##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 10-Q
  þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the quarterly period ended September 30, 2009
  ̈
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934
 For
the transition period from  to
 Commission File Number: 1-33402
 Trico Marine Services, Inc.
  Delaware
    
    72-1252405(State or other jurisdiction of
    
    (I.R.S. Employerincorporation or organization)
    
    Identification No.)10001 Woodloch Forest Drive, Suite 610,
    
    77380 (Zip code)The Woodlands, Texas(Address of principal executive offices)
  þ o
 þ o
  Large Accelerated Filer o
Accelerated Filer þ
Non-accelerated filer o (Do not Check if a Smaller Reporting Company)
Smaller Reporting Company o o þ
 þ o




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##### 



TRICO MARINE SERVICES, INC.
REPORT FORM 10-Q
FOR THE QUARTER ENDED SEPTEMBER 30, 2009
 TABLE OF CONTENTS
 PagePart I.
    
    Financial InformationItem 1. Financial Statements (Unaudited)Condensed Consolidated Balance Sheets  September 30, 2009 and December 31, 2008
    
    
    1Condensed Consolidated Statements of Income  Three and Nine Months Ended September 30, 2009
and 2008
    
    
    2Condensed Consolidated Statements of Cash Flows  Nine Months Ended September 30, 2009 and 2008
    
    
    3Notes to the Condensed Consolidated Financial Statements
    
    
    4Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    42Item 3. Quantitative and Qualitative Disclosures About Market Risk
    
    
    60Item 4. Controls and Procedures
    
    
    60Part II.
    
    Other Information
    
    
    60Item 1. Legal Proceedings
    
    
    61Item 1A. Risk Factors
    
    
    61Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
    
    
    73Item 3. Defaults upon Senior Securities
    
    
    73Item 4. Submission of Matters to a Vote of Security Holders
    
    
    73Item 5. Other Information
    
    
    73Item 6. Exhibits
    
    
    73Signature
    
    
    
    
    76EX-31.1EX-31.2EX-32.1




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##### Table of Contents



PART I  FINANCIAL INFORMATION
 
 Item 1. Financial Statements
 
 TRICO MARINE SERVICES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS  (In thousands, except share amounts)
 September 30,
    
    
    December 31,2009
    
    
    2008(Unaudited)ASSETSCurrent assets:Cash and cash equivalents
    
    $
    41,733
    
    
    $
    94,613Restricted cash
    
    
    2,741
    
    
    
    3,566Accounts receivable, net
    
    
    159,726
    
    
    
    165,152Prepaid expenses and other current assets
    
    
    19,445
    
    
    
    3,375Assets held for sale
    
    
    31,998
    
    
    
    Total current assets
    
    
    255,643
    
    
    
    266,706Property and equipment:Marine vessels
    
    
    498,091
    
    
    
    502,417Subsea equipment
    
    
    178,261
    
    
    
    153,003Construction-in-progress
    
    
    278,777
    
    
    
    260,069Transportation and other
    
    
    5,821
    
    
    
    4,902960,950
    
    
    
    920,391Less accumulated depreciation and amortization
    
    
    (123,088
    )
    
    
    (115,981
    )Net property and equipment, net
    
    
    837,862
    
    
    
    804,410Intangible assets
    
    
    118,094
    
    
    
    106,983Other assets
    
    
    24,619
    
    
    
    24,637Total assets
    
    $
    1,236,218
    
    
    $
    1,202,736LIABILITIES AND EQUITYCurrent liabilities:Short-term and current maturities of long-term debt
    
    $
    22,296
    
    
    $
    82,982Accounts payable
    
    
    60,277
    
    
    
    53,872Accrued expenses
    
    
    107,539
    
    
    
    85,656Accrued interest
    
    
    9,026
    
    
    
    10,383Foreign taxes payable
    
    
    4,647
    
    
    
    4,000Income taxes payable
    
    
    9,957
    
    
    
    18,133Other current liabilities
    
    
    921
    
    
    
    Total current liabilities
    
    
    214,663
    
    
    
    255,026Long-term debt
    
    
    691,759
    
    
    
    687,098Long-term derivative
    
    
    24,772
    
    
    
    1,119Foreign taxes payable
    
    
    31,642
    
    
    
    47,508Deferred income taxes
    
    
    5,807
    
    
    
    5,104Other liabilities
    
    
    8,117
    
    
    
    6,001Total liabilities
    
    
    976,760
    
    
    
    1,001,856Commitments and contingencies (See Note 16)
    
    
    
    
    
    
    Total equity:Common stock, $.01 par value, 50,000,000 shares authorized and 20,016,944 and
16,199,980 shares issued at September 30, 2009 and December 31, 2008, respectively
    
    
    198
    
    
    
    160Warrants
    
    
    1,640
    
    
    
    1,640Additional paid-in capital
    
    
    338,119
    
    
    
    316,694Retained earnings
    
    
    37,971
    
    
    
    25,197Accumulated other comprehensive loss, net of tax
    
    
    (161,422
    )
    
    
    (202,681
    )Phantom stock
    
    
    47,643
    
    
    
    55,588Treasury stock, at cost, 570,207 shares
    
    
    (17,604
    )
    
    
    (17,604
    )Total Trico Marine Services, Inc. equity
    
    
    246,545
    
    
    
    178,994Noncontrolling interest
    
    
    12,913
    
    
    
    21,886Total equity
    
    
    259,458
    
    
    
    200,880Total liabilities and equity
    
    $
    1,236,218
    
    
    $
    1,202,736
 The accompanying notes are an integral part of these condensed consolidated financial statements.
 1




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TRICO MARINE SERVICES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME  (Unaudited)
(In thousands, except per share amounts )
 Three Months Ended September 30,
    
    
    Nine Months Ended September 30,2009
    
    
    2008
    
    
    2009
    
    
    2008As adjusted, see
    
    
    
    
    
    
    As adjusted, seeNotes 7 and 15
    
    
    
    
    
    
    Notes 7 and 15Revenues
    
    $
    189,855
    
    
    $
    214,793
    
    
    $
    491,405
    
    
    $
    378,260Operating expenses:Direct operating expenses
    
    
    143,456
    
    
    
    155,113
    
    
    
    372,165
    
    
    
    258,952General and administrative
    
    
    19,594
    
    
    
    18,804
    
    
    
    60,423
    
    
    
    44,511Depreciation and amortization
    
    
    19,324
    
    
    
    21,673
    
    
    
    55,943
    
    
    
    41,315Impairment
    
    
    1,184
    
    
    
    
    
    
    
    15,207
    
    
    
    (Gain) loss on sales of assets
    
    
    768
    
    
    
    10
    
    
    
    (16,925
    )
    
    
    (2,736
    )Total operating expenses
    
    
    184,326
    
    
    
    195,600
    
    
    
    486,813
    
    
    
    342,042Operating income
    
    
    5,529
    
    
    
    19,193
    
    
    
    4,592
    
    
    
    36,218Interest expense, net of amounts capitalized
    
    
    (8,587
    )
    
    
    (12,682
    )
    
    
    (31,165
    )
    
    
    (20,968
    )Interest income
    
    
    181
    
    
    
    2,529
    
    
    
    2,043
    
    
    
    7,378Unrealized gain (loss) on mark-to-market of embedded
derivative
    
    
    (21,026
    )
    
    
    31,515
    
    
    
    (19,611
    )
    
    
    29,205Gain on conversions of debt
    
    
    
    
    
    
    
    
    
    
    11,330
    
    
    
    Refinancing costs
    
    
    
    
    
    
    
    
    
    
    (6,224
    )
    
    
    Foreign exchange gain (loss)
    
    
    30,543
    
    
    
    (25
    )
    
    
    33,106
    
    
    
    1,548Other expense, net
    
    
    (17
    )
    
    
    (25
    )
    
    
    (1,452
    )
    
    
    (3,063
    )Income (loss) before income taxes
    
    
    6,623
    
    
    
    40,505
    
    
    
    (7,381
    )
    
    
    50,318Income tax (benefit) expense
    
    
    (1,891
    )
    
    
    7,315
    
    
    
    (20,560
    )
    
    
    8,061Net income
    
    
    8,514
    
    
    
    33,190
    
    
    
    13,179
    
    
    
    42,257Less: Net (income) loss attributable to the
noncontrolling interest
    
    
    859
    
    
    
    (2,853
    )
    
    
    (405
    )
    
    
    (5,235
    )Net income attributable to Trico Marine Services, Inc.
    
    $
    9,373
    
    
    $
    30,337
    
    
    $
    12,774
    
    
    $
    37,022Earnings per common share:Basic
    
    $
    0.46
    
    
    $
    2.05
    
    
    $
    0.69
    
    
    $
    2.52Diluted
    
    $
    0.36
    
    
    $
    1.82
    
    
    $
    0.68
    
    
    $
    2.33Weighted average shares outstanding:Basic
    
    
    20,502
    
    
    
    14,827
    
    
    
    18,605
    
    
    
    14,684Diluted
    
    
    35,179
    
    
    
    16,680
    
    
    
    26,279
    
    
    
    15,865
 The accompanying notes are an integral part of these condensed consolidated financial statements.
 2




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TRICO MARINE SERVICES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS  ( Unaudited)
(In thousands)
 Nine Months Ended September 30,2009
    
    
    2008As adjusted, seeNotes 7 and 15Cash flows from operating activities:Net income
    
    $
    13,179
    
    
    $
    42,257Adjustments to reconcile net income to net cash provided by operating activities:Depreciation and amortization
    
    
    55,943
    
    
    
    41,315Amortization of non-cash deferred revenues
    
    
    (365
    )
    
    
    (277
    )Amortization of deferred financing costs
    
    
    2,280
    
    
    
    2,773Noncash benefit related to change in Norwegian tax law
    
    
    (18,568
    )
    
    
    Accretion of debt discount
    
    
    8,962
    
    
    
    7,068Deferred income taxes
    
    
    (840
    )
    
    
    (1,361
    )Impairment
    
    
    15,207
    
    
    
    Change in fair value of derivatives
    
    
    20,027
    
    
    
    (29,205
    )Gain on conversions of 6.5% Debentures
    
    
    (11,330
    )
    
    
    Cash paid for make-whole premium related to conversions of 6.5% Debentures
    
    
    (6,915
    )
    
    
    Foreign currency (gains)/losses, net
    
    
    (16,578
    )
    
    
    Gain on sales of assets
    
    
    (16,925
    )
    
    
    (2,736
    )Provision on doubtful accounts
    
    
    (27
    )
    
    
    566Stock based compensation
    
    
    2,582
    
    
    
    3,120Change in operating assets and liabilities
    
    
    19,549
    
    
    
    8,165Net cash provided by operating activities
    
    
    66,181
    
    
    
    71,685Cash flows from investing activities:Acquisition of DeepOcean, net of acquired cash
    
    
    
    
    
    
    (506,951
    )Purchases of property and equipment
    
    
    (66,800
    )
    
    
    (78,404
    )Proceeds from sales of assets
    
    
    30,024
    
    
    
    7,023Sale of hedge instrument
    
    
    
    
    
    
    8,151Decrease in restricted cash
    
    
    1,383
    
    
    
    2,575Net cash used in investing activities
    
    
    (35,393
    )
    
    
    (567,606
    )Cash flows from financing activities:Net proceeds from exercises of warrants and options
    
    
    
    
    
    
    11,615Proceeds from issuance of debt
    
    
    
    
    
    
    300,000Payment for exchange of convertible debentures
    
    
    (12,676
    )
    
    
    Proceeds and (repayments) of revolving credit facilities, net
    
    
    (67,465
    )
    
    
    174,106Dividend to noncontrolling partner
    
    
    (6,120
    )
    
    
    Debt issuance costs
    
    
    (430
    )
    
    
    (16,502
    )Refinancing costs
    
    
    (6,224
    )
    
    
    Net cash provided by (used in) financing activities
    
    
    (92,915
    )
    
    
    469,219Effect of exchange rate changes on cash and cash equivalents
    
    
    9,247
    
    
    
    (9,293
    )Net increase (decrease) in cash and cash equivalents
    
    
    (52,880
    )
    
    
    (35,995
    )Cash and cash equivalents at beginning of period
    
    
    94,613
    
    
    
    131,463Cash and cash equivalents at end of period
    
    $
    41,733
    
    
    $
    95,468
 The accompanying notes are an integral part of these condensed consolidated financial statements.
 3




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##### Table of Contents



TRICO MARINE SERVICES, INC. AND SUBSIDIARIES
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS  (Unaudited)
 1. Organization and Basis of Presentation
     2. Risks and Uncertainties
   4




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##### Table of Contents



Deep Cygnus, Trico Surge, Trico
Sovereign, Trico Seeker and Trico Searcher
       5




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##### Table of Contents



3. Acquisition
   6




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##### Table of Contents



Pro forma Information
  Three Months Ended
    
    Nine Months EndedSeptember 30, 2008
    
    September 30, 2008Historical
    
    Pro Forma
    
    Historical
    
    Pro FormaAs adjusted, see
    
    
    
    
    
    As adjusted, seeNotes 7 and 15
    
    
    
    
    
    Notes 7 and 15Revenues
    
    $
    214,793
    
    
    $
    276,665
    
    
    $
    378,260
    
    
    $
    525,690Operating income (1)
    
    
    19,193
    
    
    
    126
    
    
    
    36,218
    
    
    
    13,097Income before income taxes (2)
    
    
    40,505
    
    
    
    15,255
    
    
    
    50,318
    
    
    
    4,356Net income attributable to Trico Marine
Services, Inc.
    
    $
    30,337
    
    
    $
    8,323
    
    
    $
    37,022
    
    
    $
    95Diluted net income per share of common stock
    
    $
    1.82
    
    
    $
    0.50
    
    
    $
    2.33
    
    
    $
    0.01Diluted weighted average shares outstanding
    
    
    16,680
    
    
    
    16,680
    
    
    
    15,865
    
    
    
    15,865
 
 (1)
    
    Pro forma amounts for the three and nine months ended September 30, 2008 include the effect
of non-recurring transactions that occurred at DeepOcean prior to its acquisition by the
Company. These charges include a $16.5 million estimated loss on a contract for services in
Brazil that resulted following a delay in delivery of a vessel to perform the contracted work,
a $2.6 million disputed loss with a partner for a project in India and $4.3 million of
acquisition-related costs.(2)
    
    Pro forma amounts include acquisition-related debt costs ($5.2 million and $18.0 million for
the three and nine months ended September 30, 2008, respectively), including the amortization
of debt discount on the 6.5% Debentures (see Note 6). The Company determined that
approximately 50% of its acquisition related interest expense would be capitalized in the 2008
pro forma periods. 4. Asset Sales
 Asset Sales
   Assets Held for Sale
  5. Intangible Assets
  7




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##### Table of Contents



As of September 30, 2009
    
    
    
    
    
    
    
    
    
    
    As of December 31, 2008Foreign
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    ForeignCurrency
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    CurrencyGross Carrying
    
    
    Accumulated
    
    
    Translation
    
    
    
    
    
    
    Gross Carrying
    
    
    Accumulated
    
    
    TranslationAmount
    
    
    Amortization
    
    
    Adjustment
    
    
    Total
    
    
    Amount
    
    
    Amortization
    
    
    Adjustment
    
    
    TotalAmortized intangible
assets:Customer relationships
    
    $
    118,057
    
    
    $
    (10,420
    )
    
    $
    (20,657
    )
    
    $
    86,980
    
    
    $
    118,057
    
    
    $
    (5,040
    )
    
    $
    (32,459
    )
    
    $
    80,558Total
    
    $
    118,057
    
    
    $
    (10,420
    )
    
    $
    (20,657
    )
    
    $
    86,980
    
    
    $
    118,057
    
    
    $
    (5,040
    )
    
    $
    (32,459
    )
    
    $
    80,558
 Foreign
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    ForeignCurrency
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    CurrencyGross Carrying
    
    
    
    
    
    
    Translation
    
    
    
    
    
    
    Gross Carrying
    
    
    
    
    
    
    TranslationAmount
    
    
    Impairment
    
    
    Adjustment
    
    
    Total
    
    
    Amount
    
    
    Impairment
    
    
    Adjustment
    
    
    TotalUnamortized
intangible assets:Trade name
    
    $
    40,881
    
    
    $
    (3,114
    )
    
    $
    (6,653
    )
    
    $
    31,114
    
    
    $
    40,881
    
    
    $
    (3,114
    )
    
    $
    (11,342
    )
    
    $
    26,425Total
    
    $
    40,881
    
    
    $
    (3,114
    )
    
    $
    (6,653
    )
    
    $
    31,114
    
    
    $
    40,881
    
    
    $
    (3,114
    )
    
    $
    (11,342
    )
    
    $
    26,425
  6. Debt
   8




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##### Table of Contents



September 30, 2009
    
    
    December 31, 2008Current
    
    
    Long-Term
    
    
    Total
    
    
    Current
    
    
    Long-Term
    
    
    TotalRemaining debt:$50 million U.S. Revolving Credit Facility Agreement (1), maturing in December 2011
    
    $
    10,500
    
    
    $
    21,009
    
    
    $
    31,509
    (2), (3)
    
    $
    10,000
    
    
    $
    36,460
    
    
    $
    46,460
    (2), (3)$202.8 million face amount, 8.125% Convertible Debentures, net of unamortized
discount of $13.5 million as of September 30, 2009, interest payable semi-annually
in arrears, maturing on February 1, 2013
    
    
    10,141
    
    
    
    179,176
    
    
    
    189,317
    
    
    
    
    
    
    
    
    
    
    
    $150.0 million face amount, 3.0% Senior Convertible Debentures(7), net of unamortized
discount of $31.5 million and $35.9 million as of September 30, 2009 and December 31, 2008,
respectively, interest payable semi-annually in arrears, maturing on January 15, 2027
    
    
    
    
    
    
    118,483
    
    
    
    118,483
    (7)
    
    
    
    
    
    
    114,150
    
    
    
    114,150
    (7)6.11% Notes, principal and interest due in 30 semi-annual installments, maturing April 2014
    
    
    1,258
    
    
    
    5,028
    
    
    
    6,286
    
    
    
    1,258
    
    
    
    5,657
    
    
    
    6,915Insurance note
    
    
    297
    
    
    
    
    
    
    
    297
    
    
    
    
    
    
    
    
    
    
    
    Motor vehicle leases
    
    
    100
    
    
    
    62
    
    
    
    162
    
    
    
    243
    
    
    
    
    
    
    
    243Fresh-start debt premium
    
    
    
    
    
    
    267
    
    
    
    267
    
    
    
    
    
    
    
    312
    
    
    
    312Total remaining debt
    
    
    22,296
    
    
    
    324,025
    
    
    
    346,321
    
    
    
    11,501
    
    
    
    156,579
    
    
    
    168,080Debt paid and refinanced:$278.0 million face amount, 6.5% Senior Convertible Debentures, net of unamortized
discount of $45.0 million as of December 31, 2008, interest payable semi-annually in
arrears, exchanged in May 2009
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    232,998
    
    
    
    232,998NOK 350 million Revolving Credit Facility(1), maturing January 1, 2010
    
    
    
    
    
    
    59,803
    
    
    
    59,803
    (4), (5)
    
    
    3,600
    
    
    
    57,931
    
    
    
    61,531
    (4), (5)NOK 230 million Revolving Credit Facility(1), maturing January 1, 2010
    
    
    
    
    
    
    19,822
    
    
    
    19,822
    (4), (5)
    
    
    2,294
    
    
    
    18,939
    
    
    
    21,233
    (4), (5)NOK 150 million Additional Term Loan(1), maturing January 1, 2010
    
    
    
    
    
    
    9,097
    
    
    
    9,097
    (4), (5)
    
    
    3,644
    
    
    
    6,754
    
    
    
    10,398
    (4), (5)NOK 200 million Overdraft Facility(1), maturing January 1, 2010
    
    
    
    
    
    
    16,028
    
    
    
    16,028
    (4), (5)
    
    
    
    
    
    
    3,207
    
    
    
    3,207
    (4), (5)23.3 million Euro Revolving Credit Facility(1), maturing March 31, 2010
    
    
    
    
    
    
    20,671
    
    
    
    20,671
    (2), (4)
    
    
    
    
    
    
    19,717
    
    
    
    19,717
    (2), (4)NOK 260 million Short Term Credit Facility, interest at 9.9%, maturing
on February 1, 2009
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    11,631
    
    
    
    
    
    
    
    11,631$200 million Revolving Credit Facility(1), maturing in May 2013
    
    
    
    
    
    
    
    
    
    
    
    (6)
    
    
    30,563
    
    
    
    130,000
    
    
    
    160,563
    (2)$100 million Revolving Credit Facility(1), maturing no later than December 2017
    
    
    
    
    
    
    
    
    
    
    
    (6)
    
    
    
    
    
    
    15,000
    
    
    
    15,000
    (2)$100 and $200 million Revolving Credit Facility(1), maturing in May 2013
    
    
    
    
    
    
    172,759
    
    
    
    172,759
    (6)
    
    
    
    
    
    
    
    
    
    
    $18 million Revolving Credit Facility(1), maturing December 5, 2011
    
    
    
    
    
    
    14,500
    
    
    
    14,500
    (2), (4)
    
    
    2,000
    
    
    
    14,000
    
    
    
    16,000
    (2), (4)8 million Sterling Overdraft Facility, due on demand
    
    
    
    
    
    
    17,173
    
    
    
    17,173
    
    
    
    9,812
    
    
    
    
    
    
    
    9,81224.2 million Sterling Asset Financing Revolving Credit Facility(1), maturing
no later than December 13, 2014
    
    
    
    
    
    
    16,762
    
    
    
    16,762
    
    
    
    3,238
    
    
    
    14,048
    
    
    
    17,286Finance lease obligations assumed in the acquisition of DeepOcean, maturing from
October 2009 to November 2015
    
    
    
    
    
    
    14,873
    
    
    
    14,873
    
    
    
    2,225
    
    
    
    11,947
    
    
    
    14,172Other debt assumed in the acquisition of DeepOcean
    
    
    
    
    
    
    6,246
    
    
    
    6,246
    
    
    
    2,474
    
    
    
    5,978
    
    
    
    8,452Total debt paid and refinanced
    
    
    
    
    
    
    367,734
    
    
    
    367,734
    
    
    
    71,481
    
    
    
    530,519
    
    
    
    602,000Total debt
    
    $
    22,296
    
    
    $
    691,759
    
    
    $
    714,055
    
    
    $
    82,982
    
    
    $
    687,098
    
    
    $
    770,080
 
 (1)
    
    Interest on such credit facilities is at the London inter-bank offered rate (LIBOR) or
the Norwegian inter-bank offered rate (NIBOR) plus an applicable margin ranging from 1.65%
to 3.25%. The three month LIBOR rate was 0.3% and 1.8% and the three month NIBOR rate was
1.94% and 3.97% for the periods ending September 30, 2009 and December 31, 2008,
respectively.(2)
    
    The Company was not in compliance with its net worth ratio as of December 31, 2008 and
received an amendment retroactive to December 31, 2008. The amendment changed the
calculation of net worth ratio both retroactively and prospectively to permanently exclude
impairment of goodwill and non-amortizing intangible assets from the net worth ratio.(3)
    
    The Company was in compliance with its maximum consolidated leverage ratio as of
December 31, 2008, March 31, 2009 and June 30, 2009. In August 2009, the Company entered
into an amendment whereby the maximum consolidated leverage was increased from 4.5:1 to
5.0:1 for the fiscal quarter ended September 30, 2009. The Company was not in compliance
with this consolidated leverage ratio covenant at September 30, 2009 due to the negative
impact on calculated EBITDA of the increase in value of the embedded derivative associated
with the 8.125% Senior Convertible Debentures which was primarily the result of an increase
in the Companys stock price. The Company has received an amendment retroactive to
September 30, 2009 that amends the calculation retroactively and prospectively to exclude
the effects of the change in the value of this embedded derivative. With this amendment,
the Company was in compliance with this covenant as of September 30, 2009. This amendment
also increased the consolidated leverage ratio to 8.50:1 for each of the quarters ending
between December 31, 2009 through September 30, 2010. The ratio decreases to 8.00:1 for the
fiscal quarter ending December 31, 2010, and subsequently decreases to 7.00:1 for the
fiscal quarter ending March 31, 2011, 6.00:1 for the fiscal quarter ending June 30, 2011,
and to 5.00:1 for any fiscal quarters ending thereafter.(4)
    
    These debt agreements contain material adverse change provisions which permit the
lenders to declare an event of default if in their reasonable opinion, a deterioration in
the financial condition of the borrower will have a negative effect on its ability to meet
its obligation or, a material adverse change occurs with respect to the financial condition
of the borrower and/or its material subsidiaries.(5)
    
    The Company was in violation of its leverage ratio covenant as of March 31, 2009. The
Company received a waiver for the violation. The Company was in compliance with the
covenant as of September 30, 2009. 9




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##### Table of Contents



(6)
    
    The Company entered into an amendment with various lenders on September 30, 2009 to
combine the $200 million Revolving Credit Facility and the $100 million Revolving Credit
Facility. These facilities are now presented as one beginning September 30, 2009.(7)
    
    Holders of the Companys 3% Debentures have the right to require the Company to
repurchase the debentures at par on each of January 15, 2014, January 15, 2017 and January
15, 2022.  AmountDue in one year
    
    $
    22,296Due in two years
    
    
    51,046Due in three years
    
    
    70,386Due in four years
    
    
    96,085Due in five years
    
    
    1,254Due in over five years
    
    
    517,733
    (1)758,800Fresh-start debt premium
    
    
    267Unamortized discounts on 8.125% and 3.0% Debentures
    
    
    (45,012
    )Total debt
    
    $
    714,055
 
 (1)
    
    Includes the $150.0 million of 3% Debentures that may be converted earlier but have
stated maturity terms in excess of five years. Debt Paid and Refinanced:
 6.5% Convertible Debentures.
  NOK 350 million Revolving Credit Facility.
 NOK 230 million Revolving Credit Facility.
 10




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##### Table of Contents



NOK 150 million Additional Term Loan.
 NOK 200 million Overdraft Facility.
   23.3 million Euro Revolving Credit Facility.
 $200 million Revolving Credit Facility.
 11




---



##### Table of Contents



$100 million Revolving Credit Facility.
   $18 million Revolving Credit Facility .
 12




---



##### Table of Contents



8 million Sterling Overdraft Facilities.
 24.2 million Sterling Asset Financing Facilities.
 Outstanding Debt:
 $50 million U.S. Credit Facility.
  13




---



##### Table of Contents



8.125% Convertible Debentures.
    Payment Options:
  Investor Options to Convert, Redeem or Repurchase:
  14




---



##### Table of Contents



(a)
    
    the consummation of any transaction that is disclosed in a Schedule 13D (or successor
form) by any person and the result of which is that such person has become the
beneficial owner (as these terms are defined in Rule 13d-3 and Rule 13d-5 under the
Exchange Act), directly or indirectly, of more than 50% of the Companys Capital Stock that
is at the time entitled to vote by the holder thereof in the election of the Board of
Directors (or comparable body); or(b)
    
    the first day on which a majority of the members of the Board of Directors are not
continuing directors of the Board; or(c)
    
    the adoption of a plan relating to the liquidation or dissolution of the Company; or(d)
    
    the consolidation or merger of the Company with or into any other Person, or the sale,
lease, transfer, conveyance or other disposition, in one or a series of related
transactions, of all or substantially all of the Companys assets and those of its
subsidiaries taken as a whole to any person (as this term is used in Section 13(d)(3) of
the Exchange Act), other than:
 (i)
    
    any transaction pursuant to which the holders of 50% or more of the total
voting power of all shares of the Companys capital stock entitled to vote generally
in elections of directors of the Company immediately prior to such transaction have
the right to exercise, directly or indirectly, 50% or more of the total voting power
of all shares of the Companys capital stock entitled to vote generally in elections
of directors of the continuing or
surviving Person (or any parent thereof) immediately after giving effect to such
transaction; or(ii)
    
    any merger primarily for the purpose of changing the Companys jurisdiction
of incorporation and resulting in a reclassification, conversion or exchange of
outstanding shares of common stock solely into shares of common stock of the surviving
entity.
 (e)
    
    the termination of trading of the common stock, which will be deemed to have occurred if
the common stock or other common equity interests into which the 8.125% Debentures are
convertible is neither listed for trading on a United States national securities exchange
nor approved for listing on any United States system of automated dissemination of
quotations of securities prices, and no American Depositary Shares or similar instruments
for such common equity interests are so listed or approved for listing in the United States.
  Companys Ability to Repurchase or Redeem:
   15




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3% Senior Convertible Debentures.
  16




---



##### Table of Contents



6.11% Notes.
 New Facilities Entered into after September 30, 2009
 Senior Secured Notes pari passu
   17




---



##### Table of Contents



Trico Shipping Working Capital Facility.
  7. Change in Accounting for 3% Debentures
   Three Months Ended
    
    
    Nine Months EndedSeptember 30, 2009
    
    
    September 30, 2009Net incremental non-cash interest expense
    
    $
    1,288
    
    
    $
    3,989Less: tax effect
    
    
    (463
    )
    
    
    (1,435
    )Net incremental non-cash interest expense, net of tax
    
    $
    825
    
    
    $
    2,554Net decrease to earnings per common share:Basic
    
    $
    0.04
    
    
    $
    0.14Diluted
    
    $
    0.02
    
    
    $
    0.10
   18




---



##### Table of Contents



Three Months Ended September 30, 2008As Reported
    
    APB 14-1
    
    AdjustedSeptember 30, 2008
    
    Adjustment
    
    September 30, 2008Interest expense, net of amounts capitalized
    
    $
    (11,694
    )
    
    $
    (988
    )
    
    $
    (12,682
    )Income tax expense (benefit)
    
    
    7,670
    
    
    
    (355
    )
    
    
    7,315Net income (loss) attributable to Trico Marine Services, Inc.
    
    
    30,970
    
    
    
    (633
    )
    
    
    30,337Earnings (loss) per common share:Basic
    
    $
    2.09
    
    
    $
    (0.04
    )
    
    $
    2.05Diluted
    
    
    1.86
    
    
    
    (0.04
    )
    
    
    1.82Weighted average shares outstanding:Basic
    
    
    14,827
    
    
    
    14,827
    
    
    
    14,827Diluted
    
    
    16,680
    
    
    
    16,680
    
    
    
    16,680
 Nine Months Ended September 30, 2008As Reported
    
    APB 14-1
    
    AdjustedSeptember 30, 2008
    
    Adjustment
    
    September 30, 2008Interest expense, net of amounts capitalized
    
    $
    (18,093
    )
    
    $
    (2,875
    )
    
    $
    (20,968
    )Income tax expense (benefit)
    
    
    9,095
    
    
    
    (1,034
    )
    
    
    8,061Net income (loss) attributable to Trico Marine Services, Inc.
    
    
    38,863
    
    
    
    (1,841
    )
    
    
    37,022Earnings (loss) per common share:Basic
    
    $
    2.65
    
    
    $
    (0.13
    )
    
    $
    2.52Diluted
    
    
    2.45
    
    
    
    (0.12
    )
    
    
    2.33Weighted average shares outstanding:Basic
    
    
    14,684
    
    
    
    14,684
    
    
    
    14,684Diluted
    
    
    15,865
    
    
    
    15,865
    
    
    
    15,865
  8. Derivative Instruments
   19




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##### Table of Contents



Liability DerivativeSeptember 30, 2009
    
    
    December 31, 2008Derivatives Not Designated as Hedging
    
    Balance Sheet
    
    Fair
    
    
    Balance Sheet
    
    FairInstruments under Statement 133
    
    Location
    
    Value
    
    
    Location
    
    ValueOther contract - Warrant Liabilities (8.125% Debentures)
    
    Other current liabilities
    
    $
    778
    
    
    Other current liabilities
    
    $
    Other contract - 6.5% Debentures
    
    Long-term derivative
    
    
    
    
    
    Long-term derivative
    
    
    1,119Other contract - 8.125% Debentures
    
    Long-term derivative
    
    
    24,772
    
    
    Long-term derivative
    
    
    Total derivatives
    
    
    
    $
    25,550
    
    
    
    
    $
    1,119
 Derivatives NotDesignated as Hedging
    
    Location of Gain (Loss)
    
    Amount of Gain (Loss) Recognized on DerivativeInstruments under
    
    Recognized in Income
    
    Three Months Ended September 30,
    
    
    Nine Months Ended September 30,Statement 133
    
    on Derivative
    
    2009
    
    
    2008
    
    
    2009
    
    
    2008Other contract
    
    Other expense, net
    
    $
    (398
    )
    
    $
    
    
    
    $
    (416
    )
    
    $
    Other contract
    
    Unrealized gain on mark-to-market of embedded derivative - 6.5% Debentures
    
    
    
    
    
    
    31,515
    
    
    
    436
    
    
    
    29,205Other contract
    
    Unrealized loss on mark-to-market of embedded derivative - 8.125% Debentures
    
    
    (21,026
    )
    
    
    
    
    
    
    (20,047
    )
    
    
    $
    (21,424
    )
    
    $
    31,515
    
    
    $
    (20,027
    )
    
    $
    29,205
 9. Fair Value Measurements
   
    
    Level 1  Observable inputs such as quoted prices (unadjusted) in active markets for
identical assets or liabilities.
    
    Level 2  Inputs other than quoted prices that are observable for the asset or
liability, either directly or indirectly. These include quoted prices for similar assets or
liabilities in active markets and quoted prices for identical or similar assets or
liabilities in markets that are not active.
    
    Level 3  Unobservable inputs that reflect the reporting entitys own assumptions.
  20




---



##### Table of Contents



Fair Value Measurementsat September 30, 2009 Using Fair ValueHierarchyFair Value as ofSeptember 30,2009
    
    
    Level 1
    
    
    Level 2
    
    
    Level 3LiabilitiesWarrant liabilities (8.125% Debentures)
    
    $
    778
    
    
    $
    
    
    
    $
    778
    
    
    $
    Long-term derivative (8.125% Debentures)
    
    
    24,772
    
    
    
    
    
    
    
    
    
    
    
    24,772$
    25,550
    
    
    $
    
    
    
    $
    778
    
    
    $
    24,772
 Fair Value Measurementsat December 31, 2008 Using Fair ValueHierarchyFair Value as ofDecember 31,2008
    
    
    Level 1
    
    
    Level 2
    
    
    Level 3LiabilitiesWarrant liabilities (8.125% Debentures)
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    Long-term derivative (6.5% Debentures)
    
    
    1,119
    
    
    
    
    
    
    
    
    
    
    
    1,119$
    1,119
    
    
    $
    
    
    
    $
    
    
    
    $
    1,119
  Cash, cash equivalents, accounts receivable and accounts payable:
 Debt:
 September 30,
    
    December 31,2009
    
    2008Carrying amount
    
    $
    714,055
    
    
    $
    770,080Fair value
    
    
    682,242
    
    
    
    562,783
  8.125%
    
    
    6.5%Debentures
    
    
    DebenturesBalance on March 31, 2008
    
    $
    
    
    
    $
    Issuance of long-term derivative (6.5% Debentures)
    
    
    
    
    
    
    53,772Unrealized gain for the period May 14, 2008 through December 31, 2008
    
    
    
    
    
    
    (52,653
    )Balance on December 31, 2008
    
    $
    
    
    
    $
    1,119Unrealized (gain) loss for 2009
    
    
    20,047
    
    
    
    (436
    )Final valuation of 6.5% Debentures due to exchange for 8.125% Debentures
    
    
    
    
    
    
    (683
    )Issuance of long-term derivative (8.125% Debentures)
    
    
    4,725
    
    
    
    Balance on September 30, 2009
    
    $
    24,772
    
    
    $
    
 21




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##### Table of Contents



10. Earnings per Share
  Three Months Ended September 30,
    
    
    Nine Months Ended September 30,2009
    
    
    2008
    
    
    2009
    
    
    2008As adjusted, see
    
    
    
    
    
    
    As adjusted, seeNotes 7 and 15
    
    
    
    
    
    
    Notes 7 and 15Basic EPSNet income attributable to Trico Marine Services, Inc.
    
    $
    9,373
    
    
    $
    30,337
    
    
    $
    12,774
    
    
    $
    37,022Weighted-average shares of common stock outstanding:Basic
    
    
    20,502
    
    
    
    14,827
    
    
    
    18,605
    
    
    
    14,684Earnings per share:Basic
    
    $
    0.46
    
    
    $
    2.05
    
    
    $
    0.69
    
    
    $
    2.52Diluted EPSNet income attributable to Trico Marine Services, Inc.
    
    $
    9,373
    
    
    $
    30,337
    
    
    $
    12,774
    
    
    $
    37,022Add: interest on 8.125% convertible debentures, net
of tax
    
    
    3,409
    
    
    
    
    
    
    
    5,145
    
    
    
    Net income attributable to Trico Marine Services, Inc.
with assumed conversions
    
    $
    12,782
    
    
    $
    30,337
    
    
    $
    17,919
    
    
    $
    37,022Weighted-average shares of common stock outstanding:Basic
    
    
    20,502
    
    
    
    14,827
    
    
    
    18,605
    
    
    
    14,684Add dilutive effect of:Phantom stock units
    
    
    90
    
    
    
    1,582
    
    
    
    232
    
    
    
    7978.125% convertible debentures
    
    
    14,487
    
    
    
    
    
    
    
    7,376
    
    
    
    Stock options and nonvested restricted stock
    
    
    100
    
    
    
    138
    
    
    
    66
    
    
    
    142Warrants
    
    
    
    
    
    
    133
    
    
    
    
    
    
    
    242Total
    
    
    35,179
    
    
    
    16,680
    
    
    
    26,279
    
    
    
    15,865Earnings per share:Diluted
    
    $
    0.36
    
    
    $
    1.82
    
    
    $
    0.68
    
    
    $
    2.33
    11. Other Comprehensive Income (Loss)
  22




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##### Table of Contents



Three Months Ended September 30,2009
    
    
    2008Shareholders of
    
    
    
    
    
    
    
    
    
    
    Shareholders ofTrico Marine
    
    
    Noncontrolling
    
    
    
    
    
    
    Trico Marine
    
    
    NoncontrollingServices, Inc.
    
    
    Interests
    
    
    Total
    
    
    Services, Inc.
    
    
    Interests
    
    
    TotalAs adjusted, see Notes 7 and 15Net income (loss)
    
    $
    9,373
    
    
    $
    (859
    )
    
    $
    8,514
    
    
    $
    30,337
    
    
    $
    2,853
    
    
    $
    33,190Foreign currency translation gain (loss)
    
    
    5,039
    
    
    
    
    
    
    
    5,039
    
    
    
    (102,688
    )
    
    
    
    
    
    
    (102,688
    )Amortization of unrecognized actuarial gains
    
    
    84
    
    
    
    
    
    
    
    84
    
    
    
    
    
    
    
    
    
    
    
    Total comprehensive income (loss)
    
    $
    14,496
    
    
    $
    (859
    )
    
    $
    13,637
    
    
    $
    (72,351
    )
    
    $
    2,853
    
    
    $
    (69,498
    )
 Nine Months Ended September 30,2009
    
    
    2008Shareholders of
    
    
    
    
    
    
    
    
    
    
    Shareholders ofTrico Marine
    
    
    Noncontrolling
    
    
    
    
    
    
    Trico Marine
    
    
    NoncontrollingServices, Inc.
    
    
    Interests
    
    
    Total
    
    
    Services, Inc.
    
    
    Interests
    
    
    TotalAs adjusted, see Notes 7 and 15Net income
    
    $
    12,774
    
    
    $
    405
    
    
    $
    13,179
    
    
    $
    37,022
    
    
    $
    5,235
    
    
    $
    42,257Foreign currency translation gain (loss)
    
    
    40,996
    
    
    
    
    
    
    
    40,996
    
    
    
    (87,453
    )
    
    
    
    
    
    
    (87,453
    )Amortization of unrecognized actuarial gains
    
    
    263
    
    
    
    
    
    
    
    263
    
    
    
    85
    
    
    
    
    
    
    
    85Total comprehensive income
    
    $
    54,033
    
    
    $
    405
    
    
    $
    54,438
    
    
    $
    (50,346
    )
    
    $
    5,235
    
    
    $
    (45,111
    )
 12. Stock-Based Compensation
   Date of
    
    
    
    
    
    Number of
    
    ExerciseGrant
    
    Grants
    
    Vesting Period
    
    Shares
    
    PriceMarch 13, 2009
    
    SARs
    
    Ratably over three years
    
    
    170,724
    
    
    $
    2.05March 13, 2009
    
    SARs
    
    Vest 100% on third anniversary of grant date
    
    
    130,144
    
    
    
    2.05March 13, 2009
    
    Stock options
    
    Ratably over three years
    
    
    170,724
    
    
    
    2.05May 13, 2009
    
    Stock options
    
    30 days from date of grant
    
    
    60,000
    
    
    
    3.57May 13, 2009
    
    Restricted stock
    
    30 days from date of grant
    
    
    60,000
    
    
    
    3.57
  23




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##### Table of Contents



May 13, 2009March 13, 2009 Grant Date
    
    Grant DateSARs
    
    Stock
    
    StockVested Ratably
    
    Cliff Vested
    
    Options
    
    OptionsGrant-Date Fair Value
    
    $
    1.02
    
    
    $
    1.00
    
    
    $
    1.02
    
    
    $
    1.68Expected Term
    
    
    4.5
    
    
    
    5.0
    
    
    
    4.5
    
    
    
    3.5Expected Volatility
    
    
    60
    %
    
    
    55
    %
    
    
    60
    %
    
    
    65
    %Risk-Free Interest Rate
    
    
    1.74
    %
    
    
    1.87
    %
    
    
    1.74
    %
    
    
    1.48
    %Expected Dividend Distributions
    
    
    N/A
    
    
    
    N/A
    
    
    
    N/A
    
    
    
    N/A
  SARsVested Ratably
    
    Cliff VestedGrant-Date Fair Value
    
    $
    6.05
    
    
    $
    6.06Expected Term
    
    
    3.9
    
    
    
    4.5Expected Volatility
    
    
    60
    %
    
    
    55
    %Risk-Free Interest Rate
    
    
    1.85
    %
    
    
    2.07
    %Expected Dividend Distributions
    
    
    N/A
    
    
    
    N/A
 13. Taxes
     24




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##### Table of Contents



14. Employee Benefit Plans
  Three Months Ended September 30,
    
    
    Nine Months Ended September 30,2009
    
    
    2008
    
    
    2009
    
    
    2008Service cost
    
    $
    912
    
    
    $
    185
    
    
    $
    2,795
    
    
    $
    567Interest cost
    
    
    190
    
    
    
    71
    
    
    
    650
    
    
    
    218Return on plan assets
    
    
    (223
    )
    
    
    (77
    )
    
    
    (747
    )
    
    
    (236
    )Social security contributions
    
    
    134
    
    
    
    17
    
    
    
    407
    
    
    
    53Recognized net actuarial loss
    
    
    84
    
    
    
    13
    
    
    
    263
    
    
    
    39Net periodic benefit cost
    
    $
    1,097
    
    
    $
    209
    
    
    $
    3,368
    
    
    $
    641
  25




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##### Table of Contents



15. Noncontrolling Interest
   Trico Marine
    
    
    NoncontrollingTotal
    
    
    Services, Inc.
    
    
    InterestBalance, December 31, 2007
    
    $
    443,003
    
    
    $
    430,125
    
    
    $
    12,878Net income (loss)
    
    
    (106,864
    )
    
    
    (113,655
    )
    
    
    6,791Capital contribution from Volstad
    
    
    3,519
    
    
    
    
    
    
    
    3,519Distribution to NAMESE Partner
    
    
    (244
    )
    
    
    
    
    
    
    (244
    )Foreign currency translation and other
    
    
    (138,534
    )
    
    
    (137,476
    )
    
    
    (1,058
    )Balance, December 31, 2008
    
    
    200,880
    
    
    
    178,994
    
    
    
    21,886Net income
    
    
    13,179
    
    
    
    12,774
    
    
    
    405Capital contribution from Volstad
    
    
    2,284
    
    
    
    
    
    
    
    2,284Distribution to EMSL
    
    
    (6,120
    )
    
    
    
    
    
    
    (6,120
    )Foreign currency translation and other
    
    
    49,235
    
    
    
    54,777
    
    
    
    (5,542
    )Balance, September 30, 2009
    
    $
    259,458
    
    
    $
    246,545
    
    
    $
    12,913
 16. Commitments and Contingencies
 General.
 Volstad Impairment  Withdrawal from Partnership.
 26




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##### Table of Contents



Saipem.
  Plan of Reorganization Proceeding.
 Brazilian Tax Assessments.
  27




---



##### Table of Contents



17. Segment Information
   SubseaTrenchingSubsea
    
    and
    
    Towing andServices
    
    Protection
    
    Supply
    
    Corporate
    
    Total(In thousands)Three Months Ended:September 30, 2009Revenues from Unaffiliated Customers
    
    $
    79,953
    
    
    $
    79,693
    
    
    $
    30,209
    
    
    $
    
    
    
    $
    189,855Intersegment Revenues
    
    
    7,481
    
    
    
    
    
    
    
    1,290
    
    
    
    
    
    
    
    8,771Operating Income (Loss)
    
    
    1,868
    
    
    
    14,969
    
    
    
    (5,178
    )
    
    
    (6,130
    )
    
    
    5,529Income (Loss) Before Income Taxes and Noncontrolling Interests
    
    
    8,900
    
    
    
    16,607
    
    
    
    12,166
    
    
    
    (31,050
    )
    
    
    6,623September 30, 2008Revenues from Unaffiliated Customers
    
    $
    102,112
    
    
    $
    52,493
    
    
    $
    60,188
    
    
    $
    
    
    
    $
    214,793Intersegment Revenues
    
    
    1,965
    
    
    
    7,057
    
    
    
    
    
    
    
    
    
    
    
    9,022Operating Income (Loss)
    
    
    4,116
    
    
    
    5,886
    
    
    
    15,401
    
    
    
    (6,210
    )
    
    
    19,193Income (Loss) Before Income Taxes and Noncontrolling Interests, as adjusted
    
    
    5,134
    
    
    
    5,866
    
    
    
    20,277
    
    
    
    9,228
    
    
    
    40,505
 28




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##### Table of Contents



SubseaTrenchingSubsea
    
    and
    
    Towing andServices
    
    Protection
    
    Supply
    
    Corporate
    
    Total(In thousands)Nine Months Ended:September 30, 2009Revenues from Unaffiliated Customers
    
    $
    217,515
    
    
    $
    174,096
    
    
    $
    99,794
    
    
    $
    
    
    
    $
    491,405Intersegment Revenues
    
    
    14,789
    
    
    
    
    
    
    
    1,290
    
    
    
    
    
    
    
    16,079Operating Income (Loss)
    
    
    (14,003
    )(1)
    
    
    26,648
    
    
    
    11,806
    
    
    
    (19,859
    )
    
    
    4,592Income (Loss) Before Income Taxes and Noncontrolling Interests
    
    
    (6,566
    )(1)
    
    
    22,551
    
    
    
    30,588
    
    
    
    (53,954
    )
    
    
    (7,381
    )September 30, 2008Revenues from Unaffiliated Customers
    
    $
    152,315
    
    
    $
    67,957
    
    
    $
    157,988
    
    
    $
    
    
    
    $
    378,260Intersegment Revenues
    
    
    1,990
    
    
    
    7,057
    
    
    
    
    
    
    
    
    
    
    
    9,047Operating Income (Loss)
    
    
    12,070
    
    
    
    3,384
    
    
    
    37,670
    
    
    
    (16,906
    )
    
    
    36,218Income (Loss) Before Income Taxes and Noncontrolling
Interests, as adjusted
    
    
    10,209
    
    
    
    3,343
    
    
    
    44,024
    
    
    
    (7,258
    )
    
    
    50,318
 
 (1)
    
    Includes an impairment loss of $14.0 million related to our withdrawal from the
Volstad partnership (see Note 16 for further discussion). 18. Recent Accounting Standards
      29




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##### Table of Contents



19. Subsequent Events
  Senior Secured Notes and Other Debt.
   30




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##### Table of Contents



Sale of Vessels.
 20. Supplemental Condensed Consolidating Financial Information
     31




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##### Table of Contents



CONDENSED CONSOLIDATING BALANCE SHEET
NINE MONTHS ENDING SEPTEMBER 30, 2009
 ConsolidatedParent Guarantor
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (Trico Marine(Trico Marine
    
    Issuer
    
    Subsidiary
    
    Non-Guarantor
    
    
    
    
    
    Services. Inc. andServices. Inc.)
    
    (Trico Shipping AS)
    
    Guarantors (1)
    
    Subsidiaries (2)
    
    Eliminations
    
    Subsidiaries)(in thousands. except per share amounts)ASSETSCurrent assets:Cash and cash equivalents
    
    $
    
    
    
    $
    2,065
    
    
    $
    31,507
    
    
    $
    8,161
    
    
    $
    
    
    
    $
    41,733Restricted cash
    
    
    
    
    
    
    
    
    
    
    1,965
    
    
    
    776
    
    
    
    
    
    
    
    2,741Accounts receivable, net
    
    
    
    
    
    
    11,690
    
    
    
    118,155
    
    
    
    29,881
    
    
    
    
    
    
    
    159,726Prepaid expenses and other
current assets
    
    
    133
    
    
    
    156
    
    
    
    11,682
    
    
    
    7,474
    
    
    
    
    
    
    
    19,445Assets held for sale
    
    
    
    
    
    
    31,998
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    31,998Total current assets
    
    
    133
    
    
    
    45,909
    
    
    
    163,309
    
    
    
    46,292
    
    
    
    
    
    
    
    255,643Net property and equipment, net
    
    
    
    
    
    
    64,028
    
    
    
    685,331
    
    
    
    88,503
    
    
    
    
    
    
    
    837,862Intercompany receivables (payables)
    
    
    374,132
    
    
    
    (432,934
    )
    
    
    (85,403
    )
    
    
    144,205
    
    
    
    
    
    
    
    Intangible assets
    
    
    
    
    
    
    
    
    
    
    118,094
    
    
    
    
    
    
    
    
    
    
    
    118,094Other assets
    
    
    10,338
    
    
    
    3,487
    
    
    
    4,615
    
    
    
    6,179
    
    
    
    
    
    
    
    24,619Investments in subsidiaries
    
    
    238,594
    
    
    
    294,826
    
    
    
    (202,480
    )
    
    
    
    
    
    
    (330,941
    )
    
    
    Total assets
    
    $
    623,197
    
    
    $
    (24,684
    )
    
    $
    683,466
    
    
    $
    285,179
    
    
    $
    (330,941
    )
    
    $
    1,236,218LIABILITIES AND EQUITYCurrent liabilities:Short-term and current
maturities of long-term debt
    
    $
    20,938
    
    
    $
    
    
    
    $
    100
    
    
    $
    1,258
    
    
    $
    
    
    
    $
    22,296Accounts payable
    
    
    
    
    
    
    2,553
    
    
    
    44,700
    
    
    
    13,024
    
    
    
    
    
    
    
    60,277Accrued expenses
    
    
    2,919
    
    
    
    1,894
    
    
    
    84,455
    
    
    
    18,271
    
    
    
    
    
    
    
    107,539Accrued interest
    
    
    7,956
    
    
    
    
    
    
    
    900
    
    
    
    170
    
    
    
    
    
    
    
    9,026Foreign taxes payable
    
    
    
    
    
    
    4,647
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    4,647Income taxes payable
    
    
    512
    
    
    
    (2
    )
    
    
    8,335
    
    
    
    1,112
    
    
    
    
    
    
    
    9,957Other current liabilities
    
    
    778
    
    
    
    
    
    
    
    
    
    
    
    143
    
    
    
    
    
    
    
    921Total current liabilities
    
    
    33,103
    
    
    
    9,092
    
    
    
    138,490
    
    
    
    33,978
    
    
    
    
    
    
    
    214,663Long-term debt
    
    
    318,669
    
    
    
    136,218
    
    
    
    231,580
    
    
    
    5,292
    
    
    
    
    
    
    
    691,759Long-term derivative
    
    
    24,772
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    24,772Foreign taxes payable
    
    
    
    
    
    
    31,642
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    31,642Deferred income taxes
    
    
    
    
    
    
    
    
    
    
    5,807
    
    
    
    
    
    
    
    
    
    
    
    5,807Other liabilities
    
    
    108
    
    
    
    844
    
    
    
    2,929
    
    
    
    4,236
    
    
    
    
    
    
    
    8,117Total liabilities
    
    
    376,652
    
    
    
    177,796
    
    
    
    378,806
    
    
    
    43,506
    
    
    
    
    
    
    
    976,760Commitments and contingenciesTotal equity
    
    
    246,545
    
    
    
    (202,480
    )
    
    
    304,660
    
    
    
    241,673
    
    
    
    (330,941
    )
    
    
    259,458Total liabilities equity
    
    $
    623,197
    
    
    $
    (24,684
    )
    
    $
    683,466
    
    
    $
    285,179
    
    
    $
    (330,941
    )
    
    $
    1,236,218
 32




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##### Table of Contents



CONDENSED CONSOLIDATING BALANCE SHEET
NINE MONTHS ENDING SEPTEMBER 30, 2009  (Continued)
 Issuer
    
    Subsidiary(Trico Shipping AS)
    
    Guarantors (1)
    
    Adjustments (3)
    
    Trico Supply GroupASSETSCurrent assets:Cash and cash equivalents
    
    $
    2,065
    
    
    $
    31,507
    
    
    $
    
    
    
    $
    33,572Restricted cash
    
    
    
    
    
    
    1,965
    
    
    
    
    
    
    
    1,965Accounts receivable, net
    
    
    11,690
    
    
    
    118,155
    
    
    
    
    
    
    
    129,845Prepaid expenses and other current assets
    
    
    156
    
    
    
    11,682
    
    
    
    
    
    
    
    11,838Assets held for sale
    
    
    31,998
    
    
    
    
    
    
    
    
    
    
    
    31,998Total current assets
    
    
    45,909
    
    
    
    163,309
    
    
    
    
    
    
    
    209,218Net property and equipment, net
    
    
    64,028
    
    
    
    685,331
    
    
    
    
    
    
    
    749,359Intercompany receivables (payables)
    
    
    (432,934
    )
    
    
    (85,403
    )
    
    
    (34,133
    )
    
    
    (552,470
    )Intangible assets
    
    
    
    
    
    
    118,094
    
    
    
    
    
    
    
    118,094Other assets
    
    
    3,487
    
    
    
    4,615
    
    
    
    6,206
    
    
    
    14,308Investments in subsidiaries
    
    
    294,826
    
    
    
    (202,480
    )
    
    
    (92,346
    )
    
    
    Total assets
    
    $
    (24,684
    )
    
    $
    683,466
    
    
    $
    (120,273
    )
    
    $
    538,509LIABILITIES AND EQUITYCurrent liabilities:Short-term and current maturities of long-term debt
    
    $
    
    
    
    $
    100
    
    
    $
    
    
    
    $
    100Accounts payable
    
    
    2,553
    
    
    
    44,700
    
    
    
    
    
    
    
    47,253Accrued expenses
    
    
    1,894
    
    
    
    84,455
    
    
    
    
    
    
    
    86,349Accrued interest
    
    
    
    
    
    
    900
    
    
    
    
    
    
    
    900Foreign taxes payable
    
    
    4,647
    
    
    
    
    
    
    
    
    
    
    
    4,647Income taxes payable
    
    
    (2
    )
    
    
    8,335
    
    
    
    
    
    
    
    8,333Total current liabilities
    
    
    9,092
    
    
    
    138,490
    
    
    
    
    
    
    
    147,582Long-term debt
    
    
    136,218
    
    
    
    231,580
    
    
    
    
    
    
    
    367,798Foreign taxes payable
    
    
    31,642
    
    
    
    
    
    
    
    
    
    
    
    31,642Deferred income taxes
    
    
    
    
    
    
    5,807
    
    
    
    
    
    
    
    5,807Other liabilities
    
    
    844
    
    
    
    2,929
    
    
    
    
    
    
    
    3,773Total liabilities
    
    
    177,796
    
    
    
    378,806
    
    
    
    
    
    
    
    556,602Commitments and contingenciesTotal equity
    
    
    (202,480
    )
    
    
    304,660
    
    
    
    (120,273
    )
    
    
    (18,093
    )Total liabilities equity
    
    $
    (24,684
    )
    
    $
    683,466
    
    
    $
    (120,273
    )
    
    $
    538,509
 
 (1)
    
    All subsidiaries of the Parent that are provding guarantees including Trico Holding LLC and Trico Marine Cayman L.P., Trico Supply AS, and all subsidiaries below Trico Supply AS and Issuer.(2)
    
    All subsidiaries of the Parent that are not providing guarantees including Trico Marine Assets, Inc., Trico Marine Operators, Inc., Trico Servicos Maritimos Ltda., Servicios de Apoyo Maritimo de Mexico, S. de R.L. de C.V.(3)
    
    Adjustments include Trico Marine Cayman L.P. and Trico Holding LLC that are not part of the Credit Group and investment in subsidiary balances between Issuer and Subsidiary Guarantors. 33




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##### Table of Contents



CONDENSED CONSOLIDATING BALANCE SHEET
YEAR ENDING DECEMBER 31, 2008
 ConsolidatedParent Guarantor
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (Trico Marine(Trico Marine
    
    Issuer
    
    Subsidiary
    
    Non-Guarantor
    
    
    
    
    
    Services, Inc. andServices, Inc.)
    
    (Trico Shipping AS)
    
    Guarantors(1)
    
    Subsidiaries(2)
    
    Eliminations
    
    Subsidiaries)(in thousands)ASSETSCurrent assets:Cash and cash equivalents
    
    $
    
    
    
    $
    16,355
    
    
    $
    48,132
    
    
    $
    30,126
    
    
    $
    
    
    
    $
    94,613Restricted cash
    
    
    
    
    
    
    
    
    
    
    2,680
    
    
    
    886
    
    
    
    
    
    
    
    3,566Accounts receivable, net
    
    
    
    
    
    
    15,681
    
    
    
    108,940
    
    
    
    40,531
    
    
    
    
    
    
    
    165,152Prepaid expenses and other current assets
    
    
    
    
    
    
    967
    
    
    
    9,284
    
    
    
    (6,876
    )
    
    
    
    
    
    
    3,375Total current assets
    
    
    
    
    
    
    33,003
    
    
    
    169,036
    
    
    
    64,667
    
    
    
    
    
    
    
    266,706Net property and equipment, net
    
    
    1,243
    
    
    
    109,701
    
    
    
    596,509
    
    
    
    96,957
    
    
    
    
    
    
    
    804,410Intercompany receivables (debt and other
payables)
    
    
    386,231
    
    
    
    (439,876
    )
    
    
    (130,470
    )
    
    
    184,115
    
    
    
    
    
    
    
    Intangible assets
    
    
    
    
    
    
    
    
    
    
    106,983
    
    
    
    
    
    
    
    
    
    
    
    106,983Other assets
    
    
    13,051
    
    
    
    3,886
    
    
    
    3,679
    
    
    
    4,021
    
    
    
    
    
    
    
    24,637Investments in subsidiaries
    
    
    178,321
    
    
    
    248,908
    
    
    
    (276,448
    )
    
    
    
    
    
    
    (150,781
    )
    
    
    Total assets
    
    $
    578,846
    
    
    $
    (44,378
    )
    
    $
    469,289
    
    
    $
    349,760
    
    
    $
    (150,781
    )
    
    $
    1,202,736LIABILITIES AND EQUITYCurrent liabilities:Short-term and current maturities of
long-term debt
    
    $
    10,000
    
    
    $
    
    
    
    $
    71,724
    
    
    $
    1,258
    
    
    $
    
    
    
    $
    82,982Accounts payable
    
    
    
    
    
    
    2,396
    
    
    
    32,169
    
    
    
    19,307
    
    
    
    
    
    
    
    53,872Accrued expenses
    
    
    125
    
    
    
    2,737
    
    
    
    61,537
    
    
    
    21,257
    
    
    
    
    
    
    
    85,656Accrued interest
    
    
    5,303
    
    
    
    3,234
    
    
    
    1,765
    
    
    
    81
    
    
    
    
    
    
    
    10,383Foreign taxes payable
    
    
    
    
    
    
    4,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    4,000Income taxes payable
    
    
    
    
    
    
    
    
    
    
    17,442
    
    
    
    691
    
    
    
    
    
    
    
    18,133Total current liabilities
    
    
    15,428
    
    
    
    12,367
    
    
    
    184,637
    
    
    
    42,594
    
    
    
    
    
    
    
    255,026Long-term debt
    
    
    383,309
    
    
    
    172,195
    
    
    
    125,327
    
    
    
    6,267
    
    
    
    
    
    
    
    687,098Long-term derivative
    
    
    1,119
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,119Foreign taxes payable
    
    
    
    
    
    
    47,508
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    47,508Deferred income taxes
    
    
    372
    
    
    
    
    
    
    
    4,732
    
    
    
    
    
    
    
    
    
    
    
    5,104Other liabilities
    
    
    
    
    
    
    
    
    
    
    2,664
    
    
    
    3,337
    
    
    
    
    
    
    
    6,001Total liabilities
    
    
    400,228
    
    
    
    232,070
    
    
    
    317,360
    
    
    
    52,198
    
    
    
    
    
    
    
    1,001,856Commitments and contingenciesTotal equity
    
    
    178,618
    
    
    
    (276,448
    )
    
    
    151,929
    
    
    
    297,562
    
    
    
    (150,781
    )
    
    
    200,880Total liabilities and equity
    
    $
    578,846
    
    
    $
    (44,378
    )
    
    $
    469,289
    
    
    $
    349,760
    
    
    $
    (150,781
    )
    
    $
    1,202,736
 34




---



##### Table of Contents



CONDENSED CONSOLIDATING BALANCE SHEET
YEAR ENDING DECEMBER 31, 2008  (Continued)
 Issuer
    
    Subsidiary(Trico Shipping AS)
    
    Guarantors(1)
    
    Adjustments(2)
    
    Trico Supply Group(in thousands)ASSETSCurrent assets:Cash and cash equivalents
    
    $
    16,355
    
    
    $
    48,132
    
    
    $
    2
    
    
    $
    64,489Restricted cash
    
    
    
    
    
    
    2,680
    
    
    
    
    
    
    
    2,680Accounts receivable, net
    
    
    15,681
    
    
    
    108,940
    
    
    
    
    
    
    
    124,621Prepaid expenses and other current assets
    
    
    967
    
    
    
    9,284
    
    
    
    
    
    
    
    10,251Total current assets
    
    
    33,003
    
    
    
    169,036
    
    
    
    2
    
    
    
    202,041Net property and equipment, net
    
    
    109,701
    
    
    
    596,509
    
    
    
    
    
    
    
    706,210Intercompany receivables (payables)
    
    
    (439,876
    )
    
    
    (130,470
    )
    
    
    (35,631
    )
    
    
    (605,977
    )Intangible assets
    
    
    
    
    
    
    106,983
    
    
    
    
    
    
    
    106,983Other assets
    
    
    3,886
    
    
    
    3,679
    
    
    
    
    
    
    
    7,565Investments in subsidiaries
    
    
    248,908
    
    
    
    (276,448
    )
    
    
    27,540
    
    
    
    Total assets
    
    $
    (44,378
    )
    
    $
    469,289
    
    
    $
    (8,089
    )
    
    $
    416,822LIABILITIES AND EQUITYCurrent liabilities:Short-term and current maturities of long-term debt
    
    $
    
    
    
    $
    71,724
    
    
    $
    
    
    
    $
    71,724Accounts payable
    
    
    2,396
    
    
    
    32,169
    
    
    
    
    
    
    
    34,565Accrued expenses
    
    
    2,737
    
    
    
    61,537
    
    
    
    
    
    
    
    64,274Accrued interest
    
    
    3,234
    
    
    
    1,765
    
    
    
    
    
    
    
    4,999Foreign taxes payable
    
    
    4,000
    
    
    
    
    
    
    
    
    
    
    
    4,000Income taxes payable
    
    
    
    
    
    
    17,442
    
    
    
    
    
    
    
    17,442Total current liabilities
    
    
    12,367
    
    
    
    184,637
    
    
    
    
    
    
    
    197,004Long-term debt
    
    
    172,195
    
    
    
    125,327
    
    
    
    
    
    
    
    297,522Foreign taxes payable
    
    
    47,508
    
    
    
    
    
    
    
    
    
    
    
    47,508Deferred income taxes
    
    
    
    
    
    
    4,732
    
    
    
    
    
    
    
    4,732Other liabilities
    
    
    
    
    
    
    2,664
    
    
    
    
    
    
    
    2,664Total liabilities
    
    
    232,070
    
    
    
    317,360
    
    
    
    
    
    
    
    549,430Commitments and contingenciesTotal equity
    
    
    (276,448
    )
    
    
    151,929
    
    
    
    (8,089
    )
    
    
    (132,608
    )Total liabilities and equity
    
    $
    (44,378
    )
    
    $
    469,289
    
    
    $
    (8,089
    )
    
    $
    416,822
 
 (1)
    
    All subsidiaries of the Company that are providing
guarantees, including Trico Holdco, LLC, Trico Marine
Cayman L.P., Trico Supply AS and all subsidiaries of Trico
Supply AS (other than Trico Shipping).(2)
    
    Adjustments include Trico Marine Cayman L.P. and Trico
Holdco, LLC that are not part of the Trico Supply Group and
investment in subsidiary balances between Trico Shipping
and Subsidiary Guarantors. 35




---



##### Table of Contents



CONDENSED CONSOLIDATING STATEMENT OF INCOME
THREE MONTHS ENDING SEPTEMBER 30, 2009
 ConsolidatedParent Guarantor
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (Trico Marine(Trico Marine
    
    Issuer
    
    Subsidiary
    
    Non-Guarantor
    
    
    
    
    
    Services, Inc. andServices, Inc.)
    
    (Trico Shipping AS)
    
    Guarantors (1)
    
    Subsidiaries (2)
    
    Eliminations
    
    Subsidiaries)(in thousands)Revenues
    
    $
    
    
    
    $
    20,016
    
    
    $
    154,720
    
    
    $
    20,089
    
    
    $
    (4,970
    )
    
    $
    189,855Operating expenses:Direct operating expenses
    
    
    
    
    
    
    18,349
    
    
    
    111,594
    
    
    
    18,483
    
    
    
    (4,970
    )
    
    
    143,456General and administrative
    
    
    2,208
    
    
    
    (230
    )
    
    
    10,571
    
    
    
    7,045
    
    
    
    
    
    
    
    19,594Depreciation and amortization
    
    
    
    
    
    
    3,338
    
    
    
    12,661
    
    
    
    3,325
    
    
    
    
    
    
    
    19,324Impairments
    
    
    
    
    
    
    (41
    )
    
    
    1,225
    
    
    
    
    
    
    
    
    
    
    
    1,184Loss on sales of assets
    
    
    
    
    
    
    720
    
    
    
    42
    
    
    
    6
    
    
    
    
    
    
    
    768Total operating expenses
    
    
    2,208
    
    
    
    22,136
    
    
    
    136,093
    
    
    
    28,859
    
    
    
    (4,970
    )
    
    
    184,326Operating income (loss)
    
    
    (2,208
    )
    
    
    (2,120
    )
    
    
    18,627
    
    
    
    (8,770
    )
    
    
    
    
    
    
    5,529Interest expense, net of amounts capitalized
    
    
    (10,234
    )
    
    
    (5,983
    )
    
    
    1,704
    
    
    
    (100
    )
    
    
    6,026
    
    
    
    (8,587
    )Interest income
    
    
    2,428
    
    
    
    22
    
    
    
    2,246
    
    
    
    1,511
    
    
    
    (6,026
    )
    
    
    181Unrealized loss on mark-to-market of embedded
derivative
    
    
    (21,026
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (21,026
    )Refinancing Costs
    
    
    (90
    )
    
    
    
    
    
    
    
    
    
    
    90
    
    
    
    
    
    
    
    Other income (expense), net
    
    
    (417
    )
    
    
    17,806
    
    
    
    10,538
    
    
    
    2,599
    
    
    
    
    
    
    
    30,526Equity income (loss) in investees, net of tax
    
    
    40,518
    
    
    
    11,107
    
    
    
    9,644
    
    
    
    
    
    
    
    (61,269
    )
    
    
    Income (loss) before income taxes
    
    
    8,971
    
    
    
    20,832
    
    
    
    42,759
    
    
    
    (4,670
    )
    
    
    (61,269
    )
    
    
    6,623Income tax expense (benefit)
    
    
    (402
    )
    
    
    80
    
    
    
    (790
    )
    
    
    (779
    )
    
    
    
    
    
    
    (1,891
    )Net income (loss)
    
    
    9,373
    
    
    
    20,752
    
    
    
    43,549
    
    
    
    (3,891
    )
    
    
    (61,269
    )
    
    
    8,514Less: Net (income) attributable to noncontrolling interest (3)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    859
    
    
    
    
    
    
    
    859Net income (loss) attributable to the respective entity
    
    $
    9,373
    
    
    $
    20,752
    
    
    $
    43,549
    
    
    $
    (3,032
    )
    
    $
    (61,269
    )
    
    $
    9,373
 Issuer
    
    Subsidiary(Trico Shipping AS)
    
    Guarantors
    
    Adjustments (4)
    
    Trico Supply GroupRevenues
    
    $
    20,016
    
    
    $
    154,720
    
    
    $
    
    
    
    $
    174,736Operating expenses:Direct operating expenses
    
    
    18,349
    
    
    
    111,594
    
    
    
    
    
    
    
    129,943General and administrative
    
    
    (230
    )
    
    
    10,571
    
    
    
    (8
    )
    
    
    10,333Depreciation and amortization
    
    
    3,338
    
    
    
    12,661
    
    
    
    
    
    
    
    15,999Impairments
    
    
    (41
    )
    
    
    1,225
    
    
    
    
    
    
    
    1,184Loss on sales of assets
    
    
    720
    
    
    
    42
    
    
    
    
    
    
    
    762Total operating expenses
    
    
    22,136
    
    
    
    136,093
    
    
    
    (8
    )
    
    
    158,221Operating income (loss)
    
    
    (2,120
    )
    
    
    18,627
    
    
    
    8
    
    
    
    16,515Interest expense, net of amounts capitalized
    
    
    (5,983
    )
    
    
    1,704
    
    
    
    (1,137
    )
    
    
    (5,416
    )Interest income
    
    
    22
    
    
    
    2,246
    
    
    
    
    
    
    
    2,268Other income, net
    
    
    17,806
    
    
    
    10,538
    
    
    
    
    
    
    
    28,344Equity income (loss) in investees, net of tax
    
    
    11,107
    
    
    
    9,644
    
    
    
    (20,751
    )
    
    
    Income (loss) before income taxes
    
    
    20,832
    
    
    
    42,759
    
    
    
    (21,880
    )
    
    
    41,711Income tax expense (benefit)
    
    
    80
    
    
    
    (790
    )
    
    
    
    
    
    
    (710
    )Net income (loss)
    
    
    20,752
    
    
    
    43,549
    
    
    
    (21,880
    )
    
    
    42,421Less: Net (income) attributable to noncontrolling interest
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Net income (loss) attributable to Trico Supply Group
    
    $
    20,752
    
    
    $
    43,549
    
    
    $
    (21,880
    )
    
    $
    42,421
 
 (1)
    
    All subsidiaries of the Company that are providing guarantees, including Trico Holdco, LLC, Trico
Marine Cayman L.P., Trico Supply AS and all subsidiaries of Trico Supply AS (other than Trico
Shipping).(2)
    
    All subsidiaries of the Company that are not providing guarantees.(3)
    
    Non-Guarantor Subsidiaries include a noncontrolling interest in Eastern Marine Service Limited (EMSL).(4)
    
    Adjustments include Trico Marine Cayman L.P. and Trico Holdco, LLC that are not part of the Trico
Supply Group and equity income (loss) balances between Trico Shipping and Subsidiary Guarantors. 36




---



##### Table of Contents



CONDENSED CONSOLIDATING STATEMENT OF INCOME
THREE MONTHS ENDING SEPTEMBER 30, 2008
 ConsolidatedParent Guarantor
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (Trico Marine(Trico Marine
    
    Issuer
    
    Subsidiary
    
    Non-Guarantor
    
    
    
    
    
    Services, Inc. andServices, Inc.)
    
    (Trico Shipping AS)
    
    Guarantors (1)
    

Subsidiaries
(2)
    
    Eliminations
    
    Subsidiaries)(in thousands)Revenues
    
    $
    -
    
    
    $
    35,567
    
    
    $
    149,600
    
    
    $
    37,917
    
    
    $
    (8,291
    )
    
    $
    214,793Operating expenses:Direct operating expenses
    
    
    
    
    
    
    10,345
    
    
    
    131,043
    
    
    
    22,030
    
    
    
    (8,305
    )
    
    
    155,113General and administrative
    
    
    492
    
    
    
    867
    
    
    
    8,640
    
    
    
    8,791
    
    
    
    14
    
    
    
    18,804Depreciation and amortization
    
    
    
    
    
    
    2,778
    
    
    
    15,368
    
    
    
    3,527
    
    
    
    
    
    
    
    21,673Impairments
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (Gain) loss on sales of assets
    
    
    
    
    
    
    
    
    
    
    (1
    )
    
    
    11
    
    
    
    
    
    
    
    10Total operating expenses
    
    
    492
    
    
    
    13,990
    
    
    
    155,050
    
    
    
    34,359
    
    
    
    (8,291
    )
    
    
    195,600Operating income (loss)
    
    
    (492
    )
    
    
    21,577
    
    
    
    (5,450
    )
    
    
    3,558
    
    
    
    
    
    
    
    19,193Interest expense, net of amounts capitalized
    
    
    (11,588
    )
    
    
    (9,246
    )
    
    
    (156
    )
    
    
    1,393
    
    
    
    6,915
    
    
    
    (12,682
    )Interest income
    
    
    4,779
    
    
    
    109
    
    
    
    2,360
    
    
    
    2,196
    
    
    
    (6,915
    )
    
    
    2,529Unrealized gain on mark-to-market of
embedded derivative
    
    
    31,515
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    31,515Other income (expense), net
    
    
    
    
    
    
    (9,348
    )
    
    
    9,164
    
    
    
    134
    
    
    
    
    
    
    
    (50
    )Equity income (loss) in investees, net of tax
    
    
    3,562
    
    
    
    8,017
    
    
    
    (40,455
    )
    
    
    
    
    
    
    28,876
    
    
    
    Income (loss) before income taxes
    
    
    27,776
    
    
    
    11,109
    
    
    
    (34,537
    )
    
    
    7,281
    
    
    
    28,876
    
    
    
    40,505Income tax expense (benefit)
    
    
    4,451
    
    
    
    105
    
    
    
    (8,712
    )
    
    
    11,471
    
    
    
    
    
    
    
    7,315Net income (loss)
    
    
    23,325
    
    
    
    11,004
    
    
    
    (25,825
    )
    
    
    (4,190
    )
    
    
    28,876
    
    
    
    33,190Less: Net (income) loss attributable to
noncontrolling interest (3)
    
    
    
    
    
    
    (21
    )
    
    
    7
    
    
    
    (2,839
    )
    
    
    
    
    
    
    (2,853
    )Net income (loss) attributable to the
respective entity
    
    $
    23,325
    
    
    $
    10,983
    
    
    $
    (25,818
    )
    
    $
    (7,029
    )
    
    $
    28,876
    
    
    $
    30,337
 Issuer
    
    Subsidiary(Trico Shipping AS)
    
    Guarantors
    
    Adjustments (4)
    
    Trico Supply GroupRevenues
    
    $
    35,567
    
    
    $
    149,600
    
    
    $
    -
    
    
    $
    185,167Operating expenses:Direct operating expenses
    
    
    10,345
    
    
    
    131,043
    
    
    
    
    
    
    
    141,388General and administrative
    
    
    867
    
    
    
    8,640
    
    
    
    (12
    )
    
    
    9,495Depreciation and amortization
    
    
    2,778
    
    
    
    15,368
    
    
    
    
    
    
    
    18,146Gain on sales of assets
    
    
    
    
    
    
    (1
    )
    
    
    
    
    
    
    (1
    )Total operating expenses
    
    
    13,990
    
    
    
    155,050
    
    
    
    (12
    )
    
    
    169,028Operating income (loss)
    
    
    21,577
    
    
    
    (5,450
    )
    
    
    12
    
    
    
    16,139Interest expense, net of amounts
capitalized
    
    
    (9,246
    )
    
    
    (156
    )
    
    
    
    
    
    
    (9,402
    )Interest income
    
    
    109
    
    
    
    2,360
    
    
    
    (989
    )
    
    
    1,480Other income (expense), net
    
    
    (9,348
    )
    
    
    9,164
    
    
    
    
    
    
    
    (184
    )Equity income (loss) in investees,
net of tax
    
    
    8,017
    
    
    
    (40,455
    )
    
    
    32,438
    
    
    
    Income (loss) before income taxes
    
    
    11,109
    
    
    
    (34,537
    )
    
    
    31,461
    
    
    
    8,033Income tax expense (benefit)
    
    
    105
    
    
    
    (8,712
    )
    
    
    
    
    
    
    (8,607
    )Net income (loss)
    
    
    11,004
    
    
    
    (25,825
    )
    
    
    31,461
    
    
    
    16,640Less: Net (income) attributable to
noncontrolling interest
    
    
    (21
    )
    
    
    7
    
    
    
    
    
    
    
    (14
    )Net income (loss) attributable to
Trico Marine Services, Inc.
    
    $
    10,983
    
    
    $
    (25,818
    )
    
    $
    31,461
    
    
    $
    16,626
 
 (1)
    
    All subsidiaries of the Company that are providing guarantees, including Trico
Holdco, LLC, Trico Marine Cayman L.P., Trico Supply AS and all subsidiaries of Trico Supply AS
(other than Trico Shipping).(2)
    
    All subsidiaries of the Company that are not providing guarantees.(3)
    
    Non-Guarantor Subsidiaries include a noncontrolling interest in EMSL.(4)
    
    Adjustments include Trico Marine Cayman L.P. and Trico Holdco, LLC that are not part
of the Trico Supply Group and equity income (loss) balances between Trico Shipping and Subsidiary
Guarantors. 37




---



##### Table of Contents



CONDENSED CONSOLIDATING STATEMENT OF INCOME
NINE MONTHS ENDING SEPTEMBER 30, 2009
 ConsolidatedParent Guarantor
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (Trico Marine(Trico Marine
    
    Issuer
    
    Subsidiary
    
    Non-Guarantor
    
    
    
    
    
    Services, Inc. andServices, Inc.)
    
    (Trico Shipping AS)
    
    Guarantors (1)
    
    Subsidiaries (2)
    
    Eliminations
    
    Subsidiaries)(in thousands)Revenues
    
    $
    
    
    
    $
    58,228
    
    
    $
    370,417
    
    
    $
    80,922
    
    
    $
    (18,162
    )
    
    $
    491,405Operating expenses:Direct operating expenses
    
    
    
    
    
    
    36,731
    
    
    
    287,982
    
    
    
    65,614
    
    
    
    (18,162
    )
    
    
    372,165General and administrative
    
    
    5,001
    
    
    
    1,148
    
    
    
    30,411
    
    
    
    23,863
    
    
    
    
    
    
    
    60,423Depreciation and amortization
    
    
    
    
    
    
    8,918
    
    
    
    36,239
    
    
    
    10,786
    
    
    
    
    
    
    
    55,943Impairments
    
    
    
    
    
    
    11,553
    
    
    
    3,654
    
    
    
    
    
    
    
    
    
    
    
    15,207(Gain)  on sales of assets
    
    
    
    
    
    
    (14,365
    )
    
    
    (10
    )
    
    
    (2,550
    )
    
    
    
    
    
    
    (16,925
    )Total operating expenses
    
    
    5,001
    
    
    
    43,985
    
    
    
    358,276
    
    
    
    97,713
    
    
    
    (18,162
    )
    
    
    486,813Operating income (loss)
    
    
    (5,001
    )
    
    
    14,243
    
    
    
    12,141
    
    
    
    (16,791
    )
    
    
    
    
    
    
    4,592Interest expense, net of amounts capitalized
    
    
    (29,473
    )
    
    
    (22,642
    )
    
    
    50
    
    
    
    (297
    )
    
    
    21,197
    
    
    
    (31,165
    )Interest income
    
    
    8,760
    
    
    
    215
    
    
    
    8,827
    
    
    
    5,438
    
    
    
    (21,197
    )
    
    
    2,043Unrealized  loss on mark-to-market of embedded
derivative
    
    
    (19,611
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (19,611
    )Gain on conversions of debt
    
    
    11,330
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    11,330Refinancing Costs
    
    
    (6,224
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (6,224
    )Other income (expense), net
    
    
    8,061
    
    
    
    20,076
    
    
    
    9,213
    
    
    
    2,782
    
    
    
    (8,478
    )
    
    
    31,654Equity income (loss) in investees, net of tax
    
    
    44,833
    
    
    
    11,034
    
    
    
    30,588
    
    
    
    
    
    
    
    (86,455
    )
    
    
    Income (loss) before income taxes
    
    
    12,675
    
    
    
    22,926
    
    
    
    60,819
    
    
    
    (8,868
    )
    
    
    (94,933
    )
    
    
    (7,381
    )Income tax  benefit
    
    
    (98
    )
    
    
    (18,699
    )
    
    
    (4
    )
    
    
    (1,759
    )
    
    
    
    
    
    
    (20,560
    )Net income (loss)
    
    
    12,774
    
    
    
    41,624
    
    
    
    60,823
    
    
    
    (7,109
    )
    
    
    (94,933
    )
    
    
    13,179Less: Net (income) attributable to noncontrolling
interest (3)
    
    
    
    
    
    
    
    
    
    
    (1
    )
    
    
    (404
    )
    
    
    
    
    
    
    (405
    )Net income (loss) attributable to the respective entity
    
    $
    12,774
    
    
    $
    41,624
    
    
    $
    60,822
    
    
    $
    (7,513
    )
    
    $
    (94,933
    )
    
    $
    12,774
 Issuer
    
    Subsidiary(Trico Shipping AS)
    
    Guarantors
    
    Adjustments (4)
    
    Trico Supply GroupRevenues
    
    $
    58,228
    
    
    $
    370,417
    
    
    $
    
    
    
    $
    428,645Operating expenses:Direct operating expenses
    
    
    36,731
    
    
    
    287,982
    
    
    
    
    
    
    
    324,713General and administrative
    
    
    1,148
    
    
    
    30,411
    
    
    
    (8
    )
    
    
    31,551Depreciation and amortization
    
    
    8,918
    
    
    
    36,239
    
    
    
    
    
    
    
    45,157Impairments
    
    
    11,553
    
    
    
    3,654
    
    
    
    
    
    
    
    15,207Gain on sales of assets
    
    
    (14,365
    )
    
    
    (10
    )
    
    
    
    
    
    
    (14,375
    )Total operating expenses
    
    
    43,985
    
    
    
    358,276
    
    
    
    (8
    )
    
    
    402,253Operating income
    
    
    14,243
    
    
    
    12,141
    
    
    
    8
    
    
    
    26,392Interest expense, net of amounts
capitalized
    
    
    (22,642
    )
    
    
    50
    
    
    
    (1,137
    )
    
    
    (23,729
    )Interest income
    
    
    215
    
    
    
    8,827
    
    
    
    
    
    
    
    9,042Other income, net
    
    
    20,076
    
    
    
    9,213
    
    
    
    
    
    
    
    29,289Equity income (loss) in investees, net of tax
    
    
    11,034
    
    
    
    30,588
    
    
    
    (41,622
    )
    
    
    Income before income taxes
    
    
    22,926
    
    
    
    60,819
    
    
    
    (42,751
    )
    
    
    40,994Income tax benefit
    
    
    (18,699
    )
    
    
    (4
    )
    
    
    
    
    
    
    (18,703
    )Net income (loss)
    
    
    41,624
    
    
    
    60,823
    
    
    
    (42,751
    )
    
    
    59,696Less: Net (income) attributable to
noncontrolling interest
    
    
    
    
    
    
    (1
    )
    
    
    
    
    
    
    (1
    )Net income (loss) attributable to
Trico Supply Group
    
    $
    41,624
    
    
    $
    60,822
    
    
    $
    (42,751
    )
    
    $
    59,695
 
 (1)
    
    All subsidiaries of the Company that are providing guarantees, including Trico
Holdco, LLC, Trico Marine Cayman L.P., Trico Supply AS and all subsidiaries of Trico Supply AS
(other than Trico Shipping).(2)
    
    All subsidiaries of the Company that are not providing guarantees.(3)
    
    Non-Guarantor Subsidiaries include a noncontrolling interest in EMSL.(4)
    
    Adjustments include Trico Marine Cayman L.P. and Trico Holdco, LLC that are not part
of the Trico Supply Group and equity income (loss) balances between Trico Shipping and Subsidiary
Guarantors. 38




---



##### Table of Contents



CONDENSED CONSOLIDATING STATEMENT OF INCOME
NINE MONTHS ENDING SEPTEMBER 30, 2008
 ConsolidatedParent Guarantor
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (Trico Marine(Trico Marine
    
    Issuer
    
    Subsidiary
    
    Non-Guarantor
    
    
    
    
    
    Services, Inc. andServices, Inc.)
    
    (Trico Shipping AS)
    
    Guarantors (1)
    
    Subsidiaries (2)
    
    Eliminations
    
    Subsidiaries)(in thousands)Revenues
    
    $
    
    
    
    $
    95,723
    
    
    $
    203,997
    
    
    $
    95,655
    
    
    $
    (17,115
    )
    
    $
    378,260Operating expenses:Direct operating expenses
    
    
    
    
    
    
    47,330
    
    
    
    168,497
    
    
    
    60,254
    
    
    
    (17,129
    )
    
    
    258,952General and administrative
    
    
    3,561
    
    
    
    1,045
    
    
    
    17,284
    
    
    
    22,607
    
    
    
    14
    
    
    
    44,511Depreciation and amortization
    
    
    
    
    
    
    9,440
    
    
    
    21,618
    
    
    
    10,257
    
    
    
    
    
    
    
    41,315Impairments
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Gain on sales of assets
    
    
    
    
    
    
    
    
    
    
    (1
    )
    
    
    (2,735
    )
    
    
    
    
    
    
    (2,736
    )Total operating expenses

    
    
    3,561
    
    
    
    57,815
    
    
    
    207,398
    
    
    
    90,383
    
    
    
    (17,115
    )
    
    
    342,042Operating income (loss)
    
    
    (3,561
    )
    
    
    37,908
    
    
    
    (3,401
    )
    
    
    5,272
    
    
    
    
    
    
    
    36,218Interest expense, net of amounts capitalized
    
    
    (19,269
    )
    
    
    (12,590
    )
    
    
    (4,998
    )
    
    
    563
    
    
    
    15,326
    
    
    
    (20,968
    )Interest income
    
    
    7,150
    
    
    
    3,018
    
    
    
    4,055
    
    
    
    8,481
    
    
    
    (15,326
    )
    
    
    7,378Unrealized gain on mark-to-market of embedded
derivative
    
    
    29,205
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    29,205Other income (expense), net
    
    
    
    
    
    
    (10,976
    )
    
    
    9,652
    
    
    
    (191
    )
    
    
    
    
    
    
    (1,515
    )Equity income (loss) in investees, net of tax
    
    
    22,449
    
    
    
    8,021
    
    
    
    (25,732
    )
    
    
    
    
    
    
    (4,738
    )
    
    
    Income (loss) before income taxes
    
    
    35,974
    
    
    
    25,381
    
    
    
    (20,424
    )
    
    
    14,125
    
    
    
    (4,738
    )
    
    
    50,318Income tax expense (benefit)
    
    
    5,964
    
    
    
    (350
    )
    
    
    (8,051
    )
    
    
    10,498
    
    
    
    
    
    
    
    8,061Net income
    
    
    30,010
    
    
    
    25,731
    
    
    
    (12,373
    )
    
    
    3,627
    
    
    
    (4,738
    )
    
    
    42,257Less: Net (income) attributable to noncontrolling
interest (3)
    
    
    
    
    
    
    (21
    )
    
    
    (14
    )
    
    
    (5,200
    )
    
    
    
    
    
    
    (5,235
    )Net income (loss) attributable to the respective entity
    
    $
    30,010
    
    
    $
    25,710
    
    
    $
    (12,387
    )
    
    $
    (1,573
    )
    
    $
    (4,738
    )
    
    $
    37,022
 Issuer
    
    Subsidiary(Trico Shipping AS)
    
    Guarantors
    
    Adjustments (4)
    
    Trico Supply GroupRevenues
    
    $
    95,723
    
    
    $
    203,997
    
    
    $
    
    
    
    $
    299,720Operating expenses:Direct operating expenses
    
    
    47,330
    
    
    
    168,497
    
    
    
    
    
    
    
    215,827General and administrative
    
    
    1,045
    
    
    
    17,284
    
    
    
    (12
    )
    
    
    18,317Depreciation and amortization
    
    
    9,440
    
    
    
    21,618
    
    
    
    
    
    
    
    31,058Gain on sales of assets
    
    
    
    
    
    
    (1
    )
    
    
    
    
    
    
    (1
    )Total operating expenses
    
    
    57,815
    
    
    
    207,398
    
    
    
    (12
    )
    
    
    265,201Operating income (loss)
    
    
    37,908
    
    
    
    (3,401
    )
    
    
    12
    
    
    
    34,519Interest expense, net of amounts capitalized
    
    
    (12,590
    )
    
    
    (4,998
    )
    
    
    
    
    
    
    (17,588
    )Interest income
    
    
    3,018
    
    
    
    4,055
    
    
    
    (989
    )
    
    
    6,084Other income (expense), net
    
    
    (10,976
    )
    
    
    9,652
    
    
    
    
    
    
    
    (1,324
    )Equity income (loss) in investees, net of tax
    
    
    8,021
    
    
    
    (25,732
    )
    
    
    17,711
    
    
    
    Income (loss) before income taxes
    
    
    25,381
    
    
    
    (20,424
    )
    
    
    16,734
    
    
    
    21,691Income tax expense
    
    
    (350
    )
    
    
    (8,051
    )
    
    
    
    
    
    
    (8,401
    )Net income (loss)
    
    
    25,731
    
    
    
    (12,373
    )
    
    
    16,734
    
    
    
    30,092Less: Net (income) attributable to
noncontrolling interest
    
    
    (21
    )
    
    
    (14
    )
    
    
    
    
    
    
    (35
    )Net income (loss) attributable to Trico
Supply Group
    
    $
    25,710
    
    
    $
    (12,387
    )
    
    $
    16,734
    
    
    $
    30,057
 
 (1)
    
    All subsidiaries of the Company that are providing guarantees, including Trico
Holdco, LLC, Trico Marine Cayman L.P., Trico Supply AS and all subsidiaries of Trico Supply AS
(other than Trico Shipping).(2)
    
    All subsidiaries of the Company that are not providing guarantees.(3)
    
    Non-Guarantor Subsidiaries include a noncontrolling interest in EMSL.(4)
    
    Adjustments include Trico Marine Cayman L.P. and Trico Holdco, LLC that are not part
of the Trico Supply Group and equity income (loss) balances between Trico Shipping and Subsidiary
Guarantors. 39




---



##### Table of Contents



CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOW
NINE MONTHS ENDING SEPTEMBER 30, 2009
 ConsolidatedParent Guarantor
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (Trico Marine(Trico Marine
    
    Issuer
    
    Subsidiary
    
    Non-Guarantor
    
    
    
    
    
    Services, Inc. andServices, Inc.)
    
    (Trico Shipping AS)
    

Guarantors
(1)
    

Subsidiaries
(2)
    
    Eliminations
    
    Subsidiaries)(in thousands)Net cash
provided by (used in) operating activities
    
    $
    (228
    )
    
    $
    29,501
    
    
    $
    26,259
    
    
    $
    10,649
    
    
    $
    
    
    
    $
    66,181Cash flows from investing activities:Purchases of property and equipment
    
    
    (490
    )
    
    
    (2,246
    )
    
    
    (61,951
    )
    
    
    (2,113
    )
    
    
    
    
    
    
    (66,800
    )Proceeds from sales of assets
    
    
    
    
    
    
    26,224
    
    
    
    
    
    
    
    3,800
    
    
    
    
    
    
    
    30,024Return on equity investment in investee
    
    
    42,662
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (42,662
    )
    
    
    Decrease (increase) in restricted cash
    
    
    
    
    
    
    
    
    
    
    1,274
    
    
    
    109
    
    
    
    
    
    
    
    1,383Net cash provided by (used in) investing activities
    
    
    42,172
    
    
    
    23,978
    
    
    
    (60,677
    )
    
    
    1,796
    
    
    
    (42,662
    )
    
    
    (35,393
    )Cash flows from financing activities:Proceeds from issuance of senior convertible debentures
    
    
    (12,676
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (12,676
    )Borrowings (repayments) from debt, net
    
    
    (14,653
    )
    
    
    (63,507
    )
    
    
    11,322
    
    
    
    (627
    )
    
    
    
    
    
    
    (67,465
    )Borrowings (repayments) on debt between subs, net
    
    
    12,099
    
    
    
    (6,289
    )
    
    
    (20,810
    )
    
    
    15,000
    
    
    
    
    
    
    
    Debt issuance costs
    
    
    
    
    
    
    (430
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (430
    )Dividend to parent
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (42,662
    )
    
    
    42,662
    
    
    
    Capital contribution
    
    
    (20,490
    )
    
    
    579
    
    
    
    19,911
    
    
    
    
    
    
    
    
    
    
    
    Contribution from noncontrolling interest
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (6,120
    )
    
    
    
    
    
    
    (6,120
    )Debt refinancing costs
    
    
    (6,224
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (6,224
    )Net cash provided by (used in) financing activities
    
    
    (41,944
    )
    
    
    (69,647
    )
    
    
    10,423
    
    
    
    (34,409
    )
    
    
    42,662
    
    
    
    (92,915
    )Effect of exchange rate changes on cash and cash equivalents
    
    
    
    
    
    
    1,878
    
    
    
    7,369
    
    
    
    
    
    
    
    
    
    
    
    9,247Net increase (decrease) in cash and cash equivalents
    
    
    
    
    
    
    (14,290
    )
    
    
    (16,626
    )
    
    
    (21,964
    )
    
    
    
    
    
    
    (52,880
    )Cash and cash equivalents at beginning of period
    
    
    
    
    
    
    16,355
    
    
    
    48,133
    
    
    
    30,125
    
    
    
    
    
    
    
    94,613Cash and cash equivalents at end of period
    
    $
    
    
    
    $
    2,065
    
    
    $
    31,507
    
    
    $
    8,161
    
    
    $
    
    
    
    $
    41,733
 Issuer
    
    Subsidiary(Trico Shipping AS)
    
    Guarantors (1)
    
    Credit GroupNet cash
provided by (used in) operating activities
    
    
    
    
    
    $
    29,501
    
    
    $
    26,259
    
    
    $
    55,760Cash flows from investing activities:Purchases of property and equipment
    
    
    
    
    
    
    (2,246
    )
    
    
    (61,951
    )
    
    
    (64,197
    )Proceeds from sales of assets
    
    
    
    
    
    
    26,224
    
    
    
    
    
    
    
    26,224Decrease (increase) in restricted cash
    
    
    
    
    
    
    
    
    
    
    1,274
    
    
    
    1,274Net cash provided by (used in) investing activities
    
    
    
    
    
    
    23,978
    
    
    
    (60,677
    )
    
    
    (36,699
    )Cash flows from financing activities:Borrowings (repayments) from debt, net
    
    
    
    
    
    
    (63,507
    )
    
    
    11,322
    
    
    
    (52,185
    )Borrowings
(repayments) on debt between subsidiaries, net
    
    
    
    
    
    
    (6,289
    )
    
    
    (20,810
    )
    
    
    (27,099
    )Debt issuance costs
    
    
    
    
    
    
    (430
    )
    
    
    
    
    
    
    (430
    )Capital Contribution
    
    
    
    
    
    
    579
    
    
    
    19,911
    
    
    
    20,490Net cash provided by (used in) financing activities
    
    
    
    
    
    
    (69,647
    )
    
    
    10,423
    
    
    
    (59,224
    )Effect of exchange rate changes on cash and cash equivalents
    
    
    
    
    
    
    1,878
    
    
    
    7,369
    
    
    
    9,247Net increase (decrease) in cash and cash equivalents
    
    
    
    
    
    
    (14,290
    )
    
    
    (16,626
    )
    
    
    (30,916
    )Cash and cash equivalents at beginning of period
    
    
    
    
    
    
    16,355
    
    
    
    48,133
    
    
    
    64,488Cash and cash equivalents at end of period
    
    
    
    
    
    $
    2,065
    
    
    $
    31,507
    
    
    $
    33,572
 
 (1)
    
    All subsidiaries of the Company that are providing
guarantees, including Trico Holdco, LLC, Trico Marine
Cayman L.P., Trico Supply AS and all subsidiaries of Trico
Supply AS (other than Trico Shipping).(2)
    
    All subsidiaries of the Company that are not providing guarantees. 40




---



##### Table of Contents



CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOW


NINE MONTHS ENDING SEPTEMBER 30, 2008
 ConsolidatedParent Guarantor
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (Trico Marine(Trico Marine
    
    Issuer
    
    Subsidiary
    
    Non-Guarantor
    
    
    
    
    
    Services, Inc. andServices, Inc.)
    
    (Trico Shipping AS)
    
    Guarantors (1)
    
    Subsidiaries (2)
    
    Eliminations
    
    Subsidiaries)(in thousands)Net cash provided by (used in) operating activities
    
    $
    (1,277
    )
    
    $
    73,067
    
    
    $
    (4,074
    )
    
    $
    3,969
    
    
    $
    
    
    
    $
    71,685Cash flows from investing activities:Acquisition of DeepOcean, net of acquired cash
    
    
    
    
    
    
    (644,271
    )
    
    
    137,320
    
    
    
    
    
    
    
    
    
    
    
    (506,951
    )Purchases of property and equipment
    
    
    
    
    
    
    (825
    )
    
    
    (63,908
    )
    
    
    (13,671
    )
    
    
    
    
    
    
    (78,404
    )Proceeds from sales of assets
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    7,023
    
    
    
    
    
    
    
    7,023Return on equity investment in investee
    
    
    4,779
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (4,779
    )
    
    
    Settlement of hedge instrument
    
    
    
    
    
    
    
    
    
    
    8,151
    
    
    
    
    
    
    
    
    
    
    
    8,151Decrease (increase) in restricted cash
    
    
    
    
    
    
    
    
    
    
    (84
    )
    
    
    2,659
    
    
    
    
    
    
    
    2,575Net cash provided by (used in) investing activities
    
    
    4,779
    
    
    
    (645,096
    )
    
    
    81,479
    
    
    
    (3,989
    )
    
    
    (4,779
    )
    
    
    (567,606
    )Cash flows from financing activities:Net proceeds from exercises of warrants and options
    
    
    11,615
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    11,615Proceeds from issuance of senior convertible debentures
    
    
    300,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    300,000Borrowings (repayments) from debt, net
    
    
    46,459
    
    
    
    162,482
    
    
    
    (32,161
    )
    
    
    (2,674
    )
    
    
    
    
    
    
    174,106Borrowings (repayments) on debt between subs, net
    
    
    (340,642
    )
    
    
    340,642
    
    
    
    (10,000
    )
    
    
    10,000
    
    
    
    
    
    
    
    Capital contributions
    
    
    (7,694
    )
    
    
    
    
    
    
    
    
    
    
    7,694
    
    
    
    
    
    
    
    Dividend to parent
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (4,779
    )
    
    
    4,779
    
    
    
    Debt issuance costs
    
    
    (13,240
    )
    
    
    (2,800
    )
    
    
    (462
    )
    
    
    
    
    
    
    
    
    
    
    (16,502
    )Net cash provided by (used in) financing activities
    
    
    (3,502
    )
    
    
    500,324
    
    
    
    (42,623
    )
    
    
    10,241
    
    
    
    4,779
    
    
    
    469,219Effect of exchange rate changes on cash and cash equivalents
    
    
    
    
    
    
    (4,731
    )
    
    
    (4,562
    )
    
    
    
    
    
    
    
    
    
    
    (9,293
    )Net increase (decrease) in cash and cash equivalents
    
    
    
    
    
    
    (76,436
    )
    
    
    30,220
    
    
    
    10,221
    
    
    
    
    
    
    
    (35,995
    )Cash and cash equivalents at beginning of period
    
    
    
    
    
    
    82,585
    
    
    
    37,591
    
    
    
    11,287
    
    
    
    
    
    
    
    131,463Cash and cash equivalents at end of period
    
    $
    
    
    
    $
    6,149
    
    
    $
    67,811
    
    
    $
    21,508
    
    
    $
    
    
    
    $
    95,468
 Issuer
    
    Subsidiary(Trico Shipping AS)
    
    Guarantors (1)
    
    Credit GroupNet cash
provided by (used in) operating activities
    
    $
    73,067
    
    
    $
    (4,074
    )
    
    $
    68,993Cash flows from investing activities:Acquisition of DeepOcean, net of acquired cash
    
    
    (644,271
    )
    
    
    137,320
    
    
    
    (506,951
    )Purchases of property and equipment
    
    
    (825
    )
    
    
    (63,908
    )
    
    
    (64,733
    )Sale of hedge instrument
    
    
    
    
    
    
    8,151
    
    
    
    8,151Increase in restricted cash
    
    
    
    
    
    
    (84
    )
    
    
    (84
    )Net cash provided by (used in) investing activities
    
    
    (645,096
    )
    
    
    81,479
    
    
    
    (563,617
    )Cash flows from financing activities:Borrowings (repayments) from debt, net
    
    
    162,482
    
    
    
    (32,161
    )
    
    
    130,321Borrowings (repayments) on debt between subsidiaries, net
    
    
    340,642
    
    
    
    (10,000
    )
    
    
    330,642Debt issuance costs
    
    
    (2,800
    )
    
    
    (462
    )
    
    
    (3,262
    )Net cash provided by (used in) financing activities
    
    
    500,324
    
    
    
    (42,623
    )
    
    
    457,701Effect of exchange rate changes on cash and cash equivalents
    
    
    (4,731
    )
    
    
    (4,562
    )
    
    
    (9,293
    )Net increase (decrease) in cash and cash equivalents
    
    
    (76,436
    )
    
    
    30,220
    
    
    
    (46,216
    )Cash and cash equivalents at beginning of period
    
    
    82,585
    
    
    
    37,591
    
    
    
    120,176Cash and cash equivalents at end of period
    
    $
    6,149
    
    
    $
    67,811
    
    
    $
    73,960
 
 (1)
    
    All subsidiaries of the Company that are providing
guarantees, including Trico Holdco, LLC, Trico Marine
Cayman L.P., Trico Supply AS and all subsidiaries of Trico
Supply AS (other than Trico Shipping).(2)
    
    All subsidiaries of the Company that are not providing guarantees. 41




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##### Table of Contents



Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
  Cautionary Statements Regarding Forward-Looking Statements
  
    
    our objectives, business plans or strategies, and projected or anticipated benefits or
other consequences of such plans or strategies;
    
    our ability to obtain adequate financing on a timely basis and on acceptable terms,
including with respect to refinancing debt maturing in the next twelve months;
    
    our ability to continue to service, and to comply with our obligations under, our credit
facilities and our other indebtedness;
    
    projections involving revenues, operating results or cash provided from operations, or
our anticipated capital expenditures or other capital projects;
    
    overall demand for and pricing of our vessels;
    
    changes in the level of oil and natural gas exploration and development;
    
    our ability to successfully or timely complete our various vessel construction projects;
    
    further reductions in capital spending budgets by customers;
    
    further declines in oil and natural gas prices;
    
    projected or anticipated benefits from acquisitions;
    
    increases in operating costs;
    
    the inability to accurately predict vessel utilization levels and day rates;
    
    variations in global business and economic conditions;
    
    the results, timing, outcome or effect of pending or potential litigation and our
intentions or expectations with respect thereto and the availability of insurance coverage
in connection therewith; and
    
    our ability to repatriate cash from foreign operations if and when needed.
   Overview
  42




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##### Table of Contents



Our Outlook
  43




---



##### Table of Contents



Reduce our debt level and carefully manage liquidity and cash flow.
 Maximize our vessel utilization and our service spreads.
 Expand our presence in additional subsea services markets.
 Invest in growth of our subsea fleet.
 Reduce exposure to a declining offshore towing and supply vessel business.
 Market Outlook  Demand for our Vessels and Services
  Subsea Services.
 44




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##### Table of Contents



Subsea Protection and Trenching.
 Towing and Supply.
 Market Outlook  Credit Environment
  Other Items
 Senior Secured Notes and Other Debt.
   45




---



##### Table of Contents



Acquisition of DeepOcean and CTC Marine.
 Proxy Contest.
 6.5% Convertible Notes Exchange .
 Volstad Impairment.
 Asset Sales.
 46




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##### Table of Contents



Results of Operations
  Three Months Ended September 30,
    
    
    Nine Months Ended September 30,2009
    
    
    2008
    
    
    $ Change
    
    
    % Change
    
    
    2009
    
    
    2008
    
    
    $ Change
    
    
    % ChangeAs adjusted,
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    As adjusted,see Notes 7
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    see Notes 7and 15
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    and 15Revenues:Subsea services
    
    $
    79,953
    
    
    $
    102,112
    
    
    $
    (22,159
    )
    
    
    (22
    )%
    
    $
    217,515
    
    
    $
    152,315
    
    
    $
    65,200
    
    
    
    43
    %Subsea trenching and protection
    
    
    79,693
    
    
    
    52,493
    
    
    
    27,200
    
    
    
    52
    %
    
    
    174,096
    
    
    
    67,957
    
    
    
    106,139
    
    
    
    156
    %Towing & supply
    
    
    30,209
    
    
    
    60,188
    
    
    
    (29,979
    )
    
    
    (50
    )%
    
    
    99,794
    
    
    
    157,988
    
    
    
    (58,194
    )
    
    
    (37
    )%Total revenues
    
    
    189,855
    
    
    
    214,793
    
    
    
    (24,938
    )
    
    
    (12
    )%
    
    
    491,405
    
    
    
    378,260
    
    
    
    113,145
    
    
    
    30
    %Operating income (loss):Subsea services
    
    
    1,868
    
    
    
    4,116
    
    
    
    (2,248
    )
    
    
    (55
    )%
    
    
    (14,003
    )
    
    
    12,070
    
    
    
    (26,073
    )
    
    
    (216
    )%Subsea trenching and protection
    
    
    14,969
    
    
    
    5,886
    
    
    
    9,083
    
    
    
    154
    %
    
    
    26,648
    
    
    
    3,384
    
    
    
    23,264
    
    
    
    687
    %Towing & supply
    
    
    (5,178
    )
    
    
    15,401
    
    
    
    (20,579
    )
    
    
    (134
    )%
    
    
    11,806
    
    
    
    37,670
    
    
    
    (25,864
    )
    
    
    (69
    )%Corporate
    
    
    (6,130
    )
    
    
    (6,210
    )
    
    
    80
    
    
    
    (1
    )%
    
    
    (19,859
    )
    
    
    (16,906
    )
    
    
    (2,953
    )
    
    
    17
    %Total operating income
    
    
    5,529
    
    
    
    19,193
    
    
    
    (13,664
    )
    
    
    (71
    )%
    
    
    4,592
    
    
    
    36,218
    
    
    
    (31,626
    )
    
    
    (87
    )%Interest income
    
    
    181
    
    
    
    2,529
    
    
    
    (2,348
    )
    
    
    (93
    )%
    
    
    2,043
    
    
    
    7,378
    
    
    
    (5,335
    )
    
    
    (72
    )%Interest expense, net of amounts capitalized
    
    
    (8,587
    )
    
    
    (12,682
    )
    
    
    4,095
    
    
    
    (32
    )%
    
    
    (31,165
    )
    
    
    (20,968
    )
    
    
    (10,197
    )
    
    
    49
    %Unrealized gain (loss) on mark-to-market of embedded
derivative
    
    
    (21,026
    )
    
    
    31,515
    
    
    
    (52,541
    )
    
    
    (167
    )%
    
    
    (19,611
    )
    
    
    29,205
    
    
    
    (48,816
    )
    
    
    (167
    )%Gain on conversions of debt
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    0
    %
    
    
    11,330
    
    
    
    
    
    
    
    11,330
    
    
    
    100
    %Refinancing costs
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    0
    %
    
    
    (6,224
    )
    
    
    
    
    
    
    (6,224
    )
    
    
    100
    %Foreign exchange gain (loss)
    
    
    30,543
    
    
    
    (25
    )
    
    
    30,568
    
    
    
    (122,272
    )%
    
    
    33,106
    
    
    
    1,548
    
    
    
    31,558
    
    
    
    2,039
    %Other expense, net
    
    
    (17
    )
    
    
    (25
    )
    
    
    8
    
    
    
    (32
    )%
    
    
    (1,452
    )
    
    
    (3,063
    )
    
    
    1,611
    
    
    
    (53
    )%Income (loss) before income taxes
    
    
    6,623
    
    
    
    40,505
    
    
    
    (33,882
    )
    
    
    (84
    )%
    
    
    (7,381
    )
    
    
    50,318
    
    
    
    (57,699
    )
    
    
    (115
    )%Income tax (benefit) expense
    
    
    (1,891
    )
    
    
    7,315
    
    
    
    (9,206
    )
    
    
    (126
    )%
    
    
    (20,560
    )
    
    
    8,061
    
    
    
    (28,621
    )
    
    
    (355
    )%Net income
    
    
    8,514
    
    
    
    33,190
    
    
    
    (24,676
    )
    
    
    (74
    )%
    
    
    13,179
    
    
    
    42,257
    
    
    
    (29,078
    )
    
    
    (69
    )%Less: Net (income) loss attributable to the
noncontrolling interest
    
    
    859
    
    
    
    (2,853
    )
    
    
    3,712
    
    
    
    (130
    )%
    
    
    (405
    )
    
    
    (5,235
    )
    
    
    4,830
    
    
    
    (92
    )%Net income attributable to Trico Marine Services, Inc.
    
    $
    9,373
    
    
    $
    30,337
    
    
    $
    (20,964
    )
    
    
    (69
    )%
    
    $
    12,774
    
    
    $
    37,022
    
    
    $
    (24,248
    )
    
    
    (65
    )%
  47




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##### Table of Contents



Month
    
    Three Months Ended
    
    Nine Months EndedEnded
    
    September 30,
    
    September 30,October 31, 2009
    
    2009
    
    2008
    
    2009
    
    2008Average Day Rates:SubseaMSVs (1)
    
    $
    90,554
    
    
    $
    86,772
    
    
    $
    83,403
    
    
    $
    79,020
    
    
    $
    78,776SPSVs/MPSVs (2)
    
    
    26,421
    
    
    
    26,995
    
    
    
    22,422
    
    
    
    25,449
    
    
    
    20,913Subsea Trenching and Protection
    
    $
    140,717
    
    
    $
    141,049
    
    
    $
    163,254
    
    
    $
    123,278
    
    
    $
    168,791Towing and SupplyNorth Sea Class (3)
    
    $
    16,008
    
    
    $
    17,796
    
    
    $
    27,572
    
    
    $
    18,042
    
    
    $
    26,471OSVs (4)
    
    
    6,781
    
    
    
    6,167
    
    
    
    7,856
    
    
    
    6,694
    
    
    
    7,439Utilization:SubseaMSVs
    
    
    66
    %
    
    
    91
    %
    
    
    80
    %
    
    
    86
    %
    
    
    80
    %SPSVs/MPSVs
    
    
    58
    %
    
    
    71
    %
    
    
    78
    %
    
    
    73
    %
    
    
    83
    %Subsea Trenching and Protection
    
    
    93
    %
    
    
    97
    %
    
    
    100
    %
    
    
    96
    %
    
    
    92
    %Towing and SupplyNorth Sea Class
    
    
    78
    %
    
    
    83
    %
    
    
    97
    %
    
    
    80
    %
    
    
    90
    %OSVs
    
    
    66
    %
    
    
    61
    %
    
    
    87
    %
    
    
    65
    %
    
    
    82
    %Average number of Vessels:SubseaMSVs
    
    
    10.0
    
    
    
    10.0
    
    
    
    9.4
    
    
    
    9.6
    
    
    
    9.2SPSVs/MPSVs
    
    
    7.0
    
    
    
    7.5
    
    
    
    5.4
    
    
    
    7.2
    
    
    
    5.1Subsea Trenching and Protection
    
    
    4.4
    
    
    
    4.4
    
    
    
    3.7
    
    
    
    4.2
    
    
    
    3.2Towing and SupplyNorth Sea Class
    
    
    10.0
    
    
    
    12.0
    
    
    
    13.0
    
    
    
    12.4
    
    
    
    13.0OSVs
    
    
    29.0
    
    
    
    33.0
    
    
    
    38.0
    
    
    
    36.1
    
    
    
    38.1
 
 (1)
    
    Multi-purpose service vessels(2)
    
    Subsea platform supply vessels/Multi-purpose platform supply vessels(3)
    
    Anchor handling, towing and supply vessels and platform supply vessels(4)
    
    Offshore supply vessels Overall Results
  48




---



##### Table of Contents



Segment Results
 Subsea Services
 Three Months Ended September 30,
    
    
    Nine Months Ended September 30,2009
    
    
    2008
    
    
    $ Change
    
    
    % Change
    
    
    2009
    
    
    2008
    
    
    $ Change
    
    
    % Change(in thousands, except percentages)Revenues
    
    $
    79,953
    
    
    $
    102,112
    
    
    $
    (22,159
    )
    
    
    (22
    %)
    
    $
    217,515
    
    
    $
    152,315
    
    
    $
    65,200
    
    
    
    43
    %Operating expenses:Direct operating expenses
    
    
    63,210
    
    
    
    84,469
    
    
    
    (21,259
    )
    
    
    (25
    %)
    
    
    176,747
    
    
    
    120,089
    
    
    
    56,658
    
    
    
    47
    %General and administrative
    
    
    4,009
    
    
    
    3,740
    
    
    
    269
    
    
    
    7
    %
    
    
    12,151
    
    
    
    5,120
    
    
    
    7,031
    
    
    
    137
    %Depreciation and amortization
    
    
    9,682
    
    
    
    9,787
    
    
    
    (105
    )
    
    
    (1
    %)
    
    
    27,413
    
    
    
    15,036
    
    
    
    12,377
    
    
    
    82
    %Impairments
    
    
    1,184
    
    
    
    
    
    
    
    1,184
    
    
    
    100
    %
    
    
    15,207
    
    
    
    
    
    
    
    15,207
    
    
    
    100
    %Total operating expenses
    
    
    78,085
    
    
    
    97,996
    
    
    
    (19,911
    )
    
    
    (20
    %)
    
    
    231,518
    
    
    
    140,245
    
    
    
    91,273
    
    
    
    65
    %Operating income (loss)
    
    $
    1,868
    
    
    $
    4,116
    
    
    $
    (2,248
    )
    
    
    (55
    %)
    
    $
    (14,003
    )
    
    $
    12,070
    
    
    $
    (26,073
    )
    
    
    (216
    %)
   49




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##### Table of Contents



Subsea Trenching and Protection
 Three Months Ended September 30,
    
    
    Nine Months Ended September 30,2009
    
    
    2008
    
    
    $ Change
    
    
    % Change
    
    
    2009
    
    
    2008
    
    
    $ Change
    
    
    % Change(in thousands, except percentages)Revenues
    
    $
    79,693
    
    
    $
    52,493
    
    
    $
    27,200
    
    
    
    52
    %
    
    $
    174,096
    
    
    $
    67,957
    
    
    $
    106,139
    
    
    
    156
    %Operating expenses:Direct operating expenses
    
    
    55,286
    
    
    
    37,915
    
    
    
    17,371
    
    
    
    46
    %
    
    
    120,734
    
    
    
    51,185
    
    
    
    69,549
    
    
    
    136
    %General and administrative
    
    
    4,660
    
    
    
    2,679
    
    
    
    1,981
    
    
    
    74
    %
    
    
    13,240
    
    
    
    4,947
    
    
    
    8,293
    
    
    
    168
    %Depreciation and amortization
    
    
    4,795
    
    
    
    6,013
    
    
    
    (1,218
    )
    
    
    (20
    %)
    
    
    13,507
    
    
    
    8,441
    
    
    
    5,066
    
    
    
    60
    %Gain on sale of assets
    
    
    (17
    )
    
    
    
    
    
    
    (17
    )
    
    
    100
    %
    
    
    (33
    )
    
    
    
    
    
    
    (33
    )
    
    
    100
    %Total operating expenses
    
    
    64,724
    
    
    
    46,607
    
    
    
    18,117
    
    
    
    39
    %
    
    
    147,448
    
    
    
    64,573
    
    
    
    82,875
    
    
    
    128
    %Operating income
    
    $
    14,969
    
    
    $
    5,886
    
    
    $
    9,083
    
    
    
    154
    %
    
    $
    26,648
    
    
    $
    3,384
    
    
    $
    23,264
    
    
    
    687
    %
   Towing and Supply
 Three Months Ended September 30,
    
    
    Nine Months Ended September 30,2009
    
    
    2008
    
    
    $ Change
    
    
    % Change
    
    
    2009
    
    
    2008
    
    
    $ Change
    
    
    % Change(in thousands, except percentages)Revenues
    
    $
    30,209
    
    
    $
    60,188
    
    
    $
    (29,979
    )
    
    
    (50
    %)
    
    $
    99,794
    
    
    $
    157,988
    
    
    $
    (58,194
    )
    
    
    (37
    %)Operating expenses:Direct operating expenses
    
    
    24,960
    
    
    
    32,729
    
    
    
    (7,769
    )
    
    
    (24
    %)
    
    
    74,684
    
    
    
    87,678
    
    
    
    (12,994
    )
    
    
    (15
    %)General and administrative
    
    
    4,873
    
    
    
    6,223
    
    
    
    (1,350
    )
    
    
    (22
    %)
    
    
    15,401
    
    
    
    17,639
    
    
    
    (2,238
    )
    
    
    (13
    %)Depreciation and amortization
    
    
    4,769
    
    
    
    5,825
    
    
    
    (1,056
    )
    
    
    (18
    %)
    
    
    14,787
    
    
    
    17,737
    
    
    
    (2,950
    )
    
    
    (17
    %)(Gain) loss on sales of assets
    
    
    785
    
    
    
    10
    
    
    
    775
    
    
    
    7,750
    %
    
    
    (16,884
    )
    
    
    (2,736
    )
    
    
    (14,148
    )
    
    
    517
    %Total operating expenses
    
    
    35,387
    
    
    
    44,787
    
    
    
    (9,400
    )
    
    
    (21
    %)
    
    
    87,988
    
    
    
    120,318
    
    
    
    (32,330
    )
    
    
    (27
    %)Operating income (loss)
    
    $
    (5,178
    )
    
    $
    15,401
    
    
    $
    (20,579
    )
    
    
    (134
    %)
    
    $
    11,806
    
    
    $
    37,670
    
    
    $
    (25,864
    )
    
    
    (69
    %)
   50




---



##### Table of Contents



Corporate
 Three Months Ended September 30,
    
    
    Nine Months Ended September 30,2009
    
    
    2008
    
    
    $ Change
    
    
    % Change
    
    
    2009
    
    
    2008
    
    
    $ Change
    
    
    % Change(in thousands, except percentages)Operating expenses:General and administrative
    
    $
    6,052
    
    
    $
    6,162
    
    
    $
    (110
    )
    
    
    (2
    %)
    
    $
    19,631
    
    
    $
    16,805
    
    
    $
    2,826
    
    
    
    17
    %Depreciation and amortization
    
    
    78
    
    
    
    48
    
    
    
    30
    
    
    
    63
    %
    
    
    236
    
    
    
    101
    
    
    
    135
    
    
    
    134
    %Gain on sales of assets
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    0
    %
    
    
    (8
    )
    
    
    
    
    
    
    (8
    )
    
    
    100
    %Total operating expenses
    
    
    6,130
    
    
    
    6,210
    
    
    
    (80
    )
    
    
    (1
    %)
    
    
    19,859
    
    
    
    16,906
    
    
    
    2,953
    
    
    
    17
    %Operating income (loss)
    
    $
    (6,130
    )
    
    $
    (6,210
    )
    
    $
    80
    
    
    
    (1
    %)
    
    $
    (19,859
    )
    
    $
    (16,906
    )
    
    $
    (2,953
    )
    
    
    17
    %
  Other Items
 Three Months Ended September 30,
    
    Nine Months Ended September 30,2009
    
    2008
    
    $ Change
    
    % Change
    
    2009
    
    2008
    
    $ Change
    
    % Change(in thousands, except percentages)Interest income
    
    $
    181
    
    
    $
    2,529
    
    
    $
    (2,348
    )
    
    
    (93
    %)
    
    $
    2,043
    
    
    $
    7,378
    
    
    $
    (5,335
    )
    
    
    (72
    %)Interest expense, net of amounts capitalized
    
    
    (8,587
    )
    
    
    (12,682
    )
    
    
    4,095
    
    
    
    (32
    %)
    
    
    (31,165
    )
    
    
    (20,968
    )
    
    
    (10,197
    )
    
    
    49
    %Unrealized gain (loss) on mark-to-market of
embedded
derivative
    
    
    (21,026
    )
    
    
    31,515
    
    
    
    (52,541
    )
    
    
    (167
    %)
    
    
    (19,611
    )
    
    
    29,205
    
    
    
    (48,816
    )
    
    
    (167
    %)Gain on conversions of debt
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    0
    %
    
    
    11,330
    
    
    
    
    
    
    
    11,330
    
    
    
    100
    %Refinancing costs
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    0
    %
    
    
    (6,224
    )
    
    
    
    
    
    
    (6,224
    )
    
    
    100
    %Foreign exchange gain (loss)
    
    
    30,543
    
    
    
    (25
    )
    
    
    30,568
    
    
    
    (122,272
    %)
    
    
    33,106
    
    
    
    1,548
    
    
    
    31,558
    
    
    
    2,039
    %Other expense, net
    
    
    (17
    )
    
    
    (25
    )
    
    
    8
    
    
    
    (32
    %)
    
    
    (1,452
    )
    
    
    (3,063
    )
    
    
    1,611
    
    
    
    (53
    %)Income tax (benefit) expense
    
    
    (1,891
    )
    
    
    7,315
    
    
    
    (9,206
    )
    
    
    (126
    %)
    
    
    (20,560
    )
    
    
    8,061
    
    
    
    (28,621
    )
    
    
    (355
    %)Net (income) loss attributable to the
noncontrolling
interest
    
    
    859
    
    
    
    (2,853
    )
    
    
    3,712
    
    
    
    (130
    %)
    
    
    (405
    )
    
    
    (5,235
    )
    
    
    4,830
    
    
    
    (92
    %)
 Interest Income.
 Interest Expense.
 Unrealized Gain on Mark-to-Market of Embedded Derivative.
 51




---



##### Table of Contents



Gain on Conversions of Debt .
 Refinancing Costs.
 Foreign Exchange Gain (Loss).
 Income Tax (Benefit) Expense .
 Noncontrolling Interest .
 Liquidity and Capital Resources
 Overview
 Deep Cygnus Trico
Surge Trico Sovereign, Trico Seeker Trico Searcher
 52




---



##### Table of Contents



Other Liquidity Items
    53




---



##### Table of Contents



September 30, 2009
    
    
    December 31, 2008Current
    
    
    Long-Term
    
    
    Total
    
    
    Current
    
    
    Long-Term
    
    
    TotalRemaining debt:$50 million U.S. Revolving Credit Facility Agreement, maturing in
December 2011
    
    $
    10,500
    
    
    $
    21,009
    
    
    $
    31,509
    
    
    $
    10,000
    
    
    $
    36,460
    
    
    $
    46,460
    (1)$202.8 million face amount, 8.125% Convertible Debentures, net of
unamortized
discount of $13.5 million as of September 30, 2009, interest payable
semi-annually
in arrears, maturing on February 1, 2013
    
    
    10,141
    
    
    
    179,176
    
    
    
    189,317
    
    
    
    
    
    
    
    
    
    
    
    $150.0 million face amount, 3.0% Senior Convertible Debentures, net of
unamortized
discount of $31.5 million and $35.9 million as of September 30, 2009 and
December 31, 2008,
respectively, interest payable semi-annually in arrears, maturing on
January 15, 2027
    
    
    
    
    
    
    118,483
    
    
    
    118,483
    
    
    
    
    
    
    
    114,150
    
    
    
    114,1506.11% Notes, principal and interest due in 30 semi-annual installments,
maturing April 2014
    
    
    1,258
    
    
    
    5,028
    
    
    
    6,286
    
    
    
    1,258
    
    
    
    5,657
    
    
    
    6,915Insurance note
    
    
    297
    
    
    
    
    
    
    
    297
    
    
    
    
    
    
    
    
    
    
    
    Motor vehicle leases
    
    
    100
    
    
    
    62
    
    
    
    162
    
    
    
    243
    
    
    
    
    
    
    
    243Fresh-start debt premium
    
    
    
    
    
    
    267
    
    
    
    267
    
    
    
    
    
    
    
    312
    
    
    
    312Total remaining debt
    
    
    22,296
    
    
    
    324,025
    
    
    
    346,321
    
    
    
    11,501
    
    
    
    156,579
    
    
    
    168,080Debt paid and refinanced:$278.0 million face amount, 6.5% Senior Convertible Debentures, net of
unamortized
discount of $45.0 million as of December 31, 2008, interest payable
semi-annually in
arrears, exchanged in May 2009
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    232,998
    
    
    
    232,998NOK 350 million Revolving Credit Facility, maturing January 1, 2010
    
    
    
    
    
    
    59,803
    
    
    
    59,803
    
    
    
    3,600
    
    
    
    57,931
    
    
    
    61,531NOK 230 million Revolving Credit Facility, maturing January 1, 2010
    
    
    
    
    
    
    19,822
    
    
    
    19,822
    
    
    
    2,294
    
    
    
    18,939
    
    
    
    21,233NOK 150 million Additional Term Loan, maturing January 1, 2010
    
    
    
    
    
    
    9,097
    
    
    
    9,097
    
    
    
    3,644
    
    
    
    6,754
    
    
    
    10,398NOK 200 million Overdraft Facility, maturing January 1, 2010
    
    
    
    
    
    
    16,028
    
    
    
    16,028
    
    
    
    
    
    
    
    3,207
    
    
    
    3,20723.3 million Euro Revolving Credit Facility, maturing March 31, 2010
    
    
    
    
    
    
    20,671
    
    
    
    20,671
    
    
    
    
    
    
    
    19,717
    
    
    
    19,717NOK 260 million Short Term Credit Facility, interest at 9.9%, maturing
on February 1, 2009
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    11,631
    
    
    
    
    
    
    
    11,631$200 million Revolving Credit Facility, maturing in May 2013
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    30,563
    
    
    
    130,000
    
    
    
    160,563$100 million Revolving Credit Facility, maturing no later than December
2017
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    15,000
    
    
    
    15,000$100 and $200 million Revolving Credit Facility, maturing in May 2013
    
    
    
    
    
    
    172,759
    
    
    
    172,759
    
    
    
    
    
    
    
    
    
    
    
    $18 million Revolving Credit Facility, maturing December 5, 2011
    
    
    
    
    
    
    14,500
    
    
    
    14,500
    
    
    
    2,000
    
    
    
    14,000
    
    
    
    16,0008 million Sterling Overdraft Facility, due on demand
    
    
    
    
    
    
    17,173
    
    
    
    17,173
    
    
    
    9,812
    
    
    
    
    
    
    
    9,81224.2 million Sterling Asset Financing Revolving Credit Facility, maturing
no later than December 13, 2014
    
    
    
    
    
    
    16,762
    
    
    
    16,762
    
    
    
    3,238
    
    
    
    14,048
    
    
    
    17,286Finance lease obligations assumed in the acquisition of DeepOcean,
maturing from
October 2009 to November 2015
    
    
    
    
    
    
    14,873
    
    
    
    14,873
    
    
    
    2,225
    
    
    
    11,947
    
    
    
    14,172Other debt assumed in the acquisition of DeepOcean
    
    
    
    
    
    
    6,246
    
    
    
    6,246
    
    
    
    2,474
    
    
    
    5,978
    
    
    
    8,452Total amount of debt paid and refinanced
    
    
    
    
    
    
    367,734
    
    
    
    367,734
    
    
    
    71,481
    
    
    
    530,519
    
    
    
    602,000Total debt
    
    $
    22,296
    
    
    $
    691,759
    
    
    $
    714,055
    
    
    $
    82,982
    
    
    $
    687,098
    
    
    $
    770,080
 
 (1)
    
    We were in compliance with our maximum consolidated leverage ratio as of December 31,
2008, March 31, 2009 and June 30, 2009. In August 2009, we entered into an amendment
whereby the maximum consolidated leverage was increased from 4.5:1 to 5.0:1 for the fiscal
quarter ended September 30, 2009. We were not in compliance with this consolidated leverage
ratio covenant at September 30, 2009 due to the negative impact on calculated EBITDA of the
increase in value of the embedded derivative associated with the 8.125% Senior Convertible
Debentures which was primarily the result of an increase in the Companys stock price, The
Company has received an amendment retroactive to September 30, 2009 that amends the
calculation retroactively and prospectively to exclude the effects of the change in the
value of this embedded derivative and with this amendment the company was in compliance
with this covenant as of September 30, 2009. This amendment also increased the consolidated
leverage ratio to 8.50:1 for each of the quarters ending between December 31, 2009 through
September 30, 2010. The ratio decreases to 8.00:1 for the fiscal quarter ending December
31, 2010, and subsequently decreases to 7.00:1 for the fiscal quarter ending March 31,
2011, 6.00:1 for the fiscal quarter ending June 30, 2011, and to 5.00:1 for any fiscal
quarters ending thereafter. 54




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##### Table of Contents



Facility
    
    Lender (s)
    
    Borrower
    
    Guarantor
    
    Financial CovenantsCovenants on remaining debt:8.125% Senior Convertible Debentures
    
    Various
    
    Trico Marine Services, Inc.
    
    None
    
    No maintenance covenants3.0% Senior Convertible Debentures
    
    Various
    
    Trico Marine Services, Inc.
    
    None
    
    No maintenance covenants6.11% Notes
    
    Various
    
    Trico Marine
International, Inc.
    
    Trico Marine
Services, Inc. and
U.S. Maritime
Administration
    
    No maintenance covenantsSenior Secured Notes
    
    Various
    
    Trico Shipping AS
    
    Trico Supply and
subsidiaries, Trico
Marine Services
    
    No maintenance covenantsTrico Shipping Working Capital Facility
    
    Nordea Bank Finland PLC
/ Bayerische Hypo  Und
Vereinsbank AG (HVB)
    
    Trico Shipping AS
    
    Trico Supply and
subsidiaries, Trico
Marine Services
    
    No maintenance covenants$50m U.S. Revolving Credit Facility
    
    Nordea Bank Finland PLC
/ Bayerische Hypo  Und
Vereinsbank AG (HVB)
    
    Trico Marine Services, Inc.
    
    Trico Marine
Assets, Inc., Trico
Marine Operators,
Inc.
    
    (1), (2), (3), (4), (5)
 
 (1)
    
    Consolidated Net Worth  minimum net worth of Borrower(2)
    
    Free Liquidity unrestricted cash and or unutilized loan commitments at Borrower must be at
$5.0 million (excluding certain indirect and direct subsidiaries)(3)
    
    Consolidated Leverage Ratio: Net Debt to 12 month rolling EBITDA* less than or equal to 5.00
for the quarter ending September 30, 2009, 8.50 for the quarters ending December 31, 2009
through September 30, 2010, 8.00 for the quarter ending December 31, 2010 and 7.00, 6.00,
5.00, for the quarters ending March 31, 2011, June 30, 2011, September 30, 2011 and
thereafter, respectively. Calculated at the Borrower level(4)
    
    Maintenance Capital Expenditures  limits the amount of maintenance capital expenditures in
any given fiscal year(5)
    
    Collateral coverage  appraised value of collateral (vessels) must exceed 120% of amount
outstanding and amount available*
    
    EBITDA is defined under note (3) as Consolidated Net Income attributable to Trico Marine
Services, Inc. before deducting there from (i) interest expense, (ii) provisions for taxes
based on income included in Consolidated Net Income attributable to Trico Marine Services,
Inc., (iii) any and all non-cash gains or losses in connection with embedded derivatives
related to the 8.125% Debentures, and (iv) amortization and depreciation without giving any
effect to (x) any extraordinary gains or extraordinary non-cash losses and (y) any gains or
losses from sales of assets other than the sale of inventory in the ordinary course of
business. Prior to December 31, 2009, pro-forma adjustments shall be made for any vessels
delivered during the period as if such vessels were acquired or delivered on the first day of
the relevant 12 month test period. Calculated at the Entity Guarantor or Borrowers level (as
the case may be).Note:
    
    Other covenant related definitions are defined in the respective credit agreements as
previously filed with the SEC. 55




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##### Table of Contents



Minimum
    
    
    
    
    
    MinimumRequirement as
    
    September 30,
    
    Requirement to be metFinancial
    
    of September 30,
    
    2009 Results
    
    on December 31,Facility
    
    Covenant
    
    2009
    
    (1)
    
    2009Covenants on remaining debt:$50 million U.S. Revolving Credit Facility
    
    Consolidated
Leverage Ratio
    
    Net Debt to 12
month rolling
EBITDA less than or
equal to 5:00:1
    
    
    4.89
    
    
    Net Debt to 12 month
rolling EBITDA less
than or equal to
8:50:1$50 million U.S. Revolving Credit Facility
    
    Consolidated Net
Worth
    
    Net Worth must
exceed $311.1
million (equal to
80% of net worth on
commencement date)
    
    $451.1 million
    
    Net Worth must exceed
$311.1 million (equal
to 80% of net worth on
commencement date)
 
 (1)
    
    We are in compliance with our debt covenants at September 30, 2009 except, for the
consolidated leverage ratio covenant under the $50 million U.S. Revolving Credit Facility
for which we received an amendment to the calculation both retroactively and prospectively.
Please see Item 1A Risk Factors located in our 2008 Form 10-K for more details about
potential risks involving these facilities. Also, please see Item 9B. Other Information
in our 2008 Form 10-K. Amounts in this section reflecting U.S. Dollar equivalents for
foreign denominated debt amounts are translated at currency rates in effect at September
30, 2009.   Cross Default Provisions.
 
    
    The 8.125% Debentures and the 3.0% Debentures contain provisions where the debt holders may
declare an event of default and require immediate repayment if repayment of certain other
indebtedness in a principal amount in excess of $30 million or its foreign currency
equivalent has been accelerated and not remedied within 30 days after notice thereof.
    
    The $50 million U.S. Credit Facility allows the lenders to declare an event of default and
require immediate repayment if we or any of our subsidiaries were to be in default on more
than $10 million in other indebtedness.
    
    The Senior Secured Notes allow the lenders to declare an event of default if there is an
event of default on other indebtedness and that default: (i) is caused by a failure to make
any payment when due at the final maturity of such indebtedness; or (ii) results in the
acceleration of such indebtedness prior to its express maturity, and, in each case, the
principal (or face) amount of any such indebtedness, together with the principal (or face)
amount of any other indebtedness with respect to which an event described herein has
occurred, aggregates $20.0 million or more. The lenders may also declare an event of default
if there is a default under the Trico Shipping Working Capital Facility Agreement which is
caused by a failure to make any payment when due or results in the acceleration of such
Indebtedness prior to its express maturity.
    
    The Trico Shipping Working Capital Facility Agreement allows the lenders to declare an
event of default and require immediate repayment if there is an event of default under the
$50 million U.S. Credit Facility or under the Senior Secured Notes.
 56




---



##### Table of Contents



Recent Amendments and Waivers
 
    
    In October 2009, we received an amendment retroactive to September 30, 2009 that amends the
consolidated leverage ratio covenant under our $50 million U.S. Credit Facility to exclude
the effects of the change in the value of the embedded derivative associated with the 8.125%
Debentures in the EBITDA calculation. With this amendment, we were in compliance with this
covenant as of September 30, 2009. This amendment also increased the consolidated leverage
ratio to 8.50:1 for each of the quarters ending between December 31, 2009 through September
30, 2010. The ratio decreases to 8.00:1 for the fiscal quarter ending December 31, 2010, and
subsequently decreases to 7.00:1 for the fiscal quarter ending March 31, 2011, 6.00:1 for the
fiscal quarter ending June 30, 2011, and to 5.00:1 for any fiscal quarters ending thereafter.
    
    In August 2009, we entered into an amendment to our $50 million U.S. Credit Facility
whereby the maximum consolidated leverage ratio, net debt to EBITDA, was increased from 4.5:1
to 5.0:1 for the fiscal quarter ending September 30, 2009. The consolidated leverage ratios
for the remaining periods were not amended and remain at 4.5:1 for the fiscal quarter ending
December 31, 2009 and 4.0:1.0 for any fiscal quarter ending after December 31, 2009. In
connection with this amendment, the margin was increased from 3.25% to 5.0%. The total
commitment under this facility has also been permanently reduced to $35 million.
    
    In April 2009, we received a waiver of the leverage ratios under the NOK 350 million
Revolving Credit Facility, NOK 230 million Revolving Credit Facility, NOK 150 million
Additional Term Loan and the NOK 200 million Overdraft Facility. In exchange for the waiver,
the margin on each facility referenced above was increased to 275 bps.
    
    In March 2009, we entered into a series of retroactive amendments to change the method of
calculating the minimum net worth covenant for each of the $200 million Revolving Credit
Facility, the $100 million Revolving Credit Facility, the $18 million Revolving Credit
Facility, the 23.3 million Euro Revolving Credit Facility and the $50 million U.S. Credit
Facility. These amendments adjusted the calculation of net worth in order to permanently
eliminate the negative effect on net worth of any non-cash goodwill adjustments including
that which was included in the December 31, 2008 financial statements. Subsequent to this
adjustment, we were in compliance with theses net worth covenants as of December 31, 2008.
 Our Capital Requirements
   Contractual Obligations
  57




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##### Table of Contents



Payments Due by PeriodLess than
    
    
    2-3
    
    
    4-5
    
    
    More thanTotal
    
    
    1 year
    
    
    years
    
    
    years
    
    
    5 years(In thousands)Debt obligations (1) (2) (3)
    
    $
    758,800
    
    
    $
    22,296
    
    
    $
    121,432
    
    
    $
    97,339
    
    
    $
    517,733Interest on fixed rate debt (4)
    
    
    363,739
    
    
    
    68,676
    
    
    
    128,685
    
    
    
    106,975
    
    
    
    59,403Interest on variable rate debt (5)
    
    
    3,172
    
    
    
    1,682
    
    
    
    1,490
    
    
    
    
    
    
    
    Vessel construction obligations (6)
    
    
    132,454
    
    
    
    55,697
    
    
    
    76,757
    
    
    
    
    
    
    
    Time charter and equipment leases
    
    
    353,896
    
    
    
    140,455
    
    
    
    128,737
    
    
    
    58,134
    
    
    
    26,570Operating lease obligations
    
    
    9,994
    
    
    
    3,660
    
    
    
    3,255
    
    
    
    2,174
    
    
    
    905Taxes payable (7)
    
    
    36,289
    
    
    
    4,647
    
    
    
    9,294
    
    
    
    9,294
    
    
    
    13,054Pension obligations
    
    
    6,048
    
    
    
    530
    
    
    
    1,136
    
    
    
    1,174
    
    
    
    3,208Total
    
    $
    1,664,392
    
    
    $
    297,643
    
    
    $
    470,786
    
    
    $
    275,090
    
    
    $
    620,873
 
 (1)
    
    Excludes fresh-start debt premium of $0.3 million and unamortized discount on 3.0%
Debentures and 8.125% Debentures of $31.5 million and $13.5 million, respectively, at
September 30, 2009.(2)
    
    Does not assume any early conversions or redemptions of the 8.125% Debentures and 3%
Debentures as each is assumed to reach its originally stated maturity date. Holders of our 3%
Debentures have the right to require us to repurchase the debentures on each of January 15,
2014, January 15, 2017 and January 15, 2022. Please see Note 2 in our condensed consolidated
financial statements for Risks and Uncertainties. We have the option to make amortization
payments on the 8.125% Debentures in either cash or stock.(3)
    
    The maturities of debt reflect the debt repaid in October 2009 at the maturity date of the
Senior Secured Notes.(4)
    
    Primarily includes the semi-annual interest payments on Senior Secured Notes, the 8.125%
Debentures and the 3% Debentures to their maturities of 2014, 2013 and 2027, respectively, and
interest payments on the 6.11% Notes maturing 2014. This calculation also reflects the debt
refinancing mentioned above which changed most of our debt to fixed rate debt.(5)
    
    For the purpose of this calculation, amounts assume interest rates on floating rate
obligations remain unchanged from levels at September 30, 2009, throughout the life of the
obligation. This calculation also reflects the debt refinancing mentioned above which changed
most of our debt to fixed rate debt.(6)
    
    Reflects committed expenditures and does not reflect the future capital expenditures budgeted
for periods presented which are discretionary. In 2009, we also canceled the Deep Cygnus, a
large newbuild vessel, thereby terminating our obligation to fund $41.6 million in capital
expenditures, and completed negotiations with Tebma to suspend construction of the remaining
four newbuild MPSVs (the Trico Surge, Trico Sovereign, Trico Seeker and Trico Searcher). Trico
holds the option to cancel construction of the four newbuild MPSVs
after July 15, 2010 (approximately $94 million
included in the table above, with $17 million due in twelve months), which
would reduce our committed future capital expenditures to approximately $40 million on the
three MPSVs we expect to be delivered by the third quarter of 2010. If we exercised this option after the first
 twelve months, our total committed future capital expenditures would be reduced approximately $76 million in the 2-3 years column in the above table.
The Company has invested approximately $127 million in these vessels at September 30, 2009. In the event that the
Company elects to cancel construction of these vessels, there may be an impairment of the
excess of the Companys investment over any amounts recoverable from sale of materials,
equipment or construction contracts related to these vessels.
Since the beginning of
2009, we have sold legacy towing and supply vessels worth $30 million and have executed
agreements for the sale of additional vessels for approximately $37 million.(7)
    
    Norwegian tax laws allow for a portion of the accumulated untaxed shipping profits, $36.3
million, prior to September 30, 2009 to be paid in equal installments over the next eight
years. An additional liability of $18.6 million could be satisfied through making qualifying
environmental expenditures. As a result of changes in Norwegian tax laws during the first
quarter of 2009, we recognized a one-time tax benefit in first quarter earnings of $18.6
million. We also have liabilities for uncertain tax positions of $2.4 million at September 30,
2009 which have not been included in the table above due to the uncertain timing of
settlement. Cash Flows
  58




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Nine Months Ended September 30,2009
    
    2008As adjustedCash flow provided by operations
    
    $
    66,181
    
    
    $
    71,685Cash flow used in investing
    
    
    (35,393
    )
    
    
    (567,606
    )Cash flow (used in) provided by financing
    
    
    (92,915
    )
    
    
    469,219Effects of foreign exchange rate changes on cash
    
    
    9,247
    
    
    
    (9,293
    )
     Critical Accounting Policies
  Recent Accounting Standards
  59




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Item 3. Quantitative and Qualitative Market Risk Disclosures
  Foreign Currency Exchange Rate Risk
      
 Item 4. Controls and Procedures
   
 PART II  OTHER INFORMATION
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Item 1. Legal Proceedings
  
 Item 1A. Risk Factors
   We have a substantial amount of indebtedness which may adversely affect our cash flow and our
ability to operate our business, to comply with debt covenants and to make payments on our
indebtedness.
   
    
    making it more difficult to pay interest and satisfy debt obligations;
    
    requiring dedication of a substantial portion of cash flow from operations to required
payments on indebtedness, thereby reducing the availability of cash for working capital,
capital expenditures and other general corporate purposes;
    
    limiting flexibility in planning for, or responding to, adverse changes in the business and
the industry in which we operate;
    
    increasing vulnerability to general economic downturns and adverse developments in business;
    
    placing us at a competitive disadvantage compared to any less leveraged competitors; and
    
    limiting our ability to raise additional financing on satisfactory terms or at all.
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Despite current indebtedness levels, we may still be able to incur substantially more debt.
This could further exacerbate the risks associated with substantial indebtedness.
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Our indentures and credit agreements impose significant restrictions that may limit our
operating and financial flexibility.
  
    
    incur or guarantee additional indebtedness or issue certain types of equity securities;
    
    pay distributions on, purchase or redeem capital stock or purchase or redeem subordinated
indebtedness;
    
    make loans and investments;
    
    create or permit certain liens;
    
    sell or lease assets, including vessels and other collateral;
    
    engage in sale leaseback transactions;
    
    consolidate or merge with or into other companies or sell all or substantially all of their
assets;
    
    engage in transactions with affiliates;
    
    reflag vessels outside of certain jurisdictions;
    
    engage in certain business activities not related to or incidental to the provision of
subsea and marine support services, subsea trenching and protection services or towing and
supply services;
    
    materially impair any security interest with respect to the collateral; and
    
    restrict distributions or other payments to the Company or other subsidiaries.
  Provisions of our debentures could discourage an acquisition of us by a third party.
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A substantial number of shares of our common stock will be eligible for future sale upon
conversion of the 8.125% Debentures and exercise of the exchanged warrants and the phantom stock
units, and the sale of those shares could adversely affect our stock price.
  Our stockholders will experience substantial dilution if the 8.125% Debentures are converted
and the warrants and the phantom stock units are exercised for shares of our common stock.
   Risks Relating to our Business
 The loss of a key customer could have an adverse impact on our financial results.
  The early termination of contracts on our vessels could have an adverse effect on our
operations.
  Operating internationally subjects us to significant risks inherent in operating in foreign
countries.
  
    
    government instability, which may cause investment in capital projects by our potential customers to
be
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withdrawn or delayed, reducing or eliminating the viability of some markets for our services;
 
    
    potential vessel seizure or confiscation, or the expropriation, nationalization or detention of assets;
    
    imposition of additional withholding taxes or other tax on our foreign income, imposition of tariffs
or adoption of other restrictions on foreign trade or investment, including currency exchange controls
and currency repatriation limitations;
    
    exchange rate fluctuations, which may reduce the purchasing power of local currencies and cause our costs to exceed our budget, reducing our operating
margin in the affected country;
    
    difficulty in collecting accounts receivable;
    
    civil uprisings, riots, and war, which may make it unsafe to continue operations, adversely affect both budgets and schedules, and expose us to losses;
    
    availability of suitable personnel and equipment, which can be affected by government policy, or changes in policy, which limit the importation of
qualified crew members or specialized equipment in areas where local resources are insufficient;
    
    decrees, laws, regulations, interpretations and court decisions under legal systems, which are not always fully developed and which may be retroactively
applied and cause us to incur unanticipated and/or unrecoverable costs as well as delays which may result in real or opportunity costs; and
    
    acts or piracy or terrorism, including kidnappings of our crew members or onshore personnel.
  Our towing and supply fleet includes many older vessels that may require increased levels of
maintenance and capital expenditures to be maintained in good operating condition, are less
efficient than newer vessels, and may be subject to a higher likelihood of mechanical failure, an
inability to economically return to service or requirement to be scrapped. If we are unable to
manage the aging of our fleet efficiently and find profitable market opportunities for our vessels,
our results will deteriorate and our financial position and cash flows could be materially
adversely affected.
  The failure to successfully complete construction or conversion of our vessels on schedule, on
budget, or at all without a corresponding reduction in capital expenditures, or to successfully
utilize such vessels and the other vessels in our fleet at profitable levels could adversely affect
our financial position, results of operations and cash flows.
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We received a modified report from our independent registered public accounting firm for our
year ended December 31, 2008 with respect to our ability to continue as a going concern. The
existence of such a report may adversely affect our ability to raise capital, and even though we
successfully completed the issuance of the Senior Secured Notes , there is no assurance that we
will not receive a similar explanatory paragraph in their opinion for our year ending December 31,
2009.
  Trico Shipping AS and the Norwegian guarantors have not filed Norwegian audited financial
statements for the accounting year 2008 as required by Norwegian law.
  Certain deferred taxes could be accelerated and the effective tax rate on certain Norwegian
guarantors income could be increased if Trico Shipping and certain of the Norwegian guarantors
failed to comply with the Norwegian tonnage tax regime.
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Our refund guarantees may not cover all of our losses in the event of a termination of our
newbuild vessel construction contracts.
  We are exposed to the credit risks of our key customers and certain other third parties, and
nonpayment by our customers could adversely affect our financial position, results of operations
and cash flows.
  Our failure to retain key employees and attract additional qualified personnel could prevent
us from implementing our business strategy or operating our business effectively.
  Increased competitive forces in the subsea services and subsea trenching and protection
services markets could adversely affect our business.
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Time chartering of our subsea services and subsea trenching and protection vessels require us
to make payments absent revenue generation which could adversely affect our operations.
  Increases in size, quality and quantity of the offshore vessel fleet in areas where we operate
could increase competition for charters and lower day rates and/or utilization, which would
adversely affect our revenues and profitability.
  If we are unable to maintain our Jones Act status, we could be disadvantaged in the U.S.
subsea market, which would adversely affect our future revenues and profitability.
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If a stockholder conducts another proxy contest in connection with a meeting of our
stockholders, it could be costly and disruptive.
  Our U.S. employees are covered by federal laws that may subject us to job-related claims in
addition to those provided by state laws.
  Unionization efforts could increase our costs, limit our flexibility or increase the risk of a
work stoppage.
  The removal or reduction of the reimbursement of labor costs by the Norwegian government may
adversely affect our costs to operate our vessels in the North Sea.
  Certain management decisions needed to successfully operate EMSL, our 49% partnership, are
subject to the majority owners approval. The inability of our management representatives to reach
a consensus with the majority owner may negatively affect our results of operations.
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Our business plan involves establishing joint ventures with partners in targeted foreign
markets. We are subject to the Foreign Corrupt Practices Act, or FCPA. Our business may suffer
because our efforts to comply with U.S. laws could restrict our ability to do business in foreign
markets relative to our competitors who are not subject to U.S. law and a determination that we
violated the FCPA, including actions taken by our foreign agents or joint venture partners, may
adversely affect our business and operations.
   Our marine operations are seasonal and depend, in part, on weather conditions. As a result,
our results of operations will vary throughout the year.
 .
 Our operations are subject to federal, state, local and other laws and regulations that could
require us to make substantial expenditures.
   Our inability to recruit, retain and train crew members may affect our ability to offer
services, reduce operational efficiency and increase our labor rates.
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Our operations are subject to operating hazards and unforeseen interruptions for which we may
not be adequately insured.
  The cost and availability of drydock services may impede our ability to return vessels to the
market in a timely manner.
  We may face material tax consequences or assessments in countries in which we operate. If we
are required to pay material tax assessments, our financial position, results of operations and
cash flows may be materially adversely affected.
   Currency fluctuations and economic and political developments could adversely affect our financial
position, results of operations and cash flows.
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The rights of Trico Subsea AS under the vessel construction contracts for the Trico Star, Trico
Service and Trico Sea with the Tebma Shipyard in India may be impaired if it is determined that
there was not a proper novation of such contracts.
  Risks Related to Our Industry
 Changes in the level of exploration and production expenditures, in oil and gas prices or industry
perceptions about future oil and gas prices could materially decrease our cash flows and reduce our
ability to meet our financial obligations.
    The recent worldwide financial and credit crisis could lead to an extended worldwide economic
recession and have a material adverse effect on our financial position, results of operations and
cash flows.
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Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
  
 Item 3. Defaults Upon Senior Securities
  
 Item 4. Submission of Matters to a Vote of Security Holders
  
 Item 5. Other Information
  
 Item 6. EXHIBITS
  ExhibitNumber2.1
    
    Joint Prepackaged Plan of Reorganization of the
Company, Trico Marine Assets, Inc. and Trico Marine
Operators, Inc. under Chapter 11 of the United States
Bankruptcy Code (incorporated by reference to Exhibit
99.2 to our Current Report on Form 8-K dated November
12, 2004).2.2
    
    Plan Support Agreement, as amended, dated September 8,
2004 (incorporated by reference to Exhibit 99.3 to our
Current Report on Form 8-K dated November 15, 2004).3.1
    
    Second Amended and Restated Certificate of
Incorporation of the Company (incorporated by reference
to Exhibit 3.1 to our Current Report on Form 8-K filed
March 16, 2005).3.2
    
    Amendment No. 1 to the Second Amended and Restated
Certificate of Incorporation of the Company
(incorporated by reference to Annex A to our Schedule
14A filed July 2, 2008).3.3
    
    Certificate of Designation of Series A Junior
Participating Preferred Stock of Trico Marine Services,
Inc. (incorporated by reference to Exhibit 3.1 to our
Current Report on Form 8-K filed April 10, 2007).3.4
    
    Certificate of Elimination of Series A Junior
Participating Preferred Stock of Trico Marine Services,
Inc. (incorporated by reference to Exhibit 3.1 to our
Current Report on Form 8-K filed April 29, 2008).3.5
    
    Ninth Amended and Restated Bylaws of the Company
(incorporated by reference to Exhibit 3.1 to our
Current Report on Form 8-K dated September 30, 2009).4.1
    
    Specimen Common Stock Certificate (incorporated by
reference to Exhibit 4.1 to our Annual Report on Form
10-K filed March 16, 2005).4.2
    
    Registration Rights Agreement, dated as of March 16,
2005, by and among Trico Marine Services, Inc. and the
Holders named therein (incorporated by reference to
Exhibit 4.1 to our Current Report on Form 8-K filed
March 16, 2005).4.3
    
    Warrant Agreement, dated March 16, 2005 (incorporated
by reference to Exhibit 4.2 to the Companys Current
Report on Form 8-K filed March 16, 2005).
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ExhibitNumber4.4
    
    Form of Series A Warrant (incorporated by reference to
Exhibit 4.3 to the Companys Current Report on Form
8-K/A filed March 21, 2005).4.5
    
    Indenture of Trico Marine Services, Inc. and Wells
Fargo Bank, National Association, as Trustee, dated
February 7, 2007 (incorporated by reference to Exhibit
10.18 to our Annual Report on Form 10-K filed March 2,
2007).4.6
    
    Registration Rights Agreement by and among Trico Marine
Services, Inc. and the Initial Purchasers, dated
February 7, 2007 (incorporated by reference to Exhibit
10.19 to our Annual Report on Form 10-K filed March 1,
2007).4.7
    
    Share Purchase Agreement, dated May 15, 2008, by and
among Trico Marine Services, Inc., Trico Shipping AS,
and West Supply IV AS (incorporated by reference to
Exhibit 2.1 to our Current Report on Form 8-K filed May
16, 2008).4.8
    
    Phantom Stock Units Agreement, dated May 22, 2008,
between Trico Marine Services, Inc. and West Supply IV
AS (incorporated by reference to Exhibit 10.3 to our
Current Report on Form 8-K filed June 16, 2008).4.9
    
    Registration Rights Agreement, dated May 22, 2008,
between Trico Marine Services, Inc. and West Supply IV
AS (incorporated by reference to Exhibit 10.4 to our
Current Report on Form 8-K filed June 16, 2008).4.10
    
    Form of Management Share Purchase Agreement, dated May
15, 2008, by and among Trico Marine Services, Inc.,
Trico Shipping AS, and certain members of management of
DeepOcean (incorporated by reference to Exhibit 2.2 to
our Current Report on Form 8-K filed May 16, 2008).4.11
    
    Form of Phantom Stock Units Agreement, dated May 15,
2008, by and between Trico Marine Services, Inc. and
certain members of management (and their controlled
entities) of DeepOcean (incorporated by reference to
Exhibit 10.2 to our Current Report on Form 8-K filed
May 16, 2008).4.12
    
    Share Purchase Agreement, entered into on June 13,
2008, by and between DOF ASA, as Seller, and Trico
Shipping AS, as Purchaser (incorporated by reference to
Exhibit 2.1 to our Current Report on Form 8-K filed
June 13, 2008).4.13
    
    Stock Appreciation Rights Agreement by and between
Trico Marine Services, Inc. and the Participants, dated
as of March 13, 2009 (incorporated by reference to
Exhibit 10.3 to our Current Report on Form 8-K dated
March 17, 2009).4.14
    
    Form of Warrant (incorporated by reference to Exhibit
10.3 to our Current Report on Form 8-K filed May 12,
2009).4.15
    
    Indenture, dated as of May 14, 2009, between Trico
Marine Services, Inc. and Wells Fargo Bank, National
Association (incorporated by reference to Exhibit 10.2
to our Current Report on Form 8-K filed May 19, 2009).4.16
    
    Indenture dated as of October 30, 2009, by and among
Trico Shipping AS, the guarantors party thereto and
Wells Fargo Bank, N.A. (incorporated by reference to
Exhibit 4.1 to our Current Report on Form 8-K dated
November 5, 2009)10.1
    
    Fifth Amendment to Credit Agreement, dated as of August
4, 2009, by and among Trico Marine Services, Inc.,
Trico Marine Assets, Inc., Trico Marine Operators,
Inc., the Lenders, and Nordea Bank Finland plc, New
York Branch (incorporated by reference to Exhibit 10.26
to our Quarterly Report on Form 10-Q dated August 10,
2009).10.2
    
    Amended and Restated Credit Agreement by and among
Trico Shipping AS, Trico Subsea AS, Trico Supply AS,
Trico Subsea Holding AS, Various Lenders, Nordea Bank
Finland plc, New York Branch, and Bayerische Hypo-Und
Vereinsbank AG (incorporated by reference to Exhibit
10.1 to our Current Report on Form 8-K dated October 6,
2009).10.3
    
    Exchange and Registration Rights Agreement dated
October 30, 2009, by and among Trico Shipping AS, the
guarantors party thereto and Barclays Capital Inc.
(incorporated by reference to Exhibit 10.1 to our
Current Report on Form 8-K dated November 5, 2009).
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ExhibitNumber10.4
    
    Credit Agreement dated as of October 30, 2009, by and
among Trico Shipping AS, the guarantors party thereto,
the lenders party thereto, Nordea Bank Finland plc, New
York Branch as administrative agent and book-runner,
and Nordea Bank Finland plc, New York Branch and
Bayerische Hypo- Und Vereinsbank AG, as lead arrangers
(incorporated by reference to Exhibit 10.2 to our
Current Report on Form 8-K dated November 5, 2009).10.5
    
    Sixth Amendment to Credit Agreement dated as of October
30, 2009, among Trico Marine Services, Inc., the
guarantors party thereto, the lenders party thereto and
Nordea Bank Finland plc, New York Branch, as
administrative agent (incorporated by reference to
Exhibit 10.3 to our Current Report on Form 8-K dated
November 5, 2009).10.6
    
    Collateral Agency and Intercreditor Agreement dated as
of October 30, 2009, among Trico Shipping AS, the
guarantors party thereto, Nordea Bank Finland plc, New
York Branch, as the Working Capital Facility Agent,
Wells Fargo Bank, N.A., as Trustee, and Wilmington
Trust FSB, as Collateral Agent (incorporated by
reference to Exhibit 10.4 to our Current Report on Form
8-K dated November 5, 2009).10.7
    
    Equity Commitment Agreement dated as of October 30,
2009, among Trico Shipping AS, Trico Supply AS and
Wilmington Trust FSB, as Collateral Agent (incorporated
by reference to Exhibit 10.5 to our Current Report on
Form 8-K dated November 5, 2009).31.1
    
    Chief Executive Officers Certification under Section
302 of the Sarbanes-Oxley Act of 2002. (1)31.2
    
    Chief Financial Officers Certification under Section
302 of the Sarbanes-Oxley Act of 2002. (1)32.1
    
    Officers certifications pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002. (1)
 
 (1)
    
    Filed herewith. 75




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TRICO MARINE SERVICES, INC.
(Registrant)By:
    /s/  Geoff JonesGeoff JonesChief Financial Officer
(Authorized Signatory and
Principal Financial Officer)  76