -- LOSS ON EARLY
  EXTINGUISHMENT OF DEBT.......................        (734)           --             --          (734)
                                                   --------       -------        -------      --------
NET EARNINGS (LOSS)............................    $     97       $(9,231)       $    --      $ (9,134)
                                                   ========       =======        =======      ========
</Table>

                                        54
<PAGE>

                         AMERICAN COMMERCIAL LINES LLC

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
     COMBINING STATEMENT OF OPERATIONS FOR THE YEAR ENDED DECEMBER 31, 1999

<Table>
<Caption>
                                                  GUARANTOR        OTHER                      COMBINED
                                                 SUBSIDIARIES   SUBSIDIARIES   ELIMINATIONS    TOTALS
                                                 ------------   ------------   ------------   --------
                                                                (DOLLARS IN THOUSANDS)
<S>                                              <C>            <C>            <C>            <C>
OPERATING REVENUE..............................    $699,072       $40,064        $    --      $739,136
OPERATING EXPENSE
  Materials, Supplies and Other................     287,980        18,783             --       306,763
  Rent.........................................      41,232         2,746             --        43,978
  Labor and Fringe Benefits....................     172,728         9,497             --       182,225
  Fuel.........................................      50,782         2,525             --        53,307
  Depreciation and Amortization................      45,066         6,156             --        51,222
  Loss on Property Dispositions, Net...........         384            --             --           384
  Taxes, Other Than Income Taxes...............      25,910           755             --        26,665
                                                   --------       -------        -------      --------
                                                    624,082        40,462             --       664,544
                                                   --------       -------        -------      --------
OPERATING INCOME (LOSS)........................      74,990          (398)            --        74,592
OTHER EXPENSE (INCOME)
  Interest Expense.............................      71,275            --             --        71,275
  Interest Expense, Affiliate -- Net...........          --         4,861         (4,861)           --
  Other, Net...................................      (7,005)         (904)         4,861        (3,048)
                                                   --------       -------        -------      --------
                                                     64,270         3,957             --        68,227
                                                   --------       -------        -------      --------
EARNINGS (LOSS) BEFORE INCOME TAXES............      10,720        (4,355)            --         6,365
INCOME TAXES...................................         694           964             --         1,658
                                                   --------       -------        -------      --------
INCOME (LOSS) BEFORE CUMULATIVE EFFECT OF
  ACCOUNTING CHANGE............................      10,026        (5,319)            --         4,707
CUMULATIVE EFFECT OF ACCOUNTING CHANGE.........      (1,737)           --             --        (1,737)
                                                   --------       -------        -------      --------
NET EARNINGS (LOSS)............................    $  8,289       $(5,319)       $    --      $  2,970
                                                   ========       =======        =======      ========
</Table>

                                        55
<PAGE>

                         AMERICAN COMMERCIAL LINES LLC

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
     COMBINING STATEMENT OF CASH FLOWS FOR THE YEAR ENDED DECEMBER 28, 2001

<Table>
<Caption>
                                                  GUARANTOR        OTHER                      COMBINED
                                                 SUBSIDIARIES   SUBSIDIARIES   ELIMINATIONS    TOTALS
                                                 ------------   ------------   ------------   --------
                                                                (DOLLARS IN THOUSANDS)
<S>                                              <C>            <C>            <C>            <C>
OPERATING ACTIVITIES
  Net Loss.....................................    $ (1,263)      $ (2,440)      $    --      $ (3,703)
  Adjustments to Reconcile Net Loss to Net Cash
     Provided by (Used in) Operating
     Activities:
     Depreciation and Amortization.............      54,777          5,133            --        59,910
     Gain on Property Dispositions.............     (16,498)            --            --       (16,498)
     Other Operating Activities................      (6,753)         2,901            --        (3,852)
     Changes in Operating Assets and
       Liabilities:
       Accounts Receivable.....................       6,349        (32,340)       13,981       (12,010)
       Materials and Supplies..................      (1,119)          (265)           --        (1,384)
       Accrued Interest........................         413             --            --           413
       Other Current Assets....................     (14,648)         9,650            --        (4,998)
       Other Current Liabilities...............     (11,859)        18,569            --         6,710
                                                   --------       --------       -------      --------
       Net Cash Provided by Operating
          Activities...........................       9,399          1,208        13,981        24,588
INVESTING ACTIVITIES
  Property Additions...........................     (13,165)        (6,607)           --       (19,772)
  Investment in Vessel Leasing LLC.............      (6,808)            --            --        (6,808)
  Proceeds from Property Dispositions..........      23,918             --            --        23,918
  Proceeds from Sale of Terminals..............       7,818             --            --         7,818
  Proceeds from Property Condemnation..........       2,730             --            --         2,730
  Other Investing Activities...................      (9,055)         1,846         2,615        (4,594)
                                                   --------       --------       -------      --------
       Net Cash Provided by (Used in) Investing
          Activities...........................       5,438         (4,761)        2,615         3,292
FINANCING ACTIVITIES
  Short-Term Borrowings........................      17,250             --            --        17,250
  Long-Term Debt Repaid........................     (47,937)            --            --       (47,937)
  Borrowing from Affiliates....................          --            567          (567)           --
  Affiliate Debt Repaid........................          --           (567)          567            --
  Outstanding Checks Net of Deposits...........      (6,670)            --            --        (6,670)
  Debt Costs...................................      (3,463)            --            --        (3,463)
  Cash Dividends Paid..........................          --         (1,000)        1,000            --
  Other Financing..............................         625          3,615        (3,615)          625
                                                   --------       --------       -------      --------
       Net Cash (Used in) Provided by Financing
          Activities...........................     (40,195)         2,615        (2,615)      (40,195)
Net Decrease in Cash and Cash Equivalents......     (25,358)          (938)       13,981       (12,315)
Cash and Cash Equivalents at Beginning of
  Period.......................................      57,289          2,279            --        59,568
                                                   --------       --------       -------      --------
       Cash and Cash Equivalents at End of
          Period...............................    $ 31,931       $  1,341       $13,981      $ 47,253
                                                   ========       ========       =======      ========
</Table>

                                        56
<PAGE>

                         AMERICAN COMMERCIAL LINES LLC

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
     COMBINING STATEMENT OF CASH FLOWS FOR THE YEAR ENDED DECEMBER 29, 2000

<Table>
<Caption>
                                                  GUARANTOR        OTHER                      COMBINED
                                                 SUBSIDIARIES   SUBSIDIARIES   ELIMINATIONS    TOTALS
                                                 ------------   ------------   ------------   --------
                                                                (DOLLARS IN THOUSANDS)
<S>                                              <C>            <C>            <C>            <C>
OPERATING ACTIVITIES
  Net Earnings (Loss)..........................    $     97       $ (9,231)      $     --     $ (9,134)
  Adjustments to Reconcile Net Earnings (Loss)
     to Net Cash Provided by (Used in)
     Operating Activities:
     Depreciation and Amortization.............      52,167          6,909             --       59,076
     Impairment of Barges......................       3,865             --             --        3,865
     Gain on Sale of Watercom..................     (11,418)            --             --      (11,418)
     Other Operating Activities................      (4,320)        (2,260)            --       (6,580)
     Changes in Operating Assets and
       Liabilities:
       Accounts Receivable.....................       4,925         (7,472)            --       (2,547)
       Materials and Supplies..................      12,469           (265)            --       12,204
       Accrued Interest........................      10,557             --             --       10,557
       Other Current Assets....................      (6,939)         3,224             --       (3,715)
       Other Current Liabilities...............     (23,612)         2,086             --      (21,526)
                                                   --------       --------       --------     --------
       Net Cash Provided by (Used in) Operating
          Activities...........................      37,791         (7,009)            --       30,782
INVESTING ACTIVITIES
  Property Additions...........................     (27,817)        (2,737)            --      (30,554)
  Purchase of Barging Assets...................     (31,500)            --             --      (31,500)
  Proceeds from Property Dispositions..........       4,089             --             --        4,089
  Proceeds from Sale of Watercom...............      13,600             --             --       13,600
  Proceeds from Sale of Restricted
     Investments...............................      25,288             --             --       25,288
  Other Investing Activities...................     (15,537)        (1,536)        11,958       (5,115)
                                                   --------       --------       --------     --------
       Net Cash Used in Investing Activities...     (31,877)        (4,273)        11,958      (24,192)
FINANCING ACTIVITIES
  Short-Term Borrowings........................      66,750             --             --       66,750
  Short-Term Debt Issued.......................     (54,752)            --             --      (54,752)
  Short-Term Debt Repaid.......................          --             --             --           --
  Affiliate Debt Repaid........................          --        (12,560)        12,560           --
  Cash Dividends Paid..........................          --         (3,160)         3,160           --
  Other Financing..............................      10,139          1,694         (1,694)      10,139
  Borrowing from Affiliates....................          --         25,984        (25,984)          --
                                                   --------       --------       --------     --------
       Net Cash Provided by Financing
          Activities...........................      22,137         11,958        (11,958)      22,137
Net Increase in Cash and Cash Equivalents......      28,051            676             --       28,727
Cash and Cash Equivalents at Beginning of
  Period.......................................      29,238          1,603             --       30,841
                                                   --------       --------       --------     --------
       Cash and Cash Equivalents at End of
          Period...............................    $ 57,289       $  2,279       $     --     $ 59,568
                                                   ========       ========       ========     ========
</Table>

                                        57
<PAGE>

                         AMERICAN COMMERCIAL LINES LLC

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
     COMBINING STATEMENT OF CASH FLOWS FOR THE YEAR ENDED DECEMBER 31, 1999

<Table>
<Caption>
                                                  GUARANTOR        OTHER                      COMBINED
                                                 SUBSIDIARIES   SUBSIDIARIES   ELIMINATIONS    TOTALS
                                                 ------------   ------------   ------------   --------
                                                                (DOLLARS IN THOUSANDS)
<S>                                              <C>            <C>            <C>            <C>
OPERATING ACTIVITIES
  Net Earnings (Loss)..........................    $  8,289       $ (5,319)      $     --     $  2,970
  Adjustments to Reconcile Net Earnings (Loss)
     to Net Cash Provided by Operating
     Activities:
     Depreciation and Amortization.............      47,883          6,156             --       54,039
     Impairment of Barges......................         230             --             --          230
     Proceeds from the initial sale of accounts
       receivable..............................      50,000             --             --       50,000
     Other Operating Activities................       3,723         (2,039)            --        1,684
     Changes in Operating Assets and
       Liabilities:
       Accounts Receivable.....................      (1,983)         7,129             --        5,146
       Materials and Supplies..................      (3,092)           189             --       (2,903)
       Accrued Interest........................     (14,834)            --             --      (14,834)
       Other Current Assets....................      10,890        (13,026)            --       (2,136)
       Other Current Liabilities...............       3,934         (3,528)            --          406
                                                   --------       --------       --------     --------
       Net Cash Provided by (Used in) Operating
          Activities...........................     105,040        (10,438)            --       94,602
INVESTING ACTIVITIES
  Property Additions...........................     (46,564)        (9,316)            --      (55,880)
  Proceeds from Property Dispositions..........       2,111             22             --        2,133
  Other Investing Activities...................     (21,442)           279         15,754       (5,409)
                                                   --------       --------       --------     --------
       Net Cash Used in Investing Activities...     (65,895)        (9,015)        15,754      (59,156)
FINANCING ACTIVITIES
  Partner Distribution.........................        (541)            --             --         (541)
  Long-Term Debt Repaid........................     (53,046)          (155)           155      (53,046)
  Cash Dividends Paid..........................          --         (6,700)         6,700           --
  Other Financing Activities...................        (374)           189           (189)        (374)
  Borrowing from Affiliates....................          --         22,420        (22,420)          --
                                                   --------       --------       --------     --------
       Net Cash (Used in) Provided by Financial
          Activities...........................     (53,961)        15,754        (15,754)     (53,961)
Net Decrease in Cash and Cash Equivalents......     (14,816)        (3,699)            --      (18,515)
Cash and Cash Equivalents at Beginning of
  Period.......................................      44,054          5,302             --       49,356
                                                   --------       --------       --------     --------
       Cash and Cash Equivalents at End of
          Period...............................    $ 29,238       $  1,603       $     --     $ 30,841
                                                   ========       ========       ========     ========
</Table>

                                        58
<PAGE>

                         AMERICAN COMMERCIAL LINES LLC

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
         COMBINING STATEMENT OF FINANCIAL POSITION AT DECEMBER 28, 2001

<Table>
<Caption>
                                            GUARANTOR        OTHER                      COMBINED
                                           SUBSIDIARIES   SUBSIDIARIES   ELIMINATIONS    TOTALS
                                           ------------   ------------   ------------   ---------
                                                           (DOLLARS IN THOUSANDS)
<S>                                        <C>            <C>            <C>            <C>
                                             ASSETS
CURRENT ASSETS
  Cash and Cash Equivalents..............   $  45,912       $  1,341      $      --     $  47,253
  Accounts Receivable -- Net.............      25,612         29,752        (13,981)       41,383
  Accounts Receivable -- Related
     Parties.............................          --         13,402             --        13,402
  Materials and Supplies.................      30,180          1,155             --        31,335
  Other Current Assets...................      41,069        (11,436)            --        29,633
                                            ---------       --------      ---------     ---------
          Total Current Assets...........     142,773         34,214        (13,981)      163,006
PROPERTIES -- NET........................     422,877         41,256             --       464,133
NET PENSION ASSET........................      26,067             --             --        26,067
OTHER ASSETS.............................     153,227         52,702       (101,199)      104,730
                                            ---------       --------      ---------     ---------
          Total Assets...................   $ 744,944       $128,172      $(115,180)    $ 757,936
                                            =========       ========      =========     =========

                                           LIABILITIES
CURRENT LIABILITIES
  Accounts Payable.......................   $  28,094       $  1,643      $      --     $  29,737
  Accrued Payroll and Fringe Benefits....      17,206             --             --        17,206
  Deferred Revenue.......................      11,890             --             --        11,890
  Accrued Claims and Insurance
     Premiums............................      24,200             --             --        24,200
  Accrued Interest.......................      18,659             --             --        18,659
  Short-term Debt........................      84,000             --             --        84,000
  Current Portion of Long-Term Debt......     608,519             --             --       608,519
  Other Current Liabilities..............      40,249         15,804        (13,981)       42,072
  Other Current Liabilities -- Related
     Parties.............................          --          8,397             --         8,397
                                            ---------       --------      ---------     ---------
          Total Current Liabilities......     832,817         25,844        (13,981)      844,680
LONG-TERM NOTE PAYABLE TO AFFILIATE......          --         86,700        (86,700)           --
LONG-TERM DEBT...........................          --             --             --            --
PENSION LIABILITY........................      18,907             --             --        18,907
OTHER LONG-TERM LIABILITIES..............      36,163          1,129             --        37,292
                                            ---------       --------      ---------     ---------
          Total Liabilities..............   $ 887,887       $113,673      $(100,681)    $ 900,879
                                            ---------       --------      ---------     ---------

                                        MEMBER'S DEFICIT
Member's Interest........................     220,074             --             --       220,074
Other Capital............................     166,580         57,374        (57,374)      166,580
Retained Deficit.........................    (527,740)       (42,875)        42,875      (527,740)
Other Comprehensive Loss.................      (1,857)            --             --        (1,857)
                                            ---------       --------      ---------     ---------
          Total Member's Deficit.........    (142,943)        14,499        (14,499)     (142,943)
                                            ---------       --------      ---------     ---------
          Total Liabilities and Member's
            Deficit......................   $ 744,944       $128,172      $(115,180)    $ 757,936
                                            =========       ========      =========     =========
</Table>

                                        59
<PAGE>

                         AMERICAN COMMERCIAL LINES LLC

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
         COMBINING STATEMENT OF FINANCIAL POSITION AT DECEMBER 29, 2000

<Table>
<Caption>
                                                 GUARANTOR        OTHER                      COMBINED
                                                SUBSIDIARIES   SUBSIDIARIES   ELIMINATIONS    TOTALS
                                                ------------   ------------   ------------   ---------
                                                                (DOLLARS IN THOUSANDS)
<S>                                             <C>            <C>            <C>            <C>
                                                ASSETS
CURRENT ASSETS
  Cash and Cash Equivalents...................   $  57,288       $  2,280       $     --     $  59,568
  Accounts Receivable -- Net..................      32,608          8,109             --        40,717
  Accounts Receivable -- Related Parties......          --          2,111             --         2,111
  Materials and Supplies......................      28,883            890             --        29,773
  Other Current Assets........................      24,823         (1,163)            --        23,660
                                                 ---------       --------       --------     ---------
          Total Current Assets................     143,602         12,227             --       155,829
PROPERTIES -- NET.............................     469,714         39,729             --       509,443
NET PENSION ASSET.............................      24,512             --             --        24,512
OTHER ASSETS..................................     141,534         51,128        (94,908)       97,754
                                                 ---------       --------       --------     ---------
          Total Assets........................   $ 779,362       $103,084       $(94,908)    $ 787,538
                                                 =========       ========       ========     =========

                                             LIABILITIES
CURRENT LIABILITIES
  Accounts Payable............................   $  28,536       $  1,194       $     --     $  29,730
  Accrued Payroll and Fringe Benefits.........      14,003             --             --        14,003
  Deferred Revenue............................      12,011             --             --        12,011
  Accrued Claims and Insurance Premiums.......      21,047             --             --        21,047
  Accrued Interest............................      18,246             --             --        18,246
  Short-term Debt.............................      66,750             --             --        66,750
  Current Portion of Long-Term Debt...........      44,579             --             --        44,579
  Other Current Liabilities...................      50,918          4,442             --        55,360
  Other Current Liabilities -- Related
     Parties..................................          --          1,457             --         1,457
                                                 ---------       --------       --------     ---------
          Total Current Liabilities...........     256,090          7,093             --       263,183
LONG-TERM NOTE PAYABLE TO AFFILIATE...........          --         86,700        (86,700)           --
LONG-TERM DEBT................................     613,476             --             --       613,476
PENSION LIABILITY.............................      21,389             --             --        21,389
OTHER LONG-TERM LIABILITIES...................      28,066          1,083             --        29,149
                                                 ---------       --------       --------     ---------
          Total Liabilities...................   $ 919,021       $ 94,876       $(86,700)    $ 927,197
                                                 ---------       --------       --------     ---------

                                           MEMBER'S DEFICIT
Member's Interest.............................     220,074             --             --       220,074
Other Capital.................................     163,799         46,820        (46,820)      163,799
Retained Deficit..............................    (523,048)       (38,612)        38,612      (523,048)
Other Comprehensive Loss......................        (484)            --             --          (484)
                                                 ---------       --------       --------     ---------
          Total Member's Deficit..............    (139,659)         8,208         (8,208)     (139,659)
                                                 ---------       --------       --------     ---------
          Total Liabilities and Member's
            Deficit...........................   $ 779,362       $103,084       $(94,908)    $ 787,538
                                                 =========       ========       ========     =========
</Table>

                                        60
<PAGE>

                       REPORT OF INDEPENDENT ACCOUNTANTS

To Board of Managers
of American Commercial Lines LLC:

     In our opinion, based on our audits and the reports of other auditors, the
consolidated financial statements listed in the Index appearing under Item
14(a)(1) present fairly, in all material respects, the financial position of
American Commercial Lines LLC and its subsidiaries (ACL) at December 28, 2001
and December 29, 2000, and the results of their operations and their cash flows
for each of the three fiscal years in the period ended December 28, 2001, in
conformity with accounting principles generally accepted in the United States of
America. In addition, in our opinion, based on our audits and the reports of
other auditors, the financial statement schedule listed in the Index appearing
under Item 14(a)(2) presents fairly, in all material respects, the information
set forth therein when read in conjunction with the related consolidated
financial statements. These financial statements and the financial statement
schedule are the responsibility of ACL's management; our responsibility is to
express an opinion on these financial statements and financial statement
schedule based on our audits. We did not audit the financial statements of UABL
Limited (UABL), a 50% owned subsidiary, for 2001, which statements reflect 7% of
consolidated total assets as of December 28, 2001, and 27% of consolidated net
loss for the fiscal year ended December 28, 2001. We also did not audit the
financial statements of Global Material Services LLC (GMS), a 50% owned
subsidiary, for 1999, which statements reflect 1% of consolidated total assets
as of December 31, 1999, and 45% of consolidated net earnings for the fiscal
year ended December 31, 1999. Those statements were audited by other auditors
whose reports thereon have been furnished to us, and our opinion expressed
herein, insofar as it relates to the amounts included for UABL and GMS, is based
solely on the reports of the other auditors. We conducted our audits of these
statements in accordance with auditing standards generally accepted in the
United States of America, which 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, assessing
the accounting principles used and significant estimates made by management, and
evaluating the overall financial statement presentation. We believe that our
audits and the reports of other auditors provide a reasonable basis for our
opinion.

     The accompanying consolidated financial statements have been prepared
assuming that ACL will continue as a going concern. ACL incurred a substantial
loss during 2001. As discussed in Note 4 to the consolidated financial
statements, subsequent to December 28, 2001 ACL also defaulted on its Senior
Notes and Senior Credit Facilities and has determined that it is not likely that
it will be able to meet the covenant requirements included in the Senior Credit
Facilities agreement for 2002. Accordingly, ACL's outstanding debt has been
classified as current in its consolidated balance sheet at December 28, 2001.
The above facts raise substantial doubt about ACL's ability to continue as a
going concern. Management's plans in regard to these matters are also described
in Note 4. The financial statements do not include any adjustments that might
result from the outcome of this uncertainty.

     As discussed in Note 1 to the consolidated financial statements, during the
fourth quarter of 2001 the Company prospectively increased its estimate of the
useful life of towboats, which reduced the loss before extraordinary items and
the net loss by $1.1 million for the fiscal year ended December 28, 2001.

                                          PRICEWATERHOUSECOOPERS LLP

Louisville, Kentucky
March 26, 2002

                                        61
<PAGE>

               SCHEDULE VIII -- VALUATION AND QUALIFYING ACCOUNTS

                                 (IN THOUSANDS)

<Table>
<Caption>
                                         BALANCE AT
                                        BEGINNING OF   CHARGES TO                            BALANCE AT END
                                           PERIOD       EXPENSE      OTHER       WRITEOFFS     OF PERIOD
                                        ------------   ----------   -------      ---------   --------------
<S>                                     <C>            <C>          <C>          <C>         <C>
2001:
Allowance for Uncollectible
  accounts............................     $1,157        $1,176          --       $  (702)       $1,631
Valuation allowance for Foreign net
  operating Loss carryforwards........         --            --          --            --            --

2000:
Allowance for Uncollectible
  accounts............................     $2,290        $  194          --       $(1,327)       $1,157
Valuation allowance for Foreign net
  operating Loss carryforwards........     $6,605            --     $(6,605)(1)        --            --

1999:
Allowance for Uncollectible
  accounts............................     $2,335        $  813     $  (591)(2)   $  (267)       $2,290
Valuation allowance for Foreign net
  operating Loss carryforwards........     $4,186        $2,419          --            --        $6,605
</Table>

---------------

(1) Contribution of assets to UABL.

(2) Securitization of accounts receivable.

                                        62
<PAGE>

ITEM 9.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
         FINANCIAL DISCLOSURE

     There were no disagreements with accountants during 2000 or 2001.

                                    PART III

ITEM 10.  DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

                                   MANAGEMENT

EXECUTIVE OFFICERS OF THE PARENT, ACL AND/OR ITS SUBSIDIARIES; BOARD OF MANAGERS
OF THE PARENT

     The Executive Officers of ACL and/or its subsidiaries and the Parent are:

                               EXECUTIVE OFFICERS

<Table>
<Caption>
NAME                                   AGE                          POSITION
----                                   ---                          --------
<S>                                    <C>   <C>
Michael C. Hagan.....................  55    President and Chief Executive Officer -- ACL
Paul S. Besson.......................  48    Sr. Vice President -- Human Resources and Corporate
                                             Services
James F. Farley......................  50    Sr. Vice President -- Marketing Services
Robert P. Herre......................  49    President -- Jeffboat
Michael A. Khouri....................  52    Sr. Vice President -- Transportation Services
Martin K. Pepper.....................  48    Sr. Vice President -- International
R. Barry Uber........................  56    President and Chief Operating Officer -- ACBL
William N. Whitlock..................  60    Sr. Vice President -- Logistic Services
James J. Wolff.......................  44    Sr. Vice President -- Finance/Administration and Chief
                                             Financial Officer
</Table>

     The members of the Board of Managers of the Parent (the "Board of
Managers") are as follows.

                        BOARD OF MANAGERS OF THE PARENT

<Table>
<Caption>
NAME                                   AGE   POSITION
----                                   ---   --------
<S>                                    <C>   <C>
David Wagstaff III...................  63    Chairman
David H. Baggs.......................  42    Member
Ellen M. Fitzsimmons.................  41    Member
Paul R. Goodwin......................  59    Member
Ernest A. Haberli....................  53    Member
Michael C. Hagan.....................  55    Member
Richard L. Huber.....................  65    Member
Richard E. Mayberry, Jr. ............  49    Member
James P. Peter.......................  51    Member
David F. Thomas......................  51    Member
</Table>

     Michael C. Hagan is President and Chief Executive Officer and joined ACL in
1970. He has served as President and Chief Executive Officer of ACL and its
subsidiaries since 1991. Prior to that, he held a series of positions of
increasing responsibility within ACL and CSX.

     Paul S. Besson is Senior Vice President -- Human Resources and Corporate
Services for ACL and its subsidiaries. Prior to joining ACL in 1998, he was most
recently Director, Talent Negotiations and Labor Relations with the National
Broadcasting Company, Inc. ("NBC"), a wholly-owned subsidiary of General
Electric Company, and earlier held several other human resource positions at NBC
since 1984.

                                        63
<PAGE>

     James F. Farley was named Senior Vice President -- Marketing Services of
ACBL in March 2000, moving from his position as Vice President -- Liquid Sales,
which he held from 1998. Mr. Farley joined ACBL in 1992 and served in various
positions, including Vice President, Distribution Services. Prior to joining ACL
Mr. Farley was Vice President, Operations with The Valley Line -- Sequa
Corporation.

     Robert P. Herre was appointed President of Jeffboat in September 2001.  Mr.
Herre began his career with ACL in 1990 and has served in various managerial
roles, most recently as Vice President, Vessel Management for ACBL.

     Michael A. Khouri was named Senior Vice President -- Transportation
Services for ACBL and LDC in March 2000. He had served as Senior Vice
President -- Corporate Services for ACL and its subsidiaries from August 1998
through March 2000 and before that as Senior Vice President and General Counsel
since 1990. Prior to joining ACL in 1979, he worked at the Crounse Corporation.

     Martin K. Pepper was appointed Senior Vice President -- International for
American Commercial Lines International LLC in August 1998. Prior to joining ACL
in 1997 as Vice President for Fleet Maintenance, he served for sixteen years as
an operations officer with Canal Barge Line and served in sales and marketing
for Tidewater Barge Line from 1990 to 1997.

     R. Barry Uber was appointed President and Chief Operating Officer of ACBL
in July 2001. Mr. Uber was President and Chief Executive Officer of North
American Van Lines prior to joining ACBL. Prior to that, Mr. Uber spent
twenty-nine years with the Ingersoll-Rand Co., ending his career there as
President, Construction and Mining.

     William N. Whitlock was named Senior Vice President -- Logistic Services
for ACBL and LDC in March 2000. He had served as Senior Vice
President -- Transportation Services from 1982 through March 2000. Prior to
joining ACL in 1979 Mr. Whitlock devoted fifteen years of his career to the U.S.
Army Corps of Engineers in positions of increasing authority.

     James J. Wolff has served as Senior Vice
President -- Finance/Administration and Chief Financial Officer of ACL and its
subsidiaries since 1998. Mr. Wolff was head of international development for ACL
from 1996 to 1998. From 1992 to 1996, Mr. Wolff was Senior Vice
President -- Finance, transferring to ACL after serving as an executive of Texas
Gas Exploration, a former CSX subsidiary, from 1979 to 1986 and as an executive
for CSX from 1986 to 1992.

     David Wagstaff III has served as President and Chief Executive Officer of
Vectura since 1993. He was previously the Principal in a private consulting
business and has worked in various executive capacities at the Equitable Life
Assurance Company and Citicorp. He is currently a director of Great Lakes Dredge
and Dock Company and a number of private companies.

     David H. Baggs is Assistant Vice President -- Corporate Treasury for CSX.
He has held various finance and planning positions with CSX since 1985.

     Ellen M. Fitzsimmons is Senior Vice President -- Law of CSX. She has served
in various legal positions with CSX since 1991.

     Paul R. Goodwin is Vice Chairman and Chief Financial Officer of CSX. He has
served in various executive positions with CSX since 1995. From February to
April, 1995, he was Executive Vice President, Finance & Administration of CSX's
principal subsidiary, CSX Transportation, Inc. ("CSXT"), which provides rail
transportation services. Prior thereto he served as Senior Vice
President -- Finance of CSXT since 1991.

     Ernest A. Haberli is President, Commercial Operations, International of The
Gillette Company. Mr. Haberli was previously Executive Vice President and Chief
Financial Officer of Fort James Corporation from the time of the 1997 merger of
Fort Howard Corporation and James River Corporation until 2001. Prior to the
merger, he was Senior Vice President, Strategy, for James River, since 1996.
From 1990 to 1995, he served as President of Pet International. He also held
various executive positions in strategic planning and

                                        64
<PAGE>

development and international business management with Kraft General Foods,
Kraft International and Kraft, Inc. since 1985.

     Richard L. Huber has been Managing Director, Chief Executive Officer and
Principal of the Latin American direct investment group Norte-Sur Partners and
Senior Director of Kissinger McLarty Associates, a strategic advisory firm that
assists international businesses since January 2001. Mr. Huber, has
approximately forty years of investment and merchant banking, international
business, and management experience, and was most recently Chief Executive
Officer of Aetna, Inc. Before joining Aetna in 1995, he held executive positions
with Chase Manhattan Bank, Citibank, Bank of Boston, and Continental Bank. Mr.
Huber is also a Director of Perez Companc S.A., the largest publicly traded
company in Argentina, and Chairman of UABL.

     Richard E. Mayberry, Jr. has been a Managing Director of Citicorp Capital
Investors, Ltd. for over five years. Mr. Mayberry is currently a director of
Brunner Mond Group plc and a number of private companies.

     James P. Peter is Vice President -- Taxes for CSX. He has served in various
executive positions with CSX since 1987.

     David F. Thomas has been President of 399 Venture Partners, Inc. since
December 1994. In addition, Mr. Thomas has been a Managing Director of Citicorp
Venture Capital, Ltd., an affiliate of 399 Venture Partners, Inc., for over five
years. Mr. Thomas is currently a director of Lifestyles Furnishings
International Ltd., Anvil Knitwear, Inc., Neenah Foundry Company, Plainwell,
Inc. and Sleepmaster LLC.

ITEM 11.  EXECUTIVE COMPENSATION

EXECUTIVE COMPENSATION

     The following table sets forth information concerning the annual and
long-term compensation for services in all capacities to ACL, or its subsidiary
companies or their predecessors for 1999 through 2001 of those persons who
served as (i) the chief executive officer during 2001 and (ii) the other four
most highly compensated executive officers for 2001 (collectively, the "Named
Executive Officers"):

                           SUMMARY COMPENSATION TABLE

<Table>
<Caption>
                                                                            LONG-TERM COMPENSATION
                                                                            ----------------------
                                                                              AWARDS
                                         ANNUAL COMPENSATION                ----------    PAYOUTS
                             --------------------------------------------   SECURITIES   ---------
                                                           OTHER ANNUAL     UNDERLYING   LTIP PLAN      ALL OTHER
NAME AND PRINCIPAL POSITION  YEAR    SALARY    BONUS(1)   COMPENSATION(2)    OPTIONS      PAYOUTS    COMPENSATION(3)
---------------------------  ----   --------   --------   ---------------   ----------   ---------   ---------------
<S>                          <C>    <C>        <C>        <C>               <C>          <C>         <C>
Michael C. Hagan..........   2001   $315,000   $      0       $ 9,240          N/A          N/A          $27,983
  President and CEO          2000    315,000          0         9,240          N/A          N/A           30,918
  ACL                        1999    315,000    767,525(4)      11,065         N/A          N/A           27,360
R. Barry Uber.............   2001   $126,042   $150,000       $ 4,235          N/A          N/A          $15,188
  President and COO
  ACBL and LDC
  (appointed 7/2001)
William N. Whitlock.......   2001   $167,000   $      0       $ 9,240          N/A          N/A          $10,275
  Sr. Vice President --      2000    161,000          0         9,240          N/A          N/A           10,577
  Logistic Services          1999    161,000    332,157         9,009          N/A          N/A            8,440
  ACBL and LDC
Michael A. Khouri.........   2001   $167,000   $      0       $ 9,240          N/A          N/A          $ 3,288
  Sr. Vice President --      2000    159,500          0         9,240          N/A          N/A            3,189
  Transportation             1999    152,000    293,164         9,540          N/A          N/A            1,180
  Services
  ACBL and LDC
James F. Farley...........   2001   $166,125   $      0       $ 9,240          N/A          N/A          $ 2,030
  Sr. Vice President --      2000    156,250     40,000         8,140          N/A          N/A              824
  Marketing Services
  ACBL and LDC
  (appointed 3/2000)
</Table>

                                        65
<PAGE>

---------------

(1) No Named Executive Officer earned an ACL incentive award for 2001, however,
    Mr. Uber was paid $150,000 as part of an employment agreement. 1999 Bonus
    amounts consist entirely of bonus payments paid by CSX in connection with
    the Recapitalization ("CSX Bonus Payments").

(2) Consists of automobile payments only in 2001 and 2000, and automobile
    payments and medical examinations in 1999.

(3) Amounts shown include the above-market portion of earnings on a CSX deferred
    compensation program available to Mr. Hagan and Mr. Whitlock. For 2001,
    those amounts were $18,977 for Mr. Hagan and $5,280 for Mr. Whitlock. For
    2000, those amounts were $22,013 for Mr. Hagan and $6,124 for Mr. Whitlock.
    Amounts shown also include life insurance premium payments made on behalf of
    the Named Executive Officers in the following amounts for 2001: for Mr.
    Hagan, $2,913, for Mr. Uber, $1,075, for Mr. Whitlock, $3,102, for Mr.
    Khouri, $1,395, and for Mr. Farley, $1,016; and for 2000: for Mr. Hagan,
    $2,798, for Mr. Whitlock, $2,546, for Mr. Khouri, $1,282, and for Mr.
    Farley, $824. Amounts shown also include matching contributions made by ACL
    in 2001 and 2000 in conjunction with deferral of salary or bonus to a
    supplementary savings plan on behalf of Mr. Hagan of $4,200. Amounts shown
    also include payment for the provision of tax services for Messrs. Hagan,
    Whitlock and Khouri in the amount of $1,893 for each in 2001 and $1,907 for
    each in 2000, and certain travel expense payments to Mr. Farley of $1,014
    for 2001.

(4) Following the Recapitalization, CSX became obligated to pay Mr. Hagan
    certain benefits aggregating $3.75 million pursuant to an employment
    agreement.

     No Named Executive Officer received option grants in 2001.

     The following table sets forth the number of securities underlying
unexercised options held by each of the Named Executive Officers and the value
of such options at the end of fiscal 2001:

                         FISCAL YEAR END OPTION VALUES

<Table>
<Caption>
                                                             NUMBER OF
                                                       SECURITIES UNDERLYING         VALUE OF UNEXERCISED
                              SHARES                    UNEXERCISED OPTIONS          IN-THE-MONEY OPTIONS
                            ACQUIRED ON    VALUE        AT FISCAL YEAR-END          AT FISCAL YEAR-END(1)
NAME                         EXERCISE     REALIZED   EXERCISABLE/UNEXERCISABLE   EXERCISABLE/UNEXERCISABLE(2)
----                        -----------   --------   -------------------------   ----------------------------
<S>                         <C>           <C>        <C>                         <C>
Michael C. Hagan..........    54,000      $152,032                N/A                     $     0/0
R. Barry Uber.............                                        N/A                           N/A
William N. Whitlock.......                                   52,966/0                     $22,518/0
Michael A. Khouri.........    25,120      $133,462                0/0                     $     0/0
James F. Farley...........                                        N/A                           N/A
</Table>

---------------

(1) Represents options to purchase CSX Shares.

(2) Value of unexercised options at fiscal year-end represents the difference
    between the exercise price of any outstanding in-the-money options and
    $35.12, the mean value of CSX Shares on December 31, 2001.

     ACL has a salary continuation plan (the "Salary Continuation Plan") whereby
supplemental retirement benefits are paid as a function of final pay, some of
which are paid in lieu of a former life insurance benefit.

     Prior to the Recapitalization, the Named Executive Officers, and other
eligible employees, were beneficiaries of certain benefit plans established by
CSX. ACL intends to continue these benefit plans, which consist of (i) a special
retirement plan (the "Special Retirement Plan") whereby certain employees have
certain additional compensation covered, and can obtain past or extra service
credits for purposes of the qualified pension plan described below in the
"Pension Plan Table;" and (ii) a supplementary savings plan (the "Supplementary
Savings Plan") which permits deferrals of a portion of salary and bonus payments
and matching contributions for those deferrals to negate the effect of Internal
Revenue Code limits on qualified plan contributions.

                                        66
<PAGE>

PENSION PLANS

     The pension plan table provided below sets forth estimated annual benefits
payable, before offset for the Social Security annuity, by ACL to any officer or
salaried employee upon retirement at the normal retirement age after selected
periods of service and in specified compensation groups.

                               PENSION PLAN TABLE

<Table>
<Caption>
                                                              YEARS OF SERVICE
FIVE CONSECUTIVE YEAR                          -----------------------------------------------
AVERAGE COMPENSATION                             15        20        25        30        35
---------------------                          -------   -------   -------   -------   -------
<S>                                            <C>       <C>       <C>       <C>       <C>
$125,000.....................................   26,771    36,146    45,521    54,896    64,271
 150,000.....................................   32,125    43,375    54,625    65,875    77,125
 175,000.....................................   37,479    50,604    63,729    76,854    89,979
 200,000.....................................   42,833    57,833    72,833    87,833   102,833
 225,000.....................................   48,188    65,063    81,938    98,813   115,688
 250,000.....................................   53,542    72,292    91,042   109,792   128,542
 275,000.....................................   58,896    79,521   100,146   120,771   141,396
 300,000.....................................   64,250    86,750   109,250   131,750   154,250
 325,000.....................................   69,604    93,979   118,354   142,729   167,104
 350,000.....................................   74,958   101,208   127,458   153,708   179,958
 375,000.....................................   80,313   108,438   136,563   164,688   192,813
 400,000.....................................   85,667   115,667   145,667   175,667   205,667
 425,000.....................................   91,021   122,896   154,771   186,646   218,521
 450,000.....................................   96,375   130,125   163,875   197,625   231,375
 475,000.....................................  101,729   137,354   172,979   208,604   244,229
 500,000.....................................  107,083   144,583   182,083   219,583   257,083
</Table>

---------------

(1) Retirement benefits from ACL's funded and unfunded non-contributory Pension
    Plans are based on both length of service and compensation. The compensation
    covered by the Pension Plans is compensation paid by ACL to a participant on
    a regular monthly or annual salary basis, including bonuses or similar
    awards for personal services rendered in a position that is not under the
    scope of a labor agreement prior to 2000. Compensation items listed in the
    Summary Compensation Table covered by the Pension Plans are Base Salary and
    Bonus. (In the case of employees who elect to receive their Bonus in Company
    Stock, the amount of the Bonus for Pension Plan computations is the cash
    value of the Bonus prior to addition of the premium for receipt of Bonus in
    stock.) Benefits earned before February 1, 2000 are computed at the time of
    retirement under a defined benefit formula based on years of service and
    average salary and bonus for the highest 60 consecutive months of service,
    computed without regard to additional payments in stock. Benefits earned
    after February 1, 2000 are computed based on career-average base salary
    only. The Pension Plans provide for normal retirement at age 65 and, subject
    to certain eligibility requirements, early retirement beginning at age 55 is
    permitted with reduced pension payments.

     The above table sets forth the estimated annual benefits payable, before
offset for the Social Security annuity, by ACL to any officer or salaried
employee upon retirement at the normal retirement age after selected periods of
service and in specified compensation groups. The normal form of the benefit is
a straight-life annuity. As of April 1, 2002, the individuals named in the
Summary Compensation Table will have the following years of credited service:
Mr. Hagan, 31.64 years; Mr. Uber, less than 1 year; Mr. Whitlock, 22.88 years;
Mr. Khouri, 22.65 years; Mr. Farley, 9.86 years.

     The Internal Revenue Code imposes certain limitations on compensation and
benefits payable from tax-qualified pension plans. Pension amounts in excess of
such limitations are payable from the non-qualified Pension Plan, which is not
funded.

                                        67
<PAGE>

BENEFIT PLANS

     ACL maintains various qualified and non-qualified benefit plans for its
employees. All salaried, full time employees are covered or will be covered by
an ERISA qualified defined benefit retirement plan and are eligible to
participate in a 401(k) savings plan that includes a partial company match
feature. Hourly employees with certain of ACL's subsidiaries have separate ERISA
qualified defined benefit plans and are eligible to participate in separate
401(k) savings plans.

     ACL maintains a self-insured general welfare health plan for employees. The
plan has appropriate levels of employee deductible, and maximum benefit levels.
Employees may elect to participate in certain approved HMO plans in lieu of ACL
sponsored plan.

     ACL has provided to certain members of management various non-qualified
benefit and deferred compensation plans. These plans include deferred salary
plans, deferred bonus plans, salary continuation with whole life plans and,
prior to the Recapitalization, participation in certain CSX stock bonus plans,
stock option plans and stock purchase/loan plans.

     ACL reserves the right to add, amend, change, tie off and/or terminate any
or all qualified or non-qualified benefit plans at any time and to alter, amend,
add to and/or restrict employee participation to the extent permitted by
applicable federal or state law or regulation.

COMPENSATION OF BOARD OF MANAGERS

     ACL will reimburse members of the Board of Managers for any out-of-pocket
expenses incurred by them in connection with services provided in such capacity.
In addition, ACL may compensate members of the Board of Managers for services
provided in such capacity. Mr. Wagstaff received a salary from ACL for duties
performed as an employee during 1998 and 1999.

                                        68
<PAGE>

ITEM 12.  SECURITY OWNERSHIP AND CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

SECURITY OWNERSHIP

     The Parent owns all of the outstanding equity interests of ACL. The
following table sets forth certain information regarding the approximate
beneficial ownership of the Parent's equity interests at year end held by (i)
each person (other than members of the Board of Managers and executive officers
of ACL) known to ACL to be the owner of more than 5% of the outstanding voting
membership interests of the Parent, (ii) the Named Executive Officers, (iii)
members of the Board of Managers of ACL and (iv) members of the Board of
Managers and executive officers of ACL as a group.
<Table>
<Caption>
                                NUMBER OF    PERCENTAGE OF   NUMBER OF    PERCENTAGE OF   NUMBER OF    PERCENTAGE OF   NUMBER OF
                                NON-VOTING    NON-VOTING     NON-VOTING    NON-VOTING     NON-VOTING    NON-VOTING     NON-VOTING
                                  SENIOR        SENIOR         JUNIOR        JUNIOR         SENIOR        SENIOR         JUNIOR
                                PREFERRED      PREFERRED     PREFERRED      PREFERRED       COMMON        COMMON         COMMON
NAME OF                         MEMBERSHIP    MEMBERSHIP     MEMBERSHIP    MEMBERSHIP     MEMBERSHIP    MEMBERSHIP     MEMBERSHIP
BENEFICIAL OWNER                INTERESTS      INTERESTS     INTERESTS      INTERESTS     INTERESTS      INTERESTS     INTERESTS
-----------------------------   ----------   -------------   ----------   -------------   ----------   -------------   ----------
<S>                             <C>          <C>             <C>          <C>             <C>          <C>             <C>
399 Venture Partners, Inc.             --           --       4,465,960         44.4%       214,908          63.4%        46,927
CSX Corporation                 11,500,000       100.0%      3,899,393         38.8%            --            --         30,389
James F. Farley                        --           --           7,261            *             --            --            263
Michael C. Hagan                       --           --          43,568            *             --            --             --
Richard Huber                          --           --           9,909            *             --            --             88
Michael A. Khouri                      --           --          14,523            *             --            --            405
Richard E. Mayberry, Jr.               --           --          49,545            *          9,263           2.7%           750
David F. Thomas                        --           --         148,636          1.5%         1,144             *          1,362
David Wagstaff III                     --           --          11,618            *         28,753           8.5%         1,479
William N. Whitlock                    --           --          17,427            *             --            --            632
Board of Managers and
Executive Officers as a Group          --           --         373,649         3.71%        39,160          11.6%         7,558

<Caption>
                               PERCENTAGE OF   NUMBER OF    PERCENTAGE OF
                                NON-VOTING       VOTING        VOTING
                                  JUNIOR         JUNIOR        JUNIOR
                                  COMMON         COMMON        COMMON
NAME OF                         MEMBERSHIP     MEMBERSHIP    MEMBERSHIP
BENEFICIAL OWNER                 INTERESTS     INTERESTS      INTERESTS
-----------------------------  -------------   ----------   -------------
<S>                            <C>             <C>          <C>
399 Venture Partners, Inc.         48.1%         4,426           44.3%
CSX Corporation                    31.1%         3,400           34.0%
James F. Farley                       *             --             --
Michael C. Hagan                     --          1,579           15.8%
Richard Huber                         *              3              *
Michael A. Khouri                     *            121            1.2%
Richard E. Mayberry, Jr.              *             22              *
David F. Thomas                     1.4%            41              *
David Wagstaff III                  1.5%            31              *
William N. Whitlock                   *             --             --
Board of Managers and
Executive Officers as a Group       7.7%         1,797          17.97%
</Table>

---------------
* Less than one percent.

                                        69
<PAGE>

ITEM 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

AFFILIATE AGREEMENTS

     ACL has entered into agreements or arrangements with CSX, subsidiaries of
CSX and Vectura, an entity that is majority owned by 399 Venture Partners, Inc.
These agreements and business arrangements are for the purpose of either
providing or obtaining rail services for multi-modal transportation packages,
real estate and office lease arrangements (of approximately $40,000 from CSX to
ACL for certain office lease payments), and provision of certain transitional
administrative services (of approximately $200,000 from ACL to CSX for
transition services), as described herein.

     ACL has also entered into an arrangement with Vessel Leasing (in which ACL
owns 50% and Vectura owns 50% of the outstanding equity interests), whereby
Jeffboat sells barges to Vessel Leasing which charters those barges to ACBL. ACL
guarantees the charters between ACBL and Vessel Leasing.

     ACL also has entered into certain non-material agreements with GMS (for the
provision of corporate services by ACT to GMS), certain affiliates of UABL (ship
management agreements), and UABL (charters related to the UABL merger).

     ACL's arrangements described above are each on terms and conditions that
ACL believes are in the aggregate not materially more favorable or unfavorable
to ACL than would be obtained on an arm's-length basis among unaffiliated
parties.

PARENT LIMITED LIABILITY COMPANY AGREEMENT

     Upon the consummation of the Recapitalization, CSX and other investors
(collectively, the "Members") entered into the LLC Agreement. The LLC Agreement
governs the relative rights and duties of the Members. The following description
summarizes certain terms of the LLC Agreement. The following description does
not purport to be complete and is qualified in its entirety by reference to the
LLC Agreement.

     The business and affairs of the Parent are managed by a Board of Managers
having duties comparable to a corporate board of directors. The Board of
Managers is composed of ten individuals as follows: four shall be designated by
CSX, two shall be designated by Vectura and National Marine collectively (the
"Vectura Parties"), one shall be the current CEO of the Parent, one shall be the
current CEO of Vectura and two shall be independent of CSX and Vectura (and
their affiliates) designated by holders of a majority of the voting Junior
Common Membership Interests. CSX's and the Vectura Parties' rights to designate
individuals to the Board of Managers is dependent in part on such party's
continuing to hold membership interests of the Parent in specified amounts.

     As long as CSX holds specified amounts of Parent membership interests, CSX
is entitled to veto rights with respect to the following transactions, howsoever
directly or indirectly structured, subject to certain exceptions: (i) any merger
or other acquisition transaction (other than the acquisition of new capital
assets as part of the regular capital budgeting process) involving consideration
of $250 million or more; (ii) any transaction through which the Parent, ACL or
its subsidiary would become a Subchapter C corporation (other than certain
specified transactions); (iii) any amendment to the limited liability company
agreement of the Parent, ACL or its subsidiary which would adversely affect CSX;
(iv) any definition of "Excess Cash Flow," "Restricted Payments" and "Change of
Control" (and related definitions regarding the Senior Preferred Membership
Interests) in financing agreements; and (v) transactions with affiliates.

     As long as the Vectura Parties hold specified amounts of Parent membership
interests and subject to CSX's veto rights described above, the Vectura Parties
are entitled to veto rights with respect to the following transactions,
howsoever directly or indirectly structured, subject to certain exceptions: (i)
certain material financings, acquisitions, divestitures, public equity offerings
or capital expenditures; (ii) equity investment programs for management of the
Parent and its subsidiaries; and (iii) transactions with affiliates. In
addition, the Vectura Parties will have the right, subject to CSX's veto rights,
to cause an Initial Public Offering or Sale of ACL (each as defined in the LLC
Agreement).

                                        70
<PAGE>

     Membership Interests.  The Parent issued Senior Preferred Membership
Interests, Junior Preferred Membership Interests, Senior Common Membership
Interests and Junior Common Membership Interests in amounts sufficient to
consummate the Recapitalization. The Senior Preferred Membership Interests and
the Junior Preferred Membership Interests are collectively referred to as the
"Preferred Membership Interests" and the Senior Common Membership Interests and
the Junior Common Membership Interests are collectively referred to as the
"Common Membership Interests." The Junior Common Membership Interests are
divided into voting membership interests and non-voting membership interests of
the Parent, and collectively represent the residual future profits interests in
the Parent. The holders of non-voting Junior Common Membership Interests may at
any time, by a majority vote of such holders, convert all such interests into
voting Junior Common Membership Interests. Holders of the Preferred Membership
Interests are entitled to return of capital contributions prior to any
distributions made to holders of the Common Membership Interests. Each Preferred
Membership Interest has an initial Redemption Value of $100, which compounds
annually at the rate per year of 11.02% (the "Preferred Rate"). The Senior
Common Membership Interests represent an aggregate capital interest of
$3,389,091 and an aggregate future profits interest in the Parent of $32,500,000
(subject to certain adjustments) and accrue a compounded annual yield at the
Preferred Rate on a notional principal amount of $35,889,091. As to dividends,
distributions and liquidations, except as otherwise provided and except with
respect to redemptions of Membership Interests held by Management Investors upon
their termination, Senior Preferred Membership Interests rank senior to Junior
Preferred Membership Interests, Junior Preferred Membership Interests rank
senior to Senior Common Membership Interests and Senior Common Membership
Interests rank senior to Junior Common Membership Interests. At the Parent's
option, Senior Preferred Membership Interests may be exchanged into current-pay
subordinated notes containing the same features as such Membership Interests at
any time contemporaneously with or following the Parent's conversion to a
Subchapter C corporation. Senior Preferred Membership Interests have the benefit
of covenants respecting restricted payments (providing that the Parent may pay
no cash in respect of any membership interests ranking junior in priority to the
Senior Preferred Membership Interests until all Senior Preferred Membership
Interests have been redeemed, except with respect to redemptions of membership
interests held by Management Investors upon their termination or tax
distributions pursuant to the LLC Agreement), affiliate transactions, no
issuance of membership interests senior in priority to the Senior Preferred
Membership Interests and delivery of financial statements. Junior Common
Membership Interests are allocated into voting and non-voting interests. All
other classes of membership interests will be non-voting, except as otherwise
explicitly provided or as provided by law. The Parent will mandatorily redeem
all Senior Preferred Membership Interests and Junior Preferred Membership
Interests in year 15 at the amount of the Redemption Value (plus accrued and
unpaid yield thereon) of such membership interests at such time. Optional
redemptions of such membership interests and Senior Common Membership Interests
shall be permitted at the Parent's option at any time, subject to the priority
of such membership interests (other than in certain cases), without premium or
penalty, provided that CSX's consent will be required to redeem its Senior
Preferred Membership Interests in certain cases. Holders of Preferred Membership
Interests have the option to have such interests redeemed at the Redemption
Value as defined in the LLC Agreement (plus accrued but unpaid yield thereon)
upon consummation of a Change of Control.

     In addition, the LLC Agreement: (i) restricts the transfer of the equity
interests of the Parent; (ii) grants tag-along rights on certain transfers of
equity interests of the Parent (as described below); (iii) requires CSX and the
Investors to consent to a sale of the Parent to an independent third party if
such sale is approved by the Board of Managers of the Parent (as described
below); and (iv) grants preemptive rights on certain issuances of equity
interests of the Parent. Certain of the foregoing provisions of the LLC
Agreement will terminate upon the consummation of a Qualified Public Offering or
a Sale of ACL (each as defined in the LLC Agreement).

     The Vectura Parties and CSX may participate pro rata (based on ownership of
Junior Common Membership Interests) in any sale or transfer of Parent equity
securities by the other (other than certain specified transactions) and in any
control transaction howsoever structured, subject to certain limitations. In
addition, CSX may participate pro rata (based on ownership of Junior Preferred
Membership Interests) in any sale or transfer of Junior Preferred Membership
Interests by the Vectura Parties, subject to certain limitations. In the event
of a sale of all of the Parent approved by its Board of Managers (whether by
sale of
                                        71
<PAGE>

membership interests, all or substantially all assets or businesses, merger or
otherwise), each holder of membership interests shall consent to, approve and
participate in such transaction on the same terms and conditions. Any such
transaction shall also be a Change of Control, and any such transaction which
would not also otherwise trigger tag-along rights shall trigger a liquidation of
the Parent.

     Distributions.  The holders of Senior Preferred Membership Interests are
entitled to receive distributions from the Parent in an amount equal to the
Redemption Value (plus accrued and unpaid yield thereon) of such interests prior
to distributions (other than Tax Distributions described below) in respect of
any other membership interests of the Parent. The holders of Junior Preferred
Membership Interests are entitled to receive distributions from the Parent in an
amount equal to the Redemption Value (plus accrued and unpaid yield thereon) of
such interests prior to distributions (other than Tax Distributions described
below) in respect of any other membership interests of the Parent, except Senior
Preferred Membership Interests.

     Subject to certain restrictions contained in the LLC Agreement and any
restrictions contained in any financing agreements to which the Parent is a
party, and subject to the requirement of quarterly Tax Distributions described
below, the Board of Managers may make distributions, whether in cash, property
or securities of the Parent, at any time or from time to time, in the following
order of priority: first, to the holders of Senior Preferred Membership
Interests, an amount determined by the Redemption Value (plus accrued and unpaid
yield thereon) of such interests (as defined and described in the LLC
Agreement); second, to the holders of Junior Preferred Membership Interests, an
amount determined by the Redemption Value (plus accrued and unpaid yield
thereon) of such interests (as defined and described in the LLC Agreement);
third, pro rata to the holders of the Senior Common Membership Interests to the
extent of any unpaid yield (based on a notional principal amount of $35.9
million) and principal (based on a notional principal amount of $35.9 million)
thereon; and fourth, thereafter, pro rata in accordance with Capital Accounts
(as defined in the LLC Agreement) or a cash waterfall producing identical
results.

     ACL's operations are conducted in the form of a limited liability company.
As a result, in general, neither ACL nor the Parent is subject to U.S. federal
or state income taxes. Instead, taxable income from the operations of ACL and
its noncorporate subsidiaries are allocated to the equity holders of the Parent,
and such holders are directly liable for income taxes on such income. The LLC
Agreement requires the Parent to make quarterly distributions ("Tax
Distributions") to its members to enable each member to satisfy some or all of
its tax liability resulting from its equity interest in the Parent. Tax
Distributions to each member generally will be computed by multiplying the
taxable income allocated to the member from the Parent by the assumed tax rate
applicable to that member. The assumed tax rate (i) for a corporate member will
be the highest marginal federal income tax rate applicable to a corporation plus
2.3%, and (ii) for each other member will be an assumed highest marginal blended
federal, state and local income tax rate applicable to an individual. Such
distributions are permitted under the Indenture.

     Tax Distributions otherwise payable to CSX under the above formula may be
reduced (to not below zero) in three ways. First, CSX's tax distributions will
be reduced by $4.0 million in each of ACL's first five years of operation and by
$6 million in each of its following four years of operation (the "Annual
Exclusion"). Second, any income allocated by the Parent to CSX in respect of the
accruing yield on the Senior Preferred Membership Interests held by CSX will be
excluded from the computation of CSX's tax distributions. Third, taxes incurred
by CSX attributable to the recognition of Built-In Gain (through asset sales or
otherwise) will in some circumstances be excluded from the computation of CSX's
tax distributions. For this purpose, "Built-In Gain" means the excess of the
fair market value of the assets originally contributed by CSX to ACL as of the
date of the Recapitalization over the tax basis of those assets measured as of
the date of contribution. In general, subject to certain exceptions and
limitations, upon the recognition of any Built-In Gain by CSX, the Parent may
elect to either (i) accelerate the Annual Exclusion to the extent of any
resulting tax in inverse chronological order beginning with year nine, (ii)
distribute to CSX in the year in which the Built-In Gain is recognized an
additional Tax Distribution equal to one-half of the resulting tax to CSX, or
(iii) make additional distributions to CSX on its Senior Preferred Membership
Interests (in the amount of the resulting Built-In Gain tax) by accelerating
prior to year nine the time at which such distributions would otherwise be
required to commence under the LLC Agreement.

                                        72
<PAGE>

     CSX is also entitled to Tax Distributions in such amount as is required so
that CSX's "unreimbursed tax amount" does not exceed $85.0 million. CSX's
unreimbursed tax amount is the excess of its taxes at the assumed corporate tax
rate on taxable income allocated to CSX by the Parent (excluding allocations in
respect of the accruing yield on the Senior Preferred Membership Interests and
allocations of Built-In Gain arising by reason of certain extraordinary
transactions) over Tax Distributions. In addition, CSX is entitled to Tax
Distributions equal to the tax at the assumed corporate tax rate on any Built-In
Gain arising from a sale-leaseback transaction. Further, as part of the tax
distribution provisions of the LLC Agreement, the Senior Preferred Membership
Interests are entitled to distributions beginning at the end of year nine in an
amount equal to the product of the assumed corporate tax rate and the Senior
Preferred Membership Interest annual accrual, including the full annual accrual
for year nine.

     In certain circumstances, it is possible that the distributions referred to
in the foregoing paragraphs could exceed the combined federal, state, local and
foreign income taxes that would be payable with respect to taxable income of ACL
for any given period if it were a Delaware corporation filing separate tax
returns. Such distributions are permitted under the Indenture.

     The Senior Preferred Membership Interests are entitled to distributions
beginning in year six equal to the lesser of excess cash flow and an annual
limit. The annual limit is $7.5 million in each of years six through ten and $10
million in each of years 11 through 15, increased in any year by the excess, if
any, of the annual limit for prior years over the amounts distributed in such
prior years as described in this paragraph.

     Liquidating distributions will be made among the members pro rata in
accordance with capital accounts or a cash waterfall producing identical
results.

PARENT REGISTRATION RIGHTS AGREEMENTS

     The Parent, CSX Brown Corp. ("CSX Brown"), an affiliate of CSX, and the
Investors, entered into a registration rights agreement (the "Parent
Registration Rights Agreement"). Under the Parent Registration Rights Agreement,
CSX Brown and the Vectura Parties have the right, subject to certain conditions,
to require the Parent to register any or all of their common equity interests of
the Parent under the U.S. Securities Act of 1933, as amended (the "Securities
Act") at the Parent's expense. In addition, all holders of registrable
securities are entitled to request the inclusion of any Common Membership
Interests of the Parent subject to the Parent Registration Rights Agreement in
any registration statement (excluding certain registration statements, including
any registration statement in connection with an Initial Public Offering (as
defined in the Parent Registration Rights Agreement)) at the Parent's expense
whenever the Parent proposes to register any of its Common Membership Interests
under the Securities Act. In connection with all such registrations, the Parent
has agreed to indemnify all holders of registrable securities against certain
liabilities, including liabilities under the Securities Act.

TRANSITION SERVICES AGREEMENT

     ACL and CSX entered into a transition services agreement (the "Transition
Services Agreement"), pursuant to which CSX provided to ACL certain services
that it had previously provided to its predecessor. Such transitional services
have been provided since the Recapitalization and have included general
accounting, legal and computer systems support, tax planning and benefits
administration, as well as various other transitional services.

OTHER ARRANGEMENTS

     ACL, CSX and Vectura and their respective affiliates have agreed to
indemnify each other with respect to liabilities related to their respective
businesses pursuant to the Recapitalization.

                                        73
<PAGE>

                                    PART IV

ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K

(a) Documents filed as part of this report:

    (1) Consolidated Financial Statements:

     Included in Part II of this report:

        Consolidated Statement of Operations, for the years ended December 28,
        2001, December 29, 2000 and December 31, 1999.

        Consolidated Statement of Cash Flows, for the years ended December 28,
        2001, December 29, 2000 and December 31, 1999.

        Consolidated Statement of Financial Position as of December 28, 2001 and
        December 29, 2000.

        Consolidated Statement of Member's Deficit/Stockholder's Equity, for the
        years ended December 28, 2001, December 29, 2000 and December 31, 1999.

        Notes to Consolidated Financial Statements, for the years ended December
        28, 2001, December 29, 2000 and December 31, 1999.

        Report of PricewaterhouseCoopers LLP, Independent Accountants, on the
        consolidated financial statements of American Commercial Lines LLC at
        December 28, 2001, December 29, 2000 and December 31, 1999 and for each
        of the three fiscal years ended December 28, 2001, December 29, 2000 and
        December 31, 1999.

     Included in Item 14(d) to this report:

        Consolidated Statement of Operations of UABL Limited for the year ended
        December 31, 2001 and for the period of October 24 (inception date) to
        December 31, 2000.

        Consolidated Statement of Financial Position of UABL Limited as of
        December 31, 2001 and for the period of October 24 (inception date) to
        December 31, 2000.

        Report of Arthur Andersen LLP, Independent Public Accountants, on the
        consolidated financial statements of UABL Limited as of and for the year
        ended December 31, 2001 and as of December 31, 2000 and for the period
        of October 24 (inception date) to December 31, 2000.

(2) Financial Statement Schedule

     Included in Part II of this report:

          Schedule VIII -- Valuation and Qualifying Accounts

          All other schedules are omitted because they are not applicable, not
     significant or not required, or because the required information is
     included in the financial statement notes thereto.

                                        74
<PAGE>

(3) Exhibits

<Table>
<Caption>
EXHIBIT
  NO.                             DESCRIPTION
-------                           -----------
<S>       <C>
  +2.1    Recapitalization Agreement dated as of April 17, 1998 by and
          among CSX, Vectura, the Parent, ACL and National Marine
          (incorporated by reference to Exhibit 2.1 of the
          registrant's Registration Statement on Form S-4, as amended
          (Registration No. 333-62227)).
  +3.1    Certificate of Formation of the Parent (incorporated by
          reference to Exhibit 3.1 of the registrant's Registration
          Statement on Form S-4, as amended (Registration No.
          333-62227)).
  +3.2    Form of Certificate of Formation of ACL and the Subsidiary
          Guarantors (incorporated by reference to Exhibit 3.1 of the
          registrant's Registration Statement on Form S-4, as amended
          (Registration No. 333-62227)).
  +3.3    Form of Limited Liability Company Agreement for the
          Subsidiary Guarantors (incorporated by reference to Exhibit
          3.1 of the registrant's Registration Statement on Form S-4,
          as amended (Registration No. 333-62227)).
  +3.4    Amended and Restated Limited Liability Company Agreement of
          the Parent (incorporated by reference to Exhibit 3.1 of the
          registrant's Registration Statement on Form S-4, as amended
          (Registration No. 333-62227)).
  +3.5    Amended and Restated Limited Liability Company Agreement of
          ACL (incorporated by reference to Exhibit 3.1 of the
          registrant's Registration Statement on Form S-4, as amended
          (Registration No. 333-62227)).
  +3.6    Certificate of Incorporation of ACL Capital (incorporated by
          reference to Exhibit 3.1 of the registrant's Registration
          Statement on Form S-4, as amended (Registration No.
          333-62227)).
  +3.7    By-laws of ACL Capital (incorporated by reference to Exhibit
          3.1 of the registrant's Registration Statement on Form S-4,
          as amended (Registration No. 333-62227)).
  +4.1    Indenture dated as of June 30, 1998 by and among ACL, ACL
          Capital and the Subsidiary Guarantors and the United States
          Trust Company of New York, as trustee (incorporated by
          reference to Exhibit 3.1 of the registrant's Registration
          Statement on Form S-4, as amended (Registration No.
          333-62227)).
  +4.2    Purchase Agreement dated as of June 23, 1998 among ACL, ACL
          Capital and the Subsidiary Guarantors, Wasserstein Perella
          Securities, Inc. and Chase Securities Inc. (incorporated by
          reference to Exhibit 3.1 of the registrant's Registration
          Statement on Form S-4, as amended (Registration No.
          333-62227)).
  +4.3    Registration Rights Agreement dated as of June 23, 1998 by
          and among ACL, ACL Capital and the Subsidiary Guarantors,
          Wasserstein Perella Securities, Inc. and Chase Securities
          Inc. (incorporated by reference to Exhibit 3.1 of the
          registrant's Registration Statement on Form S-4, as amended
          (Registration No. 333-62227)).
  +4.4    Registration Rights Agreement dated as of June 30, 1998 by
          and among ACL, Vectura, National Marine, CSX Brown, Stuart
          Agranoff and Steven Anderson and each Person whose name is
          set forth on Schedule I therein (incorporated by reference
          to Exhibit 3.1 of the registrant's Registration Statement on
          Form S-4, as amended (Registration No. 333-62227)).
 +10.1    Credit Agreement dated as of June 30, 1998 among ACL, the
          Parent, the Lenders (as defined therein) and The Chase
          Manhattan Bank, as issuing bank, as administrative agent, as
          security trustee and as collateral agent (incorporated by
          reference to Exhibit 3.1 of the registrant's Registration
          Statement on Form S-4, as amended (Registration No.
          333-62227)).
*+10.2    Employment Agreement between ACL and Daniel J. Marquitz
          dated October 19, 1998 (incorporated by reference to Exhibit
          3.1 of the registrant's Registration Statement on Form S-4,
          as amended (Registration No. 333-62227)).
*+10.3    Employment Agreement between CSX and Michael C. Hagan dated
          February 1, 1995 (incorporated by reference to Exhibit 10.3
          of the registrant's 1998 Annual Report on Form 10-K dated
          March 25, 1999 (Registration No. 333-62227)).
*+10.4    Stock Purchase and Loan Plan, as amended (incorporated by
          reference to Exhibit 10.14 of CSX's 1998 Annual Report on
          Form 10-K dated March 3, 1999 (File No. 333-28523)).
</Table>

                                        75
<PAGE>

<Table>
<Caption>
EXHIBIT
  NO.                             DESCRIPTION
-------                           -----------
<S>       <C>
*+10.5    1987 Long-Term Performance Stock Plan, as amended
          (incorporated by reference to Exhibit 10.15 of CSX's 1998
          Annual Report on Form 10-K dated March 3, 1999 (File No.
          333-28523)).
*+10.6    1985 Deferred Compensation Program for Executives of CSX
          Corporation and Affiliated Companies, as amended
          (incorporated by reference to Exhibit 10.16 of CSX's 1998
          Annual Report on Form 10-K dated March 3, 1999 (File No.
          333-28523)).
*+10.7    Supplementary Savings Plan and Incentive Award Deferral Plan
          for Eligible Executives of CSX Corporation and Affiliated
          Companies, as amended (incorporated by reference to Exhibit
          10.17 of CSX's 1998 Annual Report on Form 10-K dated March
          3, 1999 (File No. 333-28523)).
*+10.8    Special Retirement Plan of CSX Corporation and Affiliated
          Companies, as amended (incorporated by reference to Exhibit
          10.18 of CSX's 1998 Annual Report on Form 10-K dated March
          3, 1999 (File No. 333-28523)).
*+10.9    Supplemental Retirement Plan of CSX Corporation and
          Affiliated Companies, as amended (incorporated herein by
          reference to Exhibit 10.19 of CSX's 1998 Annual Report on
          Form 10-K dated March 3, 1998 (File No. 333-28523)).
*+10.10   American Commercial Lines, Inc. Severance Pay Plan
          (incorporated by reference to Exhibit 2.1 of the
          registrant's Registration Statement on Form S-4, as amended
          (Registration No. 333-62227)).
*+10.11   American Commercial Barge Line Company Salary Continuation
          Plan, as amended Plan (incorporated by reference to Exhibit
          2.1 of the registrant's Registration Statement on Form S-4,
          as amended (Registration No. 333-62227)).
*+10.12   Employment Agreement between ACL and David Wagstaff III
          dated June 25, 1999 (incorporated by reference to Exhibit
          10.1 of the registrant's Quarterly Report on Form 10-Q for
          the period ending July 2, 1999 dated August 10, 1999 (File
          No. 333-62227)).
*+10.13   Consulting Agreement between ACL and David Wagstaff III
          dated October 1, 1999 (incorporated by reference to Exhibit
          10.13 of the registrant's 1999 Annual Report on Form 10-K
          dated March 30, 2000 (File No. 333-62227)).
 +10.14   Amendment No. 1, Waiver and Agreement to Credit Agreement
          (incorporated by reference to Exhibit 10.14 of the
          registrant's 2000 Annual Report on Form 10-K dated March 29,
          2001 (File No. 333-62227)).
 +10.15   Amendment and Waiver No. 2 to Credit Agreement (incorporated
          by reference to Exhibit 10.15 of the registrant's 2000
          Annual Report on Form 10-K dated March 29, 2001 (File No.
          333-62227)).
 +10.16   Consent and Waiver No. 3 to Credit Agreement (incorporated
          by reference to Exhibit 10.16 of the registrant's 2000
          Annual Report on Form 10-K dated March 29, 2001 (File No.
          333-62227)).
 +10.17   Amendment No. 4, Consent and Waiver to Credit Agreement.
 +10.18   Amendment No. 5, Waiver and Agreement to Credit Agreement
          (incorporated by reference to Exhibit 10.18 of the
          registrant's 2000 Annual Report on Form 10-K dated March 29,
          2001 (File No. 333-62227)).
  10.19   Employment Agreement between ACBL and R. Barry Uber dated
          July 11, 2001.
  10.22   Form of Modification of Waiver And First Amendment to The
          Second Amended and Restated Receivables Purchase Agreement
          dated as of February 25, 2002.
 +10.23   Form of Recapitalization Agreement dated as of March 15,
          2002 (incorporated by reference to Exhibit 10.23 of the
          registrant's Current Report on Form 8-K dated March 15, 2002
          (File No. 333-62227)).
  21.1    Subsidiaries of ACL.
  99.1    Report of Arthur Anderson LLP, Independent Public
          Accountants, on the financial statements of Global Materials
          Services LLC for the year ended December 31, 1999.
</Table>

                                        76
<PAGE>

<Table>
<Caption>
EXHIBIT
  NO.                             DESCRIPTION
-------                           -----------
<S>       <C>
  99.2    Report of Arthur Andersen LLP, Independent Public
          Accountants, on the consolidated financial statements of
          UABL Limited as of and for the year ended December 31, 2001
          and as of December 31, 2000 and for the period of October 24
          (inception date) to December 31, 2000 ("UABL Auditor
          Report").
  99.3    Consent of Arthur Andersen LLP, Independent Public
          Accountants, for use of UABL Auditor Report.
  99.4    Letter of Representations of Arthur Andersen LLP,
          Independent Public Accountants pursuant to SEC Release No.
          34-45590.
</Table>

---------------

 +  Not filed herewith. In accordance with Rule 12b-32 of the General Rules and
    Regulations under the Securities and Exchange Act of 1934, reference is made
    to the document previously filed with the Commission.

 *  Management Contract or Compensatory Plan or Arrangement.

(b) Reports on Form 8-K: There were no reports on Form 8-K filed for the three
    months ended December 28, 2001.

(c) Exhibits: See Index to Exhibits

(d) See attached financial statements of UABL Limited, a
    fifty-percent-or-less-owned person.

                                        77
<PAGE>

                                   SIGNATURES

     Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.

                                          American Commercial Lines LLC
                                          (Registrant)

                                          By:     /s/ MICHAEL C. HAGAN
                                            ------------------------------------
                                                      Michael C. Hagan
                                               President and Chief Executive
                                                           Officer

March 28, 2002

     Pursuant to the requirements of 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 indicated on March 28, 2002.

<Table>
<Caption>
NAME                                                                     TITLE
----                                                                     -----
<C>                                                <S>
              /s/ MICHAEL C. HAGAN                 President, Chief Executive Officer, and Member
------------------------------------------------   of Board of Representatives of the Parent
                Michael C. Hagan                   (Principal Executive Officer)

               /s/ JAMES J. WOLFF                  Senior Vice President -- Finance and
------------------------------------------------   Administration, Chief Financial Officer
                 James J. Wolff                    (Principal Financial and Accounting Officer)

             /s/ DAVID WAGSTAFF III                Chairman of Board of Representatives of Parent
------------------------------------------------
               David Wagstaff III

               /s/ DAVID H. BAGGS                  Member of Board of Representatives of Parent
------------------------------------------------
                 David H. Baggs

            /s/ ELLEN M. FITZSIMMONS               Member of Board of Representatives of Parent
------------------------------------------------
              Ellen M. Fitzsimmons

              /s/ PAUL R. GOODWIN                  Member of Board of Representatives of Parent
------------------------------------------------
                Paul R. Goodwin

             /s/ ERNEST A. HABERLI                 Member of Board of Representatives of Parent
------------------------------------------------
               Ernest A. Haberli

              /s/ RICHARD L. HUBER                 Member of Board of Representatives of Parent
------------------------------------------------
                Richard L. Huber

          /s/ RICHARD E. MAYBERRY, JR.             Member of Board of Representatives of Parent
------------------------------------------------
            Richard E. Mayberry, Jr.

               /s/ JAMES P. PETER                  Member of Board of Representatives of Parent
------------------------------------------------
                 James P. Peter

              /s/ DAVID F. THOMAS                  Member of Board of Representatives of Parent
------------------------------------------------
                David F. Thomas
</Table>

                                        78
<PAGE>

                               INDEX TO EXHIBITS

<Table>
<Caption>
EXHIBIT
  NO.                             DESCRIPTION
-------                           -----------
<S>       <C>
  +2.1    Recapitalization Agreement dated as of April 17, 1998 by and
          among CSX, Vectura, the Parent, ACL and National Marine
          (incorporated by reference to Exhibit 2.1 of the
          registrant's Registration Statement on Form S-4, as amended
          (Registration No. 333-62227)).
  +3.1    Certificate of Formation of the Parent (incorporated by
          reference to Exhibit 3.1 of the registrant's Registration
          Statement on Form S-4, as amended (Registration No.
          333-62227)).
  +3.2    Form of Certificate of Formation of ACL and the Subsidiary
          Guarantors (incorporated by reference to Exhibit 3.1 of the
          registrant's Registration Statement on Form S-4, as amended
          (Registration No. 333-62227)).
  +3.3    Form of Limited Liability Company Agreement for the
          Subsidiary Guarantors (incorporated by reference to Exhibit
          3.1 of the registrant's Registration Statement on Form S-4,
          as amended (Registration No. 333-62227)).
  +3.4    Amended and Restated Limited Liability Company Agreement of
          the Parent (incorporated by reference to Exhibit 3.1 of the
          registrant's Registration Statement on Form S-4, as amended
          (Registration No. 333-62227)).
  +3.5    Amended and Restated Limited Liability Company Agreement of
          ACL (incorporated by reference to Exhibit 3.1 of the
          registrant's Registration Statement on Form S-4, as amended
          (Registration No. 333-62227)).
  +3.6    Certificate of Incorporation of ACL Capital (incorporated by
          reference to Exhibit 3.1 of the registrant's Registration
          Statement on Form S-4, as amended (Registration No.
          333-62227)).
  +3.7    By-laws of ACL Capital (incorporated by reference to Exhibit
          3.1 of the registrant's Registration Statement on Form S-4,
          as amended (Registration No. 333-62227)).
  +4.1    Indenture dated as of June 30, 1998 by and among ACL, ACL
          Capital and the Subsidiary Guarantors and the United States
          Trust Company of New York, as trustee (incorporated by
          reference to Exhibit 3.1 of the registrant's Registration
          Statement on Form S-4, as amended (Registration No.
          333-62227)).
  +4.2    Purchase Agreement dated as of June 23, 1998 among ACL, ACL
          Capital and the Subsidiary Guarantors, Wasserstein Perella
          Securities, Inc. and Chase Securities Inc. (incorporated by
          reference to Exhibit 3.1 of the registrant's Registration
          Statement on Form S-4, as amended (Registration No.
          333-62227)).
  +4.3    Registration Rights Agreement dated as of June 23, 1998 by
          and among ACL, ACL Capital and the Subsidiary Guarantors,
          Wasserstein Perella Securities, Inc. and Chase Securities
          Inc. (incorporated by reference to Exhibit 3.1 of the
          registrant's Registration Statement on Form S-4, as amended
          (Registration No. 333-62227)).
  +4.4    Registration Rights Agreement dated as of June 30, 1998 by
          and among ACL, Vectura, National Marine, CSX Brown, Stuart
          Agranoff and Steven Anderson and each Person whose name is
          set forth on Schedule I therein (incorporated by reference
          to Exhibit 3.1 of the registrant's Registration Statement on
          Form S-4, as amended (Registration No. 333-62227)).
 +10.1    Credit Agreement dated as of June 30, 1998 among ACL, the
          Parent, the Lenders (as defined therein) and The Chase
          Manhattan Bank, as issuing bank, as administrative agent, as
          security trustee and as collateral agent (incorporated by
          reference to Exhibit 3.1 of the registrant's Registration
          Statement on Form S-4, as amended (Registration No.
          333-62227)).
*+10.2    Employment Agreement between ACL and Daniel J. Marquitz
          dated October 19, 1998 (incorporated by reference to Exhibit
          3.1 of the registrant's Registration Statement on Form S-4,
          as amended (Registration No. 333-62227)).
*+10.3    Employment Agreement between CSX and Michael C. Hagan dated
          February 1, 1995 (incorporated by reference to Exhibit 10.3
          of the registrant's 1998 Annual Report on Form 10-K dated
          March 25, 1999 (Registration No. 333-62227)).
</Table>
<PAGE>

<Table>
<Caption>
EXHIBIT
  NO.                             DESCRIPTION
-------                           -----------
<S>       <C>
*+10.4    Stock Purchase and Loan Plan, as amended (incorporated by
          reference to Exhibit 10.14 of CSX's 1998 Annual Report on
          Form 10-K dated March 3, 1999 (File No. 333-28523)).
*+10.5    1987 Long-Term Performance Stock Plan, as amended
          (incorporated by reference to Exhibit 10.15 of CSX's 1998
          Annual Report on Form 10-K dated March 3, 1999 (File No.
          333-28523)).
*+10.6    1985 Deferred Compensation Program for Executives of CSX
          Corporation and Affiliated Companies, as amended
          (incorporated by reference to Exhibit 10.16 of CSX's 1998
          Annual Report on Form 10-K dated March 3, 1999 (File No.
          333-28523)).
*+10.7    Supplementary Savings Plan and Incentive Award Deferral Plan
          for Eligible Executives of CSX Corporation and Affiliated
          Companies, as amended (incorporated by reference to Exhibit
          10.17 of CSX's 1998 Annual Report on Form 10-K dated March
          3, 1999 (File No. 333-28523)).
*+10.8    Special Retirement Plan of CSX Corporation and Affiliated
          Companies, as amended (incorporated by reference to Exhibit
          10.18 of CSX's 1998 Annual Report on Form 10-K dated March
          3, 1999 (File No. 333-28523)).
*+10.9    Supplemental Retirement Plan of CSX Corporation and
          Affiliated Companies, as amended (incorporated herein by
          reference to Exhibit 10.19 of CSX's 1998 Annual Report on
          Form 10-K dated March 3, 1998 (File No. 333-28523)).
*+10.10   American Commercial Lines, Inc. Severance Pay Plan
          (incorporated by reference to Exhibit 2.1 of the
          registrant's Registration Statement on Form S-4, as amended
          (Registration No. 333-62227)).
*+10.11   American Commercial Barge Line Company Salary Continuation
          Plan, as amended Plan (incorporated by reference to Exhibit
          2.1 of the registrant's Registration Statement on Form S-4,
          as amended (Registration No. 333-62227)).
*+10.12   Employment Agreement between ACL and David Wagstaff III
          dated June 25, 1999 (incorporated by reference to Exhibit
          10.1 of the registrant's Quarterly Report on Form 10-Q for
          the period ending July 2, 1999 dated August 10, 1999 (File
          No. 333-62227)).
*+10.13   Consulting Agreement between ACL and David Wagstaff III
          dated October 1, 1999 (incorporated by reference to Exhibit
          10.13 of the registrant's 1999 Annual Report on Form 10-K
          dated March 30, 2000 (File No. 333-62227)).
 +10.14   Amendment No. 1, Waiver and Agreement to Credit Agreement
          (incorporated by reference to Exhibit 10.14 of the
          registrant's 2000 Annual Report on Form 10-K dated March 29,
          2001 (File No. 333-62227)).
 +10.15   Amendment and Waiver No. 2 to Credit Agreement (incorporated
          by reference to Exhibit 10.15 of the registrant's 2000
          Annual Report on Form 10-K dated March 29, 2001 (File No.
          333-62227)).
 +10.16   Consent and Waiver No. 3 to Credit Agreement (incorporated
          by reference to Exhibit 10.16 of the registrant's 2000
          Annual Report on Form 10-K dated March 29, 2001 (File No.
          333-62227)).
 +10.17   Amendment No. 4, Consent and Waiver to Credit Agreement.
 +10.18   Amendment No. 5, Waiver and Agreement to Credit Agreement
          (incorporated by reference to Exhibit 10.18 of the
          registrant's 2000 Annual Report on Form 10-K dated March 29,
          2001 (File No. 333-62227)).
  10.19   Employment Agreement between ACBL and R. Barry Uber dated
          July 11, 2001.
  10.22   Form of Modification of Waiver And First Amendment to The
          Second Amended and Restated Receivables Purchase Agreement
          dated as of February 25, 2002.
 +10.23   Form of Recapitalization Agreement dated as of March 15,
          2002 (incorporated by reference to Exhibit 10.23 of the
          registrant's Current Report on Form 8-K dated March 15, 2002
          (File No. 333-62227)).
  21.1    Subsidiaries of ACL.
</Table>
<PAGE>

<Table>
<Caption>
EXHIBIT
  NO.                             DESCRIPTION
-------                           -----------
<S>       <C>
  99.1    Report of Arthur Anderson LLP, Independent Public
          Accountants, on the financial statements of Global Materials
          Services LLC for the year ended December 31, 1999.
  99.2    Report of Arthur Andersen LLP, Independent Public
          Accountants, on the consolidated financial statements of
          UABL Limited for the year ended December 31, 2001 and for
          the period of October 24 (inception date) to December 31,
          2000 ("UABL Auditor Report").
  99.3    Consent of Arthur Andersen LLP, Independent Public
          Accountants, for use of UABL Auditor Report.
  99.4    Letter of Representation of Arthur Andersen LLP, Independent
          Public Accountants pursuant to SEC Release No. 34-45590.
</Table>

---------------

 +  Not filed herewith. In accordance with Rule 12b-32 of the General Rules and
    Regulations under the Securities and Exchange Act of 1934, reference is made
    to the document previously filed with the Commission.

 *  Management Contract or Compensatory Plan or Arrangement.

(b) Reports on Form 8-K: There were no reports on Form 8-K filed for the three
    months ended December 28, 2001.

(c) Exhibits: See Index to Exhibits

(d) See attached financial statements of UABL Limited as a financial statement
    schedule for UABL Limited, a fifty-percent-or-less-owned person.