##### Table of Contents















FORM 10-K


|           |  |                                                                                                                                         
|---------- |  | ----------------------------------------------------------------------------------------------------------------------------------------
|(Mark One) |  |                                                                                                                                         
|x          |  | Annual report pursuant to Section 13 or 15(d) of the
    Securities Exchange Act of 1934 for the fiscal year ended
    December 31, 2005
|o          |  | Transition report pursuant to Section 13 or 15(d) of the
    Securities Exchange Act of 1934                                            



Trico Marine Services, Inc.




|                                                                   |  |                                         
|------------------------------------------------------------------ |  | ----------------------------------------
|Delaware                                                           |  | 72-1252405                              
|(State or other jurisdiction of
    incorporation or organization) |  | (I.R.S. Employer
    Identification No.)
|2401 Fountainview Dr., Suite 920
    Houston, TX                   |  | 77057
     (Zip code)                   
|(Address of principal executive offices)                           |  |                                         

Registrants telephone number, including area code:
(713) 780-9926





Securities registered pursuant to Section 12(b) of the
Act:


None.


Securities registered pursuant to Section 12(g) of the
Act:


Common Stock, $0.01 par value per share





x o


S-K 10-K 10-K. o


x o


12b-2 o x o


o x


o x


12b-2 o x






DOCUMENTS INCORPORATED BY REFERENCE












---



##### 










TRICO MARINE SERVICES, INC.


ANNUAL REPORT ON
FORM 10-K FOR
THE


YEAR ENDED DECEMBER 31, 2005


TABLE OF CONTENTS


|                                                 |                |  |                                                                                                                      |      |  |    | 
|------------------------------------------------ | -------------- |  | -------------------------------------------------------------------------------------------------------------------- | ---- |  | -- | 
|                                                 |                |  |                                                                                                                      | Page | 
|                                                 |                |  |                                                                                                                      |      | 
|PART I                                           |                |  |                                                                                                                      |     
|                                                 | Items 1 and 2. |  | Business and Properties                                                                                              |      |  | 1  | 
|                                                 | Item 1A.       |  | Risk Factors                                                                                                         |      |  | 9  | 
|                                                 | Item 1B.       |  | Unresolved Staff Comments                                                                                            |      |  | 17 | 
|                                                 | Item 3.        |  | Legal Proceedings                                                                                                    |      |  | 17 | 
|                                                 | Item 4.        |  | Submission of Matters to a Vote of Security
    Holders                                                              |      |  | 18 | 
|PART II                                          |                |  |                                                                                                                      |     
|                                                 | Item 5.        |  | Market for Registrants Common Equity,
    Related Stockholder Matters and Issuer Purchases of Equity
    Securities |      |  | 19 | 
|                                                 | Item 6.        |  | Selected Financial Data                                                                                              |      |  | 22 | 
|                                                 | Item 7.        |  | Managements Discussion and Analysis
    of Financial Condition and Results of Operations                            |      |  | 23 | 
|                                                 | Item 7A.       |  | Quantitative and Qualitative Disclosures
    About Market Risk                                                       |      |  | 41 | 
|                                                 | Item 8.        |  | Financial Statements and Supplementary
    Data                                                                      |      |  | 43 | 
|                                                 | Item 9.        |  | Changes in and Disagreements With
    Accountants on Accounting and Financial Disclosure                             |      |  | 85 | 
|                                                 | Item 9A.       |  | Controls and Procedures                                                                                              |      |  | 85 | 
|                                                 | Item 9B        |  | Other Information                                                                                                    |      |  | 85 | 
|PART III                                         |                |  |                                                                                                                      |     
|                                                 | Item 10.       |  | Directors and Executive Officers of the
    Registrant                                                               |      |  | 86 | 
|                                                 | Item 11.       |  | Executive Compensation                                                                                               |      |  | 86 | 
|                                                 | Item 12.       |  | Security Ownership of Certain Beneficial
    Owners and Management and Related Stockholder Matters                   |      |  | 86 | 
|                                                 | Item 13.       |  | Certain Relationships and Related
    Transactions                                                                   |      |  | 86 | 
|                                                 | Item 14.       |  | Principal Accountant Fees and Services                                                                               |      |  | 86 | 
|PART IV                                          |                |  |                                                                                                                      |     
|                                                 | Item 15.       |  | Exhibits and Financial Statement
    Schedules                                                                       |      |  | 86 | 
|EXHIBIT INDEX                                    |                |  | E-1                                                                                                                  |     
|Subsidiaries of the Company                     
|Consents of experts and counsel                 
|CEO's Certification under Section 302           
|CFO's Certification under Section 302           
|Officers' Certifications pursuant to Section 906



i



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##### Table of Contents






PART I







|               |                        
|-------------- | -----------------------
|Items 1 and 2. | Business and Properties

General








www.tricomarine.com


Business Strategy






| |   |                                                                 
| | - | ----------------------------------------------------------------
| |  | Expanding our presence in growing international markets.        
|
| |  | Upgrading our fleet.                                            
|
| |  | Maintaining a conservative financial profile.                   
|
| |  | Balancing a mix of long-term contracts and spot market exposure.

2005 Events


Termination of Our U.S. Credit Facility.


1



---



##### Table of Contents



Equity Offering.


Hurricanes.


Executive Management Changes.


Our Reorganization.


The Industry




Platform Supply Vessels.


Anchor Handling, Towing and Supply Vessels.


Supply Vessels.


Crew Boats.


2



---



##### Table of Contents





Line Handling Vessel.


Market Areas






North Sea.


Gulf of Mexico.


West Africa.


Mexico.


3



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##### Table of Contents





Brazil.


Our Fleet


Existing Fleet.


|                          |  |            |    |     |        |  |            |            |  |  |                   | 
|------------------------- |  | ---------- | -- | --- | ------ |  | ---------- | ---------- |  |  | ----------------- | 
|                          |  | No. of     |    |     |        |  |           
|Type of Vessel            |  | Vessels(1) |    |     | Length |  |            | Horsepower | 
|                          |  |            |    |     |        |  |            |            | 
|Supply Vessels            |  |            | 45 |     |        |  | 166 - 230 |            |  |  |  2,000   6,140  | 
|PSVs                      |  |            | 10 |     |        |  | 190 - 304 |            |  |  |  4,050  10,800  | 
|AHTSs                     |  |            | 6  |     |        |  | 212 - 261 |            |  |  |  11,140  15,612 | 
|Crew/Line handling Vessel |  |            | 11 | (2) |        |  | 93 - 155 |            |  |  | 1,200  10,600    | 






|    |                                                                                                                                                   
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | Includes two supply vessels, two crew boats, and our SWATH crew
    boat, which are classified as assets held for sale as of
    January 31, 2006.
|   
|(2) | Includes the Stillwater River (our SWATH crew boat), and three
    crew boats under long-term lease.                                              





Vessel Maintenance.






4



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##### Table of Contents



Dispositions of assets


10-year


Operations Bases


62.5-acre


Customers and Charter Terms








|                                        |  |                              |    |   |                              |   |        |                |  |  |          |   |  |   |        |    
|--------------------------------------- |  | ---------------------------- | -- | - | ---------------------------- | - | ------ | -------------- |  |  | -------- | - |  | - | ------ | ---
|                                        |  | Without Options              |   
|                                        |  |                              |   
|                                        |  | Year ended December 31, 2006 |    |   | Year ended December 31, 2007 |  
|                                        |  |                              |    |   |                              |  
|                                        |  | % of Total                   |    |   | Average                      |   |        | % of Total     |  |  | Average  |  
|Type of Vessel                          |  | Days available               |    |   | day rate                     |   |        | Days available |  |  | day rate |  
|                                        |  |                              |    |   |                              |   |        |                |  |  |          |  
|PSVs (10)                               |  |                              | 67 | % |                              | $ | 14,352 |                |  |  | 13       | % |  | $ | 12,352 |    
|AHTSs (6)                               |  |                              | 38 | % |                              | $ | 12,550 | (1)            |  |  | 15       | % |  | $ | 5,711  | (1)
|Supply Boat (34 active)                 |  |                              | 22 | % |                              | $ | 7,142  |                |  |  | 2        | % |  | $ | 4,950  |    
|Crew/ Line Handling Vessels (11 active) |  |                              | 43 | % |                              | $ | 3,593  |                |  |  | 11       | % |  | $ | 4,300  |    

5



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##### Table of Contents



|                                        |  |                              |    |   |                              |   |        |                |  |  |          |   |  |   |        |    
|--------------------------------------- |  | ---------------------------- | -- | - | ---------------------------- | - | ------ | -------------- |  |  | -------- | - |  | - | ------ | ---
|                                        |  | With Options                 |   
|                                        |  |                              |   
|                                        |  | Year ended December 31, 2006 |    |   | Year ended December 31, 2007 |  
|                                        |  |                              |    |   |                              |  
|                                        |  | % of Total                   |    |   | Average                      |   |        | % of Total     |  |  | Average  |  
|Type of Vessel                          |  | Days available               |    |   | day rate                     |   |        | Days available |  |  | day rate |  
|                                        |  |                              |    |   |                              |   |        |                |  |  |          |  
|PSVs (10)                               |  |                              | 74 | % |                              | $ | 14,268 |                |  |  | 46       | % |  | $ | 13,639 |    
|AHTSs (6)                               |  |                              | 60 | % |                              | $ | 14,095 | (1)            |  |  | 43       | % |  | $ | 11,790 | (1)
|Supply Boat (34 active)                 |  |                              | 22 | % |                              | $ | 7,139  |                |  |  | 2        | % |  | $ | 4,950  |    
|Crew/ Line Handling Vessels (11 active) |  |                              | 43 | % |                              | $ | 3,593  |                |  |  | 11       | % |  | $ | 4,300  |    






|    |                                                                                                                                                                                                 
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | The day rate for the AHTS class includes one vessel operating
    under a bare boat charter, during which we receive a lower day
    rate, but do not pay for the operating costs of the vessel.







Competition




Regulation








6



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##### Table of Contents





non-U.S.












7



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##### Table of Contents









Insurance




Employees










Cautionary Statements






| |   |                                                                                                                                                               
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | our objectives, business plans or strategies, and projected or
    anticipated benefits or other consequences of such plans or
    strategies;                
|
| |  | projected or anticipated benefits from future or past
    acquisitions;                                                                                       
|
| |  | projections involving revenues, operating results or cash
    provided from operations, or our anticipated capital
    expenditures or other capital projects;

8



---



##### Table of Contents





| |   |                                                                                                                                                                                                                                
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | the results, timing, outcome or effect of pending or potential
    litigation and our intentions or expectations of prevailing with
    respect thereto and the availability of insurance coverage in
    connection therewith;
|
| |  | our ability to repatriate cash from foreign operations if and
    when needed; and                                                                                                                                             
|
| |  | future expectations and outlook and any other statements
    regarding future growth, cash needs, operations, business plans
    and financial results and any other statements which are not
    historical facts.            






Item 1A. Risk Factors




Risks Relating to our Business


Our fleet includes many older vessels that may require
increased levels of maintenance and capital expenditures to
maintain them in good operating condition and the fleet may be
subject to a higher likelihood of mechanical failure, inability
to economically return to service or requirement to be
scrapped.




The cost and availability of dry-dock services may impede our
ability to return stacked vessels to the market in a timely
manner.




Our inability to upgrade our fleet successfully could
adversely affect our financial condition and results of
operations.




9



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##### Table of Contents





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.


U.S.-flagged U.S.-flagged


Operating internationally poses uncertain hazards that
increase our operating expenses.






| |   |                                                                                                            
| | - | -----------------------------------------------------------------------------------------------------------
| |  | Political instability;                                                                                     
|
| |  | Potential vessel seizure or confiscation, or the expropriation,
    nationalization or detention of assets;
|
| |  | Currency restrictions;                                                                                     
|
| |  | Import and export quotas and other forms of public and
    governmental regulation;                        
|
| |  | Lack of ability to collect amounts owed; and                                                               
|
| |  | Terrorist attacks, including kidnapping.                                                                   



As a U.S. corporation, we are subject to the Foreign
Corrupt Practices Act, and a determination that we violated this
act may affect our business and operations adversely.




10



---



##### Table of Contents



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 operating hazards and
unforeseen interruptions for which we may not be adequately
insured.




Our operations are subject to federal, state, local and other
laws and regulations that could require us to make substantial
expenditures.






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.




11



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##### Table of Contents



The loss of a key customer could have an adverse impact on
our financial results.




We are exposed to the credit risks of our key customers, and
nonpayment by our customers could adversely affect our financial
condition or results of operations.




The loss of key personnel may reduce operational efficiency
and negatively impact our results of operations.




The loss of crewmembers without replacements in a timely
manner may reduce operational efficiency and negatively impact
our results of operations.




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.




12



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##### Table of Contents



Risks Relating to our Industry


We are dependent on the oil and gas industry. Changes in the
level of exploration and production expenditures and in oil and
gas prices and industry perceptions about future oil and gas
prices could materially decrease our cash flows and reduce our
ability to service our credit facilities.






If our competitors are able to supply services to our
customers at a lower price, then we may have to reduce our day
rates, which would reduce our revenues.






| |   |                                                                                                   
| | - | --------------------------------------------------------------------------------------------------
| |  | price, service, safety record and reputation of vessel operators
    and crews; and               
|
| |  | quality and availability of vessels of the type, capability and
    size required by the customer.



Risks Relating to our Capital Structure


Our business is highly cyclical in nature due to our
dependency on the levels of offshore oil and gas drilling
activity. If we are unable to stabilize our cash flow during
depressed markets, we may not be able to meet our obligations
under credit facilities and we may not be able to secure
financing or have sufficient capital to support our
operations.




13



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##### Table of Contents



We may not be able to repatriate funds from Norway to the
U.S., which could negatively impact our operational
flexibility.






| |   |                                                                                                                                                                                                                                         
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | the availability of cash at our Norwegian subsidiary, or
    availability under the Norwegian Kroner, or (NOK),
    revolving credit facility (the NOK Revolver)
    ($61.3 million available at December 31, 2005);                
|
| |  | our ability to comply with the funded debt to operating income
    plus depreciation and amortization covenant ratios in our
    Norwegian subsidiarys NOK Term Loan and NOK Revolver
    following completion of the repatriation; and
|
| |  | our Norwegian subsidiary having sufficient distributable equity
    to support the repatriation.                                                                                                                                        





| |   |                                                                                                                                                                                             
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | obtain the consent of our lenders under the NOK Term Loan and
    NOK Revolver; and                                                                                                         
|
| |  | reduce the
    paid-in-capital in one
    of our Norwegian subsidiaries without the incurrence of tax or
    other consequences by national regulating and taxing authorities
    in Norway;



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 condition may be
materially adversely affected.






Our ability to utilize certain net operating loss
carryforwards or investment tax credits may be limited by
certain events which could have an adverse impact on our
financial results.


7 8


14



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##### Table of Contents









Our business segments have been capitalized and are financed
on a stand-alone basis, which may hinder efficient utilization
of available financial resources.






Financial statements for periods subsequent to our emergence
from bankruptcy will not be comparable to those of prior
periods, which will make it difficult for stockholders to assess
our performance in relation to prior periods.






| |   |                                                                                                                                                                                                                           
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | the reorganization of our assets and liabilities as of
    March 15, 2005, the effective date of our plan of
    reorganization; and                                                                                      
|
| |  | the application of the provisions of Statement of
    Position 90-7,
    Financial Reporting by Entities in Reorganization under
    the Bankruptcy Code, which is commonly referred to as
    fresh-start accounting.



15



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##### Table of Contents





Currency fluctuations could adversely affect our financial
condition and results of operations.




Our ability to issue primary shares in the equity capital
markets for our benefit could be limited by the terms of our
registration rights agreement with certain of our existing
common stockholders. Additionally, these stockholders may sell a
large number of shares of common stock in the public market,
which may depress the market price of our stock.




Risks Relating to the Ownership of our Common Stock


Our charter documents include provisions limiting the rights
of foreign owners of our capital stock.


non-U.S. non-U.S. non-U.S.


16



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##### Table of Contents



Some anti-takeover provisions contained in our charter could
hinder a takeover attempt.









|         |                          
|-------- | -------------------------
|Item 1B. | Unresolved Staff Comments








|        |                  
|------- | -----------------
|Item 3. | Legal Proceedings

Leif Weizman v. Trico Marine Services, Inc., Thomas E.
Fairley, and Ronald O. Palmer; 10b-5


10-K.


17



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##### Table of Contents










|        |                                                    
|------- | ---------------------------------------------------
|Item 4. | Submission of Matters To a Vote Of Security Holders



18



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##### Table of Contents






PART II







|        |                                                                                                                    
|------- | -------------------------------------------------------------------------------------------------------------------
|Item 5. | Market for Registrants Common Stock, Related
    Stockholder Matters and Issuer Purchases of Equity
    Securities



over-the


Predecessor Company(1)


|     |                                           |      |   |      |     |  |   |      | 
|---- | ----------------------------------------- | ---- | - | ---- | --- |  | - | ---- | 
|     |                                           | High |   |      | Low | 
|     |                                           |      |   |      |     | 
|2004 |                                           |      |   |      |     |  |   |     
|     | First quarter                             |      | $ | 2.64 |     |  | $ | 1.03 | 
|     | Second quarter                            |      |   | 1.48 |     |  |   | 0.17 | 
|     | Third quarter                             |      |   | 0.46 |     |  |   | 0.10 | 
|     | Fourth quarter(2)                         |      |   | 0.42 |     |  |   | 0.10 | 
|2005 |                                           |      |   |      |     |  |   |     
|     | First quarter (through March 14, 2005)(2) |      | $ | 0.32 |     |  | $ | 0.10 | 

Successor Company(1)


|     |                                                              |      |   |       |     |  |   |       | 
|---- | ------------------------------------------------------------ | ---- | - | ----- | --- |  | - | ----- | 
|     |                                                              | High |   |       | Low | 
|     |                                                              |      |   |       |     | 
|2005 |                                                              |      |   |       |     |  |   |      
|     | First quarter (from March 22, 2005 to March 31,
    2005)(3) |      |   | 22.25 |     |  |   | 21.00 | 
|     | Second quarter                                               |      |   | 21.50 |     |  |   | 17.50 | 
|     | Third quarter                                                |      |   | 26.75 |     |  |   | 18.70 | 
|     | Fourth quarter                                               |      |   | 27.20 |     |  |   | 24.25 | 
|2006 |                                                              |      |   |       |     |  |   |      
|     | First quarter (through January 31, 2006)                     |      | $ | 33.74 |     |  | $ | 26.10 | 






|    |                                                                                                                                                                                                                                                                                                                                                                                        
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | The average basic common shares outstanding for our Predecessor
    was 36,876,152 and 36,908,505 for the year ended
    December 31, 2004 and the period from January 1, 2005
    through March 14, 2005, respectively. Our average basic
    common shares outstanding for our Successor Company for the
    period from March 15, 2005 through December 31, 2005
    was 11,271,786.
|(2) | The bid prices between December 17, 2004 and March 14,
    2005 reflect
    over-the-counter market
    quotations without retail mark-up, mark-down or commission, and
    may not represent actual transactions.                                                                                                                                                                     
|(3) | No reported trading of our stock occurred between March 15,
    2005 and March 21, 2005.                                                                                                                                                                                                                                                                                               



19



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##### Table of Contents



Equity Compensation Plan Information






|                                                           |       |                            |         |         |                      |                                |       |                               |  |  |         |         | 
|---------------------------------------------------------- | ----- | -------------------------- | ------- | ------- | -------------------- | ------------------------------ | ----- | ----------------------------- |  |  | ------- | ------- | 
|                                                           |       |                            |         |         |                      | Number of securities remaining |      
|                                                           |       | Number of securities to be |         |         | Weighted-average     |                                |       | available for future issuance | 
|                                                           |       | issued upon exercise of    |         |         | exercise price of    |                                |       | under equity compensation     | 
|                                                           |       | outstanding options,       |         |         | outstanding options, |                                |       | plans (excluding securities   | 
|Plan Category                                              |       | warrants and rights        |         |         | warrants and rights  |                                |       | reflected in column(a))       | 
|                                                           |       |                            |         |         |                      |                                |       |                               | 
|                                                           |       | (a)                        |         |         | (b)                  |                                |       | (c)                           | 
|Equity compensation plans approved by security holders     |       |                            |        |         |                      |                                |      |                               |  |  |        |        
|Equity compensation plans not approved by security holders |       |                            | 420,738 | (2)     |                      | $                              | 11.00 |                               |  |  | 134.500 | (1)    
|                                                           |       |                            |         |         |                      |                                |       |                               | 
|                                                           | Total |                            |         | 420,738 |                      |                                |       |                               |  |  |         | 134,500 | 






|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | The shares remaining for issuance may also be issued as
    restricted stock or other stock based awards (which awards are
    valued in whole or in part on the value of the shares of common
    stock).                                                                                                                                                                                                                                                                                                                                             
|(2) | In connection with the prepackaged plan of reorganization, the
    Trico Marine Services, Inc. 2004 Stock Incentive Plan (the
    2004 Stock Incentive Plan) was submitted to the
    Bankruptcy Court for approval. On January 19, 2005, the
    Bankruptcy Court issued an order confirming the plan of
    reorganization, including the 2004 Stock Incentive Plan. See
    Note 18 to our Consolidated Financial Statements included
    in Item 8 of this Annual Report on
    Form 10-K for a
    description of our 2004 Stock Incentive Plan.



| |                                                                                          
| | -----------------------------------------------------------------------------------------
| | Prepackage Plan of Reorganization Under Chapter 11 of
    Title 11 the United States Code









| |                             
| | ----------------------------
| | Issuance of New Common Stock



20



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##### Table of Contents





| |                                                            
| | -----------------------------------------------------------
| | Rights to Receive Warrants to Purchase New Common
    Stock



Series A Warrants.


Series B Warrants.






| |                              
| | -----------------------------
| | Registration Rights Agreement









21



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##### Table of Contents








|        |                        
|------- | -----------------------
|Item 6. | Selected Financial Data

10-K.


|                                      |  |                   |         |                                                  |                        |   |         |                          |  |   |         |       |  |      |          |      |      |   |         |               |  |   |         |          
|------------------------------------- |  | ----------------- | ------- | ------------------------------------------------ | ---------------------- | - | ------- | ------------------------ |  | - | ------- | ----- |  | ---- | -------- | ---- | ---- | - | ------- | ------------- |  | - | ------- | ---------
|                                      |  | Successor         |         |                                                  |                       
|                                      |  | Company(1)        |         |                                                  | Predecessor Company(1) |  
|                                      |  |                   |         |                                                  |                        |  
|                                      |  | Period From       |         |                                                  | Period From            |   |         |                         
|                                      |  | March 15, 2005    |         |                                                  | January 1, 2005        |   |         | Years ended December 31, | 
|                                      |  | through           |         |                                                  | through                |   |         |                          | 
|                                      |  | December 31, 2005 |         |                                                  | March 14, 2005         |   |         | 2004                     |  |   | 2003    |       |  | 2002 |          |      | 2001 |  
|                                      |  |                   |         |                                                  |                        |   |         |                          |  |   |         |       |  |      |          |      |      |  
|                                      |  |                   |         | (Dollars in thousands, except per share amounts) |                       
|Statement of Operations Data:         |  |                   |         |                                                  |                        |   |         |                          |  |   |         |       |  |      |          |      |      |   |         |               |  |   |         |          
|Revenues                              |  | $                 | 152,399 |                                                  |                        | $ | 29,886  |                          |  | $ | 112,510 |       |  | $    | 123,521  |      |      | $ | 133,942 |               |  | $ | 182,625 |          
|Direct operating expenses and other   |  |                   | 69,081  |                                                  |                        |   | 16,217  |                          |  |   | 80,712  |       |  |      | 81,188   |      |      |   | 84,101  |               |  |   | 82,144  |          
|Depreciation and amortization expense |  |                   | 20,403  |                                                  |                        |   | 6,703   |                          |  |   | 32,931  |       |  |      | 33,392   |      |      |   | 31,870  |               |  |   | 32,888  |          
|Operating income (loss)               |  |                   | 41,816  | (2)                                              |                        |   | 879     |                          |  |   | (48,719 | )(3)  |  |      | (135,501 | )(4) |      |   | (12,077 | )(5)          |  |   | 17,253  | (6)      
|Interest expense                      |  |                   | 6,430   |                                                  |                        |   | 1,940   |                          |  |   | 33,405  |       |  |      | 30,159   |      |      |   | 28,432  |               |  |   | 26,232  |          
|Net income (loss)                     |  |                   | 20,100  | (7)                                              |                        |   | (61,361 | )(8)                     |  |   | (95,952 | )(9)  |  |      | (164,398 | )    |      |   | (67,978 | )(10)         |  |   | (6,923  | )        
|Basic Per Share Data:                 |  |                   |         |                                                  |                        |   |         |                          |  |   |         |       |  |      |          |      |      |   |         |               |  |   |         |          
|Net earnings (loss) per share         |  | $                 | 1.78    |                                                  |                        | $ | (1.66   | )                        |  | $ | (2.60   | )     |  | $    | (4.51    | )    |      | $ | (1.87   | )             |  | $ | (0.19   | )        
|Diluted Per Share Data:               |  |                   |         |                                                  |                        |   |         |                          |  |   |         |       |  |      |          |      |      |   |         |               |  |   |         |          
|Net earnings (loss) per share         |  | $                 | 1.74    |                                                  |                        | $ | (1.66   | )                        |  | $ | (2.60   | )     |  | $    | (4.51    | )    |      | $ | (1.87   | )             |  | $ | (0.19   | )        
|Balance Sheet Data:                   |  |                   |         |                                                  |                        |   |         |                          |  |   |         |       |  |      |          |      |      |   |         |               |  |   |         |          
|Working capital (deficit)             |  | $                 | 46,259  | (12)                                             |                        |   | NA      | (11)                     |  | $ | (26,660 | )(12) |  | $    | (27,740  | )(12 |      |   |         | ) $(69,427)(1 |  |   | 2       | ) $43,175
|Property and equipment, net           |  |                   | 225,646 |                                                  |                        |   | NA      | (11)                     |  |   | 459,211 |       |  |      | 487,019  |      |      |   | 546,223 |               |  |   | 450,057 |          
|Total assets                          |  |                   | 344,222 |                                                  |                        |   | NA      | (11)                     |  |   | 550,755 |       |  |      | 585,191  |      |      |   | 747,175 |               |  |   | 655,712 |          
|Debt, including current portion       |  |                   | 46,538  |                                                  |                        |   | NA      | (11)                     |  |   | 147,131 |       |  |      | 380,166  |      |      |   | 384,146 |               |  |   | 305,095 |          
|Liabilities subject to compromise     |  |                   |        |                                                  |                        |   | NA      | (11)                     |  |   | 275,179 |       |  |      |         |      |      |   |        |               |  |   |        |          
|Stockholders equity                  |  |                   | 222,432 |                                                  |                        |   | NA      | (11)                     |  |   | 63,841  |       |  |      | 142,031  |      |      |   | 295,326 |               |  |   | 291,726 |          






| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (1) | We exited bankruptcy protection on March 15, 2005. In
    accordance with Statement of
    Position 90-7,
    Financial Reporting by Entities in Reorganization Under
    the Bankruptcy Code, we adopted fresh-start
    accounting as of March 15, 2005. Fresh-start accounting is
    required upon a substantive change in control and requires that
    the reporting entity allocate the reorganization value of our
    company to our assets and liabilities in a manner similar to
    that which is required under Statement of Financial Accounting
    Standards, or SFAS, No. 141, Business
    Combinations. Under the provisions of fresh-start
    accounting, a new entity has been deemed created for financial
    reporting purposes.
| | (2) | Includes a loss on assets held for sale of $2.2 million and
    gains on sales of assets $2.5 million.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| | (3) | Includes impairment charges of long-lived assets held for use of
    $8.6 million and losses on assets held for sale of
    $10.7 million.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| | (4) | Includes goodwill impairment charges of $113.0 million,
    losses on assets held for sale of $6.2 million, and a gain
    on sales of assets of $1.0 million.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| | (5) | Includes charges for impairment of long-lived assets of
    $5.2 million.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| | (6) | Includes charges for impairment of long-lived assets of
    $24.3 million and gains on sales of assets of
    $0.9 million.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| | (7) | Includes the items in footnote (2) and a loss on early
    retirement of debt of $4.0 million.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| | (8) | Includes reorganization costs of $6.7 million, a gain on
    debt discharge of $166.5 million and fresh-start
    adjustments of $219.0 million.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               

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| |     |                                                                                                                                                                                                                                                                                             
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (9) | Includes the items in footnote (3), reorganization costs of
    $8.6 million and charges of $2.8 million and
    $7.2 million for the accelerated amortization of debt
    discounts and deferred financing costs, respectively, and a loss
    on early retirement of debt of $0.6 million.

|     |                                                                                                                                                                                                                                                                                       
|---- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(10) | Includes the operating items in footnote (5) and a loss on
    early retirement of debt of $11.0 million.                                                                                                                                                                             
|(11) | Not applicable due to fresh-start accounting, which was applied
    at an interim date that was not the end of a required reporting
    period.                                                                                                                                       
|(12) | Includes amounts outstanding under the Trico Supply Bank
    Facility of $16.3 million, $55.9 million,
    $61.5 million and $87.9 million at December 31,
    2005, 2004, 2003 and 2002, respectively, which are classified as
    current liabilities in accordance with SFAS No. 6.

10-K.







|        |                                                                                         
|------- | ----------------------------------------------------------------------------------------
|Item 7. | Managements Discussion and Analysis of Financial
    Condition and Results of Operation

Overview of the Year Ended December 31, 2005








Primary Factors Affecting our Results of Operations


Day Rates and Utilization.




| |   |                                            
| | - | -------------------------------------------
| |  | demand for vessels of the type that we own;
|
| |  | customer requirements for vessels;         
|
| |  | the supply of available vessels; and       
|
| |  | competition.                               



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| |   |                                                                                                
| | - | -----------------------------------------------------------------------------------------------
| |  | price, service and reputation of vessel operators, safety record
    and crews; and            
|
| |  | the age, quality and availability of vessels of the type and
    size required by the customer.

Operating Costs.


Managements Outlook








Primary Measures Used by Management to Evaluate Our Results
of Operations




Our Results of Operations




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|                           |                                |                          |   |        |      |  |   |        |   |  |   |        |  
|-------------------------- | ------------------------------ | ------------------------ | - | ------ | ---- |  | - | ------ | - |  | - | ------ | -
|                           |                                | Years Ended December 31, |  
|                           |                                |                          |  
|                           |                                | 2005(4)                  |   |        | 2004 |  |   | 2003   |  
|                           |                                |                          |   |        |      |  |   |        |  
|Average Day Rates:(1)      |                                |                          |   |        |      |  |   |        |   |  |   |       
|                           | PSV/AHTS (North Sea class)     |                          | $ | 16,300 |      |  | $ | 10,875 |   |  | $ | 11,295 |  
|                           | Supply vessels (Gulf class)    |                          |   | 6,493  |      |  |   | 4,479  |   |  |   | 4,954  |  
|                           | Crew/line handling             |                          |   | 2,402  |      |  |   | 2,522  |   |  |   | 2,897  |  
|Utilization:(2)            |                                |                          |   |        |      |  |   |        |   |  |   |       
|                           | PSV/AHTS (North Sea class)     |                          |   | 92     | %    |  |   | 82     | % |  |   | 82     | %
|                           | Supply vessels (Gulf class)(3) |                          |   | 60     | %    |  |   | 48     | % |  |   | 51     | %
|                           | Crew/line handling             |                          |   | 90     | %    |  |   | 89     | % |  |   | 74     | %
|Average number of Vessels: |                                |                          |   |        |      |  |   |        |   |  |   |       
|                           | PSV/AHTS (North Sea class)     |                          |   | 16.8   |      |  |   | 18.5   |   |  |   | 19.7   |  
|                           | Supply vessels (Gulf class)    |                          |   | 47.6   |      |  |   | 48.0   |   |  |   | 48.0   |  
|                           | Crew/line handling             |                          |   | 16.4   |      |  |   | 17.0   |   |  |   | 16.8   |  






|    |                                                                                                                                                                                                                                                                                                  
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | Average vessel day rate is calculated by dividing a
    vessels total revenues in a period by the total number of
    days such vessel was under contract during such period.                                                                                                                   
|(2) | Average vessel utilization is calculated by dividing the total
    number of days for which a vessel is under contract in a period
    by the total number of days in such period.                                                                                                               
|(3) | Stacked vessels for the Gulf of Mexico supply vessel class are
    included in the average number of vessels and the calculation of
    utilization. Excluding stacked vessels, our utilization was 92%,
    77%, and 71% for the years ended December 31, 2005, 2004
    and 2003, respectively.
|(4) | Includes periods of both the Successor and Predecessor
    companies, before and after our reorganization.                                                                                                                                                                                       



|                  |                              |                          |         |        |   |  |     |      |   |   |         |        |  |      |     |    |   |   |         |        |  |  |     |    |  
|----------------- | ---------------------------- | ------------------------ | ------- | ------ | - |  | --- | ---- | - | - | ------- | ------ |  | ---- | --- | -- | - | - | ------- | ------ |  |  | --- | -- | -
|                  |                              | Years Ended December 31, |        
|                  |                              |                          |        
|                  |                              | Non-GAAP                 |         |        |  
|                  |                              | Combined 2005(1)         |         |        | % |  |     | 2004 |   |   | %       |        |  | 2003 |     |    | % |  
|                  |                              |                          |         |        |   |  |     |      |   |   |         |        |  |      |     |    |   |  
|Charter Revenues: |                              |                          |         |        |   |  |     |      |   |   |         |        |  |      |     |    |   |   |         |        |  |  |     |   
|                  | PSVs/AHTSs (North Sea class) |                          | $       | 91,810 |   |  |     | 54   | % |   | $       | 60,517 |  |      |     | 54 | % |   | $       | 66,157 |  |  |     | 54 | %
|                  | Supply vessels (Gulf class)  |                          |         | 67,570 |   |  |     | 39   | % |   |         | 37,899 |  |      |     | 34 | % |   |         | 43,866 |  |  |     | 36 | %
|                  | Crew/line handling vessels   |                          |         | 12,442 |   |  |     | 7    | % |   |         | 13,899 |  |      |     | 12 | % |   |         | 13,267 |  |  |     | 10 | %
|                  |                              |                          |         |        |   |  |     |      |   |   |         |        |  |      |     |    |   |  
|                  |                              | $                        | 171,822 |        |   |  | 100 | %    |   | $ | 112,315 |        |  |      | 100 | %  |   | $ | 123,290 |        |  |  | 100 | % 
|                  |                              |                          |         |        |   |  |     |      |   |   |         |        |  |      |     |    |   |  






|    |                                                                                                                                                    
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | For presentational purposes, we have included periods of both
    the Successor and Predecessor companies, before and after our
    reorganization.



| |                                                                                                                            
| | ---------------------------------------------------------------------------------------------------------------------------
| | Comparison of day rates and utilization during the year
    ended December 31, 2005 to the year ended December 31,
    2004



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| |                                                                                       
| | --------------------------------------------------------------------------------------
| | Comparison of the Year Ended December 31, 2005 to the
    Year Ended December 31, 2004





| |   |                                            
| | - | -------------------------------------------
| |  | Amortization of non-cash deferred revenues,
|
| |  | Total revenues,                            
|
| |  | Direct vessel operating expenses and other,
|
| |  | General and administrative,                
|
| |  | Amortization of marine inspection costs,   
|
| |  | Depreciation and amortization expense,     
|
| |  | Total operating expenses,                  
|
| |  | Operating income (loss),                   
|
| |  | Income (loss) before income taxes, and     
|
| |  | Net income (loss)                          

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|                                         |                                                         |                          |          |           |                   |   |             |                 |         |   |                   |        |        |   |         |         |         | 
|---------------------------------------- | ------------------------------------------------------- | ------------------------ | -------- | --------- | ----------------- | - | ----------- | --------------- | ------- | - | ----------------- | ------ | ------ | - | ------- | ------- | ------- | 
|                                         |                                                         |                          |          | Successor |                   |   | Predecessor |                
|                                         |                                                         |                          |          | Company   |                   |   | Company     |                
|                                         |                                                         | Non-GAAP Combined        |          |           |                   |   |             |                 |        
|                                         |                                                         | Results For the          |          |           | Period from       |   |             | Period from     |         |   |                  
|                                         |                                                         | Year                     |          |           | March 15, 2005    |   |             | January 1, 2005 |         |   | Year              |       
|                                         |                                                         | Ended                    |          |           | through           |   |             | through         |         |   | Ended             |       
|                                         |                                                         | December 31, 2005        |          |           | December 31, 2005 |   |             | March 14, 2005  |         |   | December 31, 2004 |       
|                                         |                                                         |                          |          |           |                   |   |             |                 |         |   |                   |       
|Revenues:                                |                                                         |                          |          |           |                   |   |             |                 |         |   |                   |        |        |   |         |        
|                                         | Charter hire                                            |                          | $        | 171,822   |                   |   | $           | 141,953         |         |   | $                 | 29,869 |        |   | $       | 112,315 |        
|                                         | Amortization of non-cash deferred revenues (see Note 4) |                          |          | 10,137    |                   |   |             | 10,137          |         |   |                   |       |        |   |         |        |        
|                                         | Other vessel income                                     |                          |          | 326       |                   |   |             | 309             |         |   |                   | 17     |        |   |         | 195     |        
|                                         |                                                         |                          |          |           |                   |   |             |                 |         |   |                   |       
|                                         |                                                         | Total revenues           |          |           | 182,285           |   |             |                 | 152,399 |   |                   |        | 29,886 |   |         |         | 112,510 | 
|Operating expenses:                      |                                                         |                          |          |           |                   |   |             |                 |         |   |                   |        |        |   |         |        
|                                         | Direct vessel operating expenses and other              |                          |          | 85,298    |                   |   |             | 69,081          |         |   |                   | 16,217 |        |   |         | 80,712  |        
|                                         | General and administrative                              |                          |          | 25,417    |                   |   |             | 21,387          |         |   |                   | 4,030  |        |   |         | 16,815  |        
|                                         | Amortization of marine inspection costs                 |                          |          | 2,055     |                   |   |             |                |         |   |                   | 2,055  |        |   |         | 11,432  |        
|                                         | Depreciation and amortization expense                   |                          |          | 27,106    |                   |   |             | 20,403          |         |   |                   | 6,703  |        |   |         | 32,931  |        
|                                         | Impairment of long-lived assets                         |                          |          |          |                   |   |             |                |         |   |                   |       |        |   |         | 8,584   |        
|                                         | Loss on assets held for sale                            |                          |          | 2,237     |                   |   |             | 2,237           |         |   |                   |       |        |   |         | 10,725  |        
|                                         | (Gain) loss on sales of assets                          |                          |          | (2,523    | )                 |   |             | (2,525          | )       |   |                   | 2      |        |   |         | 30      |        
|                                         |                                                         |                          |          |           |                   |   |             |                 |         |   |                   |       
|                                         |                                                         | Total operating expenses |          |           | 139,590           |   |             |                 | 110,583 |   |                   |        | 29,007 |   |         |         | 161,229 | 
|Operating income (loss)                  |                                                         |                          | 42,695   |           |                   |   | 41,816      |                 |         |   | 879               |        |        |   | (48,719 | )      
|Reorganization costs                     |                                                         |                          | (6,659   | )         |                   |   |            |                 |         |   | (6,659            | )      |        |   | (8,617  | )      
|Gain on debt discharge                   |                                                         |                          | 166,459  |           |                   |   |            |                 |         |   | 166,459           |        |        |   |        |        
|Fresh-start adjustments                  |                                                         |                          | (219,008 | )         |                   |   |            |                 |         |   | (219,008          | )      |        |   |        |        
|Interest expense                         |                                                         |                          | (8,370   | )         |                   |   | (6,430      | )               |         |   | (1,940            | )      |        |   | (33,405 | )      
|Amortization of deferred financing costs |                                                         |                          | (335     | )         |                   |   | (285        | )               |         |   | (50               | )      |        |   | (7,813  | )      
|Loss on early retirement of debt         |                                                         |                          | (3,950   | )         |                   |   | (3,950      | )               |         |   |                  |        |        |   | (618    | )      
|Other income (loss), net                 |                                                         |                          | 218      |           |                   |   | 213         |                 |         |   | 5                 |        |        |   | 152     |        
|                                         |                                                         |                          |          |           |                   |   |             |                 |         |   |                   |       
|Income (loss) before income taxes        |                                                         |                          | (28,950  | )         |                   |   | 31,364      |                 |         |   | (60,314           | )      |        |   | (99,020 | )      
|Income tax expense (benefit)             |                                                         |                          | 12,311   |           |                   |   | 11,264      |                 |         |   | 1,047             |        |        |   | (3,068  | )      
|                                         |                                                         |                          |          |           |                   |   |             |                 |         |   |                   |       
|Net income (loss)                        |                                                         | $                        | (41,261  | )         |                   | $ | 20,100      |                 |         | $ | (61,361           | )      |        | $ | (95,952 | )      
|                                         |                                                         |                          |          |           |                   |   |             |                 |         |   |                   |       

Charter Hire Revenues.


Amortization of Non-Cash Deferred Revenues.


27



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Direct Operating Expenses.


General and Administrative Expenses.


Depreciation and Amortization Expense.


Impairment Charges.


Loss on Asset Held for Sale.


Gain on the Sale of Assets.


Reorganization Expense.


28



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Gain on Debt Discharge.


Fresh-start adjustments.


Interest Expense.


Amortization of Deferred Financing Costs.


Loss on early retirement of debt.


Income Tax Expense/Benefit.




| |                                                                                       
| | --------------------------------------------------------------------------------------
| | Comparison of the Year Ended December 31, 2004 to the
    Year Ended December 31, 2003

Revenues.






29



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Direct Operating Expenses.


General and Administrative Expense.


Marine Inspection Costs.


Depreciation and Amortization.


Impairment Charges.






Gain on Sale of Assets.


30



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Reorganization Expense.


Interest Expense.


Amortization of Deferred Financing Costs.


Loss on Early Retirement of Debt.


Income Tax Benefit.


Liquidity and Capital Resources








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| |                            
| | ---------------------------
| | Description of Indebtedness



| |              
| | -------------
| | NOK Term Loan









| |             
| | ------------
| | NOK Revolver







| |            
| | -----------
| | MARAD Bonds



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| |                         
| | ------------------------
| | Our Capital Requirements















| |   |                                                                                                                                                                                                       
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | The consent of our Norwegian bank syndicate,                                                                                                                                                          
|
| |  | The ability to complete the reduction without the incurrence of
    tax or other consequences by state and national regulating and
    taxing authorities in Norway,                                  
|
| |  | The availability of cash at the Norwegian subsidiary, or
    availability under the NOK Revolver in order to generate funds
    for the transfer, and                                                 
|
| |  | The ability to comply with the funded debt to operating income
    plus depreciation and amortization covenant ratios in the NOK
    Term Loan and NOK Revolver following completion of the reduction.



33



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| |   |                                           
| | - | ------------------------------------------
| |  | Net income (loss),                        
|
| |  | Depreciation and amortization,            
|
| |  | Amortization of non-cash deferred revenue,
|
| |  | Deferred marine inspection costs, and     
|
| |  | Stock based compensation.                 

|                  |                                                                                                        |                                                        |        |  |                 |   |         |                   |          |   |                   |   |          |   |         |   |         |  
|----------------- | ------------------------------------------------------------------------------------------------------ | ------------------------------------------------------ | ------ |  | --------------- | - | ------- | ----------------- | -------- | - | ----------------- | - | -------- | - | ------- | - | ------- | -
|                  |                                                                                                        | Successor                                              |        |  | Predecessor     |   |         |                   |          |  
|                  |                                                                                                        | Company                                                |        |  | Company         |   |         |                   |          |  
|                  |                                                                                                        |                                                        |        |  |                 |   |         |                   |          |  
|                  |                                                                                                        | Period from                                            |        |  | Period from     |   |         | Non-GAAP          |          |   |                  
|                  |                                                                                                        | March 15, 2005                                         |        |  | January 1, 2005 |   |         | Combined Year     |          |   |                  
|                  |                                                                                                        | through                                                |        |  | through         |   |         | Ended             |          |   | Year Ended        |  
|                  |                                                                                                        | December 31, 2005                                      |        |  | March 14, 2005  |   |         | December 31, 2005 |          |   | December 31, 2004 |  
|                  |                                                                                                        |                                                        |        |  |                 |   |         |                   |          |   |                   |  
|Net income (loss) |                                                                                                        | $                                                      | 20,100 |  |                 | $ | (61,361 | )                 |          | $ | (41,261           | ) |          | $ | (95,952 | )
|                  | Adjustments to reconcile net income (loss) to net cash provided
    by (used in) operating activities: |                                                        |        |  |                 |   |         |                   |          |   |                   |   |          |   |         |   |        
|                  |                                                                                                        | Depreciation and amortization                          |        |  | 20,636          |   |         |                   | 8,808    |   |                   | $ | 29,444   |   |         |   | 55,077  |  
|                  |                                                                                                        | Amortization of non-cash deferred revenue (see Note 4) |        |  | (10,137         | ) |         |                   |         |   |                   |   | (10,137  | ) |         |   |         |  
|                  |                                                                                                        | Deferred marine inspection costs                       |        |  |                |   |         |                   | (1,277   | ) |                   |   | (1,277   | ) |         |   | (11,360 | )
|                  |                                                                                                        | Deferred income taxes                                  |        |  | 9,385           |   |         |                   | 1,397    |   |                   |   | 10,782   |   |         |   | (3,388  | )
|                  |                                                                                                        | Gain on debt discharge                                 |        |  |                |   |         |                   | (166,459 | ) |                   |   | (166,459 | ) |         |   |         |  
|                  |                                                                                                        | Fresh-start adjustments                                |        |  |                |   |         |                   | 219,008  |   |                   |   | 219,008  |   |         |   |         |  
|                  |                                                                                                        | Loss on asset held for sale                            |        |  | 2,237           |   |         |                   |         |   |                   |   | 2,237    |   |         |   | 10,725  |  
|                  |                                                                                                        | Impairment of goodwill                                 |        |  |                |   |         |                   |         |   |                   |   |         |   |         |   |        |  
|                  |                                                                                                        | Loss on early retirement of debt                       |        |  | 3,950           |   |         |                   |         |   |                   |   | 3,950    |   |         |   | 618     |  
|                  |                                                                                                        | Impairment of long-lived assets                        |        |  |                |   |         |                   |         |   |                   |   |         |   |         |   | 8,584   |  

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|                                                             |                                                    |                                                     |                                                     |          |                 |         |        |                   |        |       |                   |          |        |         |         |         |        |         |  
|------------------------------------------------------------ | -------------------------------------------------- | --------------------------------------------------- | --------------------------------------------------- | -------- | --------------- | ------- | ------ | ----------------- | ------ | ----- | ----------------- | -------- | ------ | ------- | ------- | ------- | ------ | ------- | -
|                                                             |                                                    | Successor                                           |                                                     |          | Predecessor     |         |        |                   |        |      
|                                                             |                                                    | Company                                             |                                                     |          | Company         |         |        |                   |        |      
|                                                             |                                                    |                                                     |                                                     |          |                 |         |        |                   |        |      
|                                                             |                                                    | Period from                                         |                                                     |          | Period from     |         |        | Non-GAAP          |        |       |                  
|                                                             |                                                    | March 15, 2005                                      |                                                     |          | January 1, 2005 |         |        | Combined Year     |        |       |                  
|                                                             |                                                    | through                                             |                                                     |          | through         |         |        | Ended             |        |       | Year Ended        |         
|                                                             |                                                    | December 31, 2005                                   |                                                     |          | March 14, 2005  |         |        | December 31, 2005 |        |       | December 31, 2004 |         
|                                                             |                                                    |                                                     |                                                     |          |                 |         |        |                   |        |       |                   |         
|                                                             |                                                    | Gain on sales of assets                             |                                                     |          | (2,525          | )       |        |                   | 2      |       |                   |          | (2,523 | )       |         |         | 30     |        
|                                                             |                                                    | Provision for doubtful accounts                     |                                                     |          | 668             |         |        |                   | 40     |       |                   |          | 708    |         |         |         | 565    |        
|                                                             |                                                    | Stock based compensation                            |                                                     |          | 2,012           |         |        |                   | 9      |       |                   |          | 2,021  |         |         |         | 66     |        
|                                                             |                                                    | Change in operating assets and liabilities:         |                                                     |          |                 |         |        |                   |        |       |                   |          |        |         |         |         |        |        
|                                                             |                                                    |                                                     | Accounts receivable                                 |          |                 | (12,688 | )      |                   |        | 2,404 |                   |          |        | (10,284 | )       |         |        | (3,065  | )
|                                                             |                                                    |                                                     | Prepaid expenses and other current assets           |          |                 | (760    | )      |                   |        | (630  | )                 |          |        | (1,390  | )       |         |        | 163     |  
|                                                             |                                                    |                                                     | Accounts payable and accrued expenses               |          |                 | (4,629  | )      |                   |        | 7,676 |                   |          |        | 3,047   |         |         |        | 23,380  |  
|                                                             |                                                    |                                                     | Other, net                                          |          |                 | (1,075  | )      |                   |        | (449  | )                 |          |        | (1,524  | )       |         |        | (204    | )
|                                                             |                                                    |                                                     |                                                     |          |                 |         |        |                   |        |       |                   |         
|                                                             |                                                    |                                                     | Net cash provided by (used in) operating activities |          |                 | 27,174  |        |                   |        | 9,168 |                   |          |        | 36,342  |         |         |        | (14,761 | )
|                                                             |                                                    |                                                     |                                                     |          |                 |         |        |                   |        |       |                   |         
|Cash flows from investing activities:                        |                                                    |                                                     |                                                     |          |                 |         |        |                   |        |       |                   |          |        |         |         |        
|                                                             | Purchases of property and equipment                |                                                     |                                                     | (1,814   | )               |         |        | (947              | )      |       |                   | (2,761   | )      |         |         | (6,155  | )     
|                                                             | Proceeds from sales of assets                      |                                                     |                                                     | 6,988    |                 |         |        |                  |        |       |                   | 6,988    |        |         |         | 3,831   |       
|                                                             | Increase in restricted cash                        |                                                     |                                                     | (882     | )               |         |        | 508               |        |       |                   | (374     | )      |         |         | (5,677  | )     
|                                                             | Other, net                                         |                                                     |                                                     |         |                 |         |        | (211              | )      |       |                   | (211     | )      |         |         | 2,857   |       
|                                                             |                                                    |                                                     |                                                     |          |                 |         |        |                   |        |       |                   |         
|                                                             |                                                    | Net cash provided by (used in) investing activities |                                                     |          | 4,292           |         |        |                   | (650   | )     |                   |          | 3,642  |         |         |         | (5,144 | )      
|                                                             |                                                    |                                                     |                                                     |          |                 |         |        |                   |        |       |                   |         
|Cash flows from financing activities:                        |                                                    |                                                     |                                                     |          |                 |         |        |                   |        |       |                   |          |        |         |         |        
|                                                             | Net proceeds from issuance of common stock         |                                                     |                                                     | 95,323   |                 |         |        |                  |        |       |                   | 95,323   |        |         |         |        |       
|                                                             | Net proceeds from exercises of warrants and option |                                                     |                                                     | 1,806    |                 |         |        |                  |        |       |                   | 1,806    |        |         |         |        |       
|                                                             | Proceeds from issuance of debt                     |                                                     |                                                     | 60,550   |                 |         |        | 54,550            |        |       |                   | 115,100  |        |         |         | 55,365  |       
|                                                             | Repayment of debt                                  |                                                     |                                                     | (156,380 | )               |         |        | (56,771           | )      |       |                   | (213,151 | )      |         |         | (48,280 | )     
|                                                             | Proceeds from sale-leaseback transactions          |                                                     |                                                     |         |                 |         |        |                  |        |       |                   |         |        |         |         | 2,746   |       
|                                                             | Deferred financing costs and other                 |                                                     |                                                     |         |                 |         |        | (375              | )      |       |                   | (375     | )      |         |         | (2,783  | )     
|                                                             |                                                    |                                                     |                                                     |          |                 |         |        |                   |        |       |                   |         
|                                                             |                                                    | Net cash (used in) provided by financing activities |                                                     |          | 1,299           |         |        |                   | (2,596 | )     |                   |          | (1,297 | )       |         |         | 7,048  |        
|                                                             |                                                    |                                                     |                                                     |          |                 |         |        |                   |        |       |                   |         
|Effect of exchange rate changes on cash and cash equivalents |                                                    |                                                     | (701                                                | )        |                 |         | 62     |                   |        |       | (639              | )        |        |         | 135     |        
|Net increase (decrease) in cash and cash equivalents         |                                                    |                                                     | 32,064                                              |          |                 |         | 5,984  |                   |        |       | 38,048            |          |        |         | (12,722 | )      
|Cash and cash equivalents at beginning of period             |                                                    |                                                     | 19,154                                              |          |                 |         | 13,170 |                   |        |       | 13,170            |          |        |         | 25,892  |        
|                                                             |                                                    |                                                     |                                                     |          |                 |         |        |                   |        |       |                   |         
|Cash and cash equivalents at end of period                   |                                                    | $                                                   | 51,218                                              |          |                 | $       | 19,154 |                   |        | $     | 51,218            |          |        | $       | 13,170  |        
|                                                             |                                                    |                                                     |                                                     |          |                 |         |        |                   |        |       |                   |         

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debtor-in






|                                  |  |      |        |  |      |   |       |      |  |   |       |  |  |      |        |  |            |   |       |       |  |   |       |  |  |   |        | 
|--------------------------------- |  | ---- | ------ |  | ---- | - | ----- | ---- |  | - | ----- |  |  | ---- | ------ |  | ---------- | - | ----- | ----- |  | - | ----- |  |  | - | ------ | 
|                                  |  | 2006 |        |  | 2007 |   |       | 2008 |  |   | 2009  |  |  | 2010 |        |  | Thereafter |   |       | Total | 
|                                  |  |      |        |  |      |   |       |      |  |   |       |  |  |      |        |  |            |   |       |       | 
|Debt(1)                           |  | $    | 20,301 |  |      | $ | 1,258 |      |  | $ | 1,258 |  |  | $    | 17,568 |  |            | $ | 1,258 |       |  | $ | 4,399 |  |  | $ | 46,042 | 
|Interest on fixed rate debt       |  |      | 659    |  |      |   | 544   |      |  |   | 468   |  |  |      | 391    |  |            |   | 314   |       |  |   | 493   |  |  |   | 2,869  | 
|Interest on variable rate debt(2) |  |      | 1,079  |  |      |   | 742   |      |  |   | 742   |  |  |      | 557    |  |            |   |      |       |  |   |      |  |  |   | 3,120  | 
|Operating leases                  |  |      | 1,468  |  |      |   | 1,443 |      |  |   | 1,385 |  |  |      | 1,381  |  |            |   | 1,371 |       |  |   | 3,143 |  |  |   | 10,191 | 
|Pension obligations               |  |      | 1,175  |  |      |   | 627   |      |  |   | 658   |  |  |      | 691    |  |            |   | 726   |       |  |   | 762   |  |  |   | 4,639  | 
|                                  |  |      |        |  |      |   |       |      |  |   |       |  |  |      |        |  |            |   |       |       | 
|Total                             |  | $    | 24,682 |  |      | $ | 4,614 |      |  | $ | 4,511 |  |  | $    | 20,588 |  |            | $ | 3,669 |       |  | $ | 8,797 |  |  | $ | 66,861 | 






|    |                                                                                                                                                                                                                                                                                          
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | We consider the NOK Revolver to be a long-term source of funds
    since advances can be refinanced until the facility reduces over
    time, concluding in September 2009; therefore, the above table
    shows the NOK Revolver being repaid in its final year of
    maturity in 2009.
|(2) | Calculated at the rate applicable at December 31, 2005.
    Although the NOK Revolver is classified as current in accordance
    with GAAP requirements, we have projected the interest on the
    facility until its final maturity in 2009.                                            



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Our Critical Accounting Policies






Financial reporting by entities in reorganization. 90-7, 90-7). 90-7 90-7




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Revenue recognition.


Direct Vessel Operating Expenses.


Accounting for long-lived assets.




Impairment of long-lived assets other than goodwill.


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Restricted cash.


Losses on insured claims.


Deferred tax valuation allowance.


Marine inspection costs.


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Equity-based compensation. 90-7,


Deferred revenue on unfavorable contracts.


New Accounting Standards:






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Item 7A. Quantitative and Qualitative Disclosures
About Market Risk




Interest Rate Sensitivity








Foreign Currency Exchange Rate Sensitivity


non-U.S.




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|        |                                            
|------- | -------------------------------------------
|Item 8. | Financial Statements and Supplementary Data

Index to Consolidated Financial Statements


|                                                                                                                                       |  |      |    | 
|-------------------------------------------------------------------------------------------------------------------------------------- |  | ---- | -- | 
|                                                                                                                                       |  | Page |   
|                                                                                                                                       |  |      |   
|Successor Company  Report of
    Independent Registered Public Accounting Firm                                                        |  |      | 44 | 
|Predecessor Company  Report of
    Independent Registered Public Accounting Firm                                                      |  |      | 46 | 
|Consolidated Balance Sheets                                                                                                            |  |      |    | 
|Successor Company  as of December 31, 2005                                                                                            |  |      |    | 
|Predecessor Company  as of December 31, 2004                                                                                          |  |      | 47 | 
|Consolidated Statements of Operations                                                                                                  |  |      |    | 
|Successor Company  for the Period from March 15,
    2005 through December 31, 2005                                                   |  |      |    | 
|Predecessor Company  for the Period from
    January 1, 2005 though March 14, 2005                                                    |  |      |    | 
|and the Years Ended December 31, 2004 and 2003                                                                                         |  |      | 48 | 
|Consolidated Statements of
    Stockholders Equity                                                                                    |  |      |    | 
|Successor Company  for the Period from March 15,
    2005 through December 31, 2005                                                   |  |      |    | 
|Predecessor Company  for the Period from
    January 1, 2005 though March 14, 2005 and the Years
    Ended December 31, 2004 and 2003 |  |      | 49 | 
|Consolidated Statements of Cash Flows                                                                                                  |  |      |    | 
|Successor Company  for the Period from March 15,
    2005 through December 31, 2005                                                   |  |      |    | 
|Predecessor Company  for the Period from
    January 1, 2005 though March 14, 2005 and the Years
    Ended December 31, 2004 and 2003 |  |      | 50 | 
|Notes to Consolidated Financial
    Statements                                                                                         |  |      | 51 | 

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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM








Consolidated financial statements and financial statement
schedule








Internal control over financial reporting


Internal ControlIntegrated Framework Internal ControlIntegrated
Framework


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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
















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TRICO MARINE SERVICES, INC. AND SUBSIDIARIES





CONSOLIDATED BALANCE SHEETS


as of December 31, 2005 and December 31, 2004


(Dollars in thousands, except share and per share amounts)


|                                               |                                                                                                                                                                           |              |         |         |              |  |         |          |  
|---------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------ | ------- | ------- | ------------ |  | ------- | -------- | -
|                                               |                                                                                                                                                                           | Successor    |         |         | Predecessor  | 
|                                               |                                                                                                                                                                           | Company      |         |         | Company      | 
|                                               |                                                                                                                                                                           |              |         |         |              | 
|                                               |                                                                                                                                                                           | December 31, |         |         | December 31, | 
|                                               |                                                                                                                                                                           | 2005         |         |         | 2004         | 
|                                               |                                                                                                                                                                           |              |         |         |              | 
|ASSETS                                        
|Current assets:                                |                                                                                                                                                                           |              |         |         |              |  |         |         
|                                               | Cash and cash equivalents                                                                                                                                                 |              | $       | 51,218  |              |  | $       | 13,170   |  
|                                               | Restricted cash                                                                                                                                                           |              |         | 570     |              |  |         | 1,293    |  
|                                               | Accounts receivable, net                                                                                                                                                  |              |         | 42,986  |              |  |         | 34,373   |  
|                                               | Prepaid expenses and other current assets                                                                                                                                 |              |         | 3,484   |              |  |         | 1,405    |  
|                                               | Assets held for sale                                                                                                                                                      |              |         | 5,853   |              |  |         | 3,883    |  
|                                               |                                                                                                                                                                           |              |         |         |              | 
|                                               | Total current assets                                                                                                                                                      |              |         | 104,111 |              |  |         | 54,124   |  
|Property and equipment:                        |                                                                                                                                                                           |              |         |         |              |  |         |         
|                                               | Land and buildings                                                                                                                                                        |              |         | 1,844   |              |  |         | 3,774    |  
|                                               | Marine vessels                                                                                                                                                            |              |         | 241,360 |              |  |         | 659,289  |  
|                                               | Construction-in-progress                                                                                                                                                  |              |         | 235     |              |  |         | 32       |  
|                                               | Transportation and other                                                                                                                                                  |              |         | 1,566   |              |  |         | 5,240    |  
|                                               |                                                                                                                                                                           |              |         |         |              | 
|                                               |                                                                                                                                                                           |              | 245,005 |         |              |  | 668,335 |         
|Less accumulated depreciation and amortization |                                                                                                                                                                           |              | 19,359  |         |              |  | 209,124 |         
|                                               |                                                                                                                                                                           |              |         |         |              | 
|                                               | Net property and equipment                                                                                                                                                |              |         | 225,646 |              |  |         | 459,211  |  
|Restricted cashnoncurrent                     |                                                                                                                                                                           |              | 7,253   |         |              |  | 6,232   |         
|Other assets                                   |                                                                                                                                                                           |              | 7,212   |         |              |  | 31,188  |         
|                                               |                                                                                                                                                                           |              |         |         |              | 
|                                               | Total assets                                                                                                                                                              |              | $       | 344,222 |              |  | $       | 550,755  |  
|                                               |                                                                                                                                                                           |              |         |         |              | 
|                                              
|LIABILITIES AND STOCKHOLDERS EQUITY          
|                                              
|Current liabilities:                           |                                                                                                                                                                           |              |         |         |              |  |         |         
|                                               | Short-term and current maturities of debt                                                                                                                                 |              | $       | 36,610  |              |  | $       | 60,902   |  
|                                               | Accounts payable                                                                                                                                                          |              |         | 6,295   |              |  |         | 6,495    |  
|                                               | Accrued expenses                                                                                                                                                          |              |         | 10,715  |              |  |         | 7,994    |  
|                                               | Accrued insurance reserve                                                                                                                                                 |              |         | 3,426   |              |  |         | 4,420    |  
|                                               | Accrued interest                                                                                                                                                          |              |         | 288     |              |  |         | 518      |  
|                                               | Income taxes payable                                                                                                                                                      |              |         | 518     |              |  |         | 455      |  
|                                               |                                                                                                                                                                           |              |         |         |              | 
|                                               | Total current liabilities                                                                                                                                                 |              |         | 57,852  |              |  |         | 80,784   |  
|Liabilities subject to compromise:             |                                                                                                                                                                           |              |         |         |              |  |         |         
|                                               | Senior Notes                                                                                                                                                              |              |         |        |              |  |         | 250,000  |  
|                                               | Accrued interest on Senior Notes                                                                                                                                          |              |         |        |              |  |         | 25,179   |  
|Long-term debt, including premium              |                                                                                                                                                                           |              | 9,928   |         |              |  | 86,229  |         
|Deferred income taxes                          |                                                                                                                                                                           |              | 46,055  |         |              |  | 40,010  |         
|Deferred revenues on unfavorable contracts     |                                                                                                                                                                           |              | 5,379   |         |              |  |        |         
|Other liabilities                              |                                                                                                                                                                           |              | 2,576   |         |              |  | 4,712   |         
|                                               |                                                                                                                                                                           |              |         |         |              | 
|                                               | Total liabilities                                                                                                                                                         |              |         | 121,790 |              |  |         | 486,914  |  
|Commitments and contingencies                  |                                                                                                                                                                           |              |         |         |              |  |         |         
|Stockholders equity:                          |                                                                                                                                                                           |              |         |         |              |  |         |         
|                                               | Preferred stock, $.01 par value, 5,000,000 shares
    authorized and no shares issued at December 31, 2005 and
    December 31, 2004                                      |              |         |        |              |  |         |         |  
|                                               | Old Common stock, $.01 par value, 55,000,000 shares
    authorized, 37,037,569 shares issued and
    36,965,537 shares outstanding at December 31, 2004,
    respectively |              |         |        |              |  |         | 370      |  
|                                               | New Common stock, $.01 par value, 25,000,000 shares
    authorized, and 14,638,103 shares issued outstanding at
    December 31, 2005                                     |              |         | 146     |              |  |         |         |  
|                                               | WarrantsSeries A                                                                                                                                                         |              |         | 1,649   |              |  |         |         |  
|                                               | WarrantsSeries B                                                                                                                                                         |              |         | 634     |              |  |         |         |  
|                                               | Additional paid-in capital                                                                                                                                                |              |         | 209,538 |              |  |         | 338,071  |  
|                                               | Retained earnings (accumulated deficit)                                                                                                                                   |              |         | 20,100  |              |  |         | (310,797 | )
|                                               | Unearned compensation                                                                                                                                                     |              |         | (1,395  | )            |  |         | (119     | )
|                                               | Cumulative foreign currency translation adjustment                                                                                                                        |              |         | (8,240  | )            |  |         | 36,317   |  
|                                               | Treasury stock, at par value, zero and 72,032 shares at
    December 31, 2005 and December 31, 2004, respectively                                                         |              |         |        |              |  |         | (1       | )
|                                               |                                                                                                                                                                           |              |         |         |              | 
|                                               | Total stockholders equity                                                                                                                                                |              |         | 222,432 |              |  |         | 63,841   |  
|                                               |                                                                                                                                                                           |              |         |         |              | 
|                                               | Total liabilities and stockholders equity                                                                                                                                |              | $       | 344,222 |              |  | $       | 550,755  |  
|                                               |                                                                                                                                                                           |              |         |         |              | 



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TRICO MARINE SERVICES, INC. AND SUBSIDIARIES





CONSOLIDATED STATEMENTS OF OPERATIONS


for the Period from March 15, 2005 through December 31, 2005
and for the Period from January 1, 2005 through March 14, 2005
and the Years Ended December 31, 2004 and 2003


(Dollars in thousands, except share and per share amounts)


|                                         |                                                         |                          |        |            |                 |   |          |                   |        |   |                   |            |         |   |          |            |         | 
|---------------------------------------- | ------------------------------------------------------- | ------------------------ | ------ | ---------- | --------------- | - | -------- | ----------------- | ------ | - | ----------------- | ---------- | ------- | - | -------- | ---------- | ------- | 
|                                         |                                                         | Successor                |        |            | Predecessor     |  
|                                         |                                                         | Company                  |        |            | Company         |  
|                                         |                                                         |                          |        |            |                 |  
|                                         |                                                         | Period from              |        |            | Period from     |   |          |                  
|                                         |                                                         | March 15, 2005           |        |            | January 1, 2005 |   |          | Year              |        |   | Year              |           
|                                         |                                                         | through                  |        |            | through         |   |          | Ended             |        |   | Ended             |           
|                                         |                                                         | December 31, 2005        |        |            | March 14, 2005  |   |          | December 31, 2004 |        |   | December 31, 2003 |           
|                                         |                                                         |                          |        |            |                 |   |          |                   |        |   |                   |           
|Revenues:                                |                                                         |                          |        |            |                 |   |          |                   |        |   |                   |            |         |   |          |           
|                                         | Charter hire                                            |                          | $      | 141,953    |                 |   | $        | 29,869            |        |   | $                 | 112,315    |         |   | $        | 123,290    |        
|                                         | Amortization of non-cash deferred revenues (see Note 4) |                          |        | 10,137     |                 |   |          |                  |        |   |                   |           |         |   |          |           |        
|                                         | Other vessel income                                     |                          |        | 309        |                 |   |          | 17                |        |   |                   | 195        |         |   |          | 231        |        
|                                         |                                                         |                          |        |            |                 |   |          |                   |        |   |                   |           
|                                         |                                                         | Total revenues           |        |            | 152,399         |   |          |                   | 29,886 |   |                   |            | 112,510 |   |          |            | 123,521 | 
|Operating expenses:                      |                                                         |                          |        |            |                 |   |          |                   |        |   |                   |            |         |   |          |           
|                                         | Direct vessel operating expenses and other              |                          |        | 69,081     |                 |   |          | 16,217            |        |   |                   | 80,712     |         |   |          | 81,188     |        
|                                         | General and administrative                              |                          |        | 21,387     |                 |   |          | 4,030             |        |   |                   | 16,815     |         |   |          | 15,519     |        
|                                         | Amortization of marine inspection costs                 |                          |        |           |                 |   |          | 2,055             |        |   |                   | 11,432     |         |   |          | 10,775     |        
|                                         | Depreciation and amortization expense                   |                          |        | 20,403     |                 |   |          | 6,703             |        |   |                   | 32,931     |         |   |          | 33,392     |        
|                                         | Impairment of goodwill                                  |                          |        |           |                 |   |          |                  |        |   |                   |           |         |   |          | 113,028    |        
|                                         | Impairment of long-lived assets                         |                          |        |           |                 |   |          |                  |        |   |                   | 8,584      |         |   |          |           |        
|                                         | Loss on assets held for sale                            |                          |        | 2,237      |                 |   |          |                  |        |   |                   | 10,725     |         |   |          | 6,165      |        
|                                         | (Gain) loss on sales of assets                          |                          |        | (2,525     | )               |   |          | 2                 |        |   |                   | 30         |         |   |          | (1,045     | )      
|                                         |                                                         |                          |        |            |                 |   |          |                   |        |   |                   |           
|                                         |                                                         | Total operating expenses |        |            | 110,583         |   |          |                   | 29,007 |   |                   |            | 161,229 |   |          |            | 259,022 | 
|Operating income (loss)                  |                                                         |                          | 41,816 |            |                 |   | 879      |                   |        |   | (48,719           | )          |         |   | (135,501 | )         
|Reorganization costs                     |                                                         |                          |       |            |                 |   | (6,659   | )                 |        |   | (8,617            | )          |         |   |         |           
|Gain on debt discharge                   |                                                         |                          |       |            |                 |   | 166,459  |                   |        |   |                  |            |         |   |         |           
|Fresh-start adjustments                  |                                                         |                          |       |            |                 |   | (219,008 | )                 |        |   |                  |            |         |   |         |           
|Interest expense                         |                                                         |                          | (6,430 | )          |                 |   | (1,940   | )                 |        |   | (33,405           | )          |         |   | (30,159  | )         
|Amortization of deferred financing costs |                                                         |                          | (285   | )          |                 |   | (50      | )                 |        |   | (7,813            | )          |         |   | (977     | )         
|Loss on early retirement of debt         |                                                         |                          | (3,950 | )          |                 |   |         |                   |        |   | (618              | )          |         |   |         |           
|Other income (loss), net                 |                                                         |                          | 213    |            |                 |   | 5        |                   |        |   | 152               |            |         |   | (649     | )         
|                                         |                                                         |                          |        |            |                 |   |          |                   |        |   |                   |           
|Income (loss) before income taxes        |                                                         |                          | 31,364 |            |                 |   | (60,314  | )                 |        |   | (99,020           | )          |         |   | (167,286 | )         
|Income tax expense (benefit)             |                                                         |                          | 11,264 |            |                 |   | 1,047    |                   |        |   | (3,068            | )          |         |   | (2,888   | )         
|                                         |                                                         |                          |        |            |                 |   |          |                   |        |   |                   |           
|Net income (loss)                        |                                                         | $                        | 20,100 |            |                 | $ | (61,361  | )                 |        | $ | (95,952           | )          |         | $ | (164,398 | )         
|                                         |                                                         |                          |        |            |                 |   |          |                   |        |   |                   |           
|Basic income (loss) per common share:    |                                                         |                          |        |            |                 |   |          |                   |        |   |                   |            |         |   |          |           
|                                         | Net income (loss)                                       |                          | $      | 1.78       |                 |   | $        | (1.66             | )      |   | $                 | (2.60      | )       |   | $        | (4.51      | )      
|                                         |                                                         |                          |        |            |                 |   |          |                   |        |   |                   |           
|                                         | Average common shares outstanding                       |                          |        | 11,271,786 |                 |   |          | 36,908,505        |        |   |                   | 36,876,152 |         |   |          | 36,470,940 |        
|                                         |                                                         |                          |        |            |                 |   |          |                   |        |   |                   |           
|Diluted income (loss) per common share:  |                                                         |                          |        |            |                 |   |          |                   |        |   |                   |            |         |   |          |           
|                                         | Net income (loss)                                       |                          | $      | 1.74       |                 |   | $        | (1.66             | )      |   | $                 | (2.60      | )       |   | $        | (4.51      | )      
|                                         |                                                         |                          |        |            |                 |   |          |                   |        |   |                   |           
|                                         | Average common shares outstanding                       |                          |        | 11,558,100 |                 |   |          | 36,908,505        |        |   |                   | 36,876,152 |         |   |          | 36,470,940 |        
|                                         |                                                         |                          |        |            |                 |   |          |                   |        |   |                   |           



48



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##### Table of Contents





TRICO MARINE SERVICES, INC. AND SUBSIDIARIES





CONSOLIDATED STATEMENTS OF STOCKHOLDERS EQUITY


for the Period from March 15, 2005 through December 31, 2005
and for the Period from January 1, 2005 through March 14, 2005
and the Years Ended December 31, 2004 and 2003


(Dollars in thousands, except share amounts)


|                                                         |                                                           |                  |            |            |                  |   |     |                    |  |  |                    |            |  |            |     |     |              |  |         |          |  |          |             |            |                |         |         |         |               |   |     |              |  |   |            |          |   |        |          |          |         |   |        |        |  |   |        |         |   |   |        |         |   |   |    |   |  |   |         |          |  
|-------------------------------------------------------- | --------------------------------------------------------- | ---------------- | ---------- | ---------- | ---------------- | - | --- | ------------------ |  |  | ------------------ | ---------- |  | ---------- | --- | --- | ------------ |  | ------- | -------- |  | -------- | ----------- | ---------- | -------------- | ------- | ------- | ------- | ------------- | - | --- | ------------ |  | - | ---------- | -------- | - | ------ | -------- | -------- | ------- | - | ------ | ------ |  | - | ------ | ------- | - | - | ------ | ------- | - | - | -- | - |  | - | ------- | -------- | -
|                                                         |                                                           |                  |            |            |                  |   |     |                    |  |  |                    |            |  |            |     |     |              |  |         |          |  |          |             | Cumulative |                |         |         |         |               |   |    
|                                                         |                                                           |                  |            |            |                  |   |     |                    |  |  |                    | Retained   |  |            |     |     | Foreign      |  |         |          |  |         
|                                                         |                                                           | Old Common Stock |            |            | New Common Stock |   |     | Warrant - Series A |  |  | Warrant - Series B |            |  | Additional |     |     | Earnings     |  |         |          |  | Currency |             |            | Treasury Stock |         |         | Total   |              
|                                                         |                                                           |                  |            |            |                  |   |     |                    |  |  |                    |            |  | Paid-In    |     |     | (Accumulated |  |         | Unearned |  |          | Translation |            |                |         |         |         | Stockholders |  
|                                                         |                                                           | Shares           |            |            | Dollars          |   |     | Shares             |  |  | Dollars            |            |  | Shares     |     |     | Dollars      |  |         | Shares   |  |          | Dollars     |            |                | Capital |         |         | Deficit)      |   |     | Compensation |  |   | Adjustment |          |   | Shares |          |          | Dollars |   |        | Equity | 
|                                                         |                                                           |                  |            |            |                  |   |     |                    |  |  |                    |            |  |            |     |     |              |  |         |          |  |          |             |            |                |         |         |         |               |   |     |              |  |   |            |          |   |        |          |          |         |   |        |        | 
|Balance, December 31, 2002 (Predecessor Company)         |                                                           |                  | 36,344,367 |            |                  | $ | 363 |                    |  |  |                   |            |  | $          |    |     |              |  |        |          |  | $        |            |            |                |         |        |         |               | $ |    |              |  | $ | 337,343    |          |   | $      | (50,447  | )        |         | $ |       |        |  | $ | 8,068  |         |   | $ | 72,032 |         |   |   | (1 | ) |  |   | 295,326 |         
|Stock options exercised                                  |                                                           |                  | 578,202    |            |                  |   | 6   |                    |  |  |                    |            |  |            |     |     |              |  |         |          |  |          |             |            |                |         |         |         |               |   |     |              |  |   | 520        |          |   |        |         |          |         |   |       |        |  |   |       |         |   |   |       |         |   |   |   |   |  |   | 526     |         
|Issuances of restricted stock                            |                                                           |                  | 60,000     |            |                  |   | 1   |                    |  |  |                   |            |  |            |    |     |              |  |        |          |  |          |            |            |                |         |        |         |               |   |    |              |  |   | 144        |          |   |        |         |          |         |   | (145   | )      |  |   |       |         |   |   |       |         |   |   |   |   |  |   |        |         
|Amortization of unearned compensation                    |                                                           |                  |           |            |                  |   |    |                    |  |  |                   |            |  |            |    |     |              |  |        |          |  |          |            |            |                |         |        |         |               |   |    |              |  |   |           |          |   |        |         |          |         |   | 18     |        |  |   |       |         |   |   |       |         |   |   |   |   |  |   | 18      |         
|Comprehensive loss:                                      |                                                           |                  |            |            |                  |   |     |                    |  |  |                    |            |  |            |     |     |              |  |         |          |  |          |             |            |                |         |         |         |               |   |     |              |  |   |            |          |   |        |         |          |         |   |       |        |  |   |       |         |   |   |       |         |   |   |   |   |  |   |        |         
|                                                         | Gain on foreign currency translation                      |                  |            |           |                  |   |     |                   |  |  |                    |           |  |            |     |    |              |  |         |         |  |          |             |           |                |         |         |        |               |   |     |             |  |   |            |         |   |        |          |         |         |   |        |       |  |   |        | 10,559  |   |   |        |        |   |   |    |  |  |   |         | 10,559   |  
|                                                         | Net loss                                                  |                  |            |           |                  |   |     |                   |  |  |                    |           |  |            |     |    |              |  |         |         |  |          |             |           |                |         |         |        |               |   |     |             |  |   |            |         |   |        |          | (164,398 | )       |   |        |       |  |   |        |        |   |   |        |        |   |   |    |  |  |   |         | (164,398 | )
|                                                         |                                                           |                  |            |            |                  |   |     |                    |  |  |                    |            |  |            |     |     |              |  |         |          |  |          |             |            |                |         |         |         |               |   |     |              |  |   |            |          |   |        |          |          |         |   |        |        | 
|                                                         | Comprehensive loss:                                       |                  |            |            |                  |   |     |                    |  |  |                    |            |  |            |     |     |              |  |         |          |  |          |             |            |                |         |         |         |               |   |     |              |  |   |            |          |   |        |          |          |         |   |        |        |  |   |        |         |   |   |        |         |   |   |    |   |  |   |         | (153,839 | )
|Balance, December 31, 2003                               |                                                           |                  | 36,982,569 |            |                  |   | 370 |                    |  |  |                   |            |  |            |    |     |              |  |        |          |  |          |            |            |                |         |        |         |               |   |    |              |  |   | 338,007    |          |   |        | (214,845 | )        |         |   | (127   | )      |  |   | 18,627 |         |   |   | 72,032 |         |   |   | (1 | ) |  |   | 142,031 |         
|Issuances of restricted stock                            |                                                           |                  | 25,000     |            |                  |   |    |                    |  |  |                   |            |  |            |    |     |              |  |        |          |  |          |            |            |                |         |        |         |               |   |    |              |  |   | 58         |          |   |        |         |          |         |   | (58    | )      |  |   |       |         |   |   |       |         |   |   |   |   |  |   |        |         
|Issuances of stock to directors                          |                                                           |                  | 30,000     |            |                  |   |    |                    |  |  |                   |            |  |            |    |     |              |  |        |          |  |          |            |            |                |         |        |         |               |   |    |              |  |   | 6          |          |   |        |         |          |         |   |       |        |  |   |       |         |   |   |       |         |   |   |   |   |  |   | 6       |         
|Amortization of unearned compensation                    |                                                           |                  |           |            |                  |   |    |                    |  |  |                   |            |  |            |    |     |              |  |        |          |  |          |            |            |                |         |        |         |               |   |    |              |  |   |           |          |   |        |         |          |         |   | 66     |        |  |   |       |         |   |   |       |         |   |   |   |   |  |   | 66      |         
|Comprehensive loss:                                      |                                                           |                  |            |            |                  |   |     |                    |  |  |                    |            |  |            |     |     |              |  |         |          |  |          |             |            |                |         |         |         |               |   |     |              |  |   |            |          |   |        |         |          |         |   |       |        |  |   |       |         |   |   |       |         |   |   |   |   |  |   |        |         
|                                                         | Gain on foreign currency translation                      |                  |            |           |                  |   |     |                   |  |  |                    |           |  |            |     |    |              |  |         |         |  |          |             |           |                |         |         |        |               |   |     |             |  |   |            |         |   |        |          |         |         |   |        |       |  |   |        | 17,690  |   |   |        |        |   |   |    |  |  |   |         | 17,690   |  
|                                                         | Net loss                                                  |                  |            |           |                  |   |     |                   |  |  |                    |           |  |            |     |    |              |  |         |         |  |          |             |           |                |         |         |        |               |   |     |             |  |   |            |         |   |        |          | (95,952  | )       |   |        |       |  |   |        |        |   |   |        |        |   |   |    |  |  |   |         | (95,952  | )
|                                                         |                                                           |                  |            |            |                  |   |     |                    |  |  |                    |            |  |            |     |     |              |  |         |          |  |          |             |            |                |         |         |         |               |   |     |              |  |   |            |          |   |        |          |          |         |   |        |        | 
|                                                         | Comprehensive loss:                                       |                  |            |            |                  |   |     |                    |  |  |                    |            |  |            |     |     |              |  |         |          |  |          |             |            |                |         |         |         |               |   |     |              |  |   |            |          |   |        |          |          |         |   |        |        |  |   |        |         |   |   |        |         |   |   |    |   |  |   |         | (78,262  | )
|Balance, December 31, 2004                               |                                                           |                  | 37,037,569 |            |                  |   | 370 |                    |  |  |                   |            |  |            |    |     |              |  |        |          |  |          |            |            |                |         |        |         |               |   |    |              |  |   | 338,071    |          |   |        | (310,797 | )        |         |   | (119   | )      |  |   | 36,317 |         |   |   | 72,032 |         |   |   | (1 | ) |  |   | 63,841  |         
|Forfeiture of restricted stock                           |                                                           |                  | (5,000     | )          |                  |   |    |                    |  |  |                   |            |  |            |    |     |              |  |        |          |  |          |            |            |                |         |        |         |               |   |    |              |  |   | (12        | )        |   |        |         |          |         |   | 12     |        |  |   |       |         |   |   |       |         |   |   |   |   |  |   |        |         
|Amortization of unearned compensation                    |                                                           |                  |            |            |                  |   |    |                    |  |  |                   |            |  |            |    |     |              |  |        |          |  |          |            |            |                |         |        |         |               |   |    |              |  |   |           |          |   |        |         |          |         |   | 9      |        |  |   |       |         |   |   |       |         |   |   |   |   |  |   | 9       |         
|Comprehensive loss:                                      |                                                           |                  |            |            |                  |   |     |                    |  |  |                    |            |  |            |     |     |              |  |         |          |  |          |             |            |                |         |         |         |               |   |     |              |  |   |            |          |   |        |          |          |         |   |        |        |  |   |        |         |   |   |        |         |   |   |    |   |  |   |         |         
|                                                         | Loss on foreign currency translations                     |                  |            |           |                  |   |     |                   |  |  |                    |           |  |            |     |    |              |  |         |         |  |          |             |           |                |         |         |        |               |   |     |             |  |   |            |         |   |        |          |         |         |   |        |       |  |   |        | (1,209  | ) |   |        |        |   |   |    |  |  |   |         | (1,209   | )
|                                                         | Net loss January 1, 2005 through March 14, 2005           |                  |            |           |                  |   |     |                   |  |  |                    |           |  |            |     |    |              |  |         |         |  |          |             |           |                |         |         |        |               |   |     |             |  |   |            |         |   |        |          | (61,361  | )       |   |        |       |  |   |        |        |   |   |        |        |   |   |    |  |  |   |         | (61,361  | )
|                                                         |                                                           |                  |            |            |                  |   |     |                    |  |  |                    |            |  |            |     |     |              |  |         |          |  |          |             |            |                |         |         |         |               |   |     |              |  |   |            |          |   |        |          |          |         |   |        |        | 
|                                                         | Comprehensive loss:                                       |                  |            |            |                  |   |     |                    |  |  |                    |            |  |            |     |     |              |  |         |          |  |          |             |            |                |         |         |         |               |   |     |              |  |   |            |          |   |        |          |          |         |   |        |        |  |   |        |         |   |   |        |         |   |   |    |   |  |   |         | (62,570  | )
|                                                         | Reorganization adjustments                                |                  |            | 37,032,569 |                  |   |     | 370                |  |  |                    | 10,000,000 |  |            |     | 100 |              |  |         | 499,429  |  |          |             | 1,658      |                |         |         | 499,429 |               |   |     | 637          |  |   |            | (230,454 | ) |        |          | 372,158  |         |   |        | 98     |  |   |        | (35,108 | ) |   |        | (72,032 | ) |   |    | 1 |  |   |         | 108,720  |  
|                                                         |                                                           |                  |            |            |                  |   |     |                    |  |  |                    |            |  |            |     |     |              |  |         |          |  |          |             |            |                |         |         |         |               |   |     |              |  |   |            |          |   |        |          |          |         |   |        |        | 
|Balance, March 15, 2005 (Successor Company)              |                                                           |                  |           |            |                  |   |    |                    |  |  | 10,000,000         |            |  |            | 100 |     |              |  | 499,429 |          |  |          | 1,658       |            |                |         | 499,429 |         |               |   | 637 |              |  |   | 107,605    |          |   |        |         |          |         |   |       |        |  |   |       |         |   |   |       |         |   |   |   |   |  |   | 110,000 |         
|Issuances of restricted stock to employees and directors |                                                           |                  |           |            |                  |   |    |                    |  |  | 105,000            |            |  |            | 1   |     |              |  |        |          |  |          |            |            |                |         |        |         |               |   |    |              |  |   | 2,087      |          |   |        |         |          |         |   | (2,088 | )      |  |   |       |         |   |   |       |         |   |   |   |   |  |   |        |         
|Issuances of stock to advisors                           |                                                           |                  |           |            |                  |   |    |                    |  |  | 100,000            |            |  |            | 1   |     |              |  |        |          |  |          |            |            |                |         |        |         |               |   |    |              |  |   | 1,099      |          |   |        |         |          |         |   |       |        |  |   |       |         |   |   |       |         |   |   |   |   |  |   | 1,100   |         
|Issuances of stock during underwritten public offering   |                                                           |                  |            |            |                  |   |     |                    |  |  | 4,273,500          |            |  |            | 42  |     |              |  |        |          |  |          |            |            |                |         |        |         |               |   |    |              |  |   | 95,281     |          |   |        |         |          |         |   |       |        |  |   |       |         |   |   |       |         |   |   |   |   |  |   | 95,323  |         
|Exercises of stock options                               |                                                           |                  |           |            |                  |   |    |                    |  |  | 154,762            |            |  |            | 2   |     |              |  |        |          |  |          |            |            |                |         |        |         |               |   |    |              |  |   | 1,702      |          |   |        |         |          |         |   |       |        |  |   |       |         |   |   |       |         |   |   |   |   |  |   | 1,704   |         
|Amortization of unearned compensation                    |                                                           |                  |           |            |                  |   |    |                    |  |  |                   |            |  |            |    |     |              |  |        |          |  |          |            |            |                |         |        |         |               |   |    |              |  |   |           |          |   |        |         |          |         |   | 693    |        |  |   |       |         |   |   |       |         |   |   |   |   |  |   | 693     |         
|Stock based compensation                                 |                                                           |                  |           |            |                  |   |    |                    |  |  |                   |            |  |            |    |     |              |  |        |          |  |          |            |            |                |         |        |         |               |   |    |              |  |   | 1,319      |          |   |        |         |          |         |   |       |        |  |   |       |         |   |   |       |         |   |   |   |   |  |   | 1,319   |         
|Exercises of warrants for common stock                   |                                                           |                  |           |            |                  |   |    |                    |  |  | 4,841              |            |  |            |    |     |              |  | (2,850  | )        |  |          | (9          | )          |                |         | (1,991  | )       |               |   | (3  | )            |  |   | 114        |          |   |        |         |          |         |   |       |        |  |   |       |         |   |   |       |         |   |   |   |   |  |   | 102     |         
|Tax benefit from the utilization of fresh- start NOL     |                                                           |                  |            |            |                  |   |     |                    |  |  |                    |            |  |            |     |     |              |  |         |          |  |          |             |            |                |         |         |         |               |   |     |              |  |   | 331        |          |   |        |          |          |         |   |        |        |  |   |        |         |   |   |        |         |   |   |    |   |  |   | 331     |         
|Comprehensive loss:                                      |                                                           |                  |            |            |                  |   |     |                    |  |  |                    |            |  |            |     |     |              |  |         |          |  |          |             |            |                |         |         |         |               |   |     |              |  |   |            |          |   |        |          |          |         |   |        |        |  |   |        |         |   |   |        |         |   |   |    |   |  |   |         |         
|                                                         | Loss on foreign currency translation                      |                  |            |           |                  |   |     |                   |  |  |                    |           |  |            |     |    |              |  |         |         |  |          |             |           |                |         |         |        |               |   |     |             |  |   |            |         |   |        |          |         |         |   |        |       |  |   |        | (8,240  | ) |   |        |        |   |   |    |  |  |   |         | (8,240   | )
|                                                         | Net income  March 15, 2005 through
    December 31, 2005 |                  |            |           |                  |   |     |                   |  |  |                    |           |  |            |     |    |              |  |         |         |  |          |             |           |                |         |         |        |               |   |     |             |  |   |            |         |   |        |          | 20,100   |         |   |        |       |  |   |        |        |   |   |        |        |   |   |    |  |  |   |         | 20,100   |  
|                                                         |                                                           |                  |            |            |                  |   |     |                    |  |  |                    |            |  |            |     |     |              |  |         |          |  |          |             |            |                |         |         |         |               |   |     |              |  |   |            |          |   |        |          |          |         |   |        |        | 
|                                                         | Comprehensive income:                                     |                  |            |            |                  |   |     |                    |  |  |                    |            |  |            |     |     |              |  |         |          |  |          |             |            |                |         |         |         |               |   |     |              |  |   |            |          |   |        |          |          |         |   |        |        |  |   |        |         |   |   |        |         |   |   |    |   |  |   |         | 11,860   |  
|Balance, December 31, 2005                               |                                                           |                  |           |            |                  | $ |    |                    |  |  | 14,638,103         |            |  | $          | 146 |     |              |  | 496,579 |          |  | $        | 1,649       |            |                |         | 497,438 |         |               | $ | 634 |              |  | $ | 209,538    |          |   | $      | 20,100   |          |         | $ | (1,395 | )      |  | $ | (8,240 | )       |   |   |       |         |   | $ |   |   |  | $ | 222,432 |         
|                                                         |                                                           |                  |            |            |                  |   |     |                    |  |  |                    |            |  |            |     |     |              |  |         |          |  |          |             |            |                |         |         |         |               |   |     |              |  |   |            |          |   |        |          |          |         |   |        |        | 



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TRICO MARINE SERVICES, INC. AND SUBSIDIARIES





CONSOLIDATED STATEMENTS OF CASH FLOWS


for the Period from March 15, 2005 through
December 31, 2005 and for the Period from


January 1, 2005 through March 14, 2005 and the
Years Ended December 31, 2004 and 2003


(Dollars in thousands)


|                  |                                                                                                        |                                                     |                                                        |                                                     |                 |         |         |                   |         |          |                   |         |         |         |          |        |         |         |        |  
|----------------- | ------------------------------------------------------------------------------------------------------ | --------------------------------------------------- | ------------------------------------------------------ | --------------------------------------------------- | --------------- | ------- | ------- | ----------------- | ------- | -------- | ----------------- | ------- | ------- | ------- | -------- | ------ | ------- | ------- | ------ | -
|                  |                                                                                                        | Successor                                           |                                                        |                                                     | Predecessor     |        
|                  |                                                                                                        | Company                                             |                                                        |                                                     | Company         |        
|                  |                                                                                                        |                                                     |                                                        |                                                     |                 |        
|                  |                                                                                                        | Period from                                         |                                                        |                                                     | Period from     |         |         |                  
|                  |                                                                                                        | March 15, 2005                                      |                                                        |                                                     | January 1, 2005 |         |         |                  
|                  |                                                                                                        | through                                             |                                                        |                                                     | through         |         |         | Year ended        |         |          | Year ended        |        
|                  |                                                                                                        | December 31, 2005                                   |                                                        |                                                     | March 14, 2005  |         |         | December 31, 2004 |         |          | December 31, 2003 |        
|                  |                                                                                                        |                                                     |                                                        |                                                     |                 |         |         |                   |         |          |                   |        
|Net income (loss) |                                                                                                        | $                                                   | 20,100                                                 |                                                     |                 | $       | (61,361 | )                 |         | $        | (95,952           | )       |         | $       | (164,398 | )     
|                  | Adjustments to reconcile net income (loss) to net cash provided
    by (used in) operating activities: |                                                     |                                                        |                                                     |                 |         |         |                   |         |          |                   |         |         |         |          |        |        
|                  |                                                                                                        |                                                     | Depreciation and amortization                          |                                                     |                 | 20,636  |         |                   |         | 8,808    |                   |         |         | 55,077  |          |        |         | 45,280  |       
|                  |                                                                                                        |                                                     | Amortization of non-cash deferred revenue (see Note 4) |                                                     |                 | (10,137 | )       |                   |         | -        |                   |         |         | -       |          |        |         | -       |       
|                  |                                                                                                        |                                                     | Deferred marine inspection costs                       |                                                     |                 | -       |         |                   |         | (1,277   | )                 |         |         | (11,360 | )        |        |         | (10,840 | )     
|                  |                                                                                                        |                                                     | Deferred income taxes                                  |                                                     |                 | 9,385   |         |                   |         | 1,397    |                   |         |         | (3,388  | )        |        |         | (3,132  | )     
|                  |                                                                                                        |                                                     | Gain on debt discharge                                 |                                                     |                 | -       |         |                   |         | (166,459 | )                 |         |         | -       |          |        |         | -       |       
|                  |                                                                                                        |                                                     | Fresh-start adjustments                                |                                                     |                 | -       |         |                   |         | 219,008  |                   |         |         | -       |          |        |         | -       |       
|                  |                                                                                                        |                                                     | Loss on asset held for sale                            |                                                     |                 | 2,237   |         |                   |         | -        |                   |         |         | 10,725  |          |        |         | 6,165   |       
|                  |                                                                                                        |                                                     | Impairment of goodwill                                 |                                                     |                 | -       |         |                   |         | -        |                   |         |         | -       |          |        |         | 113,028 |       
|                  |                                                                                                        |                                                     | Loss on early retirement of debt                       |                                                     |                 | 3,950   |         |                   |         | -        |                   |         |         | 618     |          |        |         | -       |       
|                  |                                                                                                        |                                                     | Impairment of long-lived assets                        |                                                     |                 | -       |         |                   |         | -        |                   |         |         | 8,584   |          |        |         | -       |       
|                  |                                                                                                        |                                                     | Gain on sales of assets                                |                                                     |                 | (2,525  | )       |                   |         | 2        |                   |         |         | 30      |          |        |         | (1,045  | )     
|                  |                                                                                                        |                                                     | Provision for doubtful accounts                        |                                                     |                 | 668     |         |                   |         | 40       |                   |         |         | 565     |          |        |         | 120     |       
|                  |                                                                                                        |                                                     | Stock based compensation                               |                                                     |                 | 2,012   |         |                   |         | 9        |                   |         |         | 66      |          |        |         | 18      |       
|                  |                                                                                                        |                                                     | Change in operating assets and liabilities:            |                                                     |                 |         |         |                   |         |          |                   |         |         |         |          |        |         |         |       
|                  |                                                                                                        |                                                     |                                                        | Accounts receivable                                 |                 |         | (12,688 | )                 |         |          | 2,404             |         |         |         | (3,065   | )      |         |         | 9,074  |  
|                  |                                                                                                        |                                                     |                                                        | Prepaid expenses and other current assets           |                 |         | (760    | )                 |         |          | (630              | )       |         |         | 163      |        |         |         | (347   | )
|                  |                                                                                                        |                                                     |                                                        | Accounts payable and accrued expenses               |                 |         | (4,629  | )                 |         |          | 7,676             |         |         |         | 23,380   |        |         |         | (3,659 | )
|                  |                                                                                                        |                                                     |                                                        | Other, net                                          |                 |         | (1,075  | )                 |         |          | (449              | )       |         |         | (204     | )      |         |         | 471    |  
|                  |                                                                                                        |                                                     |                                                        |                                                     |                 |         |         |                   |         |          |                   |        
|                  |                                                                                                        |                                                     |                                                        | Net cash provided by (used in) operating activities |                 |         | 27,174  |                   |         |          | 9,168             |         |         |         | (14,761  | )      |         |         | (9,265 | )
|                  |                                                                                                        |                                                     |                                                        |                                                     |                 |         |         |                   |         |          |                   |        
|                  | Cash flows from investing activities:                                                                  |                                                     |                                                        |                                                     |                 |         |         |                   |         |          |                   |         |         |         |          |        |        
|                  |                                                                                                        | Purchases of property and equipment                 |                                                        |                                                     | (1,814          | )       |         |                   | (947    | )        |                   |         | (6,155  | )       |          |        | (26,443 | )      
|                  |                                                                                                        | Proceeds from sales of assets                       |                                                        |                                                     | 6,988           |         |         |                   | -       |          |                   |         | 3,831   |         |          |        | 54,392  |        
|                  |                                                                                                        | Increase in restricted cash                         |                                                        |                                                     | (882            | )       |         |                   | 508     |          |                   |         | (5,677  | )       |          |        | (730    | )      
|                  |                                                                                                        | Other, net                                          |                                                        |                                                     | -               |         |         |                   | (211    | )        |                   |         | 2,857   |         |          |        | 996     |        
|                  |                                                                                                        |                                                     |                                                        |                                                     |                 |         |         |                   |         |          |                   |        
|                  |                                                                                                        |                                                     |                                                        | Net cash provided by (used in) investing activities |                 |         | 4,292   |                   |         |          | (650              | )       |         |         | (5,144   | )      |         |         | 28,215 |  
|                  |                                                                                                        |                                                     |                                                        |                                                     |                 |         |         |                   |         |          |                   |        
|                  | Cash flows from financing activities:                                                                  |                                                     |                                                        |                                                     |                 |         |         |                   |         |          |                   |         |         |         |          |        |        
|                  |                                                                                                        | Net proceeds from issuance of common stock          |                                                        |                                                     | 95,323          |         |         |                   | -       |          |                   |         | -       |         |          |        | 526     |        
|                  |                                                                                                        | Net proceeds from exercises of warrants and options |                                                        |                                                     | 1,806           |         |         |                   | -       |          |                   |         | -       |         |          |        | -       |        
|                  |                                                                                                        | Proceeds from issuance of debt                      |                                                        |                                                     | 60,550          |         |         |                   | 54,550  |          |                   |         | 55,365  |         |          |        | 50,763  |        
|                  |                                                                                                        | Repayment of debt                                   |                                                        |                                                     | (156,380        | )       |         |                   | (56,771 | )        |                   |         | (48,280 | )       |          |        | (57,408 | )      
|                  |                                                                                                        | Proceeds from sale-leaseback transactions           |                                                        |                                                     | -               |         |         |                   | -       |          |                   |         | 2,746   |         |          |        | 2,929   |        
|                  |                                                                                                        | Deferred financing costs and other                  |                                                        |                                                     | -               |         |         |                   | (375    | )        |                   |         | (2,783  | )       |          |        | (150    | )      
|                  |                                                                                                        |                                                     |                                                        |                                                     |                 |         |         |                   |         |          |                   |        
|                  |                                                                                                        |                                                     |                                                        | Net cash (used in) provided by financing activities |                 |         | 1,299   |                   |         |          | (2,596            | )       |         |         | 7,048    |        |         |         | (3,340 | )
|                  |                                                                                                        |                                                     |                                                        |                                                     |                 |         |         |                   |         |          |                   |        
|                  | Effect of exchange rate changes on cash and cash equivalents                                           |                                                     |                                                        | (701                                                | )               |         |         | 62                |         |          |                   | 135     |         |         |          | 117    |        
|                  | Net increase (decrease) in cash and cash equivalents                                                   |                                                     |                                                        | 32,064                                              |                 |         |         | 5,984             |         |          |                   | (12,722 | )       |         |          | 15,727 |        
|                  | Cash and cash equivalents at beginning of period                                                       |                                                     |                                                        | 19,154                                              |                 |         |         | 13,170            |         |          |                   | 25,892  |         |         |          | 10,165 |        
|                  |                                                                                                        |                                                     |                                                        |                                                     |                 |         |         |                   |         |          |                   |        
|                  | Cash and cash equivalents at end of period                                                             |                                                     | $                                                      | 51,218                                              |                 |         | $       | 19,154            |         |          | $                 | 13,170  |         |         | $        | 25,892 |        
|                  |                                                                                                        |                                                     |                                                        |                                                     |                 |         |         |                   |         |          |                   |        
|                  | Supplemental cash flow information:                                                                    |                                                     |                                                        |                                                     |                 |         |         |                   |         |          |                   |         |         |         |          |        |        
|                  |                                                                                                        | Income taxes paid                                   |                                                        | $                                                   | 471             |         |         | $                 | 72      |          |                   | $       | 210     |         |          | $      | 14      |        
|                  |                                                                                                        |                                                     |                                                        |                                                     |                 |         |         |                   |         |          |                   |        
|                  |                                                                                                        | Interest paid                                       |                                                        | $                                                   | 7,351           |         |         | $                 | 1,265   |          |                   | $       | 8,464   |         |          | $      | 32,547  |        
|                  |                                                                                                        |                                                     |                                                        |                                                     |                 |         |         |                   |         |          |                   |        
|                  |                                                                                                        | Operating cash payments from reorganization items   |                                                        | $                                                   | 6,195           |         |         | $                 | 1,457   |          |                   | $       | 8,168   |         |          | $      | -       |        
|                  |                                                                                                        |                                                     |                                                        |                                                     |                 |         |         |                   |         |          |                   |        



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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS




|   |            
|-- | -----------
|1. | The Company



debtors-in




|   |                                           
|-- | ------------------------------------------
|2. | Summary of Significant Accounting Policies

Basis of Presentation.


90-7, 90-7). 90-7 7 8


90-7,


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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)


Consolidation Policy.


Cash and Cash Equivalents.


Restricted Cash.


Accounts Receivable.




Accounting for long-lived assets.




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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)








Impairment of long-lived assets other than
goodwill.


Marine vessel spare parts.


Deferred marine inspection costs.


Deferred Financing Costs.


53



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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)


Income Taxes. paid-in


Revenue Recognition.


Deferred Revenues on Unfavorable Contracts.


Direct Vessel Operating Expenses.


Losses on Insured Claims.


Foreign Currency Translation.


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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)




Stock Based Compensation.




Other Comprehensive Income/(Loss).


Use of Estimates.




| |                          
| | -------------------------
| | New Accounting Standards.





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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)




|   |                      
|-- | ---------------------
|3. | Fresh-start Reporting

Fresh-start Adjustments








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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)




|                                                        |                                                    |                                            |         |          |                |   |   |                |               |   |                |          |          |   |         |         |         | 
|------------------------------------------------------- | -------------------------------------------------- | ------------------------------------------ | ------- | -------- | -------------- | - | - | -------------- | ------------- | - | -------------- | -------- | -------- | - | ------- | ------- | ------- | 
|                                                        |                                                    | Predecessor                                |         |          |                |   |   |                | Successor     |  
|                                                        |                                                    | Company                                    |         |          |                |   |   |                | Company       |  
|                                                        |                                                    | Balance Sheet                              |         |          |                |   |   |                | Balance Sheet |  
|                                                        |                                                    | as of                                      |         |          | Reorganization |   |   | Fresh Start    |               |   | as of          |         
|                                                        |                                                    | March 15, 2005                             |         |          | Adjustments(1) |   |   | Adjustments(2) |               |   | March 15, 2005 |         
|                                                        |                                                    |                                            |         |          |                |   |   |                |               |   |                |         
|ASSETS                                                  |                                                    |                                            |         |          |                |   |   |                |               |   |                |          |          |   |         |        
|Total current assets                                    |                                                    | $                                          | 57,504  |          |                | $ |  |                |               | $ |               |          |          | $ | 57,504  |        
|Property and equipment:                                 |                                                    |                                            |         |          |                |   |   |                |               |   |                |          |          |   |         |        
|                                                        | Land and buildings                                 |                                            |         | 3,771    |                |   |   |               |               |   |                | (1,949   | )        |   |         | 1,822   |        
|                                                        | Marine vessels                                     |                                            |         | 657,780  |                |   |   |               |               |   |                | (390,405 | )        |   |         | 267,375 |        
|                                                        | Transportation and other                           |                                            |         | 5,216    |                |   |   |               |               |   |                | (4,029   | )        |   |         | 1,187   |        
|                                                        | Construction-in-progress                           |                                            |         | 100      |                |   |   |               |               |   |                | (36      | )        |   |         | 64      |        
|                                                        |                                                    |                                            |         |          |                |   |   |                |               |   |                |         
|                                                        |                                                    |                                            | 666,867 |          |                |   |  |                |               |   | (396,419       | )        |          |   | 270,448 |        
|Less accumulated depreciation and amortization          |                                                    |                                            | 215,338 |          |                |   |  |                |               |   | (215,338       | )        |          |   |        |        
|                                                        |                                                    |                                            |         |          |                |   |   |                |               |   |                |         
|                                                        | Net property and equipment                         |                                            |         | 451,529  |                |   |   |               |               |   |                | (181,081 | )        |   |         | 270,448 |        
|Restricted cashnoncurrent                              |                                                    |                                            | 6,454   |          |                |   |  |                |               |   |               |          |          |   | 6,454   |        
|Other assets                                            |                                                    |                                            | 31,305  |          |                |   |  |                |               |   | (20,720        | )        |          |   | 10,585  |        
|                                                        |                                                    |                                            |         |          |                |   |   |                |               |   |                |         
|                                                        |                                                    | Total assets                               |         | $        | 546,792        |   |   | $              |              |   |                | $        | (201,801 | ) |         | $       | 344,991 | 
|                                                        |                                                    |                                            |         |          |                |   |   |                |               |   |                |         
|                                                       
|LIABILITIES AND STOCKHOLDERS EQUITY                    |                                                    |                                            |         |          |                |   |   |                |               |   |                |          |          |   |         |        
|Total current liabilities                               |                                                    | $                                          | 86,435  |          |                | $ |  |                |               | $ |               |          |          | $ | 86,435  |        
|Liabilities subject to compromise:                      |                                                    |                                            |         |          |                |   |   |                |               |   |                |          |          |   |         |        
|                                                        | Senior Notes                                       |                                            |         | 250,000  |                |   |   | (250,000       | )             |   |                |         |          |   |         |        |        
|                                                        | Accrued interest on Senior Notes                   |                                            |         | 25,179   |                |   |   | (25,179        | )             |   |                |         |          |   |         |        |        
|Long-term debt, net of discounts                        |                                                    |                                            | 85,479  |          |                |   |  |                |               |   | 547            |          |          |   | 86,026  |        
|Deferred income taxes                                   |                                                    |                                            | 41,185  |          |                |   |  |                |               |   |               |          |          |   | 41,185  |        
|Deferred revenues on unfavorable contracts (see Note 4) |                                                    |                                            |        |          |                |   |  |                |               |   | 16,660         |          |          |   | 16,660  |        
|Other liabilities                                       |                                                    |                                            | 4,685   |          |                |   |  |                |               |   |               |          |          |   | 4,685   |        
|                                                        |                                                    |                                            |         |          |                |   |   |                |               |   |                |         
|                                                        |                                                    | Total liabilities                          |         |          | 492,963        |   |   |                | (275,179      | ) |                |          | 17,207   |   |         |         | 234,991 | 
|Commitments and contingencies                           |                                                    |                                            |         |          |                |   |   |                |               |   |                |          |          |   |         |        
|Stockholders equity:                                   |                                                    |                                            |         |          |                |   |   |                |               |   |                |          |          |   |         |        
|                                                        | Preferred stock                                    |                                            |         |         |                |   |   |               |               |   |                |         |          |   |         |        |        
|                                                        | Common stock, $.01 par value                       |                                            |         | 370      |                |   |   | (270           | )             |   |                |         |          |   |         | 100     |        
|                                                        | WarrantsSeries A                                  |                                            |         |         |                |   |   | 1,658          |               |   |                |         |          |   |         | 1,658   |        
|                                                        | WarrantsSeries B                                  |                                            |         |         |                |   |   | 637            |               |   |                |         |          |   |         | 637     |        
|                                                        | Additional paid-in capital                         |                                            |         | 338,059  |                |   |   | (230,454       | )             |   |                |         |          |   |         | 107,605 |        
|                                                        | Accumulated deficit                                |                                            |         | (319,609 | )              |   |   | 538,617        |               |   |                | (219,008 | )        |   |         |        |        
|                                                        | Unearned compensation                              |                                            |         | (98      | )              |   |   | 98             |               |   |                |         |          |   |         |        |        
|                                                        | Cumulative foreign currency translation adjustment |                                            |         | 35,108   |                |   |   | (35,108        | )             |   |                |         |          |   |         |        |        
|                                                        | Treasury stock, at par value                       |                                            |         | (1       | )              |   |   | 1              |               |   |                |         |          |   |         |        |        
|                                                        |                                                    |                                            |         |          |                |   |   |                |               |   |                |         
|                                                        |                                                    | Total stockholders equity                 |         |          | 53,829         |   |   |                | 275,179       |   |                |          | (219,008 | ) |         |         | 110,000 | 
|                                                        |                                                    |                                            |         |          |                |   |   |                |               |   |                |         
|                                                        |                                                    | Total liabilities and stockholders equity |         | $        | 546,792        |   |   | $              |              |   |                | $        | (201,801 | ) |         | $       | 344,991 | 
|                                                        |                                                    |                                            |         |          |                |   |   |                |               |   |                |         

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)







|    |                                                                                                                                                                                                                              
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | To record the conversion of liabilities subject to compromise
    into new common stock, the conversion of old common stock into
    warrants and the adjustment of other comprehensive income and
    unearned compensation.
|   
|(2) | To adjust assets and liabilities to fair market value, and
    reflect the write-off of the Predecessor Companys equity
    and the application of negative goodwill to long-lived assets.                                  



| |                                           
| | ------------------------------------------
| | Changes to Significant Accounting Policies



90-7,


|                           |                                                                                                         |                     |         |       |                   |   |         |                   |   |   |          |       |  
|-------------------------- | ------------------------------------------------------------------------------------------------------- | ------------------- | ------- | ----- | ----------------- | - | ------- | ----------------- | - | - | -------- | ----- | -
|                           |                                                                                                         | Predecessor Company |        
|                           |                                                                                                         |                     |        
|                           |                                                                                                         | Period from         |         |       |                  
|                           |                                                                                                         | January 1, 2005     |         |       | Year              |   |         | Year              |  
|                           |                                                                                                         | through             |         |       | Ended             |   |         | Ended             |  
|                           |                                                                                                         | March 14, 2005      |         |       | December 31, 2004 |   |         | December 31, 2003 |  
|                           |                                                                                                         |                     |         |       |                   |   |         |                   |  
|Net loss                   |                                                                                                         | $                   | (61,361 | )     |                   | $ | (95,952 | )                 |   | $ | (164,398 | )    
|                           | Add: Stock based compensation expense included in reported net
    loss, net of related tax effects     |                     |         | 9     |                   |   |         | 72                |   |   |          | 18    |  
|                           | Deduct: Total stock-based compensation expense determined under
    fair value-based method, net of tax |                     |         | (40   | )                 |   |         | (238              | ) |   |          | (472  | )
|                           |                                                                                                         |                     |         |       |                   |   |         |                   |  
|Pro-forma net loss         |                                                                                                         | $                   | (61,392 | )     |                   | $ | (96,118 | )                 |   | $ | (164,852 | )    
|                           |                                                                                                         |                     |         |       |                   |   |         |                   |  
|Net loss per common share: |                                                                                                         |                     |         |       |                   |   |         |                   |   |   |          |      
|                           | Basic and Diluted  as reported                                                                         |                     | $       | (1.66 | )                 |   | $       | (2.60             | ) |   | $        | (4.51 | )
|                           |                                                                                                         |                     |         |       |                   |   |         |                   |  
|                           | Basic and Diluted  pro-forma                                                                           |                     | $       | (1.66 | )                 |   | $       | (2.61             | ) |   | $        | (4.52 | )
|                           |                                                                                                         |                     |         |       |                   |   |         |                   |  



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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)




|                           |                                                                                                        |                 |         |        |                   |   |         |                   |   |   |          |         |  
|-------------------------- | ------------------------------------------------------------------------------------------------------ | --------------- | ------- | ------ | ----------------- | - | ------- | ----------------- | - | - | -------- | ------- | -
|                           |                                                                                                        | Period from     |         |        |                   |   |        
|                           |                                                                                                        | January 1, 2005 |         |        | Year              |   |         | Year              |  
|                           |                                                                                                        | through         |         |        | Ended             |   |         | Ended             |  
|                           |                                                                                                        | March 14, 2005  |         |        | December 31, 2004 |   |         | December 31, 2003 |  
|                           |                                                                                                        |                 |         |        |                   |   |         |                   |  
|Net loss                   |                                                                                                        | $               | (61,361 | )      |                   | $ | (95,952 | )                 |   | $ | (164,398 | )      
|                           | Add: Amortization of marine inspection costs included in
    reported net loss                         |                 |         | 2,055  |                   |   |         | 11,432            |   |   |          | 10,775  |  
|                           | Deduct: Expenditures for marine inspection costs determined
    under the expense as incurred method |                 |         | (1,277 | )                 |   |         | (11,360           | ) |   |          | (10,840 | )
|                           |                                                                                                        |                 |         |        |                   |   |         |                   |  
|Pro forma net loss         |                                                                                                        | $               | (60,583 | )      |                   | $ | (95,880 | )                 |   | $ | (164,463 | )      
|                           |                                                                                                        |                 |         |        |                   |   |         |                   |  
|Net loss per common share: |                                                                                                        |                 |         |        |                   |   |         |                   |   |   |          |        
|                           | Basic and Diluted  as reported                                                                        |                 | $       | (1.66  | )                 |   | $       | (2.60             | ) |   | $        | (4.51   | )
|                           |                                                                                                        |                 |         |        |                   |   |         |                   |  
|                           | Basic and Diluted  pro forma                                                                          |                 | $       | (1.64  | )                 |   | $       | (2.60             | ) |   | $        | (4.51   | )
|                           |                                                                                                        |                 |         |        |                   |   |         |                   |  



|                           |  |             |             |  |           |  |             | 
|-------------------------- |  | ----------- | ----------- |  | --------- |  | ----------- | 
|                           |  | Predecessor |             |  | Successor | 
|                           |  | Company     |             |  | Company   | 
|                           |  |             |             |  |           | 
|Buildings and improvements |  |             | 15-40 years |  |           |  | 7-33  years | 
|Marine vessels             |  |             | 15-30 years |  |           |  | 3-27  years | 
|Transportation and other   |  |             | 5-10 years  |  |           |  | 1-9 years   | 



|   |                                          
|-- | -----------------------------------------
|4. | Deferred Revenue on Unfavorable Contracts



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(Continued)






|                              |  |              |       | 
|----------------------------- |  | ------------ | ----- | 
|                              |  | Amortization |      
|                              |  | of Non-Cash  |      
|                              |  | Deferred     |      
|Period                        |  | Revenue      |      
|                              |  |              |      
|Year ending December 31, 2006 |  | $            | 4,109 | 
|Year ending December 31, 2007 |  |              | 788   | 
|Year ending December 31, 2008 |  |              | 290   | 
|Year ending December 31, 2009 |  |              | 133   | 
|Year ending December 31, 2010 |  |              | 33    | 
|Thereafter                    |  |              | 26    | 
|                              |  |              |      
|                              |  | $            | 5,379 | 



|   |                                   
|-- | ----------------------------------
|5. | Warrants to Purchase Common Stock:

00-19,




|                          |  |          |      |   |          |   |      |  
|------------------------- |  | -------- | ---- | - | -------- | - | ---- | -
|                          |  | Warrants |     
|                          |  |          |     
|                          |  | Series A |      |   | Series B |  
|                          |  |          |      |   |          |  
|Expected annual dividends |  | $        |     |   |          | $ |     |  
|Risk free interest rate   |  |          | 4.12 | % |          |   | 3.96 | %
|Expected term (in years)  |  |          | 5    |   |          |   | 3    |  
|Volatility                |  |          | 46.7 | % |          |   | 46.7 | %



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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)




|   |                     
|-- | --------------------
|6. | Reorganization Costs



|                               |                      |                     |       |       |                   |   |       |       | 
|------------------------------ | -------------------- | ------------------- | ----- | ----- | ----------------- | - | ----- | ----- | 
|                               |                      | Predecessor Company |      
|                               |                      |                     |      
|                               |                      | Period from         |       |       |                  
|                               |                      | January 1, 2005     |       |       | Year              |  
|                               |                      | through             |       |       | Ended             |  
|                               |                      | March 14, 2005      |       |       | December 31, 2004 |  
|                               |                      |                     |       |       |                   |  
|Professional and other fees    |                      | $                   | 6,479 |       |                   | $ | 8,009 |      
|Key employee retention program |                      |                     | 180   |       |                   |   | 608   |      
|                               |                      |                     |       |       |                   |  
|                               | Reorganization costs |                     | $     | 6,659 |                   |   | $     | 8,617 | 
|                               |                      |                     |       |       |                   |  







|   |                                         
|-- | ----------------------------------------
|7. | Assets Held for Sale and Sales of Assets







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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)








10-year










|   |                   
|-- | ------------------
|8. | Vessel Impairments



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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)








|   |                    
|-- | -------------------
|9. | Accounts Receivable



|                                |  |      |        |   |      |   |        |  
|------------------------------- |  | ---- | ------ | - | ---- | - | ------ | -
|                                |  | 2005 |        |   | 2004 |  
|                                |  |      |        |   |      |  
|Trade receivables               |  | $    | 39,775 |   |      | $ | 31,344 |  
|Allowance for doubtful accounts |  |      | (1,397 | ) |      |   | (1,233 | )
|Insurance and other             |  |      | 4,608  |   |      |   | 4,262  |  
|                                |  |      |        |   |      |  
|Accounts receivable, net        |  | $    | 42,986 |   |      | $ | 34,373 |  
|                                |  |      |        |   |      |  





|    |         
|--- | --------
|10. | Goodwill





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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)




|    |             
|--- | ------------
|11. | Other Assets



|                                                                                                                                                            |  |              |       |  |              |   |        | 
|----------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ------------ | ----- |  | ------------ | - | ------ | 
|                                                                                                                                                            |  | Successor    |       |  | Predecessor  |  
|                                                                                                                                                            |  | Company      |       |  | Company      |  
|                                                                                                                                                            |  |              |       |  |              |  
|                                                                                                                                                            |  | December 31, |       |  | December 31, |  
|                                                                                                                                                            |  | 2005         |       |  | 2004         |  
|                                                                                                                                                            |  |              |       |  |              |  
|Deferred marine inspection costs, net of accumulated
    amortization of $22.1 million at December 31, 2004                                                 |  | $            |      |  |              | $ | 19,017 | 
|Deferred financing costs, net of accumulated amortization of
    $1.0 million and $0.8 million at December 31,
    2005 and December 31, 2004, respectively |  |              | 296   |  |              |   | 882    | 
|Marine vessel spare parts                                                                                                                                   |  |              | 1,534 |  |              |   | 7,058  | 
|GECC lease deposits (see Note 14)                                                                                                                           |  |              | 1,698 |  |              |   | 1,698  | 
|Other                                                                                                                                                       |  |              | 3,684 |  |              |   | 2,533  | 
|                                                                                                                                                            |  |              |       |  |              |  
|Other assets                                                                                                                                                |  | $            | 7,212 |  |              | $ | 31,188 | 
|                                                                                                                                                            |  |              |       |  |              |  





|    |                                              
|--- | ---------------------------------------------
|12. | Prepetition Liabilities Subject to Compromise





|                                               |  |              |         | 
|---------------------------------------------- |  | ------------ | ------- | 
|                                               |  | December 31, |        
|                                               |  | 2004         |        
|                                               |  |              |        
|Senior Notes                                   |  | $            | 250,000 | 
|Accrued interest on Senior Notes               |  |              | 25,179  | 
|                                               |  |              |        
|Pre-petition liabilities subject to compromise |  | $            | 275,179 | 
|                                               |  |              |        



7 8 30-day


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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)


90-7,




|    |     
|--- | ----
|13. | Debt



|                                                                                                                                                                                                                                                                                                                                                                                                                                    |                         |              |        |        |              |  |         |        | 
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ----------------------- | ------------ | ------ | ------ | ------------ |  | ------- | ------ | 
|                                                                                                                                                                                                                                                                                                                                                                                                                                    |                         | Successor    |        |        | Predecessor  | 
|                                                                                                                                                                                                                                                                                                                                                                                                                                    |                         | Company      |        |        | Company      | 
|                                                                                                                                                                                                                                                                                                                                                                                                                                    |                         |              |        |        |              | 
|                                                                                                                                                                                                                                                                                                                                                                                                                                    |                         | December 31, |        |        | December 31, | 
|                                                                                                                                                                                                                                                                                                                                                                                                                                    |                         | 2005(3)      |        |        | 2004(1)      | 
|                                                                                                                                                                                                                                                                                                                                                                                                                                    |                         |              |        |        |              | 
|Trico Supply Bank Facility, bearing interest at NIBOR (Norwegian
    Interbank Offered Rate) plus a margin (weighted average interest
    rate of 4.6% at December 31, 2005) and collateralized by
    certain marine vessels. This facilitys current
    availability reduces in 13 semi-annual installments of NOK
    40 million ($5.9 million) beginning March 2003 with
    balance of the commitment expiring September 2009 |                         |              | 16,310 |        |              |  | 55,927  |       
|2004 Term loan, bearing interest at LIBOR or 2% (whichever is
    higher) plus 6% or U.S. Prime rate plus 5%, at the
    Companys option, plus a default premium of 2%
    collateralized by 43 Gulf class supply vessels. Principal
    was repaid on January 19, 2005                                                                                                                                                            |                         |              |       |        |              |  | 54,550  |       
|NOK Term loan, bearing interest at NIBOR (Norwegian Interbank
    Offered Rate) plus a margin (4.6% at December 31, 2005),
    collateralized by two marine vessels, reducing in
    5 semi-annual installments beginning June 30, 2004 by
    NOK 7.5 million ($1.1 million) with the balance
    of the commitment expiring June 2006                                                                                             |                         |              | 17,792 |        |              |  | 22,206  |       
|6.11% Notes, bearing interest at 6.11%, principal and
    interest due in 30 semi-annual installments, maturing April
    2014, collateralized by two marine vessels                                                                                                                                                                                                                                                                |                         |              | 10,690 |        |              |  | 11,948  |       
|6.08% Notes, bearing interest at 6.08%, principal and
    interest due in 16 semi-annual installments, maturing
    September 2006, collateralized by a marine vessel                                                                                                                                                                                                                                                               |                         |              | 1,250  |        |              |  | 2,500   |       
|Fresh-start debt premium(2)                                                                                                                                                                                                                                                                                                                                                                                                         |                         |              | 496    |        |              |  |        |       
|                                                                                                                                                                                                                                                                                                                                                                                                                                    |                         |              |        |        |              | 
|                                                                                                                                                                                                                                                                                                                                                                                                                                    |                         |              | 46,538 |        |              |  | 147,131 |       
|                                                                                                                                                                                                                                                                                                                                                                                                                                    | Less current maturities |              |        | 36,610 |              |  |         | 60,902 | 
|                                                                                                                                                                                                                                                                                                                                                                                                                                    |                         |              |        |        |              | 
|                                                                                                                                                                                                                                                                                                                                                                                                                                    | Long-term debt          |              | $      | 9,928  |              |  | $       | 86,229 | 
|                                                                                                                                                                                                                                                                                                                                                                                                                                    |                         |              |        |        |              | 






|    |                                                                                                                                                                                                                                                                                                                                                                 
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | The December 31, 2004 column excludes $250 million of
    outstanding indebtedness under the Senior Notes, which was
    subject to compromise as of December 31, 2004,
    and was converted into equity on March 15, 2005 in
    connection with the Chapter 11 reorganization. Refer to
    Note 3 for further details on the Companys
    reorganization.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)




|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(2) | During the application of fresh-start accounting, the Company
    recorded a fair-value adjustment to its fixed rate
    6.11% Notes and 6.08% Notes of approximately
    $0.5 million as a result of current interest rates being
    lower than the Companys stated interest rates on its
    fixed-rate debt. Fair value was determined using discounted
    future cash flows based on quoted market prices, where
    available, on its current incremental borrowing rates for
    similar types of borrowing arrangements as of the Exit Date.
    This premium will be amortized over the remaining life of the
    debt using the effective interest rate method, which will lower
    future interest expense.
|   
|(3) | During 2005, the Company refinanced the 2004 Term Loan with the
    DIP Credit Facility on January 19, 2005 and later
    refinanced the DIP Credit Facility with the U.S. Credit
    Facility on March 15, 2005. The U.S. Credit Facility
    was repaid and retired on November 22, 2005. These debt
    facilities do not appear in the above table since the facilities
    were not outstanding at the dates presented. Please see below
    for a discussion of each facility.                                                                                                                                                                                                                                     



|                              |  |        |        | 
|----------------------------- |  | ------ | ------ | 
|Period                        |  | Amount |       
|                              |  |        |       
|Year ending December 31, 2006 |  | $      | 36,610 | 
|Year ending December 31, 2007 |  |        | 1,258  | 
|Year ending December 31, 2008 |  |        | 1,258  | 
|Year ending December 31, 2009 |  |        | 1,258  | 
|Year ending December 31, 2010 |  |        | 1,258  | 
|Thereafter                    |  |        | 4,400  | 
|                              |  |        |       
|                              |  |        | 46,042 | 
|Fresh-start debt premium      |  |        | 496    | 
|                              |  |        |       
|                              |  | $      | 46,538 | 
|                              |  |        |       





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(Continued)












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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)








|    |                 
|--- | ----------------
|14. | Operating Leases





10-year






|    |                      
|--- | ---------------------
|15. | Financial Instruments





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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)




|    |      
|--- | -----
|16. | Taxes



|              |  |                   |        |   |                    |   |          |      |  |   |         |   |  |   |          |  
|------------- |  | ----------------- | ------ | - | ------------------ | - | -------- | ---- |  | - | ------- | - |  | - | -------- | -
|              |  | Successor         |        |   | Predecessor        |   |          |      |  |  
|              |  | Company           |        |   | Company            |   |          |      |  |  
|              |  |                   |        |   |                    |   |          |      |  |  
|              |  | Period from       |        |   | Period from        |   |          |      |  |  
|              |  | March 15, 2005 to |        |   | January 1, 2005 to |   |          |      |  |  
|              |  | December 31, 2005 |        |   | March 14, 2005     |   |          | 2004 |  |   | 2003    |  
|              |  |                   |        |   |                    |   |          |      |  |   |         |  
|United States |  | $                 | (1,201 | ) |                    | $ | 63,362   |      |  | $ | (72,431 | ) |  | $ | (44,092  | )
|International |  |                   | 32,565 |   |                    |   | (123,676 | )    |  |   | (26,589 | ) |  |   | (123,194 | )
|              |  |                   |        |   |                    |   |          |      |  |   |         |  
|              |  | $                 | 31,364 |   |                    | $ | (60,314  | )    |  | $ | (99,020 | ) |  | $ | (167,286 | )
|              |  |                   |        |   |                    |   |          |      |  |   |         |  



|                       |                           |                   |        |             |                    |   |        |        |   |   |        |        |   |   |        |        |  
|---------------------- | ------------------------- | ----------------- | ------ | ----------- | ------------------ | - | ------ | ------ | - | - | ------ | ------ | - | - | ------ | ------ | -
|                       |                           |                   |        | Predecessor |                    |   |        |        |  
|                       |                           | Successor Company |        |             | Company            |   |        |        |   |  
|                       |                           |                   |        |             |                    |   |        |        |   |  
|                       |                           | Period from       |        |             | Period from        |   |        |        |   |  
|                       |                           | March 15, 2005 to |        |             | January 1, 2005 to |   |        |        |   |  
|                       |                           | December 31, 2005 |        |             | March 14, 2005     |   |        | 2004   |   |   | 2003   |       
|                       |                           |                   |        |             |                    |   |        |        |   |   |        |       
|Current income taxes:  |                           |                   |        |             |                    |   |        |        |   |   |        |        |   |   |        |       
|                       | U.S. federal income taxes |                   | $      |            |                    |   | $      |       |   |   | $      |       |   |   | $      |       |  
|                       | State income taxes        |                   |        |            |                    |   |        |       |   |   |        |       |   |   |        |       |  
|                       | Foreign taxes             |                   |        | 1,180       |                    |   |        |       |   |   |        | 325    |   |   |        | 231    |  
|Deferred income taxes: |                           |                   |        |             |                    |   |        |        |   |   |        |        |   |   |        |       
|                       | U.S. federal income taxes |                   |        |            |                    |   |        |       |   |   |        |       |   |   |        |       |  
|                       | State income taxes        |                   |        | 331         |                    |   |        |       |   |   |        |       |   |   |        |       |  
|                       | Foreign taxes             |                   |        | 9,753       |                    |   |        | (1,047 | ) |   |        | (3,393 | ) |   |        | (3,119 | )
|                       |                           |                   |        |             |                    |   |        |        |   |   |        |       
|                       |                           | $                 | 11,264 |             |                    | $ | (1,047 | )      |   | $ | (3,068 | )      |   | $ | (2,888 | )     
|                       |                           |                   |        |             |                    |   |        |        |   |   |        |       

non-U.S.


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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)




|                                                                     |  |                     |       |  |                          |   |         |         |  |             |   |  |  |   |         | 
|-------------------------------------------------------------------- |  | ------------------- | ----- |  | ------------------------ | - | ------- | ------- |  | ----------- | - |  |  | - | ------- | 
|                                                                     |  | Deferred Tax Assets |       |  | Deferred Tax Liabilities |  
|                                                                     |  |                     |       |  |                          |  
|2005                                                                 |  | Current             |       |  | Non-Current              |   |         | Current |  | Non-Current |  
|                                                                     |  |                     |       |  |                          |   |         |         |  |             |  
|Depreciation and amortization                                        |  | $                   |      |  |                          | $ |        |         |  | $           |  |  |  | $ | 17,095  | 
|Deferral of taxes on Norwegian earnings                              |  |                     |      |  |                          |   |        |         |  |             |  |  |  |   | 46,055  | 
|Insurance reserves                                                   |  |                     | 1,196 |  |                          |   |        |         |  |             |  |  |  |   |        | 
|U.S. net operating loss carryforwards                                |  |                     |      |  |                          |   | 116,518 |         |  |             |  |  |  |   |        | 
|Cancellation of debt income                                          |  |                     |      |  |                          |   |        |         |  |             |  |  |  |   | 58,260  | 
|Other                                                                |  |                     | 1,465 |  |                          |   |        |         |  |             |  |  |  |   |        | 
|                                                                     |  |                     |       |  |                          |   |         |         |  |             |   | 
|                                                                     |  | $                   | 2,661 |  |                          | $ | 116,518 |         |  | $           |  |  |  | $ | 121,410 | 
|                                                                     |  |                     |       |  |                          |   |         |         |  |             |   | 
|Current deferred tax assets, net                                     |  |                     |       |  |                          |   |         |         |  |             |   |  |  | $ | 2,661   | 
|                                                                     |  |                     |       |  |                          |   |         |         |  |             |   | 
|Non-current deferred tax asset, net 
    U.S. jurisdiction          |  |                     |       |  |                          |   |         |         |  |             |   |  |  | $ | 41,163  | 
|                                                                     |  |                     |       |  |                          |   |         |         |  |             |   | 
|Valuation Allowance                                                  |  |                     |       |  |                          |   |         |         |  |             |   |  |  | $ | 43,824  | 
|                                                                     |  |                     |       |  |                          |   |         |         |  |             |   | 
|Deferred tax asset after valuation, net                              |  |                     |       |  |                          |   |         |         |  |             |   |  |  | $ |        | 
|                                                                     |  |                     |       |  |                          |   |         |         |  |             |   | 
|Non-current deferred tax liabilities, net  foreign
    jurisdiction |  |                     |       |  |                          |   |         |         |  |             |   |  |  | $ | 46,055  | 
|                                                                     |  |                     |       |  |                          |   |         |         |  |             |   | 



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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)


|                                                                     |  |                     |       |  |                          |   |         |         |  |             |   |  |  |   |        | 
|-------------------------------------------------------------------- |  | ------------------- | ----- |  | ------------------------ | - | ------- | ------- |  | ----------- | - |  |  | - | ------ | 
|                                                                     |  | Deferred Tax Assets |       |  | Deferred Tax Liabilities |  
|                                                                     |  |                     |       |  |                          |  
|2004                                                                 |  | Current             |       |  | Non-Current              |   |         | Current |  | Non-Current |  
|                                                                     |  |                     |       |  |                          |   |         |         |  |             |  
|Depreciation and amortization                                        |  | $                   |      |  |                          | $ |        |         |  | $           |  |  |  | $ | 51,316 | 
|Deferral of taxes on Norwegian earnings                              |  |                     |      |  |                          |   | 1,215   |         |  |             |  |  |  |   | 41,225 | 
|Insurance reserves                                                   |  |                     | 1,711 |  |                          |   |        |         |  |             |  |  |  |   |       | 
|U.S. net operating loss carryforwards                                |  |                     |      |  |                          |   | 119,092 |         |  |             |  |  |  |   |       | 
|Other                                                                |  |                     | 533   |  |                          |   |        |         |  |             |  |  |  |   |       | 
|                                                                     |  |                     |       |  |                          |   |         |         |  |             |   | 
|                                                                     |  | $                   | 2,244 |  |                          | $ | 120,307 |         |  | $           |  |  |  | $ | 92,541 | 
|                                                                     |  |                     |       |  |                          |   |         |         |  |             |   | 
|Current deferred tax assets, net                                     |  |                     |       |  |                          |   |         |         |  |             |   |  |  | $ | 2,244  | 
|                                                                     |  |                     |       |  |                          |   |         |         |  |             |   | 
|Non-current deferred tax asset, net 
    U.S. jurisdiction          |  |                     |       |  |                          |   |         |         |  |             |   |  |  | $ | 67,776 | 
|                                                                     |  |                     |       |  |                          |   |         |         |  |             |   | 
|Valuation Allowance                                                  |  |                     |       |  |                          |   |         |         |  |             |   |  |  | $ | 70,020 | 
|                                                                     |  |                     |       |  |                          |   |         |         |  |             |   | 
|Deferred tax asset after valuation, net                              |  |                     |       |  |                          |   |         |         |  |             |   |  |  | $ |       | 
|                                                                     |  |                     |       |  |                          |   |         |         |  |             |   | 
|Non-current deferred tax liabilities, net  foreign
    jurisdiction |  |                     |       |  |                          |   |         |         |  |             |   |  |  | $ | 40,010 | 
|                                                                     |  |                     |       |  |                          |   |         |         |  |             |   | 



|                                              |  |                   |        |   |                     |   |         |      |  |   |         |   |  |   |         |  
|--------------------------------------------- |  | ----------------- | ------ | - | ------------------- | - | ------- | ---- |  | - | ------- | - |  | - | ------- | -
|                                              |  | Successor         |        |   |                    
|                                              |  | Company           |        |   | Predecessor Company |  
|                                              |  |                   |        |   |                     |  
|                                              |  | Period from       |        |   | Period from         |   |         |     
|                                              |  | March 15, 2005 to |        |   | January 1, 2005 to  |   |         |     
|                                              |  | December 31, 2005 |        |   | March 14, 2005      |   |         | 2004 |  |   | 2003    |  
|                                              |  |                   |        |   |                     |   |         |      |  |   |         |  
|Federal income taxes at statutory rate        |  | $                 | 10,977 |   |                     | $ | (21,110 | )    |  | $ | (34,657 | ) |  | $ | (58,550 | )
|State income taxes net of federal benefit     |  |                   | 458    |   |                     |   |        |      |  |   | (333    | ) |  |   | 14      |  
|Norwegian tax rate differential               |  |                   | (2,443 | ) |                     |   | 8,685   |      |  |   | 6,300   |   |  |   | 8,559   |  
|U.S. tax on deemed repatriation               |  |                   | 2,156  |   |                     |   |        |      |  |   |        |   |  |   |        |  
|Non-deductible items in foreign jurisdictions |  |                   |       |   |                     |   | 34,673  |      |  |   |        |   |  |   | 31,516  |  
|Non-deductible loss and expenses              |  |                   | 62     |   |                     |   | 2,331   |      |  |   | 3,322   |   |  |   | 569     |  
|Impact of foreign earnings at various rates   |  |                   | 1,838  |   |                     |   | 55      |      |  |   | 24      |   |  |   | 545     |  
|Valuation Allowance                           |  |                   | (1,784 | ) |                     |   | (23,587 | )    |  |   | 22,276  |   |  |   | 14,459  |  
|                                              |  |                   |        |   |                     |   |         |      |  |   |         |  
|Income tax expense (benefit)                  |  | $                 | 11,264 |   |                     | $ | 1,047   |      |  | $ | (3,068  | ) |  | $ | (2,888  | )
|                                              |  |                   |        |   |                     |   |         |      |  |   |         |  



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(Continued)
















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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)












|    |                   
|--- | ------------------
|17. | Earnings Per Share



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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)




|                                                         |  |                   |            |  |                     |   |            |                   |  |   |                   |   |  |   |            |  
|-------------------------------------------------------- |  | ----------------- | ---------- |  | ------------------- | - | ---------- | ----------------- |  | - | ----------------- | - |  | - | ---------- | -
|                                                         |  | Successor Company |            |  | Predecessor Company |  
|                                                         |  |                   |            |  |                     |  
|                                                         |  | Period from       |            |  | Period from         |   |            |                  
|                                                         |  | March 15, 2005    |            |  | January 1, 2005     |   |            |                  
|                                                         |  | through           |            |  | through             |   |            | Year ended        |  |   | Year ended        |  
|                                                         |  | December 31, 2005 |            |  | March 14, 2005      |   |            | December 31, 2004 |  |   | December 31, 2003 |  
|                                                         |  |                   |            |  |                     |   |            |                   |  |   |                   |  
|Net income (loss) available to common shares (numerator) |  | $                 | 20,100     |  |                     | $ | (61,361    | )                 |  | $ | (95,952           | ) |  | $ | (164,398   | )
|                                                         |  |                   |            |  |                     |   |            |                   |  |   |                   |  
|Weighted-average common shares outstanding (denominator) |  |                   | 11,271,786 |  |                     |   | 36,908,505 |                   |  |   | 36,876,152        |   |  |   | 36,470,940 |  
|                                                         |  |                   |            |  |                     |   |            |                   |  |   |                   |  
|Basic EPS                                                |  | $                 | 1.78       |  |                     | $ | (1.66      | )                 |  | $ | (2.60             | ) |  | $ | (4.51      | )
|                                                         |  |                   |            |  |                     |   |            |                   |  |   |                   |  
|Net income (loss) available to common shares (numerator) |  | $                 | 20,100     |  |                     | $ | (61,361    | )                 |  | $ | (95,952           | ) |  | $ | (164,398   | )
|                                                         |  |                   |            |  |                     |   |            |                   |  |   |                   |  
|Weighted-average common shares outstanding (denominator) |  |                   | 11,271,786 |  |                     |   | 36,908,505 |                   |  |   | 36,876,152        |   |  |   | 36,470,940 |  
|Effect of dilutive securities                            |  |                   | 286,314    |  |                     |   |           |                   |  |   |                  |   |  |   |           |  
|                                                         |  |                   |            |  |                     |   |            |                   |  |   |                   |  
|Adjusted weighted-average shares                         |  |                   | 11,558,100 |  |                     |   | 36,908,505 |                   |  |   | 36,876,152        |   |  |   | 36,470,940 |  
|                                                         |  |                   |            |  |                     |   |            |                   |  |   |                   |  
|Diluted EPS                                              |  | $                 | 1.74       |  |                     | $ | (1.66      | )                 |  | $ | (2.60             | ) |  | $ | (4.51      | )
|                                                         |  |                   |            |  |                     |   |            |                   |  |   |                   |  







|    |                       
|--- | ----------------------
|18. | Equity Incentive Plans



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(Continued)












90-7,




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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)






|                          |  |                |      |  
|------------------------- |  | -------------- | ---- | -
|                          |  | March 15, 2005 |     
|                          |  |                |     
|Expected annual dividends |  | $              |     |  
|Risk free interest rate   |  |                | 4.12 | %
|Expected term (in years)  |  |                | 5    |  
|Volatility(1)             |  |                | 46.7 | %






|    |                                                                                   
|--- | ----------------------------------------------------------------------------------
|(1) | The volatility assumption was based on the average volatility of
    a peer group.



|                                     |  |            |            |   |          |   |       |            |  |  |           |   |  |            |       |  |          |  |           |   |  |   |       | 
|------------------------------------ |  | ---------- | ---------- | - | -------- | - | ----- | ---------- |  |  | --------- | - |  | ---------- | ----- |  | -------- |  | --------- | - |  | - | ----- | 
|                                     |  | 2005       |            |   | 2004     |   |       | 2003       | 
|                                     |  |            |            |   |          |   |       |            | 
|                                     |  | Number of  |            |   | Weighted |   |       | Number of  |  |  | Weighted  |   |  | Number of  |       |  | Weighted | 
|                                     |  | Shares     |            |   | Average  |   |       | Shares     |  |  | Average   |   |  | Shares     |       |  | Average  | 
|                                     |  | Underlying |            |   | Exercise |   |       | Underlying |  |  | Exercise  |   |  | Underlying |       |  | Exercise | 
|                                     |  | Options    |            |   | Prices   |   |       | Options    |  |  | Prices    |   |  | Options    |       |  | Prices   | 
|                                     |  |            |            |   |          |   |       |            |  |  |           |   |  |            |       |  |          | 
|Outstanding at beginning of the year |  |            | 1,077,800  |   |          | $ | 10.57 |            |  |  | 1,242,050 |   |  | $          | 10.51 |  |          |  | 2,083,968 |   |  | $ | 7.03  | 
|Cancelled during reorganization      |  |            | (1,077,800 | ) |          | $ | 10.57 |            |  |  |          |   |  | $          |      |  |          |  |          |   |  | $ |      | 
|Granted                              |  |            | 698,000    |   |          | $ | 11.00 |            |  |  |          |   |  | $          |      |  |          |  | 57,000    |   |  | $ | 2.76  | 
|Exercised                            |  |            | (154,762   | ) |          | $ | 11.00 |            |  |  |          |   |  | $          |      |  |          |  | (578,202  | ) |  | $ | 0.91  | 
|Expired/ Forfeited                   |  |            | (187,500   | ) |          | $ | 11.00 |            |  |  | (164,250  | ) |  | $          | 10.14 |  |          |  | (320,716  | ) |  | $ | 3.79  | 
|                                     |  |            |            |   |          |   |       |            |  |  |           |   |  |            |       |  |          | 
|Outstanding at end of the year       |  |            | 355,738    |   |          | $ | 11.00 |            |  |  | 1,077,800 |   |  | $          | 10.57 |  |          |  | 1,242,050 |   |  | $ | 10.51 | 
|                                     |  |            |            |   |          |   |       |            |  |  |           |   |  |            |       |  |          | 
|Exercisable at end of the year       |  |            | 44,574     |   |          | $ | 11.00 |            |  |  | 955,550   |   |  | $          | 11.10 |  |          |  | 962,050   |   |  | $ | 11.29 | 
|                                     |  |            |            |   |          |   |       |            |  |  |           |   |  |            |       |  |          | 





|                |  |                     |         |          |                     |  |          |          |  |   |              |  |  |             |       |  |          |  |        |              |  |   |       |  |  |   |     | 
|--------------- |  | ------------------- | ------- | -------- | ------------------- |  | -------- | -------- |  | - | ------------ |  |  | ----------- | ----- |  | -------- |  | ------ | ------------ |  | - | ----- |  |  | - | --- | 
|                |  | Options Outstanding |         |          | Options Exercisable | 
|                |  |                     |         |          |                     | 
|                |  |                     |         | Weighted |                     |  | Weighted |          |  |   |              |  |  | Weighted    |       |  |         
|                |  | Number              |         |          | Average             |  |          | Average  |  |   | Aggregate    |  |  | Number      |       |  | Average  |  |        | Aggregate    | 
|Range of        |  | Outstanding         |         |          | Remaining           |  |          | Exercise |  |   | Intrinsic    |  |  | Exercisable |       |  | Exercise |  |        | Intrinsic    | 
|Exercise Prices |  | at 12/31/05         |         |          | Contract Life       |  |          | Price    |  |   | Value ($000) |  |  | at 12/31/05 |       |  | Price    |  |        | Value ($000) | 
|                |  |                     |         |          |                     |  |          |          |  |   |              |  |  |             |       |  |          |  |        |              | 
|$11.00          |  |                     | 355,738 |          |                     |  | 6.2      |          |  | $ | 11.00        |  |  | $           | 5,336 |  |          |  | 44,574 |              |  | $ | 11.00 |  |  | $ | 669 | 



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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)




|                                              |  |            |         |         |            |   |       | 
|--------------------------------------------- |  | ---------- | ------- | ------- | ---------- | - | ----- | 
|                                              |  |            |         | Average |           
|                                              |  | Restricted |         |         | Grant Date |  
|                                              |  | Stock      |         |         | Fair Value |  
|                                              |  |            |         |         |            |  
|Outstanding at December 31, 2003              |  |            | 60,000  |         |            | $ | 2.41  | 
|Granted                                       |  |            | 25,000  |         |            |   | 2.33  | 
|Vested                                        |  |            | (20,000 | )       |            |   | 2.41  | 
|Cancelled                                     |  |            |        |         |            |   |      | 
|                                              |  |            |         |         |            |  
|Outstanding at December 31, 2004              |  |            | 65,000  |         |            |   | 2.38  | 
|Converted into warrants during reorganization |  |            | (60,000 | )       |            |   | 2.37  | 
|Granted                                       |  |            | 105,000 |         |            |   | 19.88 | 
|Vested                                        |  |            | (40,000 | )       |            |   | 13.67 | 
|Cancelled                                     |  |            | (5,000  | )       |            |   | 2.44  | 
|                                              |  |            |         |         |            |  
|Outstanding at December 31, 2005              |  |            | 65,000  |         |            | $ | 23.71 | 
|                                              |  |            |         |         |            |  





|    |                       
|--- | ----------------------
|19. | Employee Benefit Plans



| |                          
| | -------------------------
| | Defined Contribution Plan





| |                        
| | -----------------------
| | Norwegian Pension Plans



77



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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)




|                             |                                                      |                                          |   |       |                     |  |   |       |       |  |   |       |       | 
|---------------------------- | ---------------------------------------------------- | ---------------------------------------- | - | ----- | ------------------- |  | - | ----- | ----- |  | - | ----- | ----- | 
|                             |                                                      | Successor Company                        |   |       | Predecessor Company | 
|                             |                                                      |                                          |   |       |                     | 
|                             |                                                      | Period From                              |   |       | Period from         |  |   |      
|                             |                                                      | March 15, 2005                           |   |       | January 1, 2005     |  |   |      
|                             |                                                      | through                                  |   |       | through             |  |   |      
|                             |                                                      | December 31, 2005                        |   |       | March 14, 2005      |  |   | 2004  |      
|                             |                                                      |                                          |   |       |                     |  |   |       |      
|Change in Benefit Obligation |                                                      |                                          |   |       |                     |  |   |       |       |  |   |      
|                             | Benefit obligation at beginning of the period        |                                          | $ | 3,925 |                     |  | $ | 3,811 |       |  | $ | 3,465 |      
|                             | Service cost                                         |                                          |   | 944   |                     |  |   | 88    |       |  |   | 380   |      
|                             | Interest cost                                        |                                          |   | 129   |                     |  |   | 33    |       |  |   | 28    |      
|                             | Benefits paid                                        |                                          |   | (89   | )                   |  |   | (23   | )     |  |   | (91   | )    
|                             | Translation adjustment and other                     |                                          |   | (388  | )                   |  |   | 16    |       |  |   | 29    |      
|                             |                                                      |                                          |   |       |                     |  |   |       |      
|                             |                                                      | Benefit obligation at end of year        |   | $     | 4,521               |  |   | $     | 3,925 |  |   | $     | 3,811 | 
|                             |                                                      |                                          |   |       |                     |  |   |       |      
|Change in Plan Assets        |                                                      |                                          |   |       |                     |  |   |       |       |  |   |      
|                             | Fair value of plan assets at beginning of the period |                                          | $ | 4,952 |                     |  | $ | 4,871 |       |  | $ | 4,095 |      
|                             | Actual return on plan assets                         |                                          |   | 193   |                     |  |   | 49    |       |  |   | 205   |      
|                             | Contributions                                        |                                          |   | 992   |                     |  |   | 454   |       |  |   | 407   |      
|                             | Benefits paid                                        |                                          |   | (89   | )                   |  |   | (23   | )     |  |   | (91   | )    
|                             | Translation adjustment and other                     |                                          |   | (452  | )                   |  |   | (399  | )     |  |   | 255   |      
|                             |                                                      |                                          |   |       |                     |  |   |       |      
|                             |                                                      | Fair value of plan assets at end of year |   | $     | 5,596               |  |   | $     | 4,952 |  |   | $     | 4,871 | 
|                             |                                                      |                                          |   |       |                     |  |   |       |      
|                             | Funded status, over funded                           |                                          | $ | 1,075 |                     |  | $ | 1,027 |       |  | $ | 1,060 |      
|                             | Unrecognized net actuarial gain and other            |                                          |   | (489  | )                   |  |   | (552  | )     |  |   | (13   | )    
|                             |                                                      |                                          |   |       |                     |  |   |       |      
|                             |                                                      | Prepaid benefit cost                     |   | $     | 586                 |  |   | $     | 475   |  |   | $     | 1,047 | 
|                             |                                                      |                                          |   |       |                     |  |   |       |      

|                                        |                               |                           |   |      |                     |  |   |      |    |  |      |      |     |  |   |      |     | 
|--------------------------------------- | ----------------------------- | ------------------------- | - | ---- | ------------------- |  | - | ---- | -- |  | ---- | ---- | --- |  | - | ---- | --- | 
|                                        |                               | Successor Company         |   |      | Predecessor Company | 
|                                        |                               |                           |   |      |                     | 
|                                        |                               | Period From               |   |      | Period from         |  |   |     
|                                        |                               | March 15, 2005            |   |      | January 1, 2005     |  |   |     
|                                        |                               | through                   |   |      | through             |  |   |     
|                                        |                               | December 31, 2005         |   |      | March 14, 2005      |  |   | 2004 |    |  | 2003 |     
|                                        |                               |                           |   |      |                     |  |   |      |    |  |      |     
|Components of Net Periodic Benefit Cost |                               |                           |   |      |                     |  |   |      |    |  |      |      |     |  |   |     
|                                        | Service cost                  |                           | $ | 944  |                     |  | $ | 88   |    |  | $    | 380  |     |  | $ | 443  |    
|                                        | Interest cost                 |                           |   | 129  |                     |  |   | 33   |    |  |      | 133  |     |  |   | 158  |    
|                                        | Return on plan assets         |                           |   | (225 | )                   |  |   | (52  | )  |  |      | (221 | )   |  |   | (215 | )  
|                                        | Social security contributions |                           |   | 46   |                     |  |   | 12   |    |  |      | 59   |     |  |   | 71   |    
|                                        | Recognized net actuarial loss |                           |   | 8    |                     |  |   | 2    |    |  |      | 10   |     |  |   | 18   |    
|                                        |                               |                           |   |      |                     |  |   |      |    |  |      |     
|                                        |                               | Net periodic benefit cost |   |      | 902                 |  |   | $    | 83 |  |      | $    | 361 |  |   | $    | 475 | 
|                                        |                               |                           |   |      |                     |  |   |      |    |  |      |     



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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)


|                                           |                               |                   |      |      |                     |  |      |      |   |  |      |      |  
|------------------------------------------ | ----------------------------- | ----------------- | ---- | ---- | ------------------- |  | ---- | ---- | - |  | ---- | ---- | -
|                                           |                               | Successor Company |      |      | Predecessor Company | 
|                                           |                               |                   |      |      |                     | 
|                                           |                               | Period From       |      |      | Period from         |  |      |     
|                                           |                               | March 15, 2005    |      |      | January 1, 2005     |  |      |     
|                                           |                               | through           |      |      | through             |  |      |     
|                                           |                               | December 31, 2005 |      |      | March 14, 2005      |  |      | 2004 |  
|                                           |                               |                   |      |      |                     |  |      |      |  
|Weighted-Average Assumptions Discount rate |                               |                   | 4.50 | %    |                     |  | 4.50 | %    |   |  | 4.50 | %   
|                                           |                               |                   |      |      |                     |  |      |      |  
|                                           | Return on plan assets         |                   |      | 5.50 | %                   |  |      | 5.50 | % |  |      | 5.50 | %
|                                           |                               |                   |      |      |                     |  |      |      |  
|                                           | Rate of compensation increase |                   |      | 3.30 | %                   |  |      | 3.30 | % |  |      | 3.30 | %
|                                           |                               |                   |      |      |                     |  |      |      |  



|                     |  |                   |     |   |                     |  |     |      |  |  |     |  
|-------------------- |  | ----------------- | --- | - | ------------------- |  | --- | ---- |  |  | --- | -
|                     |  | Successor Company |     |   | Predecessor Company | 
|                     |  |                   |     |   |                     | 
|                     |  | Period From       |     |   | Period from         |  |     |     
|                     |  | March 15, 2005    |     |   | January 1, 2005     |  |     |     
|                     |  | through           |     |   | through             |  |     |     
|                     |  | December 31, 2005 |     |   | March 14, 2005      |  |     | 2004 | 
|                     |  |                   |     |   |                     |  |     |      | 
|Equity securities    |  |                   | 22  | % |                     |  | 18  | %    |  |  | 16  | %
|Debt Securities      |  |                   | 43  | % |                     |  | 49  | %    |  |  | 51  | %
|Property and other   |  |                   | 35  | % |                     |  | 33  | %    |  |  | 33  | %
|                     |  |                   |     |   |                     |  |     |      | 
|All asset categories |  |                   | 100 | % |                     |  | 100 | %    |  |  | 100 | %
|                     |  |                   |     |   |                     |  |     |      | 









| |                            
| | ---------------------------
| | United Kingdom Pension Plan







|    |                
|--- | ---------------
|20. | Equity Offering



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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)






|    |                              
|--- | -----------------------------
|21. | Commitments and Contingencies

Leif Weizman v. Trico Marine Services, Inc., Thomas E.
Fairley, and Ronald O. Palmer; 10b-5


04-17985.




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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)






|    |                                                     
|--- | ----------------------------------------------------
|22. | Fair Value of Financial Instruments and Market Risks



Cash, cash equivalents and accounts receivable:


Debt:


|                |  |      |        |  |      |   |         | 
|--------------- |  | ---- | ------ |  | ---- | - | ------- | 
|                |  | 2005 |        |  | 2004 |  
|                |  |      |        |  |      |  
|Carrying amount |  | $    | 46,538 |  |      | $ | 147,131 | 
|Fair value      |  | $    | 46,758 |  |      | $ | 145,953 | 

Political Risk:


Foreign Currency Risk:




|    |                                   
|--- | ----------------------------------
|23. | Segment and Geographic Information



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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)






|                                                     |  |      |         |     |           |   |         |       |  |   |        |  |  |   |         | 
|---------------------------------------------------- |  | ---- | ------- | --- | --------- | - | ------- | ----- |  | - | ------ |  |  | - | ------- | 
|Successor Company                                    | 
|                                                     | 
|Period from March 15, 2005 through December 31, 2005 |  | U.S. |         |     | North Sea |   |         | Other |  |   | Totals | 
|                                                     |  |      |         |     |           |   |         |       |  |   |        | 
|Revenues from external customers                     |  | $    | 50,311  |     |           | $ | 77,988  | (1)   |  | $ | 24,100 |  |  | $ | 152,399 | 
|Intersegment revenues                                |  |      | 1,329   |     |           |   |        |       |  |   |       |  |  |   | 1,329   | 
|Operating income                                     |  |      | 4,182   | (2) |           |   | 34,959  |       |  |   | 2,675  |  |  |   | 41,816  | 
|Interest revenue                                     |  |      | 530     |     |           |   | 82      |       |  |   | 3      |  |  |   | 615     | 
|Interest expense                                     |  |      | 4,491   |     |           |   | 1,835   |       |  |   | 104    |  |  |   | 6,430   | 
|Depreciation and amortization expense                |  |      | 7,928   |     |           |   | 9,804   |       |  |   | 2,671  |  |  |   | 20,403  | 
|Income tax expense                                   |  |      | 331     |     |           |   | 9,169   |       |  |   | 1,764  |  |  |   | 11,264  | 
|Long-lived assets                                    |  |      | 42,287  |     |           |   | 157,927 |       |  |   | 25,432 |  |  |   | 225,646 | 
|Segment total assets                                 |  |      | 212,161 |     |           |   | 186,256 |       |  |   | 30,860 |  |  |   | 429,277 | 
|Capital expenditures                                 |  |      | 804     |     |           |   | 463     |       |  |   | 547    |  |  |   | 1,814   | 

|                                                   |  |                     |        |   |           |   |         |       |  |   |        |   |  |   |         | 
|-------------------------------------------------- |  | ------------------- | ------ | - | --------- | - | ------- | ----- |  | - | ------ | - |  | - | ------- | 
|                                                   |  | Predecessor Company |       
|                                                   |  |                     |       
|Period from January 1, 2005 through March 14, 2005 |  | U.S.                |        |   | North Sea |   |         | Other |  |   | Totals |  
|                                                   |  |                     |        |   |           |   |         |       |  |   |        |  
|Revenues from external customers                   |  | $                   | 8,171  |   |           | $ | 16,528  |       |  | $ | 5,187  |   |  | $ | 29,886  | 
|Operating income (loss)                            |  |                     | (2,996 | ) |           |   | 4,220   |       |  |   | (345   | ) |  |   | 879     | 
|Interest revenue                                   |  |                     | 14     |   |           |   | 36      |       |  |   |       |   |  |   | 50      | 
|Interest expense                                   |  |                     | 1,313  |   |           |   | 608     |       |  |   | 19     |   |  |   | 1,940   | 
|Depreciation and amortization expense              |  |                     | 3,724  |   |           |   | 3,973   |       |  |   | 1,061  |   |  |   | 8,758   | 
|Income tax expense                                 |  |                     |       |   |           |   | 1,047   |       |  |   |       |   |  |   | 1,047   | 
|Long-lived assets(7)                               |  |                     | 65,347 |   |           |   | 168,297 |       |  |   | 36,804 |   |  |   | 270,448 | 
|Segment total assets                               |  |                     | 95,777 |   |           |   | 208,499 |       |  |   | 40,715 |   |  |   | 344,991 | 
|Capital expenditures                               |  |                     | 424    |   |           |   | 1,701   |       |  |   | 99     |   |  |   | 2,224   | 

|                                      |  |      |         |   |           |   |         |       |  |   |        |   |  |   |         |  
|------------------------------------- |  | ---- | ------- | - | --------- | - | ------- | ----- |  | - | ------ | - |  | - | ------- | -
|Year ended December 31, 2004          |  | U.S. |         |   | North Sea |   |         | Other |  |   | Totals |  
|                                      |  |      |         |   |           |   |         |       |  |   |        |  
|Revenues from external customers      |  | $    | 35,090  |   |           | $ | 60,409  |       |  | $ | 17,011 |   |  | $ | 112,510 |  
|Operating loss                        |  |      | (17,927 | ) |           |   | (23,016 | )(3)  |  |   | (7,776 | ) |  |   | (48,719 | )
|Interest revenue                      |  |      | 208     |   |           |   | 209     |       |  |   | 5      |   |  |   | 422     |  
|Interest expense                      |  |      | 30,799  |   |           |   | 2,504   |       |  |   | 102    |   |  |   | 33,405  |  
|Depreciation and amortization expense |  |      | 28,192  |   |           |   | 22,011  |       |  |   | 4,874  |   |  |   | 55,077  |  
|Income tax benefit                    |  |      |        |   |           |   | (3,068  | )     |  |   |       |   |  |   | (3,068  | )
|Long-lived assets(7)                  |  |      | 124,015 |   |           |   | 304,414 |       |  |   | 49,799 |   |  |   | 478,228 |  
|Segment total assets                  |  |      | 424,572 |   |           |   | 339,589 |       |  |   | 54,142 |   |  |   | 818,303 |  
|Capital expenditures                  |  |      | 3,108   |   |           |   | 11,608  |       |  |   | 2,798  |   |  |   | 17,514  |  

82



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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)


|                                      |  |      |         |      |           |   |          |       |  |   |        |      |  |   |          |  
|------------------------------------- |  | ---- | ------- | ---- | --------- | - | -------- | ----- |  | - | ------ | ---- |  | - | -------- | -
|Year ended December 31, 2003          |  | U.S. |         |      | North Sea |   |          | Other |  |   | Totals |     
|                                      |  |      |         |      |           |   |          |       |  |   |        |     
|Revenues from external customers      |  | $    | 29,345  |      |           | $ | 66,399   |       |  | $ | 27,777 |      |  | $ | 123,521  |  
|Intersegment revenues                 |  |      | 23      |      |           |   |         |       |  |   |       |      |  |   | 23       |  
|Operating loss                        |  |      | (18,502 | )(4) |           |   | (114,482 | )(5)  |  |   | (2,517 | )(6) |  |   | (135,501 | )
|Interest revenue                      |  |      | 94      |      |           |   | 229      |       |  |   |       |      |  |   | 323      |  
|Interest expense                      |  |      | 24,509  |      |           |   | 5,595    |       |  |   | 55     |      |  |   | 30,159   |  
|Depreciation and amortization expense |  |      | 17,839  |      |           |   | 22,367   |       |  |   | 4,939  |      |  |   | 45,145   |  
|Income tax benefit                    |  |      |        |      |           |   | (2,888   | )     |  |   |       |      |  |   | (2,888   | )
|Long-lived assets(7)                  |  |      | 121,243 |      |           |   | 316,304  |       |  |   | 70,300 |      |  |   | 507,847  |  
|Segment total assets                  |  |      | 431,743 |      |           |   | 356,176  |       |  |   | 71,073 |      |  |   | 858,992  |  
|Capital expenditures                  |  |      | 4,566   |      |           |   | 16,678   |       |  |   | 16,034 |      |  |   | 37,278   |  






|    |                                                                                                                                                                     
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | Includes $10.1 million in non-cash deferred revenues.                                                                                                               
|   
|(2) | Includes $2.2 million charge on loss on assets held for
    sale related to the impairment of the SWATH vessel                                                      
|   
|(3) | Includes an impairment charge of $8.6 million on assets
    held for use and an impairment charge of $10.7 million on
    assets held for sale.                     
|   
|(4) | Includes a gain of $1.0 million related to the sale of
    three vessels.                                                                                           
|   
|(5) | Includes a charge of $5.2 million related to a loss on sale
    of a North Sea class vessel, and goodwill impairment charges of
    $112.1 million.                 
|   
|(6) | Includes a charge of $1.0 million related to the sale of a
    investment in a construction project in Brazil, and a goodwill
    impairment charge of $0.9 million.
|   
|(7) | Includes property and equipment and deferred marine inspection
    costs.                                                                                           



|                                          |                           |      |         |         |      |   |          |         |  |   |          |         | 
|----------------------------------------- | ------------------------- | ---- | ------- | ------- | ---- | - | -------- | ------- |  | - | -------- | ------- | 
|                                          |                           | 2005 |         |         | 2004 |   |          | 2003    | 
|                                          |                           |      |         |         |      |   |          |         | 
|Total assets for reportable segments      |                           | $    | 429,277 |         |      | $ | 818,303  |         |  | $ | 858,992  |        
|Elimination of intersegment receivables   |                           |      | (12,943 | )       |      |   | (8,288   | )       |  |   | (7,403   | )      
|Elimination of investment in subsidiaries |                           |      | (72,112 | )       |      |   | (259,260 | )       |  |   | (266,398 | )      
|                                          |                           |      |         |         |      |   |          |         | 
|                                          | Total consolidated assets |      | $       | 344,222 |      |   | $        | 550,755 |  |   | $        | 585,191 | 
|                                          |                           |      |         |         |      |   |          |         | 



83



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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)




|    |                                     
|--- | ------------------------------------
|24. | Quarterly Financial Data (Unaudited)

|                                                 |                   |                                   |        |         |                   |   |       |        |            |   |        |       |            |        |        |        |            |   |        |        |            | 
|------------------------------------------------ | ----------------- | --------------------------------- | ------ | ------- | ----------------- | - | ----- | ------ | ---------- | - | ------ | ----- | ---------- | ------ | ------ | ------ | ---------- | - | ------ | ------ | ---------- | 
|                                                 |                   | Predecessor                       |        |         |                  
|                                                 |                   | Company                           |        |         | Successor Company |  
|                                                 |                   |                                   |        |         |                   |  
|                                                 |                   | Period from                       |        |         | Period from       |   |       |       
|                                                 |                   | January 1, 2005                   |        |         | March 15, 2005    |   |       |       
|                                                 |                   | through                           |        |         | through           |   |       |       
|Year ended December 31, 2005(1)                  |                   | March 14, 2005                    |        |         | March 31,2005     |   |       | Second |            |   | Third  |       |            | Fourth |       
|                                                 |                   |                                   |        |         |                   |   |       |        |            |   |        |       |            |        |       
|(Dollars in thousands, except per share amounts) |                   |                                   |        |         |                   |   |       |        |           
|Total revenues                                   |                   | $                                 | 29,886 |         |                   | $ | 8,210 |        |            | $ | 43,157 |       |            | $      | 47,126 |        |            | $ | 53,906 |       
|                                                 | Operating income  |                                   |        | 879     |                   |   |       | 1,111  |            |   |        | 9,054 |            |        |        | 15,217 |            |   |        | 16,434 |           
|                                                 | Net income (loss) |                                   | $      | (61,361 | )                 |   | $     | 106    |            |   | $      | 3,565 |            |        | $      | 8,550  |            |   | $      | 7,879  |           
|Basic income (loss) per common share:            |                   |                                   |        |         |                   |   |       |        |            |   |        |       |            |        |        |        |            |   |        |       
|                                                 | Net income (loss) |                                   | $      | (1.66   | )                 |   | $     | 0.01   |            |   | $      | 0.35  |            |        | $      | 0.83   |            |   | $      | 0.58   |           
|                                                 |                   | Average common shares outstanding |        |         | 36,908,505        |   |       |        | 10,064,447 |   |        |       | 10,224,348 |        |        |        | 10,294,250 |   |        |        | 13,504,657 | 
|Diluted income (loss) per common share:          |                   |                                   |        |         |                   |   |       |        |            |   |        |       |            |        |        |        |            |   |        |       
|                                                 | Net income (loss) |                                   | $      | (1.66   | )                 |   | $     | 0.01   |            |   | $      | 0.34  |            |        | $      | 0.81   |            |   | $      | 0.57   |           
|                                                 |                   | Average common shares outstanding |        |         | 36,908,505        |   |       |        | 10,293,357 |   |        |       | 10,438,659 |        |        |        | 10,577,956 |   |        |        | 13,924,371 | 

|                                                 |                                               |                     |         |            |        |   |         |            |   |   |         |            |   |   |         |            |  
|------------------------------------------------ | --------------------------------------------- | ------------------- | ------- | ---------- | ------ | - | ------- | ---------- | - | - | ------- | ---------- | - | - | ------- | ---------- | -
|                                                 |                                               | Predecessor Company |        
|                                                 |                                               |                     |        
|Year ended December 31, 2004(2)                  |                                               | First               |         |            | Second |   |         | Third      |   |   | Fourth  |           
|                                                 |                                               |                     |         |            |        |   |         |            |   |   |         |           
|(Dollars in thousands, except per share amounts) |                                               |                     |         |            |        |   |         |           
|Total revenues                                   |                                               | $                   | 23,569  |            |        | $ | 25,746  |            |   | $ | 29,488  |            |   | $ | 33,707  |           
|Operating loss                                   |                                               |                     | (9,274  | )          |        |   | (28,283 | )          |   |   | (3,425  | )          |   |   | (7,737  | )         
|Net loss                                         |                                               | $                   | (16,454 | )          |        | $ | (44,726 | )          |   | $ | (16,168 | )          |   | $ | (18,604 | )         
|Basic and diluted loss per share:                |                                               |                     |         |            |        |   |         |            |   |   |         |            |   |   |         |           
|                                                 | Net loss per average common share outstanding |                     | $       | (0.45      | )      |   | $       | (1.21      | ) |   | $       | (0.44      | ) |   | $       | (0.50      | )
|                                                 | Average common shares outstanding             |                     |         | 36,850,812 |        |   |         | 36,862,735 |   |   |         | 36,890,102 |   |   |         | 36,900,537 |  






|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | In the period from January 1, 2005 through March 14,
    2005, the Company recognized a gain on debt discharge of
    $166.5 million, fresh-start adjustments of
    $219.0 million and reorganizations costs of
    $6.7 million due to the Companys reorganization. The
    period March 15, 2005 through March 31, 2005, and the
    second, third, and fourth quarters included deferred revenues of
    $0.6 million, $3.2 million, $3.2 million, and
    $3.1 million, respectively. In the fourth quarter of 2005,
    the Company recognized a loss of $2.2 million on assets
    held for sale due to the impairment of the SWATH vessel, a gain
    on sales of assets of $1.8 million and a loss on early
    repayment of debt of $4.0 million.
|(2) | In the second quarter of 2004, an $8.7 million impairment
    charge was recognized on assets held for sale, an
    $8.6 million impairment charge was recognized on long-lived
    assets held for use, and accelerated amortization charges of
    $7.2 million and $2.8 million were recognized on
    deferred financing costs and original issue discounts,
    respectively. The Company recorded reorganization costs of
    $1.7 million, $2.6 million and $4.3 million in
    the second, third and fourth quarters of 2004, respectively. In
    the fourth quarter of 2004, the Company recorded an additional
    impairment of $2.1 million on assets held for sale.                                                                           



|    |                  
|--- | -----------------
|25. | Subsequent Events



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##### Table of Contents



NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)









|        |                                                                                         
|------- | ----------------------------------------------------------------------------------------
|Item 9. | Changes in and Disagreements with Accountants on
    Accounting and Financial Disclosure






Item 9A. Controls and Procedures




| |                                   
| | ----------------------------------
| | Disclosure Controls and Procedures

13a-15(e) 15d-15(e)




| |                                                                     
| | --------------------------------------------------------------------
| | Managements Report on Internal Control over Financial
    Reporting

13a-15(f) 15d-15(f)


Internal Control  Integrated Framework








| |                                                     
| | ----------------------------------------------------
| | Changes in Internal Control over Financial Reporting

13a-15(f) 15d-15(f)







|         |                  
|-------- | -----------------
|Item 9B. | Other Information



85



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##### Table of Contents






PART III







|         |                                                   
|-------- | --------------------------------------------------
|Item 10. | Directors and Executive Officers of the Registrant








|         |                       
|-------- | ----------------------
|Item 11. | Executive Compensation








|         |                                                                                                   
|-------- | --------------------------------------------------------------------------------------------------
|Item 12. | Security Ownership of Certain Beneficial Owners and
    Management and Related Stockholder Matters








|         |                                               
|-------- | ----------------------------------------------
|Item 13. | Certain Relationships and Related Transactions








|         |                                       
|-------- | --------------------------------------
|Item 14. | Principal Accountant Fees and Services






PART IV







|         |                                           
|-------- | ------------------------------------------
|Item 15. | Exhibits and Financial Statement Schedules





| |                                                                                                                                                                                                                                                                                                   
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (1) Financial Statements. Reference is made to Item 8
    hereof.                                                                                                                                                                                                                                 
|
| | (2) Financial Statement Schedule                                                                                                                                                                                                                                                                  
|
| | Valuation and Qualifying Accounts                                                                                                                                                                                                                                                                 
|
| | (3) Exhibits. See Index to Exhibits on page
    E-1. The Company will
    furnish to any eligible stockholder, upon written request of
    such stockholder, a copy of any exhibit listed upon the payment
    of a reasonable fee equal to the Companys expenses in
    furnishing such exhibit.

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SIGNATURES






| |                            
| | ---------------------------
| | Trico Marine Services, Inc.
| | (Registrant)               



| |     |                   
| | --- | ------------------
| | By: | /s/ Trevor Turbidy

| |                                      
| | -------------------------------------
| |                                      
| | Trevor Turbidy                       
| | President and Chief Executive Officer





|                                                         |  |                                                                                                               |  |                   |  | 
|-------------------------------------------------------- |  | ------------------------------------------------------------------------------------------------------------- |  | ----------------- |  | 
|Signature                                                |  | Title                                                                                                         |  | Date             
|                                                         |  |                                                                                                               |  |                  
|                                                        
|/s/ Trevor TurbidyTrevor Turbidy                         |  | President, Chief Executive Officer and Director (Principal
    Executive Officer)                             |  | February 27, 2006
|                                                        
|/s/ Geoff A. JonesGeoff A. Jones                         |  | Vice President and Chief Financial Officer (Principal Financial
    Officer and Principal Accounting Officer) |  | February 27, 2006
|                                                        
|/s/ Joseph S.
    CompofeliceJoseph S. Compofelice       |  | Non-executive Chairman of the Board of Directors                                                              |  | February 27, 2006
|                                                        
|/s/ Per StaehrPer Staehr                                 |  | Director                                                                                                      |  | February 27, 2006
|                                                        
|/s/ Richard A. BachmannRichard A. Bachmann               |  | Director                                                                                                      |  | February 27, 2006
|                                                        
|/s/ Edward C. Hutcheson,
    Jr.Edward C. Hutcheson, Jr. |  | Director                                                                                                      |  | February 27, 2006
|                                                        
|/s/ Myles W. ScogginsMyles W. Scoggins                   |  | Director                                                                                                      |  | February 27, 2006
|                                                        
|/s/ Kenneth M. BurkeKenneth M. Burke                     |  | Director                                                                                                      |  | February 27, 2006

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TRICO MARINE SERVICES, INC. AND SUBSIDIARIES


Valuation and Qualifying Accounts


for the years ended December 31, 2005, 2004 and 2003


(in thousands)


|                                                             |                                       |            |         |         |              |   |        |          |  |   |              |    |            |          |         |      |   |   |         |       | 
|------------------------------------------------------------ | ------------------------------------- | ---------- | ------- | ------- | ------------ | - | ------ | -------- |  | - | ------------ | -- | ---------- | -------- | ------- | ---- | - | - | ------- | ----- | 
|Column A                                                     |                                       | Column B   |         |         | Column C     |   |        | Column C |  |   | Column D     |    |            | Column E |        
|                                                             |                                       |            |         |         |              |   |        |          |  |   |              |    |            |          |        
|                                                             |                                       |            |         | Charged |              |   |        |          |  |   |             
|                                                             |                                       | Balance at |         |         | (Credited)   |   |        | Charged  |  |   |              |    | Balance at |         
|                                                             |                                       | beginning  |         |         | to costs and |   |        | to other |  |   | Recoveries   |    |            | end of   |        
|Description                                                  |                                       | of period  |         |         | expenses     |   |        | accounts |  |   | (Deductions) |    |            | period   |        
|                                                             |                                       |            |         |         |              |   |        |          |  |   |              |    |            |          |        
|The Period from March 15, 2005
    through December 31, 2005 |                                       |            |         |         |              |   |        |          |  |   |              |    |            |          |         |      |   |   |         |      
|Valuation allowance on deferred tax assets:                  |                                       | $          | 104,221 |         |              | $ |       |          |  | $ |             |    |            | $        | (60,397 | )    |   | $ | 43,824  |      
|Deducted in balance sheet from accounts receivable:          |                                       |            |         |         |              |   |        |          |  |   |              |    |            |          |         |      |   |   |         |      
|                                                             | Allowance for doubtful accountstrade |            | $       | 724     |              |   | $      | 738      |  |   | $            |   |            |          | $       | (66  | ) |   | $       | 1,396 | 
|Predecessor Company                                         
|                                                            
|The Period from January 1, 2005
    through March 14, 2005   |                                       |            |         |         |              |   |        |          |  |   |              |    |            |          |         |      |   |   |         |      
|Valuation allowance on deferred tax assets:                  |                                       | $          | 70,020  |         |              | $ | 34,201 |          |  | $ |             |    |            | $        |        |      |   | $ | 104,221 |      
|Deducted in balance sheet from accounts receivable:          |                                       |            |         |         |              |   |        |          |  |   |              |    |            |          |         |      |   |   |         |      
|                                                             | Allowance for doubtful accountstrade |            | $       | 1,233   |              |   | $      | 448      |  |   | $            | 12 |            |          | $       | (969 | ) |   | $       | 724   | 
|2004                                                         |                                       |            |         |         |              |   |        |          |  |   |              |    |            |          |         |      |   |   |         |      
|Valuation allowance on deferred tax assets:                  |                                       | $          | 47,744  |         |              | $ | 22,276 |          |  | $ |             |    |            | $        |        |      |   | $ | 70,020  |      
|Deducted in balance sheet from accounts receivable:          |                                       |            |         |         |              |   |        |          |  |   |              |    |            |          |         |      |   |   |         |      
|                                                             | Allowance for doubtful accountstrade |            | $       | 542     |              |   | $      | 947      |  |   | $            | 11 |            |          | $       | (267 | ) |   | $       | 1,233 | 
|2003                                                         |                                       |            |         |         |              |   |        |          |  |   |              |    |            |          |         |      |   |   |         |      
|Valuation allowance on deferred tax assets:                  |                                       | $          | 32,997  |         |              | $ | 14,459 |          |  | $ | 288          |    |            | $        |        |      |   | $ | 47,744  |      
|Deducted in balance sheet from accounts receivable:          |                                       |            |         |         |              |   |        |          |  |   |              |    |            |          |         |      |   |   |         |      
|                                                             | Allowance for doubtful accountstrade |            | $       | 422     |              |   | $      | 120      |  |   | $            |   |            |          | $       |     |   |   | $       | 542   | 

88



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TRICO MARINE SERVICES, INC.





EXHIBIT INDEX




| |    |      |  |                                                                                                                                                                                                                                                                                                
| | -- | ---- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | 2  | .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 2.1 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 10.1 to our Current
    Report on Form 8-K dated September 10, 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 dated March 16, 2005).                                                                                                             
| | 3  | .2   |  | Third Amended and Restated Bylaws of the Company (incorporated
    by reference to Exhibit 3.1 to our Current Report on
    Form 8-K dated June 16, 2005).                                                                                                                                     
| | 4  | .1   |  | Specimen Common Stock Certificate (incorporated by reference to
    Exhibit 4.1 to our Annual Report on Form 10-K dated
    March 16, 2005).                                                                                                                                                   
| | 4  | .2   |  | Registration Rights Agreement, dated as of March 16, 2005,
    by and among the Company and the Holders named therein
    (incorporated by reference to Exhibit 4.1 to our Current
    Report on Form 8-K dated 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 dated March 16, 2005).                                                                                                                                   
| | 4  | .4   |  | Form of Series A Warrant (incorporated by reference to
    Exhibit 4.4 to the Companys Current Report on
    Form 8-K/A dated March 21, 2005).                                                                                                                                                
| | 4  | .5   |  | Form of Series B Warrant (incorporated by reference to
    Exhibit 4.5 to the Companys Current Report on
    Form 8-K/A dated March 21, 2005).                                                                                                                                                
| | 10 | .1   |  | $75,000,000 Credit Agreement (Exit) dated as of
    February 21, 2005 (incorporated by reference to
    Exhibit 10.1 to our Current Report on Form 8-K dated
    February 22, 2005).                                                                                                           
| | 10 | .2   |  | First Waiver and Amendment, dated as of March 15, 2005, to
    the $75,000,000 Credit Agreement (Exit) dated as of
    February 21, 2005 (incorporated by reference to
    Exhibit 10.2 to our Quarterly Report on Form 10-Q
    dated May 10, 2005).                                          
| | 10 | .3   |  | Second Amendment, dated as of April 13, 2005, to the
    $75,000,000 Credit Agreement (Exit) dated as of
    February 21, 2005 (incorporated by reference to
    Exhibit 10.3 to our Quarterly Report on Form 10-Q
    dated May 10, 2005).                                                    
| | 10 | .4   |  | Consent, Waiver and Third Amendment, dated as of May 9,
    2005, to the $75,000,000 Credit Agreement (Exit) dated as of
    February 21, 2005 (incorporated by reference to
    Exhibit 10.4 to our Quarterly Report on Form 10-Q
    dated May 10, 2005).                                    
| | 10 | .5*  |  | Employment Agreement dated as of March 15, 2005, between
    Trico Marine Services, Inc. and Thomas E. Fairley (incorporated
    by reference to Exhibit 10.6 to our Current Report on
    Form 8-K dated March 16, 2005).                                                                     
| | 10 | .6*  |  | Employment Agreement dated as of March 15. 2005, between Trico
    Marine Services, Inc. and Trevor Turbidy (incorporated by
    reference to Exhibit 10.7 to our Current Report on
    Form 8-K dated March 16, 2005).                                                                        
| | 10 | .7*  |  | Trico Marine Services, Inc. 2004 Stock Incentive Plan
    (incorporated by reference to Exhibit 10.2 to our Current
    Report on Form 8-K dated March 16, 2005).                                                                                                                              
| | 10 | .8*  |  | Form of Key Employee Option Agreement (incorporated by reference
    to Exhibit 10.3 to our Current Report on Form 8-K
    dated March 16, 2005).                                                                                                                                              
| | 10 | .9*  |  | Form of Executive Option Agreement (incorporated by reference to
    Exhibit 10.4 to our Current Report on Form 8-K dated
    March 16, 2005).                                                                                                                                                 
| | 10 | .10* |  | Director Option Agreement for Joseph S. Compofelice
    (incorporated by reference to Exhibit 10.5 to our Current
    Report on Form 8-K dated March 16, 2005).                                                                                                                                
| | 10 | .11* |  | Retirement Agreement for Non-Executive Chairman (incorporated by
    reference to Exhibit 10.8 to our Current Report on
    Form 8-K dated March 16, 2005).                                                                                                                                    

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##### Table of Contents



| |    |      |  |                                                                                                                                                                                                                                                                 
| | -- | ---- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | 10 | .12* |  | Amendment to Retirement Agreement for Non-Executive Chairman
    (incorporated by reference to Exhibit 10.9 to our Current
    Report on Form 8-K dated March 16, 2005).                                                                                        
| | 10 | .13* |  | Schedule of Director Compensation Arrangements (incorporated by
    reference to Exhibit 10.10 to our Current Report on
    Form 8-K dated March 16, 2005).                                                                                                     
| | 10 | .14* |  | Summary of Compensation for our Interim Chief Executive Officer
    (incorporated by reference to Exhibit 10.14 to our
    Quarterly Report on Form 10-Q dated May 10, 2005).                                                                                   
| | 10 | .15* |  | Employment Agreement dated as of August 8, 2005, between
    Trico Marine Services, Inc. and Rishi Varma. (incorporated by
    reference to Exhibit 10.15 to our Quarterly Report on Form
    10-Q dated August 9, 2005).                                       
| | 10 | .16  |  | Consent, Waiver and Fourth Amendment, dated as of August 1,
    2005, to the $75,000,000 Credit Agreement (Exit) dated as of
    August 1, 2005. (incorporated by reference to
    Exhibit 10.16 to our Quarterly Report on Form 10-Q dated
    August 9, 2005).
| | 10 | .17* |  | Employment Agreement dated as of September 1, 2005, between
    Trico Marine Services, Inc. and Geoff A. Jones. (incorporated by
    reference to Exhibit 10.17 to our Quarterly Report on Form
    10-Q dated November 3, 2005).                               
| | 10 | .18* |  | Employment Agreement dated as of September 1, 2005, between
    Trico Marine Services, Inc. and D. Michael Wallace.
    (incorporated by reference to Exhibit 10.18 to our
    Quarterly Report on Form 10-Q dated November 3, 2005).                           
| | 10 | .19* |  | Employment Agreement dated as of September 1, 2005, between
    Trico Marine Services, Inc. and Trevor Turbidy. (incorporated by
    reference to Exhibit 10.19 to our Quarterly Report on Form
    10-Q dated November 3, 2005).                               
| | 14 | .1   |  | Financial Code of Ethics. (incorporated by reference to
    Exhibit 14.1 to our Annual Report on Form 10-K dated
    March 16, 2005).                                                                                                                           
| | 21 | .1   |  | Subsidiaries of the Company.(1)                                                                                                                                                                                                                                 
| | 23 | .1   |  | Consents of experts and counsel.(1)                                                                                                                                                                                                                             
| | 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)                                                                                                                                                                     




|    |                                                         
|--- | --------------------------------------------------------
|*   | Management Contract or Compensation Plan or Arrangement.
|(1) | Filed herewith                                          

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