10-Q

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q

þ	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)  OF THE SECURITIES EXCHANGE ACT OF 1934
	For the Quarterly Period Ended September 30, 2014
or
¨	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the Transition Period from                    to

Commission File Number: 001-33345

___________________

RAND LOGISTICS, INC.

(Exact name of registrant as specified in its charter)

Delaware	No. 20-1195343
(State or other jurisdiction of	(I.R.S. Employer
incorporation or organization)	Identification No.)
500 Fifth Avenue, 50th Floor
New York, NY	10110
(Address of principal executive offices)	(Zip Code)

(212) 644-3450

(Registrant's telephone number, including area code)

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

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ý No ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definitions of “large accelerated filer,” “accelerated filer,” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer ¨	Accelerated filer þ
Non-accelerated filer ¨	Smaller reporting company ¨

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

18,010,147 shares of Common Stock, par value $.0001, were outstanding at November 5, 2014. 

RAND LOGISTICS, INC.

INDEX

PART I. FINANCIAL INFORMATION	3
Item 1. Financial Statements.	3
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.	34
Item 3. Quantitative and Qualitative Disclosures About Market Risk.	55
Item 4. Controls and Procedures.	55
PART II. OTHER INFORMATION	56
Item 1. Legal Proceedings.	56
Item 1A. Risk Factors.	56
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.	56
Item 3. Defaults Upon Senior Securities.	56
Item 4. Mine Safety Disclosures.	56
Item 5. Other Information.	56
Item 6. Exhibits.	57

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements.

RAND LOGISTICS, INC.

Consolidated Balance Sheets (Unaudited)

(U.S. Dollars 000’s except for Shares and Per Share data)

	September 30, 2014			March 31, 2014
ASSETS
CURRENT
Cash and cash equivalents	$	3,571		$	2,602
Accounts receivable, net (Note 4)	17,391			2,629
Income tax receivable	96			96
Loan to employee	—			250
Prepaid expenses and other current assets (Notes 5 and 8)	7,994			7,344
Deferred income taxes (Note 6)	121			121
Total current assets	29,173			13,042
PROPERTY AND EQUIPMENT, NET (Note 7)	214,223			215,487
OTHER ASSETS (Note 8)	956			730
DEFERRED DRYDOCK COSTS, NET (Note 9)	8,924			9,321
INTANGIBLE ASSETS, NET (Note 10)	14,847			16,233
GOODWILL (Note 10)	10,193			10,193
Total assets	$	278,316		$	265,006
LIABILITIES
CURRENT
Bank indebtedness (Note 12)	$	8,679		$	—
Accounts payable	9,633			11,792
Accrued liabilities (Note 13)	7,466			7,956
Income taxes payable	—			100
Deferred income taxes (Note 6)	34			35
Current portion of deferred payment liability	517			499
Current portion of long-term debt  (Note 14)	1,042			787
Total current liabilities	27,371			21,169
LONG-TERM PORTION OF DEFERRED PAYMENT LIABILITY	837			1,100
LONG-TERM DEBT  (Note 14)	102,944			104,103
SUBORDINATED DEBT (Note 15)	72,500			72,500
OTHER LIABILITIES	253			253
DEFERRED INCOME TAXES (Note 6)	6,085			5,134
Total liabilities	209,990			204,259
COMMITMENTS AND CONTINGENCIES (Notes 16 and 17)
STOCKHOLDERS' EQUITY
Preferred stock, $.0001 par value, Authorized 1,000,000 shares, Issued and outstanding 300,000 shares (Note 18)	14,900			14,900
Common stock, $.0001 par value Authorized 50,000,000 shares, Issuable and outstanding 18,010,147 shares (Note 18)	1			1
Additional paid-in capital	90,040			89,486
Accumulated deficit	(33,070		)	(40,277		)
Accumulated other comprehensive loss	(3,545		)	(3,363		)
Total stockholders’ equity	68,326			60,747
Total liabilities and stockholders’ equity	$	278,316		$	265,006

The accompanying notes are an integral part of these consolidated financial statements.

3

RAND LOGISTICS, INC.

Consolidated Statements of Operations (Unaudited)

(U.S. Dollars 000’s except for Shares and Per Share data)

	Three months ended September 30, 2014			Three months ended September 30, 2013			Six months ended September 30, 2014			Six months ended September 30, 2013
REVENUE
Freight and related revenue	$	46,102		$	42,955		$	82,715		$	82,560
Fuel and other surcharges	8,168			7,586			14,864			16,382
TOTAL REVENUE	54,270			50,541			97,579			98,942
EXPENSES
Vessel operating expenses	33,612			31,608			61,639			64,291
Repairs and maintenance	(5		)	118			1,177			935
General and administrative	3,299			3,195			6,199			6,076
Depreciation	4,693			4,275			9,370			8,580
Amortization of drydock costs	856			829			1,712			1,667
Amortization of intangibles	308			319			616			641
Loss (gain) on foreign exchange	1,261			(3		)	463			60
	44,024			40,341			81,176			82,250
OPERATING INCOME	10,246			10,200			16,403			16,692
OTHER (INCOME) AND EXPENSES
Interest expense (Note 19)	3,707			2,345			7,464			4,734
Interest income	(2		)	(1		)	(4		)	(3		)
	3,705			2,344			7,460			4,731
INCOME BEFORE INCOME TAXES	6,541			7,856			8,943			11,961
PROVISION FOR INCOME TAXES (Note 6)
Current	—			—			—			—
Deferred	705			6,641			1,048			8,168
	705			6,641			1,048			8,168
NET INCOME BEFORE PREFERRED STOCK DIVIDENDS	5,836			1,215			7,895			3,793
PREFERRED STOCK DIVIDENDS	290			879			581			1,733
NET INCOME APPLICABLE TO COMMON STOCKHOLDERS	$	5,546		$	336		$	7,314		$	2,060
Net income per share basic (Note 22)	$	0.31		$	0.02		$	0.41		$	0.12
Net income per share diluted (Note 22)	0.29			0.02			0.39			0.12
Weighted average shares basic	18,002,591			17,919,524			17,968,438			17,897,856
Weighted average shares diluted	20,456,035			17,919,524			20,427,469			17,897,856

The accompanying notes are an integral part of these consolidated financial statements.

4

RAND LOGISTICS, INC.

Consolidated Statements of Comprehensive Income (Unaudited)

(U.S. Dollars 000’s except for Shares and Per Share data)

	Three months ended September 30, 2014		Three months ended September 30, 2013	Six months ended September 30, 2014		Six months ended September 30, 2013
NET INCOME BEFORE PREFERRED STOCK DIVIDENDS	5,836		1,215	7,895		3,793
Other comprehensive income (loss):
Change in foreign currency translation adjustment	(1,584	)	871	(182	)	(708	)
COMPREHENSIVE INCOME BEFORE PREFERRED STOCK DIVIDENDS	4,252		2,086	7,713		3,085

The accompanying notes are an integral part of these consolidated financial statements.

5

RAND LOGISTICS, INC.

Statements of Stockholders' Equity (Unaudited)

(U.S. Dollars 000’s except for Shares and Per Share data)

	Common Stock				Preferred Stock			Additional Paid-In Capital			Accumulated Deficit			Accumulated Other Comprehensive (Loss) Income			Total Stockholders' Equity
	Shares		Amount		Shares	Amount
Balances, March 31, 2013	17,860,266		$	1	300,000	$	14,900	$	89,077		$	(32,341	)	$	781		$	72,418
Net loss	—		—		—	—		—			(4,507		)	—			(4,507		)
Preferred stock dividends	—		—		—	—		—			(3,429		)	—			(3,429		)
Restricted stock issued (Note 18)	54,337		—		—	—		301			—			—			301
Unrestricted stock issued (Note 18)	19,256		—		—	—		108			—			—			108
Translation adjustment	—		—		—	—		—			—			(4,144		)	(4,144		)
Balances, March 31, 2014	17,933,859		$	1	300,000	$	14,900	$	89,486		$	(40,277	)	$	(3,363	)	$	60,747
Net income	—		—		—	—		—			2,059			—			2,059
Preferred stock dividends	—		—		—	—		—			(291		)	—			(291		)
Unrestricted stock issued (Note 18)	4,602		—		—	—		28			—			—			28
Translation adjustment	—		—		—	—		—			—			1,402			1,402
Balances, June 30, 2014	17,938,461		$	1	300,000	$	14,900	$	89,514		$	(38,509	)	$	(1,961	)	$	63,945
Net income	—		—		—	—		—			5,836			—			5,836
Preferred stock dividends	—		—		—	—		—			(290		)	—			(290		)
Restricted stock issued (Note 18)	105,189		—		—	—		621			—			—			621
Unrestricted stock issued (Note 18)	4,870		—		—	—		28			—			—			28
Stock repurchased and extinguished	(38,373	)	—		—	—		(143		)	(107		)	—			(250		)
Restricted Stock Unit (RSU)	—		—		—	—		20			—			—			20
Translation adjustment	—		—		—	—		—			—			(1,584		)	(1,584		)
Balances, September 30, 2014	18,010,147		$	1	300,000	$	14,900	$	90,040		$	(33,070	)	$	(3,545	)	$	68,326

The accompanying notes are an integral part of these consolidated financial statements.

6

RAND LOGISTICS, INC.

Consolidated Statements of Cash Flows (Unaudited)

(U.S. Dollars 000’s except for Shares and Per Share data)

	Six months ended September 30, 2014			Six months ended September 30, 2013
CASH FLOWS FROM OPERATING ACTIVITIES
Net income	$	7,895		$	3,793
Adjustments to reconcile net income to net cash provided  by operating activities:
Depreciation and amortization of drydock costs	11,082			10,247
Amortization of intangibles and deferred financing costs	1,282			912
Deferred income taxes	1,048			8,168
Equity compensation granted	697			354
Unrealized foreign exchange loss (gain)	301			—
Deferred drydock costs paid	(2,020		)	(3,532		)
Changes in operating assets and liabilities:
Accounts receivable	(14,762		)	(13,242		)
Prepaid expenses and other current assets	(650		)	(509		)
Accounts payable and accrued liabilities	6,152			(2,404		)
Other assets and liabilities	24			137
Income taxes payable (net)	(100		)	—
	10,949			3,924
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of property and equipment	(17,610		)	(5,520		)
	(17,610		)	(5,520		)
CASH FLOWS FROM FINANCING ACTIVITIES
Deferred payment liability obligation	(245		)	(227		)
Shares repurchased and extinguished	(250		)	—
Long-term debt repayment	(261		)	(1,799		)
Debt financing cost	(277		)	(23		)
Proceeds from bank indebtedness	19,767			17,414
Repayment of bank indebtedness	(11,000		)	(11,559		)
Payment of preferred stock dividend	(291		)	—
	7,443			3,806
EFFECT OF FOREIGN EXCHANGE RATES ON CASH	187			(18		)
NET INCREASE IN CASH AND CASH EQUIVALENTS	969			2,192
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD	2,602			848
CASH AND CASH EQUIVALENTS, END OF  PERIOD	$	3,571		$	3,040
SUPPLEMENTAL CASH FLOW DISCLOSURE
Payments for interest	$	6,849		$	4,634
Unpaid purchases of property and equipment	$	903		$	544
Unpaid purchases of deferred drydock cost	$	9		$	2
Payment of income taxes	$	100		$	—
Capitalized interest	$	68		$	—

The accompanying notes are an integral part of these consolidated financial statements.

7

RAND LOGISTICS, INC.

Notes to the Consolidated Financial Statements (Unaudited)

(U.S. Dollars 000’s except for Shares and Per Share data)

1.     DESCRIPTION OF BUSINESS

Rand Logistics, Inc. (the “Company”), a Delaware corporation, is a leading provider of bulk freight shipping services throughout the Great Lakes region. The Company believes that it is the only company providing significant domestic port-to-port services to both Canada and the United States in the Great Lakes region. The Company maintains this operating flexibility by operating both U.S. and Canadian flagged vessels in compliance with the Shipping Act, 1916, and the Merchant Marine Act, 1920, commonly referred to as the Jones Act in the U.S. and the Coasting Trade Act in

Canada, respectively.

2. SIGNIFICANT ACCOUNTING POLICIES

Basis of presentation and consolidation

The consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States of America and include the accounts of Rand Finance Corp. (“Rand Finance”), Rand LL Holdings Corp. ("Rand LL Holdings") and Black Creek Shipping Holding Company, Inc. ("Black Creek Holdings"), wholly-owned subsidiaries of the Company, the accounts of Lower Lakes Towing Ltd. ("Lower Lakes"), Lower Lakes Transportation Company ("Lower Lakes Transportation") and Grand River Navigation Company, Inc. ("Grand River"), each of which is a wholly-owned subsidiary of Rand LL Holdings, Black Creek Shipping Company, Inc. ("Black Creek"), which is a wholly-owned subsidiary of Black Creek Holdings. and Lower Lakes Ship Repair Company Ltd. ("Lower Lakes Ship Repair") and Lower Lakes (17) Ltd. ("Lower Lakes (17)"), each of which is a wholly-owned subsidiary of Lower Lakes.

The consolidated financial statements include the accounts of the Company and all of its wholly-owned subsidiaries. All significant intercompany transactions and balances have been eliminated. In the opinion of management, the interim financial statements contain all adjustments necessary (consisting of normal recurring accruals) to present fairly the financial information contained herein. Operating results for the interim period presented are not necessarily indicative of the results to be expected for a full year, in part due to the seasonal nature of the business. The comparative balance sheet amounts are derived from audited consolidated financial statements for the fiscal year ended and as at March 31, 2014. The statements and related notes have been prepared pursuant to the rules and regulations of the U.S. Securities and Exchange Commission. Accordingly, certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been omitted pursuant to such rules and regulations. These financial statements should be read in conjunction with the financial statements that were included in the Company's Annual Report on Form 10-K for the fiscal year ended March 31, 2014.

Cash and cash equivalents

The Company considers all highly liquid investments with an original maturity of three months or less to be cash equivalents.

8

RAND LOGISTICS, INC.

Notes to the Consolidated Financial Statements (Unaudited)

(U.S. Dollars 000’s except for Shares and Per Share data)

2. SIGNIFICANT ACCOUNTING POLICIES (continued)

Accounts receivable and concentration of credit risk

The majority of the Company’s accounts receivable are amounts due from customers and other accounts receivable, including insurance and Harmonized Sales Tax refunds.  The majority of accounts receivable are due within 30 to 60 days and are stated at amounts due from customers net of an allowance for doubtful accounts. The Company extends credit to its customers based upon its assessment of their creditworthiness and past payment history. Accounts outstanding longer than the contractual payment terms are considered past due. The Company has historically had no significant bad debts. Interest is not accrued on outstanding receivables.

Revenue and operating expenses recognition

The Company generates revenues from freight billings under contracts of affreightment (voyage charters) generally on a rate per ton basis based on origin-destination and cargo carried. Voyage revenue is recognized ratably over the duration of a voyage based on the relative transit time in each reporting period when the following conditions are met: the Company has a signed contract of affreightment, the contract price is fixed or determinable and collection is reasonably assured.  Included in freight billings are other fees such as fuel surcharges and other freight surcharges, which represent pass-through charges to customers for toll fees, lockage fees and ice breaking fees paid to other parties.  Fuel surcharges are recognized ratably over the duration of the voyage, while freight surcharges are recognized when the associated costs are incurred. Freight surcharges are less than 5% of total revenue.

Marine operating expenses such as crewing costs, fuel, tugs and insurance are recognized as incurred or consumed and thereby are recognized ratably in each reporting period. Repairs and maintenance and certain other insignificant costs are recognized as incurred.

The Company subcontracts excess customer demand to other freight providers.  Service to customers under such arrangements is transparent to the customer and no additional services are provided to customers.  Consequently, revenues recognized for customers serviced by freight subcontractors are recognized on the same basis as described above.  Costs for subcontracted freight providers, presented as “outside voyage charter fees” in the consolidated statements of operations, are recognized as incurred and therefore are recognized ratably over the voyage.

The Company accounts for sales taxes imposed on its services on a net basis in the consolidated statements of operations.

In addition, all revenues are presented on a gross basis.

Vessel acquisitions

Vessels are stated at cost, which consists of the purchase price and any material expenses incurred upon acquisition, such as initial repairs, improvements, delivery expenses and other expenditures to prepare the vessel for its initial voyage. Subsequent expenditures for conversions and major improvements are also capitalized when they appreciably extend the life, increase the earnings capacity or improve the efficiency or safety of the vessels. Significant financing costs incurred during the construction period of the vessels are also capitalized and included in the vessels' cost.

Fuel and lubricant inventories

Raw materials, fuel and certain operating supplies are accounted for on a first-in, first-out cost method (based on monthly averages). Raw materials and fuel are stated at the lower of actual cost (first-in, first-out method) or market. Operating supplies are stated at actual cost or average cost.

9

RAND LOGISTICS, INC.

Notes to the Consolidated Financial Statements (Unaudited)

(U.S. Dollars 000’s except for Shares and Per Share data)

2. SIGNIFICANT ACCOUNTING POLICIES (continued)

Intangible assets and goodwill

Intangible assets consist primarily of goodwill, deferred financing costs, trademarks, trade names and customer relationships and contracts. Intangible assets are amortized as follows:

Trademarks and trade names	10 years straight-line
Customer relationships and contracts	15 years straight-line

Deferred financing costs are amortized on a straight-line basis over the term of the related debt, which approximates the effective interest method.

Property and equipment

Property and equipment are recorded at cost.  Depreciation methods for property and equipment are as follows:

Vessels	5 - 25 years straight-line
Leasehold improvements	7 - 11 years straight-line
Vehicles	20% declining-balance
Furniture and equipment	20% declining-balance
Computer equipment	45% declining-balance
Communication equipment	20% declining-balance

Impairment of fixed assets

Fixed assets (e.g. property and equipment) and finite-lived intangible assets (e.g. customer lists) are tested for impairment upon the occurrence of a triggering event that indicates the carrying value of such an asset or asset group (e.g. tugs and barges), might be no longer recoverable. Examples of such triggering events include a significant disposal of a portion of such assets, an adverse change in the market involving the business employing the related asset(s), a significant decrease in the benefits realized from an acquired business, difficulties or delays in integrating the business, and a significant change in the operations of an acquired business.

Once a triggering event has occurred, the recoverability test employed is based on whether the intent is to hold the asset(s) for continued use or to hold the asset(s) for sale. If the intent is to hold the asset(s) for continued use, the recoverability test involves a comparison of undiscounted cash flows excluding interest expense, against the carrying value of the asset(s) as an initial test. If the carrying value of such asset(s) exceeds the undiscounted cash flow, the asset(s) would be deemed to be impaired. Impairment would then be measured as the difference between the fair value of the fixed or amortizing intangible asset and the carrying value of such asset(s). The Company generally determines fair value by using the discounted cash flow method. If the intent is to hold the asset(s) for sale and certain other criteria are met (i.e. the asset(s) can be disposed of currently, appropriate levels of authority have approved the sale and there is an actively pursuing buyer), the impairment test is a comparison of the asset’s carrying value to its fair value less costs to sell. To the extent that the carrying value is greater than the asset’s fair value less costs to sell, an impairment loss is recognized for the difference. The Company has determined that there were no adverse changes in our markets or other triggering events that could affect the valuation of our assets during the six month period ended September 30, 2014.

10

RAND LOGISTICS, INC.

Notes to the Consolidated Financial Statements (Unaudited)

(U.S. Dollars 000’s except for Shares and Per Share data)

2. SIGNIFICANT ACCOUNTING POLICIES (continued)

Impairment of goodwill

The Company annually reviews the carrying value of goodwill to determine whether impairment may exist. Accounting Standards Codification (“ASC”) 350 “Intangibles-Goodwill and Other” and Accounting Standards Update (“ASU”) 2011-08 Intangibles—Goodwill and Other (Topic 350) - Testing Goodwill for Impairment requires that goodwill and certain intangible assets be assessed annually for impairment using fair value measurement techniques. Specifically, goodwill impairment is determined using a three-step process. The first step of the goodwill impairment test is to perform a qualitative assessment before calculating the fair value of the reporting unit when testing goodwill for impairment. If the fair value of the reporting unit is determined, based on qualitative factors, to be more likely than not less than the carrying amount of the reporting unit, then entities are required to perform the two-step goodwill impairment test. The second step of the goodwill impairment test is used to identify potential impairment by comparing the fair value of a reporting unit with its carrying amount, including goodwill. The estimates of fair value of the Company’s two reporting units, which are the Company’s Canadian and US operations (excluding the parent), are determined using various valuation techniques with the primary techniques being a discounted cash flow analysis and peer analysis. A discounted cash flow analysis requires various judgmental assumptions, including assumptions about future cash flows, growth rates, and discount rates. The assumptions about future cash flows and growth rates are based on the Company’s forecast and long-term estimates. Discount rate assumptions are based on an assessment of the risk inherent in the respective reporting units. If the fair value of a reporting unit exceeds its carrying amount, goodwill of the reporting unit is considered not impaired and the third step of the impairment test is unnecessary. If the carrying amount of a reporting unit exceeds its fair value, the third step of the goodwill impairment test is performed to measure the amount of impairment loss, if any. The third step of the goodwill impairment test compares the implied fair value of the reporting unit’s goodwill with the carrying amount of that goodwill. If the carrying amount of the reporting unit’s goodwill exceeds the implied fair value of that goodwill, an impairment loss is recognized in an amount equal to that excess. The implied fair value of goodwill is determined in the same manner as the amount of goodwill recognized in a business combination. That is, the fair value of the reporting unit is allocated to all of the assets and liabilities of that unit (including any unrecognized intangible assets) as if the reporting unit had been acquired in a business combination and the fair value of the reporting unit was the purchase price paid to acquire the reporting unit.  As of March 31, 2014, the Company conducted the qualitative assessment and determined that the fair value of its two reporting units exceeded their carrying amounts and the remaining two-step impairment testing was therefore not necessary.  The Company has determined that there were no adverse changes in our markets or other triggering events that indicated that it is more likely than not that the fair value of our reporting units was less than the carrying value of our reporting units during the six month period ended September 30, 2014.

Drydock costs

Drydock costs incurred during statutory Canadian and United States certification processes are capitalized and amortized on a straight-line basis over the benefit period, which is generally 60 months. Drydock costs include costs of work performed by third party shipyards and subcontractors and other direct expenses to complete the mandatory certification process.

Repairs and maintenance

The Company’s vessels require repairs and maintenance each year to ensure the fleet is operating efficiently during the shipping season.  The majority of repairs and maintenance are completed in January, February, and March of each year when the vessels are inactive.  The Company expenses such routine repairs and maintenance costs.  Significant repairs to the Company’s vessels (whether owned or available to the Company under a time charter), such as major engine overhauls and major hull steel repairs, are capitalized and amortized over the remaining useful life of the upgrade or asset repaired, or the remaining lease term.

11

RAND LOGISTICS, INC.

Notes to the Consolidated Financial Statements (Unaudited)

(U.S. Dollars 000’s except for Shares and Per Share data)

2. SIGNIFICANT ACCOUNTING POLICIES (continued)

Income taxes

The Company accounts for income taxes in accordance with ASC 740 “Income Taxes”, which requires the determination of deferred tax assets and liabilities based on the differences between the financial statement and income tax bases of tax assets and liabilities, using enacted tax rates in effect for the year in which the differences are expected to reverse.  A valuation allowance is recognized, if necessary, to measure tax benefits to the extent that, based on available evidence, it is more likely than not that they will be realized.

The Company classifies interest expense related to income tax liabilities, when applicable, as part of the interest expense in its consolidated statements of operations rather than income tax expense.  To date, the Company has not incurred material interest expenses or penalties relating to assessed taxation amounts.

There is a current examination taking place by the U.S. taxing authorities for the fiscal year ended March 31, 2012 with no adjustments proposed as of the date of this Quarterly Report on Form 10-Q. Lower Lakes was examined by the Canadian taxing authority for the tax years 2009 and 2010 and such examination is now complete.  This audit did not result in any material adjustments for such periods. The Company's primary U.S. state income tax jurisdictions are Illinois, Indiana, Michigan, Minnesota, Pennsylvania, Wisconsin and New York and its only international jurisdictions are Canada and its province of Ontario. The following table summarizes the open fiscal tax years for each major jurisdiction:

Jurisdiction	Open Tax Years
Federal (USA)	2010 – 2014
Various states	2010 – 2014
Federal (Canada)	2009 – 2014
Ontario	2009 – 2014

Foreign currency translation

The Company uses the U.S. Dollar as its reporting currency.  The functional currency of the Company's Canadian subsidiaries is the Canadian Dollar.  The functional currency of the Company’s U.S. subsidiaries is the U.S. Dollar. Assets and liabilities denominated in foreign currencies are translated into U.S. Dollars at the rate of exchange at the balance sheet date, while revenue and expenses are translated at the average exchange rates prevailing during the respective month.  Components of stockholders’ equity are translated at historical exchange rates.  Exchange gains and losses resulting from translation are reflected in accumulated other comprehensive income or loss, except for financial assets and liabilities designated in foreign currency, which are reflected in the Company's consolidated statements of operations.

Advertising costs

The Company expenses all advertising costs as incurred. These costs are included in general and administrative costs and were insignificant during the periods presented.

Use of estimates

The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. Significant estimates used in the preparation of these financial statements include the assumptions used in determining the useful lives of long-lived assets, the assumptions used in determining whether assets are impaired, the assumptions used in determining the valuation allowance for deferred income tax assets and the assumptions used in stock based compensation awards. Actual results could differ from those estimates.

12

RAND LOGISTICS, INC.

Notes to the Consolidated Financial Statements (Unaudited)

(U.S. Dollars 000’s except for Shares and Per Share data)

2.    SIGNIFICANT ACCOUNTING POLICIES (continued)

Stock-based compensation

The Company recognizes compensation expense for all newly granted awards and awards modified, repurchased or cancelled based on fair value at the date of grant.

Financial instruments

The Company accounts for its foreign currency hedge contract on its subordinated debt utilizing ASC 815 “Derivatives and Hedging”. All changes in the fair value of the contract is recorded in earnings and the fair value of settlement costs to terminate the contract is included in current assets or current liabilities on the consolidated balance sheets. Disclosure requirements of ASC 815 are disclosed in Note 21.

Fair value of financial instruments

ASC 820 “Fair Value Measurements and Disclosures” ("ASC 820") defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles and establishes a hierarchy that categorizes and prioritizes the inputs to be used to estimate fair value. The three levels of inputs used are as follows:

Level 1 - Quoted prices in active markets for identical assets or liabilities.

Level 2 - Inputs other than Level 1 that are observable for the asset or liability, either directly or indirectly, such as quoted prices for similar assets and liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; or other inputs that are observable or can be corroborated by observable market data by correlation or other means.

Level 3 - Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

The disclosure requirements of ASC 820 related to the Company’s financial assets and liabilities are presented in Note 21.

3. RECENTLY ISSUED PRONOUNCEMENTS

Revenue from Contracts with Customers

In May 2014, the Financial Accounting Standard Board issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606) ("ASU 2014-09"), which supersedes the revenue recognition requirements in ASC 605, Revenue Recognition. ASU 2014-09 requires entities to recognize revenue in a way that depicts the transfer of goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled to in exchange for those goods or services. ASU 2014-09 requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to obtain or fulfill a contract. ASU 2014-09 is effective retrospectively for fiscal years, and interim periods within those years, beginning after December 15, 2016. Early adoption is not permitted. The Company is currently evaluating the effect that this pronouncement will have on its financial statements and related disclosures.

13

RAND LOGISTICS, INC.

Notes to the Consolidated Financial Statements (Unaudited)

(U.S. Dollars 000’s except for Shares and Per Share data)

4. ACCOUNTS RECEIVABLE

Trade receivables are presented net of an allowance for doubtful accounts. The allowance was $50 as of September 30, 2014 and $58 as of March 31, 2014. The Company manages and evaluates the collectability of its trade receivables as follows: management reviews aged accounts receivable listings and contact is made with customers that have extended beyond agreed upon credit terms. Senior management and operations are notified so that when they are contacted by such customers for a future delivery, they can request that the customer pay any past due amounts before any future cargo is booked for shipment. Customer credit risk is also managed by reviewing the history of payments by the customer, the size and credit quality of the customer, the period of time remaining within the shipping season and demand for future cargos.

5.PREPAIDEXPENSES AND OTHER CURRENT ASSETS

Prepaid expenses and other current assets are comprised of the following:

	September 30, 2014		March 31, 2014
Prepaid insurance	$	584	$	565
Fuel and lubricants	5,070		4,351
Deposits and other prepaids	2,340		2,428
	$	7,994	$	7,344

6. INCOME TAXES

The Company's effective tax rate was a deferred tax expense of 11.7% for the six month period ended September 30, 2014 compared to a deferred tax expense of 68.3% for the six month period ended September 30, 2013. The decrease in effective tax rate was primarily due to the implementation of the valuation allowance related to the net U.S. Federal deferred tax assets, which are primarily net operating losses and changes in forecasted full year pre-tax results compared to the prior year comparative period.

The effective tax rate for the six month period ended September 30, 2014 was lower than the statutory tax rate due to the implementation of the valuation allowance related to the net U.S. Federal deferred tax assets, which are primarily net operating losses.

The Company had no unrecognized tax benefits as of September 30, 2014. The Company did not incur any income tax related interest expense or penalties related to uncertain tax positions during each of the six month periods ended September 30, 2014 and September 30, 2013.

14

RAND LOGISTICS, INC.

Notes to the Consolidated Financial Statements (Unaudited)

(U.S. Dollars 000’s except for Shares and Per Share data)

7. PROPERTY AND EQUIPMENT

Property and equipment are comprised of the following:

	September 30, 2014		March 31, 2014
Cost
Vessels	$	282,255	$	274,919
Leasehold improvements	3,834		3,834
Furniture and equipment	603		534
Vehicles	18		19
Computer, communication equipment and purchased software	3,027		2,937
	$	289,737	$	282,243
Accumulated depreciation
Vessels	$	71,059	$	62,694
Leasehold improvements	2,193		1,953
Furniture and equipment	284		249
Vehicles	14		13
Computer, communication equipment  and purchased software	1,964		1,847
	75,514		66,756
	$	214,223	$	215,487

Depreciable assets as at September 30, 2014 included $13,562 ($7,635 as at March 31, 2014) related to a recently acquired vessel. Depreciation on this asset will commence after the vessel is converted to a self-unloading dry-bulk vessel and is available for commercial sailing.

8. OTHER ASSETS

Other assets includes certain customer contract related expenditures, which are amortized over a five year period.

	September 30, 2014		March 31, 2014
Customer contract costs	$	710	$	850
Prepaid expenses and other assets	8,240		7,224
Total	$	8,950	$	8,074
Current portion	7,994		7,344
Other long term assets	$	956	$	730

15

RAND LOGISTICS, INC.

Notes to the Consolidated Financial Statements (Unaudited)

(U.S. Dollars 000’s except for Shares and Per Share data)

9. DEFERRED DRYDOCK COSTS

Deferred drydock costs are comprised of the following:

	September 30, 2014			March 31, 2014
Drydock expenditures	$	16,878		$	15,635
Accumulated amortization	(7,954		)	(6,314		)
	$	8,924		$	9,321

The following table shows periodic deferrals of drydock costs and amortization.

Balance as of March 31, 2013	$	10,895
Drydock costs accrued and incurred	2,150
Amortization of drydock costs	(3,290		)
Foreign currency translation adjustment	(434		)
Balance as of March 31, 2014	$	9,321
Drydock costs accrued and incurred	1,383
Amortization of drydock costs	(1,712		)
Foreign currency translation adjustment	(68		)
Balance as of September 30, 2014	$	8,924

16

RAND LOGISTICS, INC.

Notes to the Consolidated Financial Statements (Unaudited)

(U.S. Dollars 000’s except for Shares and Per Share data)

10. INTANGIBLE ASSETS AND GOODWILL

Intangibles are comprised of the following:

	September 30, 2014		March 31, 2014
Intangible assets:
Deferred financing costs	$	7,284	$	7,331
Trademarks and trade names	942		951
Customer relationships and contracts	16,730		16,884
Total identifiable intangibles	$	24,956	$	25,166
Accumulated amortization:
Deferred financing costs	$	731	$	75
Trademarks and trade names	808		768
Customer relationships and contracts	8,570		8,090
Total accumulated amortization	10,109		8,933
Net intangible assets	$	14,847	$	16,233
Goodwill	$	10,193	$	10,193

Intangible asset amortization over the next five years is estimated as follows:

Twelve month period ending:

September 30, 2015	$	2,704
September 30, 2016	2,645
September 30, 2017	2,602
September 30, 2018	2,601
September 30, 2019	2,265
	$	12,817

11. VESSEL ACQUISITIONS

On March 11, 2014, Lower Lakes Towing entered into and consummated the transactions contemplated by a Memorandum of Agreement with Uni-Tankers M/T “Lalandia Swan” ApS (the "Seller"), pursuant to which Lower Lakes Towing purchased the LALANDIA SWAN from the Seller for a purchase price of $7,000. Lower Lakes Towing subsequently transferred the title of such vessel to Lower Lakes (17). This acquisition was funded with borrowings under the subordinated loan described in Note 15.

17

RAND LOGISTICS, INC.

Notes to the Consolidated Financial Statements (Unaudited)

(U.S. Dollars 000’s except for Shares and Per Share data)

12. BANK INDEBTEDNESS

As discussed in detail in Note 14, on March 11, 2014, Lower Lakes Towing, Lower Lakes Transportation, Grand River and Black Creek, as borrowers, and Rand LL Holdings, Rand Finance, Black Creek Holdings, Lower Lakes Ship Repair and Lower Lakes (17), and the Company as guarantors, entered into a Fourth Amended and Restated Credit Agreement (the "Fourth Amended and Restated Credit Agreement"), with General Electric Capital Corporation, as agent and a lender, and certain other lenders, which amends and restates the Third Amended and Restated Credit Agreement (the “Third Amended and Restated Credit Agreement”) entered on August 30, 2012, as the same was amended from time to time.

As of September 30, 2014, the Company had authorized operating lines of credit under the Fourth Amended and Restated Credit Agreement of CDN $17,500 and US $17,500 (CDN 17,500 and US 17,500 as of March 31, 2014), was utilizing CDN $3,000 as of September 30, 2014 and CDN $Nil as of March 31, 2014, was utilizing US $6,000 as of September 30, 2014 and US $Nil as of March 31, 2014, and maintained letters of credit of CDN $100 as of each of September 30, 2014 and March 31, 2014.

The Fourth Amended and Restated Credit Agreement provides that the line of credit bears interest, at the borrowers' option, at Canadian Prime Rate plus 3.00% or Canadian BA rate plus 4.00% on Canadian Dollar borrowings, and the U.S. Base rate plus 3.00% or LIBOR plus 4.00% on U.S. Dollar borrowings, compared to the Third Amended and Restated Credit Agreement, which bore interest at the Canadian Prime Rate plus 3.75% or Canadian BA rate plus 4.75% on Canadian Dollar borrowings, and the U.S. Base rate plus 3.75% or LIBOR plus 4.75% on U.S. Dollar borrowings. The Fourth Amended and Restated Credit Agreement is subject to the terms and conditions described in Note 14. Available collateral for borrowings and letters of credit are based on eligible accounts receivable, which are limited to 85% of those receivables that are not over 90 days old, not in excess of 20%-30% per customer in each line and certain other standard limitations. As of September 30, 2014, the Company had credit availability of US $5,648 on the combined lines of credit based on eligible receivables and the seasonal overadvance facilities.

13. ACCRUED LIABILITIES

Accrued liabilities are comprised of the following:

	September 30, 2014		March 31, 2014
Deferred financing and other transaction costs	$	269	$	560
Payroll compensation and benefits	2,887		957
Preferred stock dividends	291		—
Professional fees	412		386
Interest	784		767
Winter work, deferred drydock expenditures and capital expenditures	419		3,961
Capital and franchise taxes	30		36
Other	2,374		1,289
	$	7,466	$	7,956

18

RAND LOGISTICS, INC.

Notes to the Consolidated Financial Statements (Unaudited)

(U.S. Dollars 000’s except for Shares and Per Share data)

14. LONG-TERM DEBT

		September 30, 2014		March 31, 2014
a)	Canadian term loan bearing interest at Canadian Prime rate plus 3.00% (3.00% at March 31, 2014) or Canadian BA rate plus 4.00% (4.00% at March 31, 2014) at the Company’s option.  The loan is repayable until April 1, 2019 with quarterly payments of CDN $137 commenced September 1, 2014 and the balance due April 1, 2019.	$	48,879	$	49,644
b)	U.S. term loan bearing interest at LIBOR rate plus 4.00% (4.00% at March 31, 2014) or U.S. base rate plus 3.00% (3.00% at March 31, 2014) at the Company’s option.  The loan is repayable until April 1, 2019 with quarterly payments of US $138 commenced September 1, 2014 and the balance due April 1, 2019.	55,107		55,246
		$	103,986	$	104,890
	Less amounts due within 12 months	1,042		787
		$	102,944	$	104,103

The effective interest rates on the term loans at September 30, 2014 were 5.27% (5.26% at March 31, 2014) on the Canadian term loan and 4.23% (4.24% at March 31, 2014) on the U.S. term loan.

Principal payments are due as follows:

Twelve month period ending:

September 30, 2015	$	1,042
September 30, 2016	1,042
September 30, 2017	1,042
September 30, 2018	1,043
September 30, 2019	99,817
	$	103,986

19

RAND LOGISTICS, INC.

Notes to the Consolidated Financial Statements (Unaudited)

(U.S. Dollars 000’s except for Shares and Per Share data)

14. LONG-TERM DEBT (continued)

On March 11, 2014, Lower Lakes Towing, Lower Lakes Transportation, Grand River and Black Creek Shipping, as borrowers, Rand LL Holdings Corp. ("Rand LL Holdings"), Rand Finance, Black Creek Shipping Holdings Company, Inc. ("Black Creek Holdings"), Lower Lakes Ship Repair, Lower Lakes (17) and Rand, as guarantors, General Electric Capital Corporation, as agent and Lender, and certain other lenders, entered into a Fourth Amended and Restated Credit Agreement (the "Fourth Amended and Restated Credit Agreement"), which (i) amends and restates the existing Third Amended and Restated Credit Agreement to which the borrowers are a party, dated as of August 30, 2012, as the same has been amended from time to time, in its entirety, (ii) consolidates the existing U.S. term loans into a single term loan, (iii) provides for certain new loans and (iv) provides working capital financing, funds for other general corporate purposes and funds for other permitted purposes. The Fourth Amended and Restated Credit Agreement provides for (i) a revolving credit facility under which Lower Lakes Towing may borrow up to CDN $17,500 with a seasonal overadvance facility of the lesser of US $17,000 or CDN $17,500 less the principal amount outstanding under the seasonal overadvance facility for Lower Lakes Transportation, and a swing line facility of CDN $4,000, subject to limitations, (ii) a revolving credit facility under which Lower Lakes Transportation may borrow up to US $17,500 with a seasonal overadvance facility of US $17,000 less the principal amount outstanding under the seasonal overadvance facility for Lower Lakes Towing, and a swing line facility of US $50 subject to limitations, (iii) the continuation of an existing Canadian dollar denominated term loan facility under which Lower Lakes Towing is obligated to the lenders in the amount of CDN $54,882 as of the date of the Fourth Amended and Restated Credit Agreement (the “CDN Term Loan”) and (iv) the modification and continuation of a U.S. dollar denominated term loan facility under which Grand River and Black Creek are obligated to the lenders in the amount of $55,246 as of the date of the Fourth Amended and Restated Credit Agreement (the “U.S. Term Loan”).

Under the Fourth Amended and Restated Credit Agreement, the revolving credit facilities and swing line loans expire on April 1, 2019. The outstanding principal amount of the CDN Term Loan borrowings will be repayable as follows: (i) annual payments equal to one percent (1%) of the initial principal amount thereof paid quarterly commencing September 1, 2014 and (ii) a final payment in the outstanding principal amount of the CDN Term Loan upon the CDN Term Loan’s maturity on April 1, 2019. The outstanding principal amount of the U.S. Term Loan borrowings will be repayable as follows: (i) annual payments equal to one percent (1%) of the initial principal amount thereof paid quarterly commencing September 1, 2014, and (iii) a final payment in the outstanding principal amount of the U.S. Term Loan upon the U.S. Term Loan’s maturity on April 1, 2019. Borrowings under the Canadian revolving credit facility, the Canadian swing line facility and the CDN Term Loan will bear an interest rate per annum, at the borrowers' option, equal to (i) the Canadian Prime Rate (as defined in the Fourth Amended and Restated Credit Agreement), plus 3.00% per annum or (ii) the BA Rate (as defined in the Fourth Amended and Restated Credit Agreement) plus 4.00% per annum. Borrowings under the U.S. revolving credit facility, the U.S. swing line facility and the U.S. Term Loan will bear interest, at the borrowers’ option, equal to (i) LIBOR (as defined in the Fourth Amended and Restated Credit Agreement) plus 4.00% per annum, or (ii) the U.S. Base Rate (as defined in the Fourth Amended and Restated Credit Agreement) plus 3.00% per annum.

Obligations under the Fourth Amended and Restated Credit Agreement are secured by (i) a first priority lien and security interest on all of the borrowers’ and guarantors’ assets, tangible or intangible, real, personal or mixed, existing and newly acquired, (ii) a pledge by Rand LL Holdings of all of the outstanding capital stock of the borrowers other than Black Creek and Lower Lakes Towing, and a pledge of 65% of the outstanding capital stock of Lower Lakes Towing, (iii) a pledge by Black Creek Holdings of all of the outstanding capital stock of Black Creek, (iv) a pledge by Lower Lakes Towing of all of the outstanding capital stock of Lower Lakes Ship Repair and Lower Lakes (17) and (v) a pledge by Rand of all of the outstanding capital stock of Rand LL Holdings, Rand Finance and Black Creek Holdings. The indebtedness of each domestic borrower under the Fourth Amended and Restated Credit Agreement is unconditionally guaranteed by each other domestic borrower and by the guarantors which are domestic subsidiaries, and such guaranty is secured by a lien on substantially all of the assets of each borrower and each guarantor. Each domestic borrower also guarantees the obligations of the Canadian borrower and each Canadian guarantor guarantees the obligations of the Canadian borrower. Under the Fourth Amended and Restated Credit Agreement, the borrowers will be required to make mandatory prepayments of principal on term loan borrowings (i) if the outstanding balance of the term loans plus the outstanding balance of the seasonal facilities exceeds the sum of 85% of the orderly liquidation value of the vessels owned by the borrowers, less the amount of outstanding liens against the vessels with priority over the lenders’ liens, in an amount equal to such excess, (ii) in the event of certain dispositions of assets and insurance proceeds (all subject to certain exceptions), in an amount equal to 100% of the net proceeds received by the borrowers therefrom and (iii) in an amount

20

RAND LOGISTICS, INC.

Notes to the Consolidated Financial Statements (Unaudited)

(U.S. Dollars 000’s except for Shares and Per Share data)

14. LONG-TERM DEBT (continued)

equal to 100% of the net proceeds to a borrower from any issuance of a borrower’s debt or equity securities (all subject to certain exceptions).

The Fourth Amended and Restated Credit Agreement contains certain covenants, including those limiting the guarantors’, the borrowers’, and their subsidiaries’ ability to incur indebtedness, incur liens, sell or acquire assets or businesses, change the nature of their businesses, engage in transactions with related parties, make certain investments or pay dividends. In addition, the Fourth Amended and Restated Credit Agreement requires the borrowers to maintain certain financial ratios. Failure of the borrowers or the guarantors to comply with any of these covenants or financial ratios could result in the loans under the Fourth Amended and Restated Credit Agreement being accelerated.

As a result of the execution of the Fourth Amended and Restated Credit Agreement discussed above, the Company recognized a loss on extinguishment of debt of $1,267 during the fiscal year ended March 31, 2014, that consisted of the unamortized deferred financing costs in connection with previously existing financing arrangement.

On August 30, 2012, Lower Lakes Towing, Lower Lakes Transportation, Grand River and Black Creek, as borrowers, Rand LL Holdings, Rand Finance, Black Creek Holdings and the Company, as guarantors, General Electric Capital Corporation, as agent and Lender, and certain other lenders, entered into the Third Amended and Restated Credit Agreement which (i) amended and restated the Second Amended and Restated Credit Agreement in its entirety, (ii) continued the tranches of loans provided for under the Second Amended and Restated Credit Agreement, (iii) refinanced the indebtedness of Black Creek under its then-existing credit facility and added Black Creek as a U.S. Borrower, (iv) provided for certain new loans and (v) provided working capital financing, funds for other general corporate purposes and funds for other permitted purposes.

The Third Amended and Restated Credit Agreement provided for (i) a revolving credit facility including letters of credit under which Lower Lakes Towing was able to borrow up to CDN $13,500 with a seasonal overadvance facility of US $12,000, less the principal amount outstanding under the seasonal overadvance facility for Lower Lakes Transportation, and a swing line facility of CDN $4,000, subject to limitations, (ii) a revolving credit facility under which Lower Lakes Transportation was able to borrow up to US $13,500 with a seasonal overadvance facility of US $12,000, less the principal amount outstanding under the seasonal overadvance facility for Lower Lakes Towing, and a swing line facility of US $50, subject to limitations, (iii) the modification and continuation of an existing Canadian dollar denominated term loan facility under which Lower Lakes Towing was obligated to the Lenders in the amount of CDN $52,979 as of the date of the Third Amended and Restated Credit Agreement (the “2012 CDN Term Loan”), (iv) the modification and continuation of a U.S. dollar denominated term loan facility under which Grand River was obligated to the Lenders in the amount of $64,127 as of the date of the Third Amended and Restated Credit Agreement (“Grand River Term Loan”) and (v) a U.S. dollar denominated term loan facility under which Black Creek was obligated to Lenders in the amount of $28,934 as of the date of the Third Amended and Restated Credit Agreement (“Black Creek Term Loan”).

Under the Third Amended and Restated Credit Agreement, the revolving credit facilities and swing line loans were to expire on August 1, 2016. The outstanding principal amount of the 2012 CDN Term Loan borrowings was repayable as follows: (i) quarterly payments of CDN $331 commencing on December 1, 2012 and ending September 2014, (ii) quarterly payments of CDN $662 commencing December 1, 2014 and ending June 1, 2016 and (iii) a final payment in the outstanding principal amount of the 2012 CDN Term Loan upon the 2012 CDN Term Loan's scheduled maturity on August 1, 2016. The outstanding principal amount of the Grand River Term Loan borrowings was repayable as follows: (i) quarterly payments of US $401 commencing on December 1, 2012 and ending on September 1, 2014, (ii) quarterly payments of US $802 commencing December 1, 2014 and ending June 1, 2016 and (iii) a final payment in the outstanding principal amount of the Grand River Term Loan upon the Grand River Term Loan's scheduled maturity on August 1, 2016. The outstanding principal amount of the Black Creek Term Loan borrowings was repayable as follows: (i) quarterly payments of US $181 commencing on December 1, 2012 and ending September 1, 2014, (ii) quarterly payments of US $362 commencing December 1, 2014 and ending June 1, 2016 and (iii) a final payment in the outstanding principal amount of the Black Creek Term Loan upon the Black Creek Term Loan's scheduled maturity on August 1, 2016.

21

RAND LOGISTICS, INC.

Notes to the Consolidated Financial Statements (Unaudited)

(U.S. Dollars 000’s except for Shares and Per Share data)

14. LONG-TERM DEBT (continued)

Borrowings under the Canadian revolving credit facility, Canadian swing line facility and the 2012 CDN Term Loan bore an interest rate per annum, at the borrowers' option, equal to (i) the Canadian Prime Rate (as defined in the Third Amended and Restated Credit Agreement), plus 3.75% per annum or (ii) the BA Rate (as defined in the Third Amended and Restated Credit Agreement) plus 4.75% per annum. Borrowings under the U.S. revolving credit facility, the U.S. swing line facility, the Grand River Term Loan and Black Creek Term Loan bore interest, at the borrowers' option equal to (i) LIBOR (as defined in the Third amended and Restated Credit Agreement) plus 4.75% per annum, or (ii) the U.S. Base Rate (as defined in the Third Amended and Restated Credit Agreement), plus 3.75% per annum. Obligations under the Third Amended and Restated Credit Agreement were secured by (i) a first priority lien and security interest on all of the borrowers' and guarantors' assets, tangible or intangible, real, personal or mixed, existing and newly acquired, (ii) a pledge by Rand LL Holdings of all of the outstanding capital stock of the borrowers other than Black Creek; (iii) a pledge by Black Creek Holdings of most of the outstanding capital stock of Black Creek; and (iv) a pledge by Rand of all of the outstanding capital stock of Rand LL Holdings, Rand Finance and Black Creek Holdings. The indebtedness of each domestic borrower under the Third Amended and Restated Credit Agreement was unconditionally guaranteed by each other domestic borrower and by the guarantors which are domestic subsidiaries, and such guaranty was secured by a lien on substantially all of the assets of each borrower and each guarantor. Each domestic borrower also guaranteed the obligations of the Canadian borrower and each Canadian guarantor guaranteed the obligations of the Canadian borrower.

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

The Third Amended and Restated Credit Agreement contained certain covenants, including those limiting the guarantors', the borrowers' and their subsidiaries' ability to incur indebtedness, incur liens, sell or acquire assets or businesses, change the nature of their businesses, engage in transactions with related parties, make certain investments or pay dividends. In addition, the Third Amended and Restated Credit Agreement required the borrowers to maintain certain financial ratios.

As a result of the execution of the Third Amended and Restated Credit Agreement discussed above, the Company recognized a loss on extinguishment of debt of $3,339 during the fiscal year ended March 31, 2013, that consisted of the unamortized deferred financing costs in connection with previously existing financing arrangements.

As of September 30, 2014, the Company was in compliance with covenants contained in the Fourth Amended and Restated Credit Agreement.

22

RAND LOGISTICS, INC.

Notes to the Consolidated Financial Statements (Unaudited)

(U.S. Dollars 000’s except for Shares and Per Share data)

15.    SUBORDINATED DEBT

		September 30, 2014		March 31, 2014
a)	U.S. Dollar denominated term loan (Second Lien CDN Term loan) bearing interest at LIBOR rate (as defined) plus 9.5% or U.S. base rate (as defined) plus 8.5% at the Company’s option. The loan is repayable upon maturity on March 11, 2020.	$	34,200	$	34,200
b)	U.S. Dollar denominated term loan (Second Lien U.S. Term loan) bearing interest at LIBOR rate (as defined) plus 9.5% or U.S. base rate (as defined) plus 8.5% at the Company’s option. The loan is repayable upon maturity on March 11, 2020.	$	38,300	$	38,300
		$	72,500	$	72,500

On March 11, 2014, Lower Lakes Towing, Grand River and Black Creek, as borrowers, Rand LL Holdings, Rand Finance , Black Creek Holdings and Rand, as guarantors, Guggenheim Corporate Funding, LLC, as agent and Lender, and certain other lenders, entered into a Term Loan Credit Agreement (the “Term Loan Credit Agreement”), which provides term loans to (i) partially repay outstanding indebtedness of borrowers under the Third Amended and Restated Credit Agreement, (ii) partially pay the acquisition and conversion costs for a new vessel, (iii) pay accrued but unpaid dividends due on our Series A Convertible Preferred Stock and (iv) provide working capital financing, funds for other general corporate purposes and funds for other permitted purposes. The Term Loan Credit Agreement provides for (i) a U.S. Dollar denominated term loan facility under which Lower Lakes Towing is obligated to the lenders in the amount of $34,200 (the “Second Lien CDN Term Loan”), (ii) U.S. dollar denominated term loan facility under which Grand River and Black Creek are obligated to the Lenders in the amount of $38,300 (the “Second Lien U.S. Term Loan”) and (iii) an uncommitted incremental term loan facility of up to $32,500.

The outstanding principal amount of the Second Lien CDN Term Loan borrowings will be repayable upon the Second Lien CDN Term Loan’s maturity on March 11, 2020. The outstanding principal amount of the Second Lien U.S. Term Loan borrowings will be repayable upon the Second Lien U.S. Term Loan’s maturity on March 11, 2020. The Second Lien CDN Term Loan and Second Lien U.S. Term Loan will bear an interest rate per annum at borrowers’ option, equal to (i) LIBOR (as defined in the Term Loan Credit Agreement) plus 9.50% per annum, or (ii) the U.S. Base Rate (as defined in the Term Loan Credit Agreement), plus 8.50% per annum.

Obligations under the Term Loan Credit Agreement are secured by (i) a first priority lien and security interest on all of the borrowers’ and guarantors’ assets, tangible or intangible, real, personal or mixed, existing and newly acquired, (ii) a pledge by Rand LL Holdings of all of the outstanding capital stock of the borrowers, other than Black Creek and Lower Lakes Towing, and a pledge of 65% of the outstanding capital stock of Lower Lakes Towing, (iii) a pledge by Black Creek Holdings of all of the outstanding capital stock of Black Creek, (iv) a pledge by Lower Lakes Towing of all of the outstanding capital stock of Lower Lakes Ship Repair and Lower Lakes (17) and (v) a pledge by Rand of all of the outstanding capital stock of Rand LL Holdings, Rand Finance and Black Creek Holding. The indebtedness of each domestic borrower under the Term Loan Credit Agreement is unconditionally guaranteed by each other domestic borrower and by the guarantors which are domestic subsidiaries, and such guaranty is secured by a lien on substantially all of the assets of each borrower and each guarantor. Each domestic borrower also guarantees the obligations of the Canadian borrower and each Canadian guarantor guarantees the obligations of the Canadian borrower. Under the Term Loan Credit Agreement and subject to the terms of the Intercreditor Agreement (as defined below), the borrowers will be required to make mandatory prepayments of principal on term loan borrowings (i) in the event of certain dispositions of assets and insurance proceeds (all subject to certain exceptions), in an amount equal to 100% of the net proceeds received by the borrowers therefrom, and (ii) in an amount equal to 100% of the net proceeds to a borrower from any issuance of a borrower’s debt or equity securities (all subject to certain exceptions). The Term Loan Credit Agreement contains certain covenants, including those limiting the guarantors, the borrowers, and their subsidiaries’ ability to incur indebtedness, incur liens, sell or acquire assets or businesses, change the nature of their businesses, engage in transactions with related parties, make certain investments or pay dividends. In addition, the Term Loan Credit Agreement requires the borrowers to

23

RAND LOGISTICS, INC.

Notes to the Consolidated Financial Statements (Unaudited)

(U.S. Dollars 000’s except for Shares and Per Share data)

15.    SUBORDINATED DEBT (continued)

maintain certain financial ratios. Failure of the borrowers or the guarantors to comply with any of these covenants or financial ratios could result in the loans under the Term Loan Credit Agreement being accelerated. The obligations of the borrowers and the liens of the lenders under the Term Loan Credit Agreement are subject to the terms of an Intercreditor Agreement, which is further described below under the heading “Intercreditor Agreement”.

As of September 30, 2014, the Company was in compliance with covenants contained in the Term Loan Credit Agreement.

Intercreditor Agreement

Also on March 11, 2014, Lower Lakes Towing, Lower Lakes Transportation, Grand River, Black Creek, Lower Lakes Ship Repair, Rand, Rand LL Holdings, Rand Finance, Black Creek Holdings and Lower Lakes (17) (collectively, the “Credit Parties”), General Electric Capital Corporation, as agent for the lenders under the Fourth Amended and Restated Credit Agreement (the “First Lien Lenders”) and Guggenheim Corporate Funding , LLC, as agent for the lenders under the Term Loan Credit Agreement (the “Second Lien Lenders”), entered into an Intercreditor Agreement (the “Intercreditor Agreement”), pursuant to which the Second Lien Lenders have agreed to subordinate the obligations of the Credit Parties to them to the repayment of the obligations of the Credit Parties to the First Lien Lenders and have further agreed to subordinate their liens on the assets of the Credit Parties to the liens in granted in favor of the First Lien Lenders. Absent the occurrence of an Event of Default under the Fourth Amended and Restated Credit Agreement, the Second Lien Lenders are permitted to receive regularly scheduled principal and interest payments under the Term Loan Credit Agreement.

24

RAND LOGISTICS, INC.

Notes to the Consolidated Financial Statements (Unaudited)

(U.S. Dollars 000’s except for Shares and Per Share data)

16. COMMITMENTS

The Company did not have any leases which met the criteria of a capital lease as of September 30, 2014. Leases which do not qualify as capital leases are classified as operating leases. Operating lease rental and sublease rental payments included in general and administrative expenses are as follows:

	Three months ended September 30, 2014		Three months ended September 30, 2013		Six months ended September 30, 2014		Six months ended September 30, 2013
Operating leases	$	150	$	146	$	295	$	277
Operating sublease	41		40		81		79
	$	191	$	186	$	376	$	356

The Company’s future minimum rental commitments under other operating leases are as follows.

Twelve month period ending:

September 30, 2015	$	509
September 30, 2016	379
September 30, 2017	295
September 30, 2018	225
September 30, 2019	131
Thereafter	380
	$	1,919

The Company is party to a bareboat charter agreement for the McKee Sons barge that expires in December 2018.  The chartering cost included in vessel operating expenses was $Nil for the six month period ended September 30, 2014 ($254 for the six month period ended September 30, 2013). The lease was amended on February 22, 2008 to provide a lease payment deferment in return for leasehold improvements. The lease contains a clause whereby annual payments escalate at the Consumer Price Index, capped at a maximum annual increase of 3%. Total charter commitments for the McKee Sons vessel for the term of the lease before inflation adjustments are set forth below. 

Twelve month period ending:

September 30, 2015	$	771
September 30, 2016	771
September 30, 2017	771
September 30, 2018	772
September 30, 2019	257
	$	3,342

As of September 30, 2014, the Company had signed contractual commitments with several suppliers totaling $17,453 ($1,801 as of March 31, 2014) in connection with capital expenditures and shipyard projects due in less than one year.

25

RAND LOGISTICS, INC.

Notes to the Consolidated Financial Statements (Unaudited)

(U.S. Dollars 000’s except for Shares and Per Share data)

17. CONTINGENCIES

The Company is not involved in any legal proceedings which are expected to have a material effect on its business, financial position, results of operations or liquidity, nor is the Company aware of any proceedings that are pending or threatened which may have a material effect on the Company’s business, financial position, results of operations or liquidity.  From time to time, the Company may be subject to legal proceedings and claims in the ordinary course of business involving principally commercial charter party disputes, and claims for alleged property damages, personal injuries and other matters. Those claims, even if lacking merit, could result in the expenditure of significant financial and managerial resources.  It is expected that larger claims would be covered by insurance, subject to customary deductibles, if they involve liabilities that may arise from allision, other marine casualty, damage to cargoes, oil pollution, death or personal injuries to crew. The Company evaluates the need for loss accruals under the requirements of ASC 450 – Contingencies.  The Company records an estimated loss for any claim, lawsuit, investigation or proceeding when it is probable that a liability has been incurred and the amount of the loss can reasonably be estimated. If the reasonable estimate of a probable loss is a range, and no amount within the range is a better estimate, then the Company records the minimum amount in the range as the loss accrual. If a loss is not probable or a probable loss cannot be reasonably estimated, no liability is recorded. As of September 30, 2014 an accrual of $237 ($138 as of March 31, 2014) was recorded for various claims.  Management does not anticipate material variations in actual losses from the amounts accrued related to these claims.

18. STOCKHOLDERS’ EQUITY

On September 21, 2011, the Company completed a public underwritten offering of 2,800,000 shares of the Company’s common stock for $6.00 per share.  The Company’s proceeds from the offering, net of underwriter’s commissions and expenses, were $15,525.

On February 11, 2011, in connection with the Company's acquisition of two vessels, the Company issued 1,305,963 shares of the Company’s common stock to the seller of such vessels. Such shares were valued at the average of high and low price on that day of $5.175.

The Company is authorized to issue 1,000,000 shares of preferred stock with such designations, voting and other rights and preferences that may be determined from time to time by the Board of Directors. The shares of the Company’s series A convertible preferred stock: rank senior to the Company’s common stock with respect to liquidation and dividends; are entitled to receive a cash dividend at the annual rate of 7.75% (based on the $50 per share issue price) payable quarterly (subject to increases of 0.5% for each six month period in respect of which the dividend is not timely paid, up to a maximum of 12%, subject to reversion to 7.75% upon payment of all accrued and unpaid dividends); are convertible into shares of the Company’s common stock at any time at the option of the series A preferred stockholder at a conversion price of $6.20 per share (based on the $50 per share issue price and subject to adjustment) or 8.065 shares of common stock for each Series A Preferred Share (subject to adjustment); are convertible into shares of the Company’s common stock (based on a conversion price of $6.20 per share, subject to adjustment) at the option of the Company if, after the third anniversary of the acquisition, the trading price of the Company’s common stock for 20 trading days within any 30 trading day period equals or exceeds $8.50 per share (subject to adjustment); may be redeemed by the Company in connection with certain change of control or acquisition transactions; will vote on an as-converted basis with the Company’s common stock; and have a separate vote over certain material transactions or changes involving the Company.

The accrued preferred stock dividends payable at September 30, 2014 were $291 and at March 31, 2014 were $Nil. As of September 30, 2014 and March 31, 2014, the effective dividend rate of the preferred stock was 7.75% .

26

RAND LOGISTICS, INC.

Notes to the Consolidated Financial Statements (Unaudited)

(U.S. Dollars 000’s except for Shares and Per Share data)

18. STOCKHOLDERS’ EQUITY (continued)

Since January 2007, share-based compensation has been granted to management and directors from time to time.  The Company had no surviving, outstanding share-based compensation agreements with employees or directors prior to that date except as described below.  The Company has reserved 2,500,000 shares for issuance under the Company’s 2007 Long Term Incentive Plan (the “LTIP”) to employees, officers, directors and consultants.  At September 30, 2014, a total of 444,355 shares (589,066 shares at March 31, 2014) were available under the LTIP for future awards.

The following table summarizes shares issued to officers under employment agreements and restricted stock agreements from time to time.

Date issued	No. of Officers Covered	No. of Shares	Share Price	Reference	Expense
				Vesting	Three months ended September 30, 2014	Three months ended September 30, 2013	Six months ended September 30, 2014	Six months ended September 30, 2013
Oct 13, 2009	1	39,660	3.17	Employment Agreement	—	7	—	13
				20% in each of five fiscal years ending March 31, 2014.
Apr 8, 2011	6	86,217	7.94	Restricted Share Award Agreement	—	56	—	113
				Three years in equal installments on each anniversary date.
Apr 11, 2012	2	45,754	8.68	Restricted Share Award Agreement	33	33	66	66
				Three years in equal installments on each anniversary date.
Feb 22, 2013	4	32,387	5.96	Restricted Share Award Agreement	23	25	46	49
				Two years in equal installments on each anniversary date.
Jun 5, 2013	6	54,337	5.55	Restricted Share Award Agreement	25	25	50	33
				Three years in equal installments on each anniversary date.
Jul 22, 2014	10	105,189	5.90	Restricted Share Award Agreement	34	—	34	—
				Three years in equal installments on each anniversary date.

For all share-based compensation, as employees and directors render service over the vesting periods, expense is recorded in general and administrative expenses. Share capital and additional paid-in capital are increased on the grant date with an offset to prepaid assets. Grant date fair market value for all non-option share-based compensation is the average of the high and low trading prices on the date of grant.

27

RAND LOGISTICS, INC.

Notes to the Consolidated Financial Statements (Unaudited)

(U.S. Dollars 000’s except for Shares and Per Share data)

18.STOCKHOLDERS’ EQUITY (continued)

The general characteristics of share-based awards granted under the LTIP through September 30, 2014 are as follows:

Stock Awards - All of the shares issued to non-employee outside directors vest immediately.  The first award to non-employee outside directors in the amount of 12,909 shares was made on February 13, 2008 for services through March 31, 2008.  During the fiscal year ended March 31, 2009, the Company awarded 15,948 shares for services from April 1, 2008 through December 31, 2008. The Company awarded 37,144 shares during the fiscal year ended March 31, 2010 for services from January 1, 2009 through March 31, 2010. During the fiscal year ended March 31, 2011, the Company awarded 14,007 shares for services provided from April 1, 2010 through March 31, 2011. During the fiscal year ended March 31, 2012, the Company awarded 10,722 shares for services from April 1, 2011 to March 31, 2012. During the fiscal year ended March 31, 2013, the Company awarded 10,854 shares for services provided from April 1, 2012 to March 31, 2013. During the fiscal year ended March 31, 2014, the Company awarded 19,256 shares for services rendered from April 1, 2013 to March 31, 2014. During the six month period ended September 30, 2014, the Company awarded 9,472 shares for services rendered from April 1, 2014 to September 30, 2014. Grant date fair market value for all these awards is the average of the high and low trading prices of the Company’s common stock on the date of grant.

On July 31, 2008, the Company’s Board of Directors authorized management to make payments effective as of that date to the participants in the management bonus program. Pursuant to the terms of the management bonus program, Rand issued 478,232 shares of common stock to such employee participants.

Stock Options - Stock options granted to management employees vest over three years in equal annual installments. All options issued through September 30, 2014 expire ten years from the date of grant. Stock option grant date fair values are determined at the date of grant using a Black-Scholes option pricing model, a closed-form fair value model based on market prices at the date of grant. At each grant date the Company has estimated a dividend yield of 0%.  The weighted average risk free interest rate within the contractual life of the option is based on the U.S. Treasury yield curve in effect at the time of the grant, which was 4.14% for the fiscal 2009 (July 2008) grant. Expected volatility for the fiscal 2009 grants was based on the prior 26 week period, which reflected trading and volume after the Company made major announcements on acquisitions and capital investments. Expected volatility was 39.49% for the fiscal 2009 grant. Options outstanding (479,785) at September 30, 2014, had a remaining weighted average contractual life of approximately three years.  The Company recorded compensation expenses related to such stock options of $Nil for each of the three and six month periods ended September 30, 2014 and September 30, 2013. All of the stock options granted in February 2008 (243,199) and July 2008 (236,586), had vested as of September 30, 2014.

Shares issued under Employees’ Retirement Savings Plans - The Company issued an aggregate of 204,336 shares to the individual retirement plans of all eligible Canadian employees under the LTIP from July 1, 2009 through September 30, 2014.  The Canadian employees’ plans are managed by independent brokerages. These shares vested immediately but are subject to the Company’s Insider Trading Policy. The shares were issued using the fair value share price, as defined by the LTIP, as of the first trading day of each month for that previous period’s accrued expense. The Company granted $Nil of equity of such accrued compensation expense for each of the three and six month periods ended September 30, 2014 and September 30, 2013.

Shares issued in lieu of cash compensation - The Company experienced a decrease in customer demand at the beginning of the 2009 sailing season and in an effort to maximize the Company’s liquidity, the Compensation Committee of the Company’s Board of Directors requested that five of the Company’s executive officers and all of its outside directors receive common stock as compensation in lieu of cash until the Company had better visibility about its outlook. As of November 16, 2009, the Company issued 158,325 shares to such officers and all of its outside directors at the average of the high and low sale prices Company’s common stock on the date of grant. The shares were issued under the LTIP and vested immediately. Beginning the third quarter of the fiscal year ended March 31, 2010, such executives' and outside directors’ compensation reverted back to cash.

28

RAND LOGISTICS, INC.

Notes to the Consolidated Financial Statements (Unaudited)

(U.S. Dollars 000’s except for Shares and Per Share data)

18.STOCKHOLDERS’ EQUITY (continued)

Restricted Stock Units -On June 27, 2014, The Company issued 30,050 Restricted Stock Units (“RSU”) to eligible US and Canadian employees under the LTIP. Each RSU represents one share of the Company's common stock. The grant date fair value of each RSU was $5.99, which represents the average of the high and low sale prices of the Company’s common stock on the date of grant. One-third of the RSU's vest on March 31 of each year, beginning on March 31, 2015. RSUs are not entitled to dividends or voting rights, if any, until the underlying shares of common stock are delivered. The total compensation cost of this grant is $204, net of estimated forfeitures. The fair value of the RSU awards is recognized on a straight-line basis over the vesting period. The Company recorded expense of $20 for each of the three and six month periods ended September 30, 2014.

On September 16, 2010, the Company issued 15,153 shares to a key executive for payment of the fiscal year 2010 bonus at the average of the high and low sale prices of the Company’s common stock on the date of grant. The shares were issued under the LTIP and vested immediately. On February 15, 2013, the Company issued 94,993 shares to eligible Canadian and U.S. employees for a bonus at the average of the high and low trading prices of the Company’s common stock on the date of grant. The shares were issued under the LTIP and vested immediately.

19. INTEREST EXPENSE

Interest expense is comprised of the following:

	Three months ended September 30, 2014			Three months ended September 30, 2013		Six months ended September 30, 2014			Six months ended September 30, 2013
Bank indebtedness	$	155		$	245	$	334		$	526
Amortization of deferred financing costs	333			135		666			271
Long-term debt-senior	1,265			1,928		2,519			3,862
Long-term debt-subordinated	1,992			—		3,953			—
Interest rate caps	3			2		5			3
Deferred payment liability	27			35		55			72
Interest capitalized	(68		)	—		(68		)	—
	$	3,707		$	2,345	$	7,464		$	4,734

29

RAND LOGISTICS, INC.

Notes to the Consolidated Financial Statements (Unaudited)

(U.S. Dollars 000’s except for Shares and Per Share data)

20. SEGMENT INFORMATION

The Company has identified only one reportable segment under ASC 280 “Segment Reporting”.

Information about geographic operations is as follows:

	Three months ended September 30, 2014		Three months ended September 30, 2013		Six months ended September 30, 2014		Six months ended September 30, 2013
Revenue by country:
Canada	$	31,012	$	28,522	$	55,212	$	56,966
United States	23,258		22,019		42,367		41,976
	$	54,270	$	50,541	$	97,579	$	98,942

Revenues from external customers are allocated based on the country of the legal entity of the Company in which the revenues were recognized.

	September 30, 2014		March 31, 2014
Property and equipment by country:
Canada	$	100,830	$	99,050
United States	113,393		116,437
	$	214,223	$	215,487
Intangible assets by country:
Canada	$	8,788	$	9,666
United States	6,059		6,567
	$	14,847	$	16,233
Goodwill by country:
Canada	$	8,284	$	8,284
United States	1,909		1,909
	$	10,193	$	10,193
Total assets by country:
Canada	$	140,626	$	130,817
United States	137,690		134,189
	$	278,316	$	265,006

30

RAND LOGISTICS, INC.

Notes to the Consolidated Financial Statements (Unaudited)

(U.S. Dollars 000’s except for Shares and Per Share data)

21. FINANCIAL INSTRUMENTS

Fair value of financial instruments

Financial instruments are comprised of cash and cash equivalents, accounts receivable, accounts payable, long-term debts, a deferred payment liability, accrued liabilities and bank indebtedness.  The estimated fair values of cash and cash equivalents, accounts receivable, accounts payable and accrued liabilities approximate book values because of the short-term maturities of these instruments.  The estimated fair value of senior debt approximates the carrying value as the debt bears interest at variable interest rates, which are based on rates for similar debt with similar credit rates in the open market.  The subordinated note and deferred payment liabilities are valued based on the interest rate of similar debt in the open market.

Fair value guidance establishes a valuation hierarchy for disclosure of the inputs to valuation used to measure fair value. A financial asset's or liability's classification within the hierarchy is determined based on the lowest level input that is significant to the fair value measurement.

In August 2014, the Company entered into a rolling foreign currency hedge contract to mitigate currency fluctuation risk on a portion of its subordinated US dollar denominated debt owed by Lower Lakes Towing.

Fair value guidance establishes a valuation hierarchy for disclosure of the inputs to valuation used to measure fair value. This hierarchy prioritizes the inputs into three broad levels as follows. Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities. Level 2 inputs are quoted prices for similar assets and liabilities in active markets or inputs that are observable for the asset or liability, either directly or indirectly through market corroboration, for substantially the full term of the financial instrument. Level 3 inputs are unobservable inputs based on our own assumptions used to measure assets and liabilities at fair value. A financial asset or liability's classification within the hierarchy is determined based on the lowest level input that is significant to the fair value measurement.

The following table provides the fair value of the foreign currency hedge contract measured on a recurring basis as of September 30, 2014 and March 31, 2014:

		Fair value measurements at September 30, 2014			Fair value measurements at March 31, 2014
	Carrying value at September 30, 2014	Quoted prices in active markets (Level 1)	Significant other observable inputs (Level 2)	Carrying value at March 31, 2014	Quoted prices in active markets (Level 1)	Significant other observable inputs (Level 2)
Foreign currency hedge contract	$95	$—	$95	$—	$—	$—

The foreign currency hedge contract is measured at fair value using available rates on the similar instruments and is classified within Level 2 of the valuation hierarchy. This contract is accounted for using the mark-to-market accounting method as if the contract were terminated at the day of valuation. There were no transfers into or out of Levels 1 and 2 of the fair value hierarchy during the six month period ended September 30, 2014.

The Company recorded a receivable of $95 as of September 30, 2014 for this foreign currency hedge contract on a portion of the Company’s US dollar denominated subordinated debt owed by Lower Lakes Towing. For each of the three and six month periods ended September 30, 2014, the fair value adjustment of the foreign currency hedge contract resulted in a gain of $379. This gain is included in the Company’s earnings and the fair value of settlement cost to terminate the contract is included in current assets on the Company's consolidated balance sheets.

31

RAND LOGISTICS, INC.

Notes to the Consolidated Financial Statements (Unaudited)

(U.S. Dollars 000’s except for Shares and Per Share data)

21.FINANCIAL INSTRUMENTS (continued)

 The following table sets forth the fair value of the foreign currency hedge instrument as of the dates set forth below:

Derivatives not designated as hedging instrument:	Balance Sheet location	Fair Value as at September 30, 2014	Fair Value as at March 31, 2014
Foreign currency hedge contract	Current assets	$95	$—

The Company has not designated this contract as a hedging instrument. The changes in fair value of the foreign currency hedge contract is recorded in earnings as follows:

Derivatives not designated as hedging instrument:	Location of loss (gain) -Recognized in earnings	Three months ended September 30, 2014	Six month ended September 30, 2014	Three months ended September 30, 2013	Six month ended September 30, 2013
Foreign currency hedge contract	Loss (gain) on foreign exchange	$(379)	$(379)	$—	$—

Foreign exchange risk

Foreign currency exchange risk to the Company results primarily from changes in exchange rates between the Company’s reporting currency, the U.S. Dollar, and the Canadian dollar.  As discussed above, in August 2014, the Company entered into a rolling foreign currency hedge contract to mitigate currency fluctuation risk on a portion of its U.S. dollar denominated subordinated debt owed by Lower Lakes Towing. The Company is exposed to fluctuations in foreign exchange as a significant portion of revenue and operating expenses are denominated in Canadian dollars.

Interest rate risk

The Company is exposed to fluctuations in interest rates as a result of its banking facilities and senior debt bearing variable interest rates.

In December 2012, the Company entered into two interest rate cap contracts covering 50% of its outstanding term debt on the date of such contracts at a cap of three month Libor at 2.5% on its U.S. Term Debt borrowings and a cap of three month BA rates at 3.0% on its Canadian Term Debt borrowings. The notional amount on each of these instruments will decrease with each scheduled principal payment of the term loan under the Third Amended and Restated Credit Agreement, notwithstanding the termination of such agreement. The interest rate cap contracts will terminate on December 1, 2015. Such contracts cover approximately 64% of first lien term debt as of September 30, 2014.

Credit risk

Accounts receivable credit risk is mitigated by the diversification of the Company’s customers among industries and the short shipping season.

Liquidity risk

The ongoing tightened credit in financial markets and continued general economic downturn in some markets may adversely affect the ability of the Company’s customers and suppliers to obtain financing for significant operations and purchases and to perform their obligations under agreements with the Company.  The tightening of credit could (i) result in a decrease in, or cancellation of, existing business, (ii) limit new business, (iii) negatively impact the Company’s ability to collect accounts receivable on a timely basis and (iv) affect the eligible receivables that are collateral for the Company’s lines of credit.  The Company makes seasonal net borrowings under its revolving credit facility during the first quarter of each fiscal year to fund working capital needed to commence the sailing season. Such borrowings are then reduced during the second half of each fiscal year.

32

RAND LOGISTICS, INC.

Notes to the Consolidated Financial Statements (Unaudited)

(U.S. Dollars 000’s except for Shares and Per Share data)

22. EARNINGS PER SHARE

The Company had a total of 18,010,147 shares of common stock issued and outstanding as of September 30, 2014, out of an authorized total of 50,000,000 shares. The fully diluted calculation utilizes a total of 20,338,879 shares for the three month period ended September  30, 2013 and 20,317,211 for the six month period ended September 30, 2013. Since the calculation for three month and six month periods ended September 30, 2013 are anti-dilutive, the basic and fully diluted weighted average shares outstanding are 17,919,524 and 17,897,856, respectively. The convertible preferred shares convert to an aggregate of 2,419,355 common shares based on a conversion price of $6.20.

	Three months ended September 30, 2014			Three months ended September 30, 2013			Six months ended September 30, 2014			Six months ended September 30, 2013
Numerator:
Net income before preferred dividends	$	5,836		$	1,215		$	7,895		$	3,793
Preferred stock dividends	(290		)	(879		)	(581		)	(1,733		)
Net income applicable to common stockholders	$	5,546		$	336		$	7,314		$	2,060
Denominator:
Weighted average common shares for basic EPS	18,002,591			17,919,524			17,968,438			17,897,856
Effect of dilutive securities:
Average price during period	6.09			5.08			6.16			5.34
Long term incentive stock option plan	479,785			479,785			479,785			479,785
Average exercise price of stock options	5.66			5.66			5.66			5.66
Shares that could be acquired with the proceeds of options	446,172			—			440,554			—
Dilutive shares due to options	33,613			—			39,231			—
Restricted Stock Units (RSU)	30,050			—			15,764			—
Average exercise price of RSU	5.99			—			5.99			—
Shares that could be acquired with the proceeds of RSU	29,574			—			15,319			—
Dilutive shares due to RSU	476			—			445			—
Weighted average convertible preferred shares at $6.20	2,419,355			2,419,355			2,419,355			2,419,355
Weighted average common shares for diluted EPS	20,456,035			17,919,524			20,427,469			17,897,856
Basic EPS	$	0.31		$	0.02		$	0.41		$	0.12
Diluted EPS	$	0.29		$	0.02		$	0.39		$	0.12

33

Item 2.    Management's Discussion and Analysis of Financial Condition and Results of Operations

All dollar amounts are presented in millions except share, per share and per day amounts.

The following Management's Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) is written to help the reader understand our company. The MD&A is provided as a supplement to, and should be read in conjunction with, the Consolidated Financial Statements and the accompanying financial statement notes of the Company appearing elsewhere in this Quarterly Report on Form 10-Q for the three and six month periods ended September 30, 2014.

Cautionary Note Regarding Forward-Looking Statements

This quarterly report on Form 10-Q contains forward-looking statements, including those relating to our capital needs, business strategy, expectations and intentions. Statements that use the terms “believe”, “anticipate”, “expect”, “plan”, “estimate”, “intend” and similar expressions of a future or forward-looking nature identify forward-looking statements for purposes of the U.S. federal securities laws or otherwise. For these statements and all other forward-looking statements, we claim the protection of the Safe Harbor for Forward-Looking Statements contained in the Private Securities Litigation Reform Act of 1995.

 Forward-looking statements are inherently subject to risks and uncertainties, many of which cannot be predicted with accuracy or are otherwise beyond our control and some of which might not even be anticipated.  Forward-looking statements reflect our current views with respect to future events and because our business is subject to such risks and uncertainties, actual results, our strategic plan, our financial position, results of operations and cash flows could differ materially from those described in or contemplated by the forward-looking statements contained in this report.

 Important factors that contribute to such risks include, but are not limited to, those factors set forth under “Risk Factors” on our Form 10-K filed with the Securities and Exchange Commission on June 12, 2014, which include: the continuing effects of the economic downturn in our markets; the weather conditions on the Great Lakes; and our ability to maintain and replace our vessels as they age. The foregoing review of important factors should not be construed as exhaustive and should be read in conjunction with other cautionary statements that are included in this report. We undertake no obligation to publicly update or review any forward-looking statements, whether as a result of new information, future developments or otherwise.

Overview

Business

Rand (formerly Rand Acquisition Corporation) was incorporated in the State of Delaware in 2004.

On March 3, 2006, we acquired all of the outstanding shares of capital stock of Lower Lakes Towing Ltd. ("Lower Lakes Towing"), a Canadian corporation which, with its subsidiary Lower Lakes Transportation Company ("Lower Lakes Transportation"), provides bulk freight shipping services throughout the Great Lakes region, and at the time of acquisition, operated eight vessels. As part of the acquisition of Lower Lakes, we also acquired Lower Lakes’ affiliate, Grand River Navigation Company, Inc. ("Grand River"). Prior to the acquisition, we did not conduct, or have any investment in, any operating business.

Subsequent to the acquisition, we have added ten vessels to our fleet through acquisition transactions and we retired two smaller vessels. In this Quarterly Report on Form 10-Q, unless the context otherwise requires, references to Rand, we, us and the Company include Rand and its direct and indirect subsidiaries, and references to Lower Lakes' business or the business of Lower Lakes mean the combined businesses of Lower Lakes Towing, Lower Lakes Transportation, Grand River and our additional operating subsidiary, Black Creek Shipping Company, Inc. ("Black Creek").

Lower Lakes Ship Repair Company Ltd., a wholly owned subsidiary of Lower Lakes Towing, was incorporated on December 27, 2012 under the laws of Canada. This company provides ship repair services exclusively for the Lower Lakes fleet.

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On March 11, 2014, Lower Lakes Towing (17) Ltd. ("Lower Lakes (17)"), a wholly-owned subsidiary of Lower Lakes Towing, was incorporated under the laws of Canada.

Our shipping business is operated in Canada by Lower Lakes Towing and in the United States by Lower Lakes Transportation. Lower Lakes Towing was organized in March 1994 under the laws of Canada to provide marine transportation services to dry bulk goods suppliers and purchasers operating in ports on the Great Lakes and has grown from its origin as a small tug and barge operator to a full service shipping company with a fleet of sixteen cargo-carrying vessels. We have grown to become one of the largest bulk shipping companies operating on the Great Lakes and the leading service provider in the River Class market segment, which we define as vessels less than 650 feet in overall length. We transport construction aggregates, salt, iron ore, coal, grain and other dry bulk commodities for customers in the construction, electric utility, integrated steel and food industries.

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

Lower Lakes' fleet consists of five self-unloading bulk carriers and four conventional bulk carriers in Canada and seven self-unloading bulk carriers in the U.S., including one integrated tug and barge unit and three articulated tug and barge units. Lower Lakes Towing owns the nine Canadian vessels. Lower Lakes Transportation time charters the seven U.S. vessels, including the four tug and barge units, from Grand River. With the exception of one barge (which Grand River bareboat charters from an unrelated third party) and two of the articulated tug and barge units (which Grand River bareboat charters from Black Creek), Grand River owns the vessels that it time charters to Lower Lakes Transportation.

Use of Non-GAAP Measures

Our discussion of our Results of Operations contains references to certain Non-GAAP financial measures, including (1) operating income plus depreciation, amortization of drydock costs, amortization of intangibles and loss (gain) on foreign exchange, (2) operating income plus depreciation, amortization of drydock costs and amortization of intangibles and (3) marine transportation performance measures consisting of Sailing Days, Delay Days and per day measurements. Such measures are used internally when evaluating our operating performance and, we believe, allow investors to make a more meaningful comparison between our business operating results over different periods of time, as well as with those of other similar companies. Management believes that such measures, when viewed with the Company's results under GAAP and the accompanying reconciliation, provides useful information about our operating performance and period-over-period comparisons. Additionally, management believes that (1) operating income plus depreciation, amortization of drydock costs, amortization of intangibles and loss (gain) on foreign exchange and (2) operating income plus depreciation, amortization of drydock costs and amortization of intangibles permit investors to gain an understanding of the factors and trends affecting our ongoing cash earnings. However, such measures are not measures of financial performance or liquidity under GAAP and, accordingly, should not be considered as an alternative to net income or cash flow from operating activities as indicators of operating performance or liquidity.  Instead, such performance measures should be viewed in addition to, and not in lieu of or superior to, our operating performance measures calculated in accordance with GAAP. Reconciliations of such non-GAAP measures to GAAP measures are provided below.

Our discussion of our Results of Operations also contains references to constant currency amounts. The constant currency information presented herein is calculated by translating current period results using prior period weighted average foreign currency exchange rates. Revenue from our Canadian operations has historically represented more than half of our total revenue. Consequently, our revenue has been impacted, and we expect will continue to be impacted, by fluctuations in foreign currency exchange rates. For example, if the Canadian dollar weakens, our consolidated results stated in U.S. dollars are negatively impacted. These rate fluctuations can have a significant effect on our reported results. As a supplement to our reported operating results, we present constant currency financial information, which is a non-GAAP financial measure. We use constant currency information to provide a framework to assess how our business performed excluding the effects of foreign currency fluctuations. We believe this information is useful to investors to facilitate comparisons of operating results and better identify trends in our business. These constant currency performance measures should be viewed in addition to, and not in lieu of or superior to, our operating performance measures calculated in accordance with GAAP.

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Results of Operations for the three month period ended September 30, 2014 compared to the three month period ended September 30, 2013

Selected Financial and Operating Information

(USD in 000's)	Three months ended September 30, 2014		Three months ended September 30, 2013		$ Change		% Change
Revenue:
Freight and related revenue	$	46,102	$	42,955	$	3,147	7.3	%
Fuel and other surcharges	$	8,168	$	7,586	$	582	7.7	%
Total	$	54,270	$	50,541	$	3,729	7.4	%
Expenses:
Vessel operating expenses	$	33,612	$	31,608	$	2,004	6.3	%
Operating income plus depreciation, amortization of drydock costs, amortization of intangibles and loss (gain) on foreign exchange	17,364		15,620		1,744		11.2	%
Operating Income plus loss (gain) on foreign exchange	$	11,507	10,197		$	1,310	12.8	%
OPERATING INCOME	$	10,246	$	10,200	$	46	0.5	%
Sailing days:	1,351		1,286		65		5.1	%
Number of vessels operated:	15		15		—		—	%
Per day in whole USD:
Revenue per sailing day:
Freight and related revenue	$	34,124	$	33,402	$	722	2.2	%
Fuel and other surcharges	$	6,046	$	5,899	$	147	2.5	%
Expenses per sailing day:
Vessel operating expenses	$	24,879	$	24,579	$	300	1.2	%

The following table provides a reconciliation of operating income plus depreciation, amortization of drydock costs, amortization of intangibles and loss/(gain) on foreign exchange during the three month periods ended September 30, 2014 and 2013 (USD in 000's)
	Three months ended September 30, 2014		Three months ended September 30, 2013
Operating Income	$	10,246	$	10,200
Depreciation	$	4,693	$	4,275
Amortization of drydock costs	$	856	$	829
Amortization of intangibles	$	308	$	319
Loss/(gain) on foreign exchange	$	1,261	$	(3	)
Operating income plus depreciation, amortization of drydock costs, amortization of intangibles and loss/(gain) on foreign exchange	$	17,364	$	15,620

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The following table summarizes the changes in the components of our revenue and certain expenses during the three month period ended September 30, 2014 compared to the three month period ended September 30, 2013:

(USD in 000's)	Freight and related revenue			Fuel and other surcharges			Total revenue			Vessel operating expenses			Repairs and Maintenance			G&A			*Subtotal
Three months ended September 30, 2013	$	42,955		$	7,586		$	50,541		$	31,608		$	118		$	3,195		$	15,620
Changes in three month period ended September 30, 2013:
Change attributable to weaker Canadian dollar	(1,185		)	(275		)	(1,460		)	(924		)	(6		)	(76		)	(454		)
Net change on a constant currency basis	4,332			857			5,189			2,928			(117		)	180			2,198
Total Change	$	3,147		$	582		$	3,729		$	2,004		(123		)	104			1,744
Three months ended September 30, 2014	$	46,102		$	8,168		$	54,270		$	33,612		$	(5	)	$	3,299		$	17,364

* Operating Income plus Depreciation, Amortization of Drydock Costs, Amortization of Intangibles and Loss/(Gain) on Foreign Exchange

Total revenue during the three month period ended September 30, 2014 was $54.3 million, an increase of 7.4%, compared to $50.5 million during the three month period ended September 30, 2013. This increase was primarily attributable to additional Sailing Days, which we define as days a vessel is crewed and available for sailing, (resulting in a modest increase in tonnage carried and an associated increase in Freight and related revenue and Fuel and other surcharges), contractual price increases, improvements in commodity mix and water levels and a higher percentage of time spent in revenue loaded condition. This increase in revenue was dampened by the deterioration of the Canadian dollar during the three month period ended September 30, 2014. On a constant currency basis, our total revenue increased 10.3%, or $5.2 million, during the three month period ended September 30, 2014 compared to the three month period ended September 30, 2013.

According to the Lake Carriers' Association, during the three month period ended September 30, 2014, U.S.-flagged vessels experienced a 7.4% increase in overall customer shipments for the commodities that we carry on the Great Lakes compared to the three month period ended September 30, 2013. On a total Great Lakes basis, which includes Canadian and U.S. ports, iron ore shipments increased 16.7%, coal shipments decreased 1.7% and aggregates shipments increased a 7.2%, in each case during the three month period ended September 30, 2014 compared to the three month period ended September 30, 2013. These commodities account for a significant share of the dry bulk commodities that are transported on the Great Lakes.

Freight and other related revenue generated from Company-operated vessels increased $3.1 million, or 7.3%, to $46.1 million during the three month period ended September 30, 2014 compared to $43.0 million during the three month period ended September 30, 2013. On a constant currency basis, freight and other related revenue increased 10.1%, or $4.3 million, during the three month period ended September 30, 2014 compared to the three month period ended September 30, 2013.

Our tonnage carried during the three month period ended September 30, 2014 increased 1.8% compared to the three month period ended September 30, 2013. During the three month period ended September 30, 2014, we experienced an increase in iron ore, salt, and grain carried of 58.6%, 39.3%, and 7.6%, respectively, offset by a reduction of aggregates and coal carried of 8.3% and 13.9%, respectively, in each case when compared to the three month period ended September 30, 2013.

We operated fifteen vessels during each of the three month periods ended September 30, 2014 and September 30, 2013. Management believes that each of our vessels should achieve a theoretical maximum of 92 Sailing Days in our second fiscal quarter, assuming no major repairs, incidents or vessel layups and normal drydocking cycle times performed during the winter lay-up period. The Company’s vessels sailed an average of approximately 90 Sailing Days during the three month period ended September 30, 2014, representing 97.9% of the theoretical maximum, compared to an average of 86 Sailing Days during the three month period ended September 30, 2013, or 93.2% of the theoretical maximum.

We also measure Delay Days, which we define as the lost time incurred by our vessels while in operation, and includes delays caused by inclement weather, dock delays, traffic congestion, vessel mechanical issues and other varied events. We

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experienced 72 Delay Days during the three month period ended September 30, 2014 compared to 93 Delay Days during the three month period ended September 30, 2013. Such Delay Days represent a Lost Time Factor, calculated as Delay Days as a percentage of Sailing Days, of 5.3% during the three month period ended September 30, 2014 compared to 7.2% during the three month period ended September 30, 2013.

Freight and related revenue per Sailing Day increased $722, or 2.2%, to $34,124 per Sailing Day during the three month period ended September 30, 2014 compared to $33,402 per Sailing Day during the three month period ended September 30, 2013. This revenue increase was due to a change in the mix of cargos carried, the associated price of those cargos, higher water levels and the efficiency of trade patterns. On a constant currency basis, freight and related revenue per Sailing Day increased 4.8%, or $1,600 per Sailing Day, during the three month period ended September 30, 2014 compared to the three month period ended September 30, 2013.

All of our customer contracts have fuel surcharge provisions whereby changes in our fuel costs are passed on to our customers. Such increases and decreases in fuel surcharges impact margin percentages, but do not significantly impact our margin dollars. Fuel and other surcharges increased $0.6 million, or 7.7%, to $8.2 million during the three month period ended September 30, 2014 compared to $7.6 million during the three month period ended September 30, 2013. This increase was attributable to an additional 65 Sailing Days during the three month period ended September 30, 2014 compared to the three month period ended September 30, 2013, offset by reduced fuel prices and a weaker Canadian dollar. Fuel and other surcharges per Sailing Day increased by $147, or 2.5%, to $6,046 per Sailing Day during the three month period ended September 30, 2014 compared to $5,899 per Sailing Day during the three month period ended September 30, 2013.

Vessel operating expenses increased $2.0 million, or 6.3%, to $33.6 million during the three month period ended September 30, 2014 compared to $31.6 million during the three month period ended September 30, 2013. This increase was primarily due to a greater number of Sailing Days during the three month period ended September 30, 2014 compared to the three month period ended September 30, 2013, offset by a weaker Canadian dollar and reduced fuel prices. On a constant currency basis, vessel operating expenses increased 9.3%, or $2.9 million, during the three month period ended September 30, 2014 compared to the three month period ended September 30, 2013. Vessel operating expenses per Sailing Day increased $300, or 1.2%, to $24,879 per Sailing Day during the three month period ended September 30, 2014 from $24,579 per Sailing Day during the three month period ended September 30, 2013.

Our general and administrative expenses were $3.3 million during the the three month period ended September 30, 2014 compared to $3.2 million during the three month period ended September 30, 2013. The modest increase was due to additional costs related to the contested proxy solicitation and compensation and benefit inflationary cost increases, offset by the weaker Canadian dollar. Our general and administrative expenses represented 7.2%of freight revenues during the three month period ended September 30, 2014 and 7.4% of freight revenues during the three month period ended September 30, 2013.

Depreciation expense increased $0.4 million to $4.7 million during the three month period ended September 30, 2014 compared to $4.3 million during the three month period ended September 30, 2013. This increase was primarily attributable to winter 2014 capital expenditures, offset by a weaker Canadian dollar during the three month period ended September 30, 2014 compared to the three month period ended September 30, 2013.

Amortization of drydock costs were $0.8 million during each of the three month periods ended September 30, 2014 and September 30, 2013. During the three month period ended September 30, 2014, the Company amortized the deferred drydock costs of twelve of its sixteen vessels, compared to twelve vessels during the three month period ended September 30, 2013.

Loss (gain) on foreign exchange during the three month period ended September 30, 2014 was $1.3 million, which was primarily a non-cash loss on translation of approximately $34.2 million USD denominated debt incurred in March 2014 and carried on the balance sheet of the Canadian subsidiary, net of $10.0 million of currency hedging, during a portion of the three month period ended September 30, 2014. During the three month period ended September 30, 2013, an immaterial gain on translation of other balance sheet items was recorded.

Operating income plus depreciation, amortization of drydock costs, amortization of intangibles and loss (gain) on foreign exchange increased $1.8 million, or 11.2%, from $15.6 million during the three month period ended September 30, 2013 to $17.4 million during the three month period ended September 30, 2014. On a constant currency basis, during the three month period ended September 30, 2014, operating income plus depreciation, amortization of drydock costs, amortization of intangibles and loss (gain) on foreign exchange increased 14.1%, or $2.2 million, compared to the three month period ended September 30, 2013.

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As a result of the items described above, operating income during each of the three month periods ended September 30, 2014 and September 30, 2013 equaled $10.2 million. Operating Income plus loss (gain) on foreign exchange increased $1.3 million, or 12.8%, from $10.2 million during the three month period ended September 30, 2013 to $11.5 million during the three month period ended September 30, 2014.

Interest expense, which includes $3.5 million of cash interest and $0.3 million of deferred financing costs, increased $1.4 million to $3.7 million during the three month period ended September 30, 2014 from $2.3 million during the three month period ended September 30, 2013. This increase in interest expense was primarily attributable to the higher interest rate on a portion of our long term debt and the amortization of the deferred financing costs. The increase in interest expense was partially offset by a decrease in our accrued dividends on our preferred stock.

Our income before income taxes was $6.5 millionduring the three month period ended September 30, 2014 compared to $7.9 million during the three month period ended September 30, 2013.

Our effective tax rate was 10.8% on pre-tax income of $6.5 million during the three month period ended September 30, 2014 compared to 84.5% on pre-tax income of $7.9 million during the three month period ended September 30, 2013. Our provision for income tax expenses was $0.7 million during the three month period ended September 30, 2014 compared to an income tax expense of $6.6 million during the three month period ended September 30, 2013. The decrease in income tax expense was due to a change in forecasted pre-tax results and the implementation of the valuation allowance related to the net U.S. Federal deferred tax assets during the three month period ended September 30, 2014 compared to the three month period ended September 30, 2013. The effective tax rate for the three month period ended September 30, 2014 was lower than the statutory tax rate due to the implementation of the valuation allowance related to the net U.S. Federal deferred tax assets, which are primarily net operating losses.

Our net income before preferred stock dividends was $5.8 million during the three month period ended September 30, 2014 compared to $1.2 million during the three month period ended September 30, 2013.

We accrued $0.3 million for dividends on our preferred stock during the three month period ended September 30, 2014 compared to $0.9 million during the three month period ended September 30, 2013. The dividends accrued at a rate of 7.75% during the three month period ended September 30, 2014 compared to a rate of 12.0% during the three month period ended September 30, 2013.

Our net income applicable to common stockholders was $5.5 million during the three month period ended September 30, 2014 compared to $0.3 million during the three month period ended September 30, 2013.

The Canadian dollar weakened by 4.7% compared to the U.S. dollar during the three month period ended September 30, 2014 compared to the three month period ended September 30, 2013, averaging approximately $0.918 USD per CDN during the three month period ended September 30, 2014 compared to approximately $$0.963 USD per CDN during the three month period ended September 30, 2013. The Company's balance sheet translation rate decreased from $0.905 USD per CDN at March 31, 2014 to $0.893 USD per CDN at September 30, 2014.

During the three month period ended September 30, 2014, the Company operated an average of six vessels in the US and nine vessels in Canada. The percentage of our total freight and other revenue, fuel and other surcharge revenue, vessel operating expenses, repairs and maintenance costs and combined depreciation and amortization costs approximate the percentage of vessels operated by country. Approximately half of our general and administrative costs and our interest expense are incurred in Canada, reflecting the approximate percentage of total debt. All of our preferred stock dividends are accrued in the U.S.

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Results of Operations for the six month period ended September 30, 2014 compared to the six month period ended September 30, 2013

Selected Financial and Operating Information

(USD in 000's)	Six months ended September 30, 2014		Six months ended September 30, 2013		Change			% Change
Revenue:
Freight and related revenue	$	82,715	$	82,560	$	155		0.2	%
Fuel and other surcharges	$	14,864	$	16,382	$	(1,518	)	(9.3	)%
Total	$	97,579	$	98,942	$	(1,363	)	(1.4	)%
Expenses:
Vessel operating expenses	$	61,639	$	64,291	$	(2,652	)	(4.1	)%
Repairs and maintenance	$	1,177	$	935	$	242		25.9	%
Operating income plus depreciation, amortization of drydock costs, amortization of intangibles and loss (gain) on foreign exchange	28,564		27,640		924			3.3	%
Operating Income plus loss (gain) on foreign exchange	$	16,866	16,752		114			0.7	%
OPERATING INCOME	$	16,403	16,692		(289		)	(1.7	)%
Sailing Days:	2,489		2,548		(59		)	(2.3	)%
Number of vessels operated:	15		15		—			—	%
Per day in whole USD:
Revenue per Sailing Day:
Freight and related revenue	$	33,232	$	32,402	$	830		2.6	%
Fuel and other surcharges	$	5,972	$	6,429	$	(457	)	(7.1	)%
Expenses per Sailing Day:
Vessel operating expenses	$	24,765	$	25,232	$	(467	)	(1.9	)%
Repairs and maintenance	$	473	$	367	$	106		28.9	%

The following table provides a reconciliation of operating income plus depreciation, amortization of drydock costs, amortization of intangibles and loss/(gain) on foreign exchange during the six month periods ended September 30, 2014 and 2013 (USD in 000's)
	Six months ended September 30, 2014		Six months ended September 30, 2013
Operating Income	$	16,403	$	16,692
Depreciation	$	9,370	$	8,580
Amortization of drydock costs	$	1,712	$	1,667
Amortization of intangibles	$	616	$	641
Loss/(gain) on foreign exchange	$	463	$	60
Operating income plus depreciation, amortization of drydock costs, amortization of intangibles and loss/(gain) on foreign exchange	$	28,564	$	27,640

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The following table summarizes the changes in the components of our revenue and certain expenses during the six month period ended September 30, 2014 compared to the six month period ended September 30, 2013:

(USD in 000's)	Freight and related revenue			Fuel and other surcharges			Total revenue			Vessel operating expenses			Repairs and Maintenance			G&A			*Subtotal
Six months ended September 30, 2013	$	82,560		$	16,382		$	98,942		$	64,291		$	935		$	6,076		$	27,640
Changes in six month period ended September 30, 2014:
Change attributable to weaker Canadian dollar	(2,424		)	(559		)	(2,983		)	(1,981		)	(67		)	(178		)	(757		)
Net change on a constant currency basis	2,579			(959		)	1,620			(671		)	309			301			1,681
Total Change	$	155		$	(1,518	)	$	(1,363	)	$	(2,652	)	$	242		$	123		$	924
Six months ended September 30, 2014	$	82,715		$	14,864		$	97,579		$	61,639		$	1,177		$	6,199		$	28,564

* Operating Income plus Depreciation, Amortization of Drydock Costs, Amortization of Intangibles and Loss/(Gain) on Foreign Exchange

Total revenue during the six month period ended September 30, 2014 was $97.6 million, a decrease of 1.4%, compared to $98.9 million during the six month period ended September 30, 2013. This decrease was primarily attributable to a reduction in tonnage carried, Sailing Days and fuel surcharges, combined with a weaker Canadian dollar and an increase in Delay Days attributable to the poor weather conditions at the start of the sailing season. These factors were offset by increased prices, more efficient trade patterns and improved water levels and commodity mix. On a constant currency basis, our total revenue increased 1.6%, or $1.6 million, during the six month period ended September 30, 2014 compared to the six month period ended September 30, 2013.

According to the Lake Carriers' Association, during the six month period ending September 30, 2014, U.S.-flagged vessels on the Great Lakes experienced a 5.7% decrease in overall customer shipments for the commodities that we carry compared to the six month period ended September 30, 2013. During the same time periods, U.S.-flagged vessels experienced a decrease of iron ore tonnage carried of 4.6%, a decrease of coal tonnage carried of 8.9% and a decrease of aggregates tonnage carried of 5.7%. During the six month period ended September 30, 2014, on a total Great Lakes basis, which includes Canadian and U.S. ports, iron ore tonnage carried decreased 2.1%, coal tonnage carried decreased 7.4% and aggregates tonnage carried decreased 3.0%, in each case compared to the six month period ended September 30, 2013. These commodities account for a significant share of the dry bulk commodities that are transported on the Great Lakes.

Our results for the six month period ended September 30, 2014 reflect the effects of the harshest winter experienced on the Great Lakes in approximately thirty years and the resultant late start of the 2014 sailing season. Ice coverage on the Great Lakes reached near record levels during the winter season, delaying the formal opening of the St. Lawrence Seaway and many of the ports and docks that we service. Once the Seaway was opened, passage on the lakes was limited and highly inefficient. Trade patterns were difficult to establish because of delayed customer openings, excessive ice, which created the potential, but unrealized, risk of vessel damage, and the U.S. and Canadian Coast Guards' requirement that vessels transit certain trade lanes as a part of Coast Guard-led convoys. These factors meaningfully impacted our profitability until the mid to latter part of May 2014.

Our total tonnage carried decreased 5.7% during the six month period ended September 30, 2014 compared to the six month period ended September 30, 2013. Weather-related factors experienced from April through mid-May 2014 resulted in a compression of our customer requirements into a shorter sailing season. We have been able to recapture only a small portion of the tonnage shortfall experienced at the start of the season. During the six month period ended September 30, 2014, we experienced increases in tonnage carried in salt and iron ore commodities of 16.0% and 25.8%, respectively, due to expanded market share, in each case when compared to the six month period ended September 30, 2014. Aggregates, coal and to a limited extent grain tonnages carried during the six month period ended September 30, 2014 trail the six month period ended September 30, 2013, decreasing 16.9%, 6.4% and 0.9% respectively.

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Freight and other related revenue generated from Company-operated vessels increased $0.1 million, or 0.2%, to $82.7 million during the six month period ended September 30, 2014 compared to $82.6 million during the six month period ended September 30, 2013. On a constant currency basis, freight revenue increased 3.1%, or $2.6 million, during the six month period ended September 30, 2014 compared to the six month period ended September 30, 2013.

The increase in freight and related revenue was attributable to an improved commodity mix, more efficient trade patterns and contractual price increases, offset by the weakened Canadian dollar, the decrease in tonnage carried and 59 fewer Sailing Days during the six month period ended September 30, 2014 compared to the six month period ended September 30, 2013. The decrease in Sailing Days was due in part to certain of our vessels not sailing in April 2014 and a high level of inefficiency for those that did operate as a result of ice and other winter weather conditions.

We operated fifteen vessels during each of the six month periods ended September 30, 2014 and September 30, 2013. Management believes that each of our vessels should achieve a theoretical maximum of 183 Sailing Days in the first two fiscal quarters, assuming no major repairs, incidents or vessel layups and normal drydocking cycle times performed during the winter lay-up period. The Company’s operated vessels sailed an average of approximately 166 Sailing Days during the six month period ended September 30, 2014 compared to an average of 170 Sailing Days during the six month period ended September 30, 2013. We operated the Company's vessels for an average of 15 Sailing Days in April 2014 versus 26 Sailing Days in April 2013 and a theoretical maximum of 30 Sailing Days. We operated at 90.7% of the theoretical maximum Sailing Days for the six month period ended September 30, 2014 primarily due to the late start of the 2014 sailing season compared to 92.8% of the theoretical maximum of Sailing Days for the six month period ended September 30, 2013.

We experienced 203 Delay Days during the six month period ended September 30, 2014 compared to 222 Delay Days during the six month period ended September 30, 2013. We continued to reduce Delay Days arising from traffic congestion, dock delays, other factors and vessel mechanical issues during the six month period ended September 30, 2014 by 31 Delay Days, or 19.3%, compared to the six month period ended September 30, 2013. The reductions in Delay Days in these categories during the six month period ended September 30, 2014 were offset by an increase of 12 Delay Days during the six month period ended September 30, 2014 related to increased weather-related delays. Weather-related delays accounted for approximately 36.0% of the Delay Days during the six month period ended September 30, 2014 compared to approximately 28% of the Delay Days during the six month period ended September 30, 2013. Such Delay Days represent a Lost Time Factor of 8.1% for the six month period ended September 30, 2014 compared to 8.7% for the six month period ended September 30, 2013. Delay Days, the vast majority of which were weather related, exceeded 28% of our total Sailing Days in April, 2014.

Freight and related revenue per Sailing Day increased $830, or 2.6%, to $33,232 per Sailing Day during the six month period ended September 30, 2014 compared to $32,402 per Sailing Day during the six month period ended September 30, 2013. This revenue increase was due to a change in the mix of cargos carried, the associated freight rates of those cargos, higher water levels and the efficiency of trade patterns. The increase in freight and related revenue per Sailing Day was dampened by a weaker Canadian dollar. On a constant currency basis, freight and related revenue per Sailing Day increased 5.6%, or $1,804 per Sailing Day, during the six month period ended September 30, 2014 compared to the six month period ended September 30, 2013.

All of our customer contracts have fuel surcharge provisions pursuant to which changes in our fuel costs are passed on to our customers. Such increases and decreases in fuel surcharges impact margin percentages, but do not significantly impact our margin dollars. Fuel and other surcharges decreased $1.5 million, or 9.3%, to $14.9 million during the six month period ended September 30, 2014 compared to $16.4 million during the six month period ended September 30, 2013. This decrease was attributable to reduced number of Sailing Days and a weaker Canadian dollar. Fuel and other surcharges per Sailing Day decreased by $457, or 7.1%, to $5,972 per Sailing Day during the six month period ended September 30, 2014 compared to $6,429 per Sailing Day during the six month period ended September 30, 2013. On a constant currency basis, fuel and other surcharges per Sailing Day decreased by $233, or 3.6%, to $6,196 per Sailing Day during the six month period ended September 30, 2014 compared to $6,429 per Sailing Day during the six month period ended September 30, 2013.

Vessel operating expenses decreased $2.7 million, or 4.1%, to $61.6 million during the six month period ended September 30, 2014 compared to $64.3 million during the six month period ended September 30, 2013. This decrease was primarily due to fewer Sailing Days and a weaker Canadian dollar, offset by increased costs due to the inefficient operations at the start of the 2014 sailing season. On a constant currency basis, vessel operating expenses decreased $0.7 million or 1.0%. Vessel operating expenses per Sailing Day decreased $467, or 1.9%, to $24,765 per Sailing Day during the six month period ended September 30, 2014 from $25,232 per Sailing Day during the six month period ended September 30, 2013.

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Repairs and maintenance expenses, which primarily consist of expensed winter work, increased 0.3 million to $1.2 million during the six month period ended September 30, 2014 from $0.9 million during the six month period ended September 30, 2013, primarily due to the late start of the 2014 sailing season resulting in fitout costs being incurred in April 2014 that are typically incurred in the preceding March. Repairs and maintenance per Sailing Day increased $106 to $473 per Sailing Day during the six month period ended September 30, 2014 from $367 per Sailing Day during the six month period ended September 30, 2013.

Our general and administrative expenses were $6.2 million during the six month period ended September 30, 2014 and $6.1 million during six month period September 30, 2013. Overall, the benefit of the weaker Canadian dollar was offset by increased costs related to the contested 2014 proxy solicitation and compensation and benefit inflationary cost increases during the six month period ended September 30, 2014 compared to the six month period ended September 30, 2013. Our general and administrative expenses represented 7.5%of freight revenues during the six month period ended September 30, 2014 compared to 7.4% of freight revenues during the six month period ended September 30, 2013.

Depreciation expense increased $0.8 million to $9.4 million during the six month period ended September 30, 2014 compared to $8.6 million during the ix month period ended September 30, 2013. This increase was primarily attributable to winter 2014 capital expenditures, offset by a weaker Canadian dollar during the six month period ended September 30, 2014.

Amortization of drydock costs were $1.7 million during each of the six month periods ended September 30, 2014 and September 30, 2013. During the six month period ended September 30, 2014, the Company amortized the deferred drydock costs of twelve of its sixteen vessels, compared to twelve vessels during the six month period ended September 30, 2013.

Loss (gain) on foreign exchange during the six month period ended September 30, 2014 was $0.5 million, which includes a non-cash loss on translation of US dollar denominated debt incurred in March 2014 and carried on the balance sheet of the Canadian subsidiary, net of $10 million of currency hedging during a portion of the six month period ended September 30, 2014. During the six month period ended September 30, 2013, $0.1 million of loss on translation of other balance sheet items was recorded.

Operating income plus depreciation, amortization of drydock costs, amortization of intangibles and loss (gain) on foreign exchange increased $1.0 million, or 3.3%, to $28.6 million during the six month period ended September 30, 2014 from $27.6 million during the six month period ended September 30, 2013. Operating income plus depreciation, amortization of drydock costs and amortization of intangibles was $3.0 million lower in April, 2014 than in April, 2013. On a constant currency basis, operating income plus depreciation, amortization of drydock costs, amortization of intangibles and loss (gain) on foreign exchange increased $1.7 million, or 6.1%, during the six month period ended September 30, 2014 from $27.6 million during the six month period ended September 30, 2013.

As a result of the items described above, including sailing for 59 fewer days during the six month period ended September 30, 2014 than in the six month period ended September 30, 2014, during the six month period ended September 30, 2014, the Company’s operating income decreased $0.3 million, or 1.7%, to $16.4 million compared to operating income of $16.7 million during the six month period ended September 30, 2013. Operating Income plus loss (gain) on foreign exchange increased $0.1 million, or 0.7%, to $16.9 million during the six month period ended September 30, 2014 from $16.8 million during the six month period ended September 30, 2013.

Interest expense, which includes $6.9 million of cash interest and $0.7 million of deferred financing costs, increased $2.8 million to $7.5 million during the six month period ended September 30, 2014 from $4.7 million during the six month period ended September 30, 2013. This increase in interest expense was primarily attributable to the interest expense on our long term subordinated debt and the amortization of deferred financing costs. The increase in interest expense was partially offset by a decrease in our accrued dividends on our preferred stock.

Our income before income taxes was $8.9 millionduring the six month period ended September 30, 2014 compared to income before income taxes of $12.0 million during the six month period ended September 30, 2013.

Our effective tax rate for six month period ended September 30, 2014 was 11.7% on pre-tax income of $8.9 million, resulting in an income tax expense of $1.0 million. Other than statutory minimum foreign federal tax, none of our federal or foreign income tax expense is payable in cash due to our net operating loss carry-forwards. Our effective tax rate for the six month period ended September 30, 2013 was 68.3% on pre-tax income of $12.0 million, resulting in an income tax expense of $8.2 million. The decrease in income tax expense was due to lower forecasted net income before income taxes and a lower consolidated

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tax rate during the six month period ended September 30, 2014 compared to the six month period ended September 30, 2013.  The effective tax rate for the six month period ended September 30, 2014 was lower than the statutory tax rate due to the implementation of the valuation allowance related to the net U.S. Federal deferred tax assets, which were primarily net operating losses.

Our net income before preferred stock dividends was $7.9 million during the six month period ended September 30, 2014 compared to $3.8 million during the six month period ended September 30, 2013.

We accrued $0.6 million for dividends on our preferred stock during the six month period ended September 30, 2014 compared to $1.7 million during the six month period ended September 30, 2013. The dividends accrued at a rate of 7.75% during the six month period ended September 30, 2014 and at a rate of 12.0% during the six month period ended September 30, 2013.

Our net income applicable to common stockholders was $7.3 million during the six month period ended September 30, 2014 compared to net income of $2.1 million during the six month period ended September 30, 2013.

The Canadian dollar weakened by 5.4% compared to the U.S. dollar during the six month period ended September 30, 2014 compared to the six month period ended September 30, 2013, averaging approximately $0.918 USD per CDN during the six month period ended September 30, 2014 compared to approximately $0.970 USD per CDN during the six month period ended September 30, 2013. The Company's balance sheet translation rate decreased from $0.905 USD per CDN at March 31, 2014 to $0.893 USD per CDN at September 30, 2014.

During the six month period ended September 30, 2014, the Company operated an average of six vessels in the U.S. and nine vessels in Canada. The percentage of our total freight and other revenue, fuel and other surcharge revenue, vessel operating expenses, repairs and maintenance costs and combined depreciation and amortization costs approximate the percentage of vessels operated by country. Approximately half of our general and administrative costs are incurred in Canada. Approximately 50% of our interest expense is incurred in Canada, reflecting the approximate percentage of total debt. All of our preferred stock dividends are accrued in the U.S.

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Impact of Inflation and Changing Prices

During the six month periods ended September 30, 2014, and September 30, 2013, there were major fluctuations in our fuel costs. However, our contracts with our customers provide for recovery of these costs over specified rates through fuel surcharges. In addition, there was volatility in the exchange rate between the U.S. dollar and the Canadian dollar during the six month periods ended September 30, 2014, and September 30, 2013, which impacted the average of monthly translation rates for total revenue and costs to U.S. dollars by a decrease of approximately 4.7% during the six month period ended September 30, 2014 compared to the six month period ended September 30, 2013.

Liquidity and Capital Resources

Our primary sources of liquidity are cash from operations, the proceeds of our credit facility and proceeds from sales of our common stock. Our principal uses of cash are vessel acquisitions, capital expenditures, drydock expenditures, operations and interest and principal payments under our credit facility. Information on our consolidated cash flow is presented in the consolidated statements of cash flows (categorized by operating, investing and financing activities) which is included in our consolidated financial statements for the six month periods ended September 30, 2014 and September 30, 2013. The Company makes seasonal net borrowings under its revolving credit facility during the first quarter of each fiscal year to fund working capital needed to commence the sailing season. Such borrowings are then reduced during the second half of each fiscal year. We believe cash generated from our operations and availability of borrowings under our credit facilities will provide sufficient cash availability to cover our anticipated working capital needs, capital expenditures and debt service requirements for the next twelve months. However, if the Company experiences a material shortfall to its financial forecasts or if the Company's customers materially delay their receivable payments due to further deterioration of economic conditions, the Company may breach its financial covenants and collateral thresholds and be strained for liquidity. The Company has maintained its focus on productivity gains and cost controls, and is closely monitoring customer credit and accounts receivable balances.

Net cash provided by operating activities during the six month period ended September 30, 2014 was $10.9 million, an increase of $7.0 million of cash provided, from $3.9 million of cash provided during the six month period ended September 30, 2013. The increase in cash provided was primarily attributable to a decrease in build up of seasonal working capital due to the late start of the 2014 sailing season and lower payments of deferred drydock costs.

The Company did not incur any significant bad-debt write-offs or material slowdowns in receivable collections during either of the six month periods ended September 30, 2014 or 2013.

Net cash used in investing activities increased by $12.1 million to net cash used of $17.6 million during the six month period ended September 30, 2014 from net cash used of $5.5 million during the six month period ended September 30, 2013. This increase was primarily due to the timing of payments for capital expenditures during the six month period ended September 30, 2014 compared to the six month period ended September 30, 2013, and progress payments on the forebody conversion project during the six month period ended September 30, 2014.

Net cash provided by financing activities increased $3.6 million to $7.4 million used during the six month period ended September 30, 2014 compared to $3.8 million provided during the six month period ended September 30, 2013, primarily due to the timing of the revolver borrowings and lower long-term debt principal payments of $1.5 million.

Fourth Amended and Restated Credit Agreement

On March 11, 2014, Lower Lakes Towing, Lower Lakes Transportation, Grand River and Black Creek Shipping, as borrowers, Rand LL Holdings Corp. ("Rand LL Holdings"), Rand Finance, Black Creek Shipping Holdings Company, Inc. ("Black Creek Holdings"), Lower Lakes Ship Repair, Lower Lakes (17) and Rand, as guarantors, General Electric Capital Corporation, as agent and Lender, and certain other lenders, entered into a Fourth Amended and Restated Credit Agreement (the "Fourth Amended and Restated Credit Agreement"), which (i) amends and restates the existing Third Amended and Restated Credit Agreement to which the borrowers are a party, dated as of August 30, 2012, as the same has been amended from time to time, in its entirety, (ii) consolidates the existing U.S. term loans into a single term loan, (iii) provides for certain new loans and (iv) provides working capital financing, funds for other general corporate purposes and funds for other permitted purposes. The Fourth Amended and Restated Credit Agreement provides for (i) a revolving credit facility under which Lower Lakes Towing may borrow up to CDN $17.5 million with a seasonal overadvance facility equal to the lesser of US $17.0 million or CDN $17.5 million, less the principal amount outstanding under the seasonal overadvance facility for Lower Lakes Transportation, and a swing line facility of CDN $4

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million, subject to limitations, (ii) a revolving credit facility under which Lower Lakes Transportation may borrow up to US $17.5 million with a seasonal overadvance facility of US $17 million, less the principal amount outstanding under the seasonal overadvance facility for Lower Lakes Towing, and a swing line facility of US $.05 million, subject to limitations, (iii) the continuation of an existing Canadian dollar denominated term loan facility under which Lower Lakes Towing is obligated to the lenders in the amount of CDN $54.9 million as of the date of the Fourth Amended and Restated Credit Agreement (the “CDN Term Loan”) and (iv) the modification and continuation of a U.S. dollar denominated term loan facility under which Grand River and Black Creek are obligated to the lenders in the amount of $55.2 million as of the date of the Fourth Amended and Restated Credit Agreement (the “U.S. Term Loan”).

Under the Fourth Amended and Restated Credit Agreement, the revolving credit facilities and swing line loans expire on April 1, 2019. The outstanding principal amount of the CDN Term Loan borrowings will be repayable as follows: (i) annual payments equal to one percent (1%) of the initial principal amount thereof paid quarterly commencing September 1, 2014 and (ii) a final payment in the outstanding principal amount of the CDN Term Loan upon the CDN Term Loan’s maturity on April 1, 2019. The outstanding principal amount of the U.S. Term Loan borrowings will be repayable as follows: (i) annual payments equal to one percent (1%) of the initial principal amount thereof paid quarterly commencing September 1, 2014 and (ii) a final payment in the outstanding principal amount of the U.S. Term Loan upon the U.S. Term Loan’s maturity on April 1, 2019. Borrowings under the Canadian revolving credit facility, the Canadian swing line facility and the CDN Term Loan will bear an interest rate per annum, at the borrowers' option, equal to (i) the Canadian Prime Rate (as defined in the Fourth Amended and Restated Credit Agreement), plus 3.00% per annum or (ii) the BA Rate (as defined in the Fourth Amended and Restated Credit Agreement) plus 4.00% per annum. Borrowings under the U.S. revolving credit facility, the U.S. swing line facility and the U.S. Term Loan will bear interest, at the borrowers’ option, equal to (i) LIBOR (as defined in the Fourth Amended and Restated Credit Agreement) plus 4.00% per annum or (ii) the U.S. Base Rate (as defined in the Fourth Amended and Restated Credit Agreement) plus 3.00% per annum.

Obligations under the Fourth Amended and Restated Credit Agreement are secured by (i) a first priority lien and security interest on all of the borrowers’ and guarantors’ assets, tangible or intangible, real, personal or mixed, existing and newly acquired, (ii) a pledge by Rand LL Holdings of all of the outstanding capital stock of the borrowers other than Black Creek and Lower Lakes Towing, and a pledge of 65% of the outstanding capital stock of Lower Lakes Towing, (iii) a pledge by Black Creek Holdings of all of the outstanding capital stock of Black Creek, (iv) a pledge by Lower Lakes Towing of all of the outstanding capital stock of Lower Lakes Ship Repair and Lower Lakes (17) and (v) a pledge by Rand of all of the outstanding capital stock of Rand LL Holdings, Rand Finance and Black Creek Holdings. The indebtedness of each domestic borrower under the Fourth Amended and Restated Credit Agreement is unconditionally guaranteed by each other domestic borrower and by the guarantors which are domestic subsidiaries, and such guaranty is secured by a lien on substantially all of the assets of each borrower and each guarantor. Each domestic borrower also guarantees the obligations of the Canadian borrower and each Canadian guarantor guarantees the obligations of the Canadian borrower. Under the Fourth Amended and Restated Credit Agreement, the borrowers will be required to make mandatory prepayments of principal on term loan borrowings (i) if the outstanding balance of the term loans plus the outstanding balance of the seasonal facilities exceeds the sum of 85% of the orderly liquidation value of the vessels owned by the borrowers, less the amount of outstanding liens against the vessels with priority over the lenders’ liens, in an amount equal to such excess, (ii) in the event of certain dispositions of assets and insurance proceeds (all subject to certain exceptions), in an amount equal to 100% of the net proceeds received by the borrowers therefrom and (iii) in an amount equal to 100% of the net proceeds to a borrower from any issuance of a borrower’s debt or equity securities (all subject to certain exceptions).

The Fourth Amended and Restated Credit Agreement contains certain covenants, including those limiting the guarantors’, the borrowers’ and their subsidiaries’ ability to incur indebtedness, incur liens, sell or acquire assets or businesses, change the nature of their businesses, engage in transactions with related parties, make certain investments or pay dividends. In addition, the Fourth Amended and Restated Credit Agreement requires the borrowers to maintain certain financial ratios. Failure of the borrowers or the guarantors to comply with any of these covenants or financial ratios could result in the loans under the Fourth Amended and Restated Credit Agreement being accelerated.

As a result of the execution of the Fourth Amended and Restated Credit Agreement discussed above, the Company recognized a loss on extinguishment of debt of $1.3 million during the fiscal year ended March 31, 2014 that consisted of the unamortized deferred financing costs in connection with the previously existing financing arrangement.

As of September 30, 2014, the Company was in compliance with the covenants under the Fourth Amended and Restated Credit Agreement.

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Term Loan Credit Agreement

On March 11, 2014, Lower Lakes Towing, Grand River and Black Creek, as borrowers, Rand LL Holdings, Rand Finance, Black Creek Holdings and Rand, as guarantors, Guggenheim Corporate Funding, LLC, as agent and Lender, and certain other lenders, entered into a Term Loan Credit Agreement (the “Term Loan Credit Agreement”), which provides term loans to (i) partially repay outstanding indebtedness of borrowers under the Third Amended and Restated Credit Agreement, (ii) partially pay the acquisition and conversion costs for a new vessel, (iii) pay accrued but unpaid dividends due on our Series A Convertible Preferred Stock and (iv) provide working capital financing, funds for other general corporate purposes and funds for other permitted purposes. The Term Loan Credit Agreement provides for (i) a U.S. Dollar denominated term loan facility under which Lower Lakes Towing is obligated to the lenders in the amount of $34.2 million (the “Second Lien CDN Term Loan”), (ii) U.S. dollar denominated term loan facility under which Grand River and Black Creek are obligated to the Lenders in the amount of $38.3 million (the “Second Lien U.S. Term Loan”) and (iii) an uncommitted incremental term loan facility of up to $32.5 million.

The outstanding principal amount of the Second Lien CDN Term Loan borrowings will be repayable upon the Second Lien CDN Term Loan’s maturity on March 11, 2020. The outstanding principal amount of the Second Lien U.S. Term Loan borrowings will be repayable upon the Second Lien U.S. Term Loan’s maturity on March 11, 2020.

The Second Lien CDN Term Loan and Second Lien U.S. Term Loan will bear an interest rate per annum at borrowers’ option, equal to (i) LIBOR (as defined in the Term Loan Credit Agreement) plus 9.50% per annum or (ii) the U.S. Base Rate (as defined in the Term Loan Credit Agreement) plus 8.50% per annum.

Obligations under the Term Loan Credit Agreement are secured by (i) a first priority lien and security interest on all of the borrowers’ and guarantors’ assets, tangible or intangible, real, personal or mixed, existing and newly acquired, (ii) a pledge by Rand LL Holdings of all of the outstanding capital stock of the borrowers, other than Black Creek and Lower Lakes Towing, and a pledge of 65% of the outstanding capital stock of Lower Lakes Towing, (iii) a pledge by Black Creek Holdings of all of the outstanding capital stock of Black Creek, (iv) a pledge by Lower Lakes Towing of all of the outstanding capital stock of Lower Lakes Ship Repair and Lower Lakes (17) and (v) a pledge by Rand of all of the outstanding capital stock of Rand LL Holdings, Rand Finance and Black Creek Holding. The indebtedness of each domestic borrower under the Term Loan Credit Agreement is unconditionally guaranteed by each other domestic borrower and by the guarantors which are domestic subsidiaries, and such guaranty is secured by a lien on substantially all of the assets of each borrower and each guarantor. Each domestic borrower also guarantees the obligations of the Canadian borrower and each Canadian guarantor guarantees the obligations of the Canadian borrower.

Under the Term Loan Credit Agreement and subject to the terms of the Intercreditor Agreement (as defined below), the borrowers will be required to make mandatory prepayments of principal on term loan borrowings (i) in the event of certain dispositions of assets and insurance proceeds (all subject to certain exceptions), in an amount equal to 100% of the net proceeds received by the borrowers therefrom and (ii) in an amount equal to 100% of the net proceeds to a borrower from any issuance of a borrower’s debt or equity securities (all subject to certain exceptions).

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

The obligations of the borrowers and the liens of the lenders under the Term Loan Credit Agreement are subject to the terms of an Intercreditor Agreement, which is further described below under the heading “Intercreditor Agreement”.

As of September 30, 2014, the Company was in compliance with covenants under the Term Loan Credit Agreement.

Intercreditor Agreement

Also on March 11, 2014, Lower Lakes Towing, Lower Lakes Transportation, Grand River, Black Creek, Lower Lakes Ship Repair, Rand, Rand LL Holdings, Rand Finance, Black Creek Holdings and Lower Lakes (17) (collectively, the “Credit Parties”), General Electric Capital Corporation, as agent for the lenders under the Fourth Amended and Restated Credit Agreement (the “First Lien Lenders”) and Guggenheim Corporate Funding, LLC, as agent for the lenders under the Term Loan Credit Agreement (the “Second Lien Lenders”), entered into an Intercreditor Agreement (the “Intercreditor Agreement”), pursuant to which the Second Lien Lenders have agreed to subordinate the obligations of the Credit Parties to them to the repayment of the obligations

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of the Credit Parties to the First Lien Lenders and have further agreed to subordinate their liens on the assets of the Credit Parties to the liens in granted in favor of the First Lien Lenders.  Absent the occurrence of an Event of Default under the Fourth Amended and Restated Credit Agreement, the Second Lien Lenders are permitted to receive regularly scheduled principal and  interest payments under the Term Loan Credit Agreement.

Previous Credit Agreements

On August 30, 2012, Lower Lakes Towing, Lower Lakes Transportation, Grand River, and Black Creek, as borrowers, Rand LL Holdings, Rand Finance, Black Creek Holdings and Rand, as guarantors, General Electric Capital Corporation, as agent and lender, and certain other lenders, entered into a Third Amended and Restated Credit Agreement (the “Third Amended and Restated Credit Agreement”) which (i) amended and restated the amended and restated credit agreement to which the borrowers were a party, dated as of September 28, 2011 (as the same had been amended from time to time, the “2011 Credit Agreement”), in its entirety, (ii) continued the tranches of loans provided for under the 2011 Credit Agreement, (iii) refinanced the indebtedness of Black Creek under its existing credit facility and adds Black Creek as a U.S. Borrower, (iv) provided for certain new loans and (v) provided working capital financing, funds for other general corporate purposes and funds for other permitted purposes.

The Third Amended and Restated Credit Agreement provided for (i) a revolving credit facility under which Lower Lakes Towing could borrow up to CDN $13.5 million with a seasonal overadvance facility of CDN $12 million, less the principal amount outstanding under the seasonal overadvance facility for Lower Lakes Transportation, and a swing line facility of CDN $4 million, subject to limitations, (ii) a revolving credit facility that included letters of credit under which Lower Lakes Transportation could borrow up to US $13.5 million with a seasonal overadvance facility of US $12 million, less the principal amount outstanding under the seasonal overadvance facility for Lower Lakes Towing, and a swing line facility of US $0.1 million, subject to limitations, (iii) the modification and continuation of an existing Canadian dollar denominated term loan facility under which Lower Lakes was obligated to the lenders in the amount of CDN $53.0 million as of the date of the Third Amended and Restated Credit Agreement (the “2012 CDN Term Loan”), (iv) the modification and continuation of a U.S. dollar denominated term loan facility under which Grand River was obligated to the lenders in the amount of $64.1 million as of the date of the Third Amended and Restated Credit Agreement (the “Grand River Term Loan”) and (v) a U.S. dollar denominated term loan facility under which Black Creek was obligated to the lenders in the amount of $28.9 million as of the date of the Third Amended and Restated Credit Agreement (the “Black Creek Term Loan”).

Under the Third Amended and Restated Credit Agreement, total scheduled term loan principal payments paid on a quarterly basis were approximately $3.6 million per year (2.5% of the total term debt at inception) in the fiscal year ended March 31, 2014, approximately $5.4 million in the fiscal year ending March 31, 2015, approximately $7.3 million in the fiscal year ending March 31, 2016 and the remaining balance to be repaid in the fiscal year ending March 31, 2017, subject to customary excess cash flow and collateral coverage conditions. Under the prior credit agreements, the Company was obligated to pay approximately $9.2 million per year in scheduled principal payments.

Under the Third Amended and Restated Credit Agreement, the revolving credit facilities and swing line loans expire on August 1, 2016. The outstanding principal amount of the 2012 CDN Term Loan borrowings was repayable as follows: (i) quarterly payments of CDN $0.3 million commencing December 1, 2012 and ending September 2014, (ii) quarterly payments of CDN $0.7 million commencing December 1, 2014 and ending June 1, 2016 and (iii) a final payment in the outstanding principal amount of the 2012 CDN Term Loan upon the 2012 CDN Term Loan's scheduled maturity on August 1, 2016. The outstanding principal amount of the Grand River Term Loan borrowings was repayable as follows: (i) quarterly payments of US $0.4 million commencing December 1, 2011 and ending on September 1, 2014, (ii) quarterly payments of US $0.8 million commencing December 1, 2014 and ending June 1, 2016 and (iii) a final payment in the outstanding principal amount of the Grand River Term Loan upon the Grand River Term Loan's scheduled maturity on August 1, 2016. The outstanding principal amount of the Black Creek Term Loan borrowings was repayable as follows: (i) quarterly payments of US $0.2 million commencing quarterly December 1, 2011 and ending September 1, 2014, (ii) quarterly payments of US $0.4 million commencing December 1, 2014 and ending June 1, 2016 and (iii) a final payment in the outstanding principal amount of the Black Creek Term Loan upon the Black Creek Term Loan's scheduled maturity on August 1, 2016.

Borrowings under the Canadian revolving credit facility, Canadian swing line facility and the 2012 CDN Term Loan bore an interest rate per annum, at the borrowers' option, equal to (i) the Canadian Prime Rate (as defined in the Third Amended and Restated Credit Agreement), plus 3.75% per annum or (ii) the BA Rate (as defined in the Third Amended and Restated Credit Agreement) plus 4.75% per annum. Borrowings under the U.S. revolving credit facility, U.S. swing line facility and the Grand River Term Loan and Black Creek Term Loan bore interest, at the borrowers' option, equal to (i) LIBOR (as defined in the Third

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Amended and Restated Credit Agreement) plus 4.75% per annum, or (ii) the U.S. Base Rate (as defined in the Third Amended and Restated Credit Agreement), plus 3.75% per annum.

Obligations under the Third Amended and Restated Credit Agreement were secured by (i) a first priority lien and security interest on all of the borrowers' and guarantors' assets, tangible or intangible, real, personal or mixed, existing and newly acquired, (ii) a pledge by Rand LL Holdings of all of the outstanding capital stock of the borrowers other than Black Creek; (iii) a pledge by Black Creek Holdings of all of the outstanding capital stock of Black Creek; and (iv) a pledge by Rand of all of the outstanding capital stock of Rand LL Holdings, Rand Finance and Black Creek Holdings. The indebtedness of each domestic borrower under the Third Amended and Restated Credit Agreement was unconditionally guaranteed by each other domestic borrower and by the guarantors which are domestic subsidiaries, and such guaranty was secured by a lien on substantially all of the assets of each borrower and each guarantor. Each domestic borrower also guaranteed the obligations of the Canadian borrower and each Canadian guarantor guaranteed the obligations of the Canadian borrower.

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

The Third Amended and Restated Credit Agreement contained certain covenants, including those limiting the guarantors', the borrowers', and their subsidiaries' ability to incur indebtedness, incur liens, sell or acquire assets or businesses, change the nature of their businesses, engage in transactions with related parties, make certain investments or pay dividends. In addition, the Third Amended and Restated Credit Agreement required the borrowers to maintain certain financial ratios. Failure of the borrowers or the guarantors to comply with any of these covenants or financial ratios could have resulted in the loans under the Third Amended and Restated Credit Agreement being accelerated.

In connection with the execution of the Third Amended and Restated Credit Agreement, on August 30, 2012, Black Creek and Black Creek Holdings terminated their Credit Agreement (the “Black Creek Credit Agreement”) with General Electric Capital Corporation, as agent and lender, and certain other lenders, dated as of February 11, 2011, as amended. All outstanding amounts due under the Black Creek Credit Agreement were repaid in connection with the refinancing of Black Creek's indebtedness under the Third Amended and Restated Credit Agreement, as more fully described above.

Preferred Stock and Preferred Stock Dividends

The shares of the Company's series A convertible preferred stock rank senior to the Company's common stock with respect to liquidation and dividends; are entitled to receive a cash dividend at the annual rate of 7.75% (based on the $50 per share issue price), payable quarterly (subject to increases of 0.5% for each six month period in respect of which the dividend is not paid in cash, up to a maximum of 12%, subject to reversion to 7.75% upon payment of all accrued and unpaid dividends); are convertible into shares of the Company's common stock at any time at the option of the series A preferred stockholder at a conversion price of $6.20 per share (based on the $50 per share issue price and subject to adjustment) or 8.065 shares of common stock for each Series A Preferred Share (subject to adjustment); are convertible into shares of the Company's common stock (based on a conversion price of $6.20 per share, subject to adjustment) at the option of the Company if, after the third anniversary of our acquisition of Lower Lakes, the trading price of the Company's common stock for 20 trading days within any 30 trading day period equals or exceeds $8.50 per share (subject to adjustment); may be redeemed by the Company in connection with certain change of control or acquisition transactions; will vote on an as-converted basis with the Company's common stock; and have a separate vote over certain material transactions or changes involving the Company.

As of September 30, 2014, the Company had $0.3 million of unpaid accrued dividends on its preferred stock for the six month period ended September 30, 2014 compared to $Nil at March 31, 2014. As of September 30, 2014, the effective rate of preferred dividends was 7.75%. As of September 30, 2013, the effective rate of preferred dividends was 12.0%.

49

Investments in Capital Expenditures and Drydockings

We incurred $10.8 million in paid and unpaid capital expenditures and drydock expenses during the six month period ended September 30, 2014, including $4.1 million of carryover from the 2014 winter season and $5.8 million of capital expenditures on the forebody conversion project, compared to $2.5 million in paid and unpaid capital expenditures and drydock expenses during the six month period ended September 30, 2013, which amount included $1.9 million relating to carryover from the 2013 winter season.

Vessel Acquisitions

On March 11, 2014, Lower Lakes (17) acquired the LALANDIA SWAN from Uni-Tankers M/T "Lalandia Swan" for a purchase price of $7,000,000. The LALANDIA SWAN is a Danish-flagged chemical tanker that we intend to convert into a Canadian-flagged river class self-unloader vessel. We currently plan to introduce this new vessel into service during the 2015 sailing season.

Contractual Commitments

A table of our contractual obligations as of March 31, 2014 was included in Item 7, “Management's Discussion and Analysis of Financial Condition and Results of Operations” of our Annual Report on Form 10-K for the fiscal year ended March 31, 2014. As of September 30, 2014, the Company had signed contractual commitments with several suppliers totaling $17,453 ($1,801 as of March 31, 2014) in connection with capital expenditures and shipyard projects, due in less than one year.

Foreign Exchange Rate Risk

We have foreign currency exposure related to the currency related translation of various financial instruments denominated in the Canadian dollar (fair value risk) and operating cash flows denominated in the Canadian dollar (cash flow risk). These exposures are associated with period to period changes in the exchange rate between the U.S. dollar and the Canadian dollar. At September 30, 2014, our liability for financial instruments with exposure to foreign currency risk was approximately CDN $54.9 million of term debt borrowings and CDN $3.0 million of revolver debt borrowings. Although we have tried to match our indebtedness and cash flows from earnings by country, a sudden increase in the Canadian dollar exchange rates could increase the indebtedness converted to U.S. dollars before operating cash flows can make up for such a currency conversion change.

From a cash flow perspective, our operations are insulated against changes in currency rates as operations in Canada and the United States have revenues and expenditures denominated in local currencies and our operations are cash flow positive. However, as stated above, a significant portion of our financial liabilities are denominated in Canadian dollars, exposing us to currency risks related to principal payments and interest payments on such financial liability instruments.

Interest Rate Risk

We are exposed to changes in interest rates associated with our banking facilities and senior debt bearing variable interest rates under our Fourth Amended and Restated Credit Agreement, which carries interest rates which vary with Canadian Prime Rates and B.A. Rates for Canadian borrowings, and U.S. Prime Rates and Libor Rates on U.S. borrowings under the Term Loan Credit Agreement, which carries interest rates which vary with the Libor rates, the U.S. Prime rates and the Federal Funds rates.

In December 2012, the Company entered into two interest rate cap contracts through December 1, 2015 covering 38% of its outstanding term debt at a cap of three month Libor at 2.5% on 50% of its U.S. Term Debt borrowings and three month BA rates at 3.0% on 50% of its Canadian Term Debt borrowings. The notional amount on each of these instruments decreases in accordance with the principal payments schedule of the Third Amended and Restated Credit Agreement dated August 30, 2012.

Off-Balance Sheet Arrangements

There are no off-balance sheet arrangements.

50

Lack of Historical Operating Data for Acquired Vessels

From time to time, as opportunities arise and depending on the availability of financing, we may acquire additional secondhand drybulk carriers.

Consistent with shipping industry practice, other than inspection of the physical condition of the vessels and examinations of classification society records, there is typically no historical financial due diligence process conducted when we acquire vessels. Accordingly, in such circumstances, we do not obtain the historical operating data for the vessels from the sellers because that information is not material to our decision to make vessel acquisitions, nor do we believe it would be helpful to potential investors in our stock in assessing our business or profitability.

Consistent with shipping industry practice, we generally treat the acquisition of a vessel as the acquisition of an asset rather than a business. In cases where a vessel services a contract of affreightment with a third party customer and the buyer desires to acquire such contract, the seller generally cannot transfer the contract to the buyer without the customer's consent. The purchase of a vessel itself typically does not transfer the contracts of affreightment serviced by such vessel because such contracts are separate service agreements between the vessel owner and its customers.

Where we identify any intangible assets or liabilities associated with the acquisition of a vessel, we allocate the purchase price of acquired tangible and intangible assets based on their relative fair values.

When we purchase a vessel and assume or renegotiate contracts of affreightment associated with the vessel, we must take the following steps before the vessel will be ready to commence operations:

• obtain the customer's consent to us as the new owner if applicable; arrange for a new crew for the vessel;

• replace all hired equipment on board, such as gas cylinders and communication equipment;

• negotiate and enter into new insurance contracts for the vessel through our own insurance brokers; and

• implement a new planned maintenance program for the vessel.

The following discussion is intended to provide an understanding of how acquisitions of vessels affect our business and results of operations.

Our business is comprised of the following main elements:

• employment and operation of our drybulk vessels;

• scheduling our vessels to satisfy customer's contracts of affreightment; and

• management of the financial, general and administrative elements involved in the conduct of our business and ownership of our drybulk vessels.

The employment and operation of our vessels requires the following main components:

• vessel maintenance and repair;

• crew selection and training;

• vessel spares and stores supply;

• planning and undergoing drydocking, special surveys and other major repairs;

• organizing and undergoing regular classification society surveys;

• contingency response planning;

• onboard safety procedures auditing;

• accounting;

• vessel insurance arrangement;

• vessel scheduling;

• vessel security training and security response plans (ISPS);

• obtain ISM certification and audit for each vessel within six months of taking over a vessel;

• vessel hire management;

• vessel surveying; and

• vessel performance monitoring.

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The management of financial, general and administrative elements involved in the conduct of our business and ownership of our vessels requires the following main components:

• management of our financial resources, including banking relationships (e.g., administration of bank loans);

• management of our accounting system and records and financial reporting;

• administration of the legal and regulatory requirements affecting our business and assets; and

• management of the relationships with our service providers and customers.

The principal factors that affect our profitability, cash flows and stockholders' return on investment include:

• rates of contracts of affreightment and charterhire;

• scheduling to match vessels with customer requirements, including dock limitation, vessel trade patterns and backhaul opportunities;

• weather conditions;

• vessel incidents;

• levels of vessel operating expenses;

• depreciation and amortization expenses;

• financing costs; and

• fluctuations in foreign exchange rates.

Critical accounting policies

Rand's significant accounting policies are presented in Note 2 to its unaudited consolidated financial statements, and the following summaries should be read in conjunction with the financial statements and the related notes included in this quarterly report on Form 10-Q. While all accounting policies affect the financial statements, certain policies may be viewed as critical.

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires the application of certain accounting policies, many of which require the Company to make estimates and assumptions about future events and their impact on amounts reported in the financial statements and related notes. Since future events and their impact cannot be determined with certainty, the actual results will inevitably differ from our estimates. Such differences could be material to the financial statements.

Revenue and operating expenses recognition

The Company generates revenues from freight billings under contracts of affreightment (voyage charters) generally on a rate per ton basis based on origin-destination and cargo carried. Voyage revenue is recognized ratably over the duration of a voyage based on the relative transit time in each reporting period when the following conditions are met: the Company has a signed contract of affreightment, the contract price is fixed or determinable and collection is reasonably assured. Included in freight billings are other fees such as fuel surcharges and other freight surcharges, which represent pass-through charges to customers for toll fees, lockage fees and ice breaking fees paid to other parties. Fuel surcharges are recognized ratably over the duration of the voyage, while freight surcharges are recognized when the associated costs are incurred. Freight surcharges are less than 5% of total revenue.

Marine operating expenses such as crewing costs, fuel, tugs and insurance are recognized as incurred or consumed and thereby are recognized ratably in each reporting period. Repairs and maintenance and certain other insignificant costs are recognized as incurred.

The Company subcontracts excess customer demand to other freight providers. Service to customers under such arrangements is transparent to the customer and no additional services are provided to customers. Consequently, revenues recognized for customers serviced by freight subcontractors are recognized on the same basis as described above. Costs for subcontracted freight providers, presented as “outside voyage charter fees” in the consolidated statements of operations, are recognized as incurred and therefore are recognized ratably over the voyage.

The Company accounts for sales taxes imposed on its services on a net basis in the consolidated statements of operations. In addition, all revenues are presented on a gross basis.

52

Vessel acquisitions

Vessels are stated at cost, which consists of the purchase price and any material expenses incurred upon acquisition, such as initial repairs, improvements, delivery expenses and other expenditures to prepare the vessel for its initial voyage. Subsequent expenditures for conversions and major improvements are also capitalized when they appreciably extend the life, increase the earnings capacity or improve the efficiency or safety of the vessels. Significant financing costs incurred during the construction period of the vessels are also capitalized and included in the vessels' cost. Otherwise these amounts are charged to expense as incurred.

Intangible assets and goodwill

Intangible assets consist primarily of goodwill, financing costs, trademarks, trade names and customer relationships and contracts. Intangible Assets are amortized as follows:

Trademarks and trade names         10 years straight-line

Customer relationships and contracts     15 years straight-line

Deferred financing costs are amortized on a straight-line basis over the term of the related debt, which approximates the effective interest method.

Impairment of fixed assets

Fixed assets (e.g. property and equipment) and finite-lived intangible assets (e.g. customer lists) are tested for impairment upon the occurrence of a triggering event that indicates the carrying value of such an asset or asset groups e.g. tugs and barges, might be no longer recoverable. Examples of such triggering events include a significant disposal of a portion of such assets, an adverse change in the market involving the business employing the related asset(s), a significant decrease in the benefits realized from an acquired business, difficulties or delays in integrating the business, and a significant change in the operations of an acquired business.

Once a triggering event has occurred, the recoverability test employed is based on whether the intent is to hold the asset(s) for continued use or to hold the asset(s) for sale. If the intent is to hold the asset(s) for continued use, the recoverability test involves a comparison of undiscounted cash flows excluding interest expense, against the carrying value of the asset(s) as an initial test. If the carrying value of such asset(s) exceeds the undiscounted cash flow, the asset(s) would be deemed to be impaired. Impairment would then be measured as the difference between the fair value of the fixed or amortizing intangible asset and the carrying value of such asset(s). The Company generally determines fair value by using the discounted cash flow method. If the intent is to hold the asset(s) for sale and certain other criteria are met (i.e., the asset(s) can be disposed of currently, appropriate levels of authority have approved the sale and there is an actively pursuing buyer), the impairment test is a comparison of the asset's carrying value to its fair value less costs to sell. To the extent that the carrying value is greater than the asset's fair value less costs to sell, an impairment loss is recognized for the difference. The Company has determined that there were no adverse changes in our markets or other triggering events that could affect the valuation of our assets during the three month period ended September 30, 2014.

Impairment of goodwill

The Company annually reviews the carrying value of goodwill to determine whether impairment may exist. Accounting Standards Codification (“ASC”) 350 “Intangibles-Goodwill and Other” and Accounting Standards Update (“ASU”) 2011-08 Intangibles—Goodwill and Other (Topic 350) - Testing Goodwill for Impairment requires that goodwill and certain intangible assets be assessed annually for impairment using fair value measurement techniques. Specifically, goodwill impairment is determined using a three-step process. The first step of the goodwill impairment test is to perform a qualitative assessment before calculating the fair value of the reporting unit when testing goodwill for impairment. If the fair value of the reporting unit is determined, based on qualitative factors, to be more likely than not less than the carrying amount of the reporting unit, then entities are required to perform the two-step goodwill impairment test. The second step of the goodwill impairment test is used to identify potential impairment by comparing the fair value of a reporting unit with its carrying amount, including goodwill. The estimates of fair value of the Company’s two reporting units, which are the Company’s Canadian and US operations (excluding the parent), are determined using various valuation techniques with the primary techniques being a discounted cash flow analysis and peer

53

analysis. A discounted cash flow analysis requires various judgmental assumptions, including assumptions about future cash flows, growth rates, and discount rates. The assumptions about future cash flows and growth rates are based on the Company’s forecast and long-term estimates. Discount rate assumptions are based on an assessment of the risk inherent in the respective reporting units. If the fair value of a reporting unit exceeds its carrying amount, goodwill of the reporting unit is considered not impaired and the third step of the impairment test is unnecessary. If the carrying amount of a reporting unit exceeds its fair value, the third step of the goodwill impairment test is performed to measure the amount of impairment loss, if any. The third step of the goodwill impairment test compares the implied fair value of the reporting unit’s goodwill with the carrying amount of that goodwill. If the carrying amount of the reporting unit’s goodwill exceeds the implied fair value of that goodwill, an impairment loss is recognized in an amount equal to that excess. The implied fair value of goodwill is determined in the same manner as the amount of goodwill recognized in a business combination. That is, the fair value of the reporting unit is allocated to all of the assets and liabilities of that unit (including any unrecognized intangible assets) as if the reporting unit had been acquired in a business combination and the fair value of the reporting unit was the purchase price paid to acquire the reporting unit.  As of March 31, 2014, the Company conducted the qualitative assessment and determined that the fair value of its two reporting units exceeded their carrying amounts and the remaining two-step impairment testing was therefore not necessary.  The Company has determined that there were no adverse changes in our markets or other triggering events that indicated that it is more likely than not that the fair value of our reporting units was less than the carrying value of our reporting units during the six month period ended September 30, 2014.

Income taxes

The Company accounts for income taxes in accordance with ASC 740 “Income Taxes”, which requires the determination of deferred tax assets and liabilities based on the differences between the financial statement and income tax bases of tax assets and liabilities, using enacted tax rates in effect for the year in which the differences are expected to reverse.  A valuation allowance is recognized, if necessary, to measure tax benefits to the extent that, based on available evidence, it is more likely than not that they will be realized.

The Company classifies interest expense related to income tax liabilities, when applicable, as part of the interest expense in its consolidated statements of operations rather than income tax expense.  To date, the Company has not incurred material interest expenses or penalties relating to assessed taxation amounts.

There is a current examination taking place by the U.S. taxing authorities for the fiscal year ended March 31, 2012 with no adjustments proposed as of the date of this Quarterly Report on Form 10-Q. Lower Lakes was examined by the Canadian taxing authority for the tax years 2009 and 2010 and such examination is now complete.  This audit did not result in any material adjustments for such periods. The Company's primary U.S. state income tax jurisdictions are Illinois, Indiana, Michigan, Minnesota, Pennsylvania, Wisconsin and New York and its only international jurisdictions are Canada and its province of Ontario. The following table summarizes the open fiscal tax years for each major jurisdiction:

Jurisdiction	Open Tax Years
Federal (USA)	2010 – 2014
Various states	2010 – 2014
Federal (Canada)	2009 – 2014
Ontario	2009 – 2014

Stock-based compensation

The Company recognizes compensation expense for all newly granted awards and awards modified, repurchased or

cancelled based on fair value at the date of grant.

54

Recently Issued Pronouncements

Revenue from Contracts with Customers

In May 2014, the Financial Accounting Standard Board issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606) ("ASU 2014-09"), which supersedes the revenue recognition requirements in ASC 605, Revenue Recognition. ASU 2014-09 requires entities to recognize revenue in a way that depicts the transfer of goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled to in exchange for those goods or services. ASU 2014-09 requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to obtain or fulfill a contract. ASU 2014-09 is effective retrospectively for fiscal years, and interim periods within those years, beginning after December 15, 2016. Early adoption is not permitted. The Company is currently evaluating the effect that this pronouncement will have on its financial statements and related disclosures.

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

There have been no material changes to the market risk disclosures set forth in Item 7A in our Annual Report on Form 10-K for the fiscal year ended March 31, 2014.

ITEM 4. CONTROLS AND PROCEDURES

Disclosure Controls and Procedures.

Our senior management is responsible for establishing and maintaining disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d - 15(e) under the Exchange Act), designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the Securities and Exchange Commission's rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the Exchange Act is accumulated and communicated to the issuer's management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.

Evaluation of Disclosure Controls and Procedures.

We have evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of the end of the period covered by this report, with the participation of our Principal Executive Officer and Chief Financial Officer, as well as other members of our management. Based on this evaluation, our Principal Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective as of September 30, 2014.

Changes in Internal Control Over Financial Reporting

No change occurred in our internal controls concerning financial reporting during the three month period ended September 30, 2014 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

55

PART II. OTHER INFORMATION

Item 1. Legal Proceedings.

The nature of our business exposes us to the potential for legal proceedings related to labor and employment, personal injury, property damage, and environmental matters. Although the ultimate outcome of any legal matter cannot be predicted with certainty, based on present information, including our assessment of the merits of each particular claim, as well as our current reserves and insurance coverage, we do not expect that any known legal proceeding will in the foreseeable future have a material adverse impact on our financial condition or the results of our operations.

Item 1A.   Risk Factors.

There has been no material change to our Risk Factors from those presented in our Form 10-K for the fiscal year ended March 31, 2014.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

None.

Item 3. Defaults Upon Senior Securities.

None.

Item 4. Mine Safety Disclosures.

Not applicable.

Item 5. Other Information

None.

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Item 6. Exhibits.

(a) Exhibits

10.1	Agreement, dated as of September 22, 2014, by and between Rand Logistics, Inc. and JWEST, LLC (filed as Exhibit 10.1 to the Form 8-K filed with the SEC on September 22, 2014).**
31.1	Chief Executive Officer's Certificate, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.*
31.2	Chief Financial Officer's Certificate, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.*
32.1	Chief Executive Officer's Certificate, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.*
32.2	Chief Financial Officer's Certificate, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.*
101.INS	XBRL Instance Document*
101.SCH	XBRL Taxonomy Extension Schema Document*
101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document*
101.DEF	XBRL Taxonomy Extension Definition Linkbase Document*
101.LAB	XBRL Taxonomy Extension Label Linkbase Document*
101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document*
* Filed herewith
** Previously filed with the SEC as indicated, and hereby incorporated herein by reference.

57

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

		RAND LOGISTICS, INC.
Date:	November 5, 2014	/s/ Laurence S. Levy
		Laurence S. Levy
		Executive Chairman
		(Principal Executive Officer)
Date:	November 5, 2014	/s/ Joseph W. McHugh, Jr.
		Joseph W. McHugh, Jr.
		Vice President and Chief Financial Officer
		(Principal Financial and Accounting Officer)

58

Exhibit Index

10.1	Agreement, dated as of September 22, 2014, by and between Rand Logistics, Inc. and JWEST, LLC (filed as Exhibit 10.1 to the Form 8-K filed with the SEC on September 22, 2014.**
31.1	Chief Executive Officer's Certificate, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.*
31.2	Chief Financial Officer's Certificate, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.*
32.1	Chief Executive Officer's Certificate, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.*
32.2	Chief Financial Officer's Certificate, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.*
101.INS	XBRL Instance Document*
101.SCH	XBRL Taxonomy Extension Schema Document*
101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document*
101.DEF	XBRL Taxonomy Extension Definition Linkbase Document*
101.LAB	XBRL Taxonomy Extension Label Linkbase Document*
101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document*
* Filed herewith.
**Previously filed with the SEC as indicated, and hereby incorporated herein by reference.

59

EX-31.1

Exhibit 31.1

CERTIFICATION

PURSUANT TO RULE 13a-14 AND 15d-14

UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED

CERTIFICATIONS

I, Laurence S. Levy, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Rand Logistics, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: November 5, 2014	/s/ Laurence S. Levy
	Laurence S. Levy
	Executive Chairman (Principal Executive Officer)

EX-31.2

Exhibit 31.2

CERTIFICATION

PURSUANT TO RULE 13a-14 AND 15d-14

UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED

CERTIFICATIONS

I, Joseph W. McHugh, Jr., certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Rand Logistics, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: November 5, 2014	/s/ Joseph W. McHugh, Jr.
	Joseph W. McHugh, Jr.
	Chief Financial Officer

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the filing of the Quarterly Report (the "Report") of Rand Logistics, Inc. (the "Company") on Form 10-Q for the period ended September 30, 2014 with the Securities and Exchange Commission, the undersigned, in the capacity and on the date indicated below, hereby certifies pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: November 5, 2014	/s/ Laurence S. Levy
	Laurence S. Levy
	Executive Chairman (Principal Executive Officer)

EX-32.2

Exhibit 32.2

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the filing of the Quarterly Report (the "Report") of Rand Logistics, Inc. (the "Company") on Form 10-Q for the period ended September 30, 2014 with the Securities and Exchange Commission, the undersigned, in the capacity and on the date indicated below, hereby certifies pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: November 5, 2014	/s/ Joseph W. McHugh, Jr.
	Joseph W. McHugh, Jr.
	Chief Financial Officer

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STOCKHOLDERS' EQUITY Stockholders Equity (Tables)

6 Months Ended

Sep. 30, 2014

Stockholders' Equity Note [Abstract]

Schedule of share-based compensation awards

The following table summarizes shares issued to officers under employment agreements and restricted stock agreements from time to time.

Date issued	No. of Officers Covered	No. of Shares	Share Price	Reference	Expense
				Vesting	Three months ended September 30, 2014	Three months ended September 30, 2013	Six months ended September 30, 2014	Six months ended September 30, 2013
Oct 13, 2009	1	39,660	3.17	Employment Agreement	—	7	—	13
				20% in each of five fiscal years ending March 31, 2014.
Apr 8, 2011	6	86,217	7.94	Restricted Share Award Agreement	—	56	—	113
				Three years in equal installments on each anniversary date.
Apr 11, 2012	2	45,754	8.68	Restricted Share Award Agreement	33	33	66	66
				Three years in equal installments on each anniversary date.
Feb 22, 2013	4	32,387	5.96	Restricted Share Award Agreement	23	25	46	49
				Two years in equal installments on each anniversary date.
Jun 5, 2013	6	54,337	5.55	Restricted Share Award Agreement	25	25	50	33
				Three years in equal installments on each anniversary date.
Jul 22, 2014	10	105,189	5.90	Restricted Share Award Agreement	34	—	34	—
				Three years in equal installments on each anniversary date.

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BANK INDEBTEDNESS (Details) In Thousands, unless otherwise specified	3 Months Ended						0 Months Ended															0 Months Ended
	Jun. 30, 2014	Sep. 30, 2014 Fourth Amended and Restated Credit Agreement Mar 14 to Apr 19 [Member] USD ($)	Sep. 30, 2014 Fourth Amended and Restated Credit Agreement Mar 14 to Apr 19 [Member] CAD	Mar. 31, 2014 Fourth Amended and Restated Credit Agreement Mar 14 to Apr 19 [Member] CAD	Sep. 30, 2014 Minimum [Member] Fourth Amended and Restated Credit Agreement Mar 14 to Apr 19 [Member]	Sep. 30, 2014 Maximum [Member] Fourth Amended and Restated Credit Agreement Mar 14 to Apr 19 [Member]	Sep. 01, 2012 Lower Lakes Towing Ltd. [Member] Canadian Prime Rate [Member] Third Amended & Restated Credit Agreement [Member]	Sep. 01, 2012 Lower Lakes Towing Ltd. [Member] Canadian 30 Day BA Rate [Member] Third Amended & Restated Credit Agreement [Member]	Mar. 13, 2014 Loans Payable [Member] Canadian Term Loan [Member] Lower Lakes Towing Ltd. [Member] Canadian Prime Rate [Member] Fourth Amended and Restated Credit Agreement Mar 14 to Apr 19 [Member]	Mar. 13, 2014 Loans Payable [Member] Canadian Term Loan [Member] Lower Lakes Towing Ltd. [Member] Canadian 30 Day BA Rate [Member] Fourth Amended and Restated Credit Agreement Mar 14 to Apr 19 [Member]	Mar. 13, 2014 Loans Payable [Member] US Term Loan [Member] Grand River Navigation Company, Inc. [Member] US Base Rate [Member] Fourth Amended and Restated Credit Agreement Mar 14 to Apr 19 [Member]	Mar. 13, 2014 Loans Payable [Member] US Term Loan [Member] Grand River Navigation Company, Inc. [Member] LIBOR [Member] Fourth Amended and Restated Credit Agreement Mar 14 to Apr 19 [Member]	Sep. 01, 2012 Canada, Dollars Canadian Prime Rate [Member] Third Amended & Restated Credit Agreement [Member]	Mar. 13, 2014 Canada, Dollars Canadian Prime Rate [Member] Fourth Amended and Restated Credit Agreement Mar 14 to Apr 19 [Member]	Sep. 01, 2012 Canada, Dollars Canadian BA Rate [Member] Third Amended & Restated Credit Agreement [Member]	Mar. 13, 2014 Canada, Dollars Canadian BA Rate [Member] Fourth Amended and Restated Credit Agreement Mar 14 to Apr 19 [Member]	Aug. 30, 2012 Canada, Dollars Lower Lakes Towing Ltd. [Member] Revolving Credit Facility [Member] Third Amended & Restated Credit Agreement [Member] CAD	Sep. 30, 2014 Canada, Dollars Lower Lakes Towing Ltd. [Member] Revolving Credit Facility [Member] Fourth Amended and Restated Credit Agreement Mar 14 to Apr 19 [Member] CAD	Mar. 31, 2014 Canada, Dollars Lower Lakes Towing Ltd. [Member] Revolving Credit Facility [Member] Fourth Amended and Restated Credit Agreement Mar 14 to Apr 19 [Member] CAD	Mar. 11, 2014 Canada, Dollars Lower Lakes Towing Ltd. [Member] Revolving Credit Facility [Member] Fourth Amended and Restated Credit Agreement Mar 14 to Apr 19 [Member] USD ($)	Mar. 11, 2014 Canada, Dollars Lower Lakes Towing Ltd. [Member] Revolving Credit Facility [Member] Fourth Amended and Restated Credit Agreement Mar 14 to Apr 19 [Member] CAD	Sep. 01, 2012 United States of America, Dollars US Base Rate [Member] Third Amended & Restated Credit Agreement [Member]	Mar. 13, 2014 United States of America, Dollars US Base Rate [Member] Fourth Amended and Restated Credit Agreement Mar 14 to Apr 19 [Member]	Sep. 01, 2012 United States of America, Dollars LIBOR [Member] Third Amended & Restated Credit Agreement [Member]	Mar. 13, 2014 United States of America, Dollars LIBOR [Member] Fourth Amended and Restated Credit Agreement Mar 14 to Apr 19 [Member]	Aug. 30, 2012 United States of America, Dollars Lower Lakes Transportation Company [Member] Revolving Credit Facility [Member] Third Amended & Restated Credit Agreement [Member] USD ($)	Sep. 30, 2014 United States of America, Dollars Lower Lakes Transportation Company [Member] Revolving Credit Facility [Member] Fourth Amended and Restated Credit Agreement Mar 14 to Apr 19 [Member] CAD	Mar. 31, 2014 United States of America, Dollars Lower Lakes Transportation Company [Member] Revolving Credit Facility [Member] Fourth Amended and Restated Credit Agreement Mar 14 to Apr 19 [Member] CAD	Mar. 11, 2014 United States of America, Dollars Lower Lakes Transportation Company [Member] Revolving Credit Facility [Member] Fourth Amended and Restated Credit Agreement Mar 14 to Apr 19 [Member] USD ($)	Mar. 11, 2014 United States of America, Dollars Lower Lakes Transportation Company [Member] Revolving Credit Facility [Member] Fourth Amended and Restated Credit Agreement Mar 14 to Apr 19 [Member] CAD
Line of Credit Facility [Line Items]
Authorized amount of line of credit																	13,500			$ 17,500	17,500					$ 13,500			$ 17,500	17,500
Amount of line of credit being utilized																		3,000	0								6,000	0
Amount of letters of credit maintained			100	100
Basis spread on variable rate							3.75%	4.75%	3.00%	4.00%	3.00%	4.00%	3.75%	3.00%	4.75%	4.00%						3.75%	3.00%	4.75%	4.00%
Collateral, percent of receivables eligible for collateral if not aged over 90 days		85.00%	85.00%
Collateral, minimum age of receivables eligible for collateral	90 days
Collateral, receivables eligible for collateral if not aged over 90 days, percent limitation per one customer					20.00%	30.00%
Credit availability		$ 5,648

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PROPERTY AND EQUIPMENT (Details) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2014	Mar. 31, 2014
Property, Plant and Equipment [Line Items]
Payments to Acquire Vessel	$ 13,562	$ 7,635
Cost	289,737	282,243
Accumulated depreciation	75,514	66,756
Property and equipment, net	214,223	215,487
Vessels [Member]
Property, Plant and Equipment [Line Items]
Cost	282,255	274,919
Accumulated depreciation	71,059	62,694
Leasehold improvements [Member]
Property, Plant and Equipment [Line Items]
Cost	3,834	3,834
Accumulated depreciation	2,193	1,953
Furniture and equipment [Member]
Property, Plant and Equipment [Line Items]
Cost	603	534
Accumulated depreciation	284	249
Vehicles [Member]
Property, Plant and Equipment [Line Items]
Cost	18	19
Accumulated depreciation	14	13
Computer, communication equipment and purchased software [Member]
Property, Plant and Equipment [Line Items]
Cost	3,027	2,937
Accumulated depreciation	$ 1,964	$ 1,847

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ACCRUED LIABILITIES (Details) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2014	Mar. 31, 2014
Payables and Accruals [Abstract]
Deferred financing and other transaction costs	$ 269	$ 560
Payroll compensation and benefits	2,887	957
Preferred stock dividends	291	0
Professional fees	412	386
Interest	784	767
Winter work, deferred drydock and capital expenditures	419	3,961
Capital and franchise taxes	30	36
Other	2,374	1,289
Accrued liabilities	$ 7,466	$ 7,956

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PREPAID EXPENSES AND OTHER CURRENT ASSETS (Details) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2014	Mar. 31, 2014
Prepaid Expense and Other Assets, Current [Abstract]
Prepaid insurance	$ 584	$ 565
Fuel and lubricants	5,070	4,351
Deposits and other prepaids	2,340	2,428
Prepaid expenses and other current assets	$ 7,994	$ 7,344

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OTHER ASSETS (Tables)

6 Months Ended

Sep. 30, 2014

Other Assets [Abstract]

Schedule of other assets

	September 30, 2014		March 31, 2014
Customer contract costs	$	710	$	850
Prepaid expenses and other assets	8,240		7,224
Total	$	8,950	$	8,074
Current portion	7,994		7,344
Other long term assets	$	956	$	730

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LONG-TERM DEBT (Debt Maturities Due) (Details) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2014
Long-term Debt, Rolling Maturity [Abstract]
September 30, 2015	$ 1,042
September 30, 2016	1,042
September 30, 2017	1,042
March 31, 2018	1,043
March 31, 2019	99,817
Long Term Debt Maturities Repayments in Years One to Five	$ 103,986

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INTEREST EXPENSE

6 Months Ended

Sep. 30, 2014

Interest Expense [Abstract]

INTEREST EXPENSE

INTEREST EXPENSE

Interest expense is comprised of the following:

	Three months ended September 30, 2014			Three months ended September 30, 2013		Six months ended September 30, 2014			Six months ended September 30, 2013
Bank indebtedness	$	155		$	245	$	334		$	526
Amortization of deferred financing costs	333			135		666			271
Long-term debt-senior	1,265			1,928		2,519			3,862
Long-term debt-subordinated	1,992			—		3,953			—
Interest rate caps	3			2		5			3
Deferred payment liability	27			35		55			72
Interest capitalized	(68		)	—		(68		)	—
	$	3,707		$	2,345	$	7,464		$	4,734

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DEFERRED DRYDOCK COSTS (Balance Sheet Details) (Details) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2014	Mar. 31, 2014	Mar. 31, 2013
Deferred Drydock Costs [Abstract]
Deferred expenditures	$ 16,878	$ 15,635
Accumulated amortization	(7,954)	(6,314)
Deferred drydock costs, net	$ 8,924	$ 9,321	$ 10,895

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FINANCIAL INSTRUMENTS (Tables)

6 Months Ended

Sep. 30, 2014

Financial Instruments [Abstract]

Schedule of Foreign Exchange Contracts, Statement of Financial Position [Table Text Block]

The following table provides the fair value of the foreign currency hedge contract measured on a recurring basis as of September 30, 2014 and March 31, 2014:

		Fair value measurements at September 30, 2014			Fair value measurements at March 31, 2014
	Carrying value at September 30, 2014	Quoted prices in active markets (Level 1)	Significant other observable inputs (Level 2)	Carrying value at March 31, 2014	Quoted prices in active markets (Level 1)	Significant other observable inputs (Level 2)
Foreign currency hedge contract	$95	$—	$95	$—	$—	$—

 The following table sets forth the fair value of the foreign currency hedge instrument as of the dates set forth below:

Derivatives not designated as hedging instrument:	Balance Sheet location	Fair Value as at September 30, 2014	Fair Value as at March 31, 2014
Foreign currency hedge contract	Current assets	$95	$—

Schedule of contracts not designated for hedge accounting treatment, changes in fair value recorded in earnings

The changes in fair value of the foreign currency hedge contract is recorded in earnings as follows:

Derivatives not designated as hedging instrument:	Location of loss (gain) -Recognized in earnings	Three months ended September 30, 2014	Six month ended September 30, 2014	Three months ended September 30, 2013	Six month ended September 30, 2013
Foreign currency hedge contract	Loss (gain) on foreign exchange	$(379)	$(379)	$—	$—

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LONG-TERM DEBT (Tables)

6 Months Ended

Sep. 30, 2014

Debt Disclosure [Abstract]

Schedule of long-term debt instruments

		September 30, 2014		March 31, 2014
a)	Canadian term loan bearing interest at Canadian Prime rate plus 3.00% (3.00% at March 31, 2014) or Canadian BA rate plus 4.00% (4.00% at March 31, 2014) at the Company’s option.  The loan is repayable until April 1, 2019 with quarterly payments of CDN $137 commenced September 1, 2014 and the balance due April 1, 2019.	$	48,879	$	49,644
b)	U.S. term loan bearing interest at LIBOR rate plus 4.00% (4.00% at March 31, 2014) or U.S. base rate plus 3.00% (3.00% at March 31, 2014) at the Company’s option.  The loan is repayable until April 1, 2019 with quarterly payments of US $138 commenced September 1, 2014 and the balance due April 1, 2019.	55,107		55,246
		$	103,986	$	104,890
	Less amounts due within 12 months	1,042		787
		$	102,944	$	104,103

		September 30, 2014		March 31, 2014
a)	U.S. Dollar denominated term loan (Second Lien CDN Term loan) bearing interest at LIBOR rate (as defined) plus 9.5% or U.S. base rate (as defined) plus 8.5% at the Company’s option. The loan is repayable upon maturity on March 11, 2020.	$	34,200	$	34,200
b)	U.S. Dollar denominated term loan (Second Lien U.S. Term loan) bearing interest at LIBOR rate (as defined) plus 9.5% or U.S. base rate (as defined) plus 8.5% at the Company’s option. The loan is repayable upon maturity on March 11, 2020.	$	38,300	$	38,300
		$	72,500	$	72,500

Schedule of principal payments due

Principal payments are due as follows:

Twelve month period ending:

September 30, 2015	$	1,042
September 30, 2016	1,042
September 30, 2017	1,042
September 30, 2018	1,043
September 30, 2019	99,817
	$	103,986

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INTANGIBLE ASSETS AND GOODWILL (Details) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2014	Mar. 31, 2014
Finite-Lived Intangible Assets, Net [Abstract]
Intangible assets, gross	$ 24,956	$ 25,166
Accumulated amortization	10,109	8,933
Intangible assets	14,847	16,233
Goodwill	10,193	10,193
Twelve month period ending:
September 30, 2015	2,704
September 30, 2016	2,645
September 30, 2017	2,602
September 30, 2018	2,601
September 30, 2019	2,265
Total	12,817
Deferred financing costs [Member]
Finite-Lived Intangible Assets, Net [Abstract]
Intangible assets, gross	7,284	7,331
Accumulated amortization	731	75
Trademarks and trade names [Member]
Finite-Lived Intangible Assets, Net [Abstract]
Intangible assets, gross	942	951
Accumulated amortization	808	768
Customer relationships and contracts [Member]
Finite-Lived Intangible Assets, Net [Abstract]
Intangible assets, gross	16,730	16,884
Accumulated amortization	$ 8,570	$ 8,090

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STOCKHOLDERS' EQUITY (Details) (USD $) In Thousands, except Share data, unless otherwise specified	0 Months Ended				3 Months Ended			6 Months Ended			3 Months Ended
	Sep. 21, 2011	Feb. 11, 2011	Sep. 30, 2014	Mar. 31, 2014	Sep. 30, 2014 Series A Preferred Stock [Member]	Jun. 30, 2014 Series A Preferred Stock [Member] D	Sep. 30, 2013 Series A Preferred Stock [Member]	Sep. 30, 2014 Series A Preferred Stock [Member]	Sep. 30, 2013 Series A Preferred Stock [Member]	Mar. 31, 2014 Series A Preferred Stock [Member]	Jun. 30, 2014 Maximum [Member] Series A Preferred Stock [Member]	Sep. 30, 2014 Long Term Incentive Plan 2007 [Member]	Mar. 31, 2014 Long Term Incentive Plan 2007 [Member]
Class of Stock [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Available for Grant												444,355	589,066
Number of shares offered	2,800,000
Sale of stock, price per share	$ 6.00
Proceeds from the offering, net of underwriter’s commissions and expenses	$ 15,525
Shares issued of the Company’s common stock to Buckeye		1,305,963
Share price, average of high and low price		$ 5.175
Preferred stock, shares authorized			1,000,000	1,000,000		1,000,000
Cash dividend annual rate						7.75%
Price per share basis for dividend						$ 50
Dividend rate subject to percentage increase every six months						0.50%
Potential dividend rate, maximum											12.00%
Conversion price per share					$ 6.20		$ 6.20	$ 6.20	$ 6.20
Price per share basis for conversion rate						$ 50
Conversion option rate, shares						8.065
Conversion option determination, number of trading days price per share exceeds $8.50						20
Conversion option determination, number of trading days cutoff period						30
Conversion option determination, agreed upon price per common share						$ 8.50
Preferred stock dividends			$ 291	$ 0
Effective interest rate of preferred dividends					7.75%			7.75%		7.75%

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INCOME TAXES (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Sep. 30, 2014	Sep. 30, 2013	Sep. 30, 2014	Sep. 30, 2013	Mar. 31, 2014
Income (Loss) from Continuing Operations before Income Taxes, Extraordinary Items, Noncontrolling Interest	$ 6,541	$ 7,856	$ 8,943	$ 11,961
Deferred Federal Income Tax Expense (Benefit)	705	6,641	1,048	8,168
Income Tax Expense (Benefit)	705	6,641	1,048	8,168
Effective Income Tax Rate Reconciliation, Percent [Abstract]
Statutory U.S. federal income tax rate			11.70%	68.30%
Components of Deferred Tax Assets and Liabilities [Abstract]
Deferred income taxes	121		121		121
Current deferred tax liabilities	34		34		35
Deferred Tax Liabilities, Net, Noncurrent	$ 6,085		$ 6,085		$ 5,134

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SIGNIFICANT ACCOUNTING POLICIES

6 Months Ended

Sep. 30, 2014

Accounting Policies [Abstract]

SIGNIFICANT ACCOUNTING POLICIES

SIGNIFICANT ACCOUNTING POLICIES

Basis of presentation and consolidation

The consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States of America and include the accounts of Rand Finance Corp. (“Rand Finance”), Rand LL Holdings Corp. ("Rand LL Holdings") and Black Creek Shipping Holding Company, Inc. ("Black Creek Holdings"), wholly-owned subsidiaries of the Company, the accounts of Lower Lakes Towing Ltd. ("Lower Lakes"), Lower Lakes Transportation Company ("Lower Lakes Transportation") and Grand River Navigation Company, Inc. ("Grand River"), each of which is a wholly-owned subsidiary of Rand LL Holdings, Black Creek Shipping Company, Inc. ("Black Creek"), which is a wholly-owned subsidiary of Black Creek Holdings. and Lower Lakes Ship Repair Company Ltd. ("Lower Lakes Ship Repair") and Lower Lakes (17) Ltd. ("Lower Lakes (17)"), each of which is a wholly-owned subsidiary of Lower Lakes.

The consolidated financial statements include the accounts of the Company and all of its wholly-owned subsidiaries. All significant intercompany transactions and balances have been eliminated. In the opinion of management, the interim financial statements contain all adjustments necessary (consisting of normal recurring accruals) to present fairly the financial information contained herein. Operating results for the interim period presented are not necessarily indicative of the results to be expected for a full year, in part due to the seasonal nature of the business. The comparative balance sheet amounts are derived from audited consolidated financial statements for the fiscal year ended and as at March 31, 2014. The statements and related notes have been prepared pursuant to the rules and regulations of the U.S. Securities and Exchange Commission. Accordingly, certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been omitted pursuant to such rules and regulations. These financial statements should be read in conjunction with the financial statements that were included in the Company's Annual Report on Form 10-K for the fiscal year ended March 31, 2014.

Cash and cash equivalents

The Company considers all highly liquid investments with an original maturity of three months or less to be cash equivalents.

2. SIGNIFICANT ACCOUNTING POLICIES (continued)

Accounts receivable and concentration of credit risk

The majority of the Company’s accounts receivable are amounts due from customers and other accounts receivable, including insurance and Harmonized Sales Tax refunds.  The majority of accounts receivable are due within 30 to 60 days and are stated at amounts due from customers net of an allowance for doubtful accounts. The Company extends credit to its customers based upon its assessment of their creditworthiness and past payment history. Accounts outstanding longer than the contractual payment terms are considered past due. The Company has historically had no significant bad debts. Interest is not accrued on outstanding receivables.

Revenue and operating expenses recognition

The Company generates revenues from freight billings under contracts of affreightment (voyage charters) generally on a rate per ton basis based on origin-destination and cargo carried. Voyage revenue is recognized ratably over the duration of a voyage based on the relative transit time in each reporting period when the following conditions are met: the Company has a signed contract of affreightment, the contract price is fixed or determinable and collection is reasonably assured.  Included in freight billings are other fees such as fuel surcharges and other freight surcharges, which represent pass-through charges to customers for toll fees, lockage fees and ice breaking fees paid to other parties.  Fuel surcharges are recognized ratably over the duration of the voyage, while freight surcharges are recognized when the associated costs are incurred. Freight surcharges are less than 5% of total revenue.

Marine operating expenses such as crewing costs, fuel, tugs and insurance are recognized as incurred or consumed and thereby are recognized ratably in each reporting period. Repairs and maintenance and certain other insignificant costs are recognized as incurred.

The Company subcontracts excess customer demand to other freight providers.  Service to customers under such arrangements is transparent to the customer and no additional services are provided to customers.  Consequently, revenues recognized for customers serviced by freight subcontractors are recognized on the same basis as described above.  Costs for subcontracted freight providers, presented as “outside voyage charter fees” in the consolidated statements of operations, are recognized as incurred and therefore are recognized ratably over the voyage.

The Company accounts for sales taxes imposed on its services on a net basis in the consolidated statements of operations.

In addition, all revenues are presented on a gross basis.

Vessel acquisitions

Vessels are stated at cost, which consists of the purchase price and any material expenses incurred upon acquisition, such as initial repairs, improvements, delivery expenses and other expenditures to prepare the vessel for its initial voyage. Subsequent expenditures for conversions and major improvements are also capitalized when they appreciably extend the life, increase the earnings capacity or improve the efficiency or safety of the vessels. Significant financing costs incurred during the construction period of the vessels are also capitalized and included in the vessels' cost.

Fuel and lubricant inventories

Raw materials, fuel and certain operating supplies are accounted for on a first-in, first-out cost method (based on monthly averages). Raw materials and fuel are stated at the lower of actual cost (first-in, first-out method) or market. Operating supplies are stated at actual cost or average cost.

2. SIGNIFICANT ACCOUNTING POLICIES (continued)

Intangible assets and goodwill

Intangible assets consist primarily of goodwill, deferred financing costs, trademarks, trade names and customer relationships and contracts. Intangible assets are amortized as follows:

Trademarks and trade names	10 years straight-line
Customer relationships and contracts	15 years straight-line

Deferred financing costs are amortized on a straight-line basis over the term of the related debt, which approximates the effective interest method.

Property and equipment

Property and equipment are recorded at cost.  Depreciation methods for property and equipment are as follows:

Vessels	5 - 25 years straight-line
Leasehold improvements	7 - 11 years straight-line
Vehicles	20% declining-balance
Furniture and equipment	20% declining-balance
Computer equipment	45% declining-balance
Communication equipment	20% declining-balance

Impairment of fixed assets

Fixed assets (e.g. property and equipment) and finite-lived intangible assets (e.g. customer lists) are tested for impairment upon the occurrence of a triggering event that indicates the carrying value of such an asset or asset group (e.g. tugs and barges), might be no longer recoverable. Examples of such triggering events include a significant disposal of a portion of such assets, an adverse change in the market involving the business employing the related asset(s), a significant decrease in the benefits realized from an acquired business, difficulties or delays in integrating the business, and a significant change in the operations of an acquired business.

Once a triggering event has occurred, the recoverability test employed is based on whether the intent is to hold the asset(s) for continued use or to hold the asset(s) for sale. If the intent is to hold the asset(s) for continued use, the recoverability test involves a comparison of undiscounted cash flows excluding interest expense, against the carrying value of the asset(s) as an initial test. If the carrying value of such asset(s) exceeds the undiscounted cash flow, the asset(s) would be deemed to be impaired. Impairment would then be measured as the difference between the fair value of the fixed or amortizing intangible asset and the carrying value of such asset(s). The Company generally determines fair value by using the discounted cash flow method. If the intent is to hold the asset(s) for sale and certain other criteria are met (i.e. the asset(s) can be disposed of currently, appropriate levels of authority have approved the sale and there is an actively pursuing buyer), the impairment test is a comparison of the asset’s carrying value to its fair value less costs to sell. To the extent that the carrying value is greater than the asset’s fair value less costs to sell, an impairment loss is recognized for the difference. The Company has determined that there were no adverse changes in our markets or other triggering events that could affect the valuation of our assets during the six month period ended September 30, 2014.

2. SIGNIFICANT ACCOUNTING POLICIES (continued)

Impairment of goodwill

The Company annually reviews the carrying value of goodwill to determine whether impairment may exist. Accounting Standards Codification (“ASC”) 350 “Intangibles-Goodwill and Other” and Accounting Standards Update (“ASU”) 2011-08 Intangibles—Goodwill and Other (Topic 350) - Testing Goodwill for Impairment requires that goodwill and certain intangible assets be assessed annually for impairment using fair value measurement techniques. Specifically, goodwill impairment is determined using a three-step process. The first step of the goodwill impairment test is to perform a qualitative assessment before calculating the fair value of the reporting unit when testing goodwill for impairment. If the fair value of the reporting unit is determined, based on qualitative factors, to be more likely than not less than the carrying amount of the reporting unit, then entities are required to perform the two-step goodwill impairment test. The second step of the goodwill impairment test is used to identify potential impairment by comparing the fair value of a reporting unit with its carrying amount, including goodwill. The estimates of fair value of the Company’s two reporting units, which are the Company’s Canadian and US operations (excluding the parent), are determined using various valuation techniques with the primary techniques being a discounted cash flow analysis and peer analysis. A discounted cash flow analysis requires various judgmental assumptions, including assumptions about future cash flows, growth rates, and discount rates. The assumptions about future cash flows and growth rates are based on the Company’s forecast and long-term estimates. Discount rate assumptions are based on an assessment of the risk inherent in the respective reporting units. If the fair value of a reporting unit exceeds its carrying amount, goodwill of the reporting unit is considered not impaired and the third step of the impairment test is unnecessary. If the carrying amount of a reporting unit exceeds its fair value, the third step of the goodwill impairment test is performed to measure the amount of impairment loss, if any. The third step of the goodwill impairment test compares the implied fair value of the reporting unit’s goodwill with the carrying amount of that goodwill. If the carrying amount of the reporting unit’s goodwill exceeds the implied fair value of that goodwill, an impairment loss is recognized in an amount equal to that excess. The implied fair value of goodwill is determined in the same manner as the amount of goodwill recognized in a business combination. That is, the fair value of the reporting unit is allocated to all of the assets and liabilities of that unit (including any unrecognized intangible assets) as if the reporting unit had been acquired in a business combination and the fair value of the reporting unit was the purchase price paid to acquire the reporting unit.  As of March 31, 2014, the Company conducted the qualitative assessment and determined that the fair value of its two reporting units exceeded their carrying amounts and the remaining two-step impairment testing was therefore not necessary.  The Company has determined that there were no adverse changes in our markets or other triggering events that indicated that it is more likely than not that the fair value of our reporting units was less than the carrying value of our reporting units during the six month period ended September 30, 2014.

Drydock costs

Drydock costs incurred during statutory Canadian and United States certification processes are capitalized and amortized on a straight-line basis over the benefit period, which is generally 60 months. Drydock costs include costs of work performed by third party shipyards and subcontractors and other direct expenses to complete the mandatory certification process.

Repairs and maintenance

The Company’s vessels require repairs and maintenance each year to ensure the fleet is operating efficiently during the shipping season.  The majority of repairs and maintenance are completed in January, February, and March of each year when the vessels are inactive.  The Company expenses such routine repairs and maintenance costs.  Significant repairs to the Company’s vessels (whether owned or available to the Company under a time charter), such as major engine overhauls and major hull steel repairs, are capitalized and amortized over the remaining useful life of the upgrade or asset repaired, or the remaining lease term.

2. SIGNIFICANT ACCOUNTING POLICIES (continued)

Income taxes

The Company accounts for income taxes in accordance with ASC 740 “Income Taxes”, which requires the determination of deferred tax assets and liabilities based on the differences between the financial statement and income tax bases of tax assets and liabilities, using enacted tax rates in effect for the year in which the differences are expected to reverse.  A valuation allowance is recognized, if necessary, to measure tax benefits to the extent that, based on available evidence, it is more likely than not that they will be realized.

The Company classifies interest expense related to income tax liabilities, when applicable, as part of the interest expense in its consolidated statements of operations rather than income tax expense.  To date, the Company has not incurred material interest expenses or penalties relating to assessed taxation amounts.

There is a current examination taking place by the U.S. taxing authorities for the fiscal year ended March 31, 2012 with no adjustments proposed as of the date of this Quarterly Report on Form 10-Q. Lower Lakes was examined by the Canadian taxing authority for the tax years 2009 and 2010 and such examination is now complete.  This audit did not result in any material adjustments for such periods. The Company's primary U.S. state income tax jurisdictions are Illinois, Indiana, Michigan, Minnesota, Pennsylvania, Wisconsin and New York and its only international jurisdictions are Canada and its province of Ontario. The following table summarizes the open fiscal tax years for each major jurisdiction:

Jurisdiction	Open Tax Years
Federal (USA)	2010 – 2014
Various states	2010 – 2014
Federal (Canada)	2009 – 2014
Ontario	2009 – 2014

Foreign currency translation

The Company uses the U.S. Dollar as its reporting currency.  The functional currency of the Company's Canadian subsidiaries is the Canadian Dollar.  The functional currency of the Company’s U.S. subsidiaries is the U.S. Dollar. Assets and liabilities denominated in foreign currencies are translated into U.S. Dollars at the rate of exchange at the balance sheet date, while revenue and expenses are translated at the average exchange rates prevailing during the respective month.  Components of stockholders’ equity are translated at historical exchange rates.  Exchange gains and losses resulting from translation are reflected in accumulated other comprehensive income or loss, except for financial assets and liabilities designated in foreign currency, which are reflected in the Company's consolidated statements of operations.

Advertising costs

The Company expenses all advertising costs as incurred. These costs are included in general and administrative costs and were insignificant during the periods presented.

Use of estimates

The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. Significant estimates used in the preparation of these financial statements include the assumptions used in determining the useful lives of long-lived assets, the assumptions used in determining whether assets are impaired, the assumptions used in determining the valuation allowance for deferred income tax assets and the assumptions used in stock based compensation awards. Actual results could differ from those estimates.

2.    SIGNIFICANT ACCOUNTING POLICIES (continued)

Stock-based compensation

The Company recognizes compensation expense for all newly granted awards and awards modified, repurchased or cancelled based on fair value at the date of grant.

Financial instruments

The Company accounts for its foreign currency hedge contract on its subordinated debt utilizing ASC 815 “Derivatives and Hedging”. All changes in the fair value of the contract is recorded in earnings and the fair value of settlement costs to terminate the contract is included in current assets or current liabilities on the consolidated balance sheets. Disclosure requirements of ASC 815 are disclosed in Note 21.

Fair value of financial instruments

ASC 820 “Fair Value Measurements and Disclosures” ("ASC 820") defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles and establishes a hierarchy that categorizes and prioritizes the inputs to be used to estimate fair value. The three levels of inputs used are as follows:

Level 1 - Quoted prices in active markets for identical assets or liabilities.

Level 2 - Inputs other than Level 1 that are observable for the asset or liability, either directly or indirectly, such as quoted prices for similar assets and liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; or other inputs that are observable or can be corroborated by observable market data by correlation or other means.

Level 3 - Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

The disclosure requirements of ASC 820 related to the Company’s financial assets and liabilities are presented in Note 21.

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STOCKHOLDERS' EQUITY (Share-based Compensation) (Details) (USD $) In Thousands, except Share data, unless otherwise specified	6 Months Ended			6 Months Ended	12 Months Ended			0 Months Ended	6 Months Ended	9 Months Ended	12 Months Ended				15 Months Ended	0 Months Ended	3 Months Ended		6 Months Ended		63 Months Ended	1 Months Ended		3 Months Ended		6 Months Ended		12 Months Ended	3 Months Ended	6 Months Ended		0 Months Ended	3 Months Ended		6 Months Ended		0 Months Ended			3 Months Ended		6 Months Ended		0 Months Ended	3 Months Ended		6 Months Ended		0 Months Ended	3 Months Ended		6 Months Ended		0 Months Ended	3 Months Ended		6 Months Ended		0 Months Ended	3 Months Ended		6 Months Ended		0 Months Ended			12 Months Ended
	Sep. 30, 2014	Sep. 30, 2013	Feb. 11, 2011	Sep. 30, 2014 Stock Options [Member]	Mar. 31, 2009 Stock Options [Member]	Sep. 30, 2014 Restricted Stock [Member]	Sep. 30, 2013 Restricted Stock [Member]	Feb. 13, 2008 Long Term Incentive Plan 2007 [Member]	Sep. 30, 2014 Long Term Incentive Plan 2007 [Member]	Dec. 31, 2008 Long Term Incentive Plan 2007 [Member]	Mar. 31, 2014 Long Term Incentive Plan 2007 [Member]	Mar. 31, 2013 Long Term Incentive Plan 2007 [Member]	Mar. 31, 2012 Long Term Incentive Plan 2007 [Member]	Mar. 31, 2011 Long Term Incentive Plan 2007 [Member]	Mar. 31, 2010 Long Term Incentive Plan 2007 [Member]	Jul. 31, 2008 Long Term Incentive Plan 2007 [Member] Management [Member]	Sep. 30, 2014 Long Term Incentive Plan 2007 [Member] Canadian employees [Member]	Sep. 30, 2013 Long Term Incentive Plan 2007 [Member] Canadian employees [Member]	Sep. 30, 2014 Long Term Incentive Plan 2007 [Member] Canadian employees [Member]	Sep. 30, 2013 Long Term Incentive Plan 2007 [Member] Canadian employees [Member]	Sep. 30, 2014 Long Term Incentive Plan 2007 [Member] Canadian employees [Member]	Jul. 31, 2008 Long Term Incentive Plan 2007 [Member] Stock Options [Member]	Feb. 29, 2008 Long Term Incentive Plan 2007 [Member] Stock Options [Member]	Sep. 30, 2014 Long Term Incentive Plan 2007 [Member] Stock Options [Member]	Sep. 30, 2013 Long Term Incentive Plan 2007 [Member] Stock Options [Member]	Sep. 30, 2014 Long Term Incentive Plan 2007 [Member] Stock Options [Member]	Sep. 30, 2013 Long Term Incentive Plan 2007 [Member] Stock Options [Member]	Mar. 31, 2009 Long Term Incentive Plan 2007 [Member] Stock Options [Member]	Sep. 30, 2014 Long Term Incentive Plan 2007 [Member] Restricted Stock [Member]	Sep. 30, 2014 Long Term Incentive Plan 2007 [Member] Restricted Stock [Member]	Jun. 27, 2014 Long Term Incentive Plan 2007 [Member] Restricted Stock [Member]	Oct. 13, 2009 October 13, 2009 Grants [Member] key_executives	Sep. 30, 2014 October 13, 2009 Grants [Member]	Sep. 30, 2013 October 13, 2009 Grants [Member]	Sep. 30, 2014 October 13, 2009 Grants [Member]	Sep. 30, 2013 October 13, 2009 Grants [Member]	Feb. 24, 2010 February 24, 2010 Grants [Member]	Apr. 05, 2010 April 5, 2010 Grants [Member]	Apr. 08, 2011 April 8, 2011 Grants [Member] key_executives	Sep. 30, 2014 April 8, 2011 Grants [Member]	Sep. 30, 2013 April 8, 2011 Grants [Member]	Sep. 30, 2014 April 8, 2011 Grants [Member]	Sep. 30, 2013 April 8, 2011 Grants [Member]	Apr. 11, 2012 April 11, 2012 Grants [Member] key_executives	Sep. 30, 2014 April 11, 2012 Grants [Member]	Sep. 30, 2013 April 11, 2012 Grants [Member]	Sep. 30, 2014 April 11, 2012 Grants [Member]	Sep. 30, 2013 April 11, 2012 Grants [Member]	Feb. 22, 2013 February 22, 2013 Grants [Member] [Member] key_executives	Sep. 30, 2014 February 22, 2013 Grants [Member] [Member]	Sep. 30, 2013 February 22, 2013 Grants [Member] [Member]	Sep. 30, 2014 February 22, 2013 Grants [Member] [Member]	Sep. 30, 2013 February 22, 2013 Grants [Member] [Member]	Jun. 05, 2013 June 5, 2013 Grants [Member] key_executives	Sep. 30, 2014 June 5, 2013 Grants [Member]	Sep. 30, 2013 June 5, 2013 Grants [Member]	Sep. 30, 2014 June 5, 2013 Grants [Member]	Sep. 30, 2013 June 5, 2013 Grants [Member]	Jul. 22, 2014 July 22, 2014 Grants [Member] key_executives	Sep. 30, 2014 July 22, 2014 Grants [Member]	Sep. 30, 2013 July 22, 2014 Grants [Member]	Sep. 30, 2014 July 22, 2014 Grants [Member]	Sep. 30, 2013 July 22, 2014 Grants [Member]	Feb. 15, 2013 Shares Issued in Lieu of Cash Compensation [Member]	Sep. 16, 2010 Shares Issued in Lieu of Cash Compensation [Member]	Nov. 16, 2009 Shares Issued in Lieu of Cash Compensation [Member]	Mar. 31, 2009 Shares Issued in Lieu of Cash Compensation [Member] executive_officers	Sep. 30, 2014 Series A Preferred Stock [Member]	Mar. 31, 2014 Series A Preferred Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares awarded																478,232					204,336											39,660							86,217					45,754					32,387					54,337					105,189					94,993	15,153	158,325
Share price, average of high and low price			$ 5.175																													$ 3.17							$ 7.94					$ 8.68					$ 5.96					$ 5.55					$ 5.90
Annual vesting rate																																20.00%
Expense recorded																	$ 0	$ 0	$ 0	$ 0				$ 0	$ 0	$ 0	$ 0		$ 20	$ 20			$ 0	$ 7	$ 0	$ 13				$ 0	$ 56	$ 0	$ 113		$ 33	$ 33	$ 66	$ 66		$ 23	$ 25	$ 46	$ 49		$ 25	$ 25	$ 50	$ 33		$ 34	$ 0	$ 34	$ 0
Number of key executives to receive awards																																1							6					2					4					6					10
Award vesting period																										3 years											3 years	3 years	3 years					3 years					2 years					3 years					3 years
Number of shares authorized									2,500,000
Number of shares available for grant									444,355		589,066
Shares issued to non-employees								12,909	9,472	15,948	19,256	10,854	10,722	14,007	37,144
Options expiration period																										10 years
Expected dividend rate																										0.00%
Risk free interest rate																												4.14%
Expected volatility rate																												39.49%
Expected volatility rate measurement period					P26W
Weighted average remaining contractual term of options outstanding				3 years
Number of executive officers asked to receive shares in lieu of cash compensation																																																																			5
Preferred Stock, Effective Dividend Rate, Percentage																																																																				7.75%	7.75%
Number of options outstanding																								479,785		479,785
Options granted																						236,586	243,199
Compensation expense	697	354
Unrecognized compensation cost at March 31																															$ 204
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number																															30,050
Unvested, Weighted Average Value						$ 5.99	$ 0.00																								$ 5.99

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EARNINGS PER SHARE (Tables)

6 Months Ended

Sep. 30, 2014

Earnings Per Share [Abstract]

Schedule of earnings per share, basic and diluted

	Three months ended September 30, 2014			Three months ended September 30, 2013			Six months ended September 30, 2014			Six months ended September 30, 2013
Numerator:
Net income before preferred dividends	$	5,836		$	1,215		$	7,895		$	3,793
Preferred stock dividends	(290		)	(879		)	(581		)	(1,733		)
Net income applicable to common stockholders	$	5,546		$	336		$	7,314		$	2,060
Denominator:
Weighted average common shares for basic EPS	18,002,591			17,919,524			17,968,438			17,897,856
Effect of dilutive securities:
Average price during period	6.09			5.08			6.16			5.34
Long term incentive stock option plan	479,785			479,785			479,785			479,785
Average exercise price of stock options	5.66			5.66			5.66			5.66
Shares that could be acquired with the proceeds of options	446,172			—			440,554			—
Dilutive shares due to options	33,613			—			39,231			—
Restricted Stock Units (RSU)	30,050			—			15,764			—
Average exercise price of RSU	5.99			—			5.99			—
Shares that could be acquired with the proceeds of RSU	29,574			—			15,319			—
Dilutive shares due to RSU	476			—			445			—
Weighted average convertible preferred shares at $6.20	2,419,355			2,419,355			2,419,355			2,419,355
Weighted average common shares for diluted EPS	20,456,035			17,919,524			20,427,469			17,897,856
Basic EPS	$	0.31		$	0.02		$	0.41		$	0.12
Diluted EPS	$	0.29		$	0.02		$	0.39		$	0.12

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SIGNIFICANT ACCOUNTING POLICIES (Policies)

6 Months Ended

Sep. 30, 2014

Accounting Policies [Abstract]

Cash and cash equivalents

Cash and cash equivalents

The Company considers all highly liquid investments with an original maturity of three months or less to be cash equivalents.

Accounts receivable and concentration of credit risk

Accounts receivable and concentration of credit risk

The majority of the Company’s accounts receivable are amounts due from customers and other accounts receivable, including insurance and Harmonized Sales Tax refunds.  The majority of accounts receivable are due within 30 to 60 days and are stated at amounts due from customers net of an allowance for doubtful accounts. The Company extends credit to its customers based upon its assessment of their creditworthiness and past payment history. Accounts outstanding longer than the contractual payment terms are considered past due. The Company has historically had no significant bad debts. Interest is not accrued on outstanding receivables.

Revenue and operating expenses recognition

Revenue and operating expenses recognition

The Company generates revenues from freight billings under contracts of affreightment (voyage charters) generally on a rate per ton basis based on origin-destination and cargo carried. Voyage revenue is recognized ratably over the duration of a voyage based on the relative transit time in each reporting period when the following conditions are met: the Company has a signed contract of affreightment, the contract price is fixed or determinable and collection is reasonably assured.  Included in freight billings are other fees such as fuel surcharges and other freight surcharges, which represent pass-through charges to customers for toll fees, lockage fees and ice breaking fees paid to other parties.  Fuel surcharges are recognized ratably over the duration of the voyage, while freight surcharges are recognized when the associated costs are incurred. Freight surcharges are less than 5% of total revenue.

Marine operating expenses such as crewing costs, fuel, tugs and insurance are recognized as incurred or consumed and thereby are recognized ratably in each reporting period. Repairs and maintenance and certain other insignificant costs are recognized as incurred.

The Company subcontracts excess customer demand to other freight providers.  Service to customers under such arrangements is transparent to the customer and no additional services are provided to customers.  Consequently, revenues recognized for customers serviced by freight subcontractors are recognized on the same basis as described above.  Costs for subcontracted freight providers, presented as “outside voyage charter fees” in the consolidated statements of operations, are recognized as incurred and therefore are recognized ratably over the voyage.

The Company accounts for sales taxes imposed on its services on a net basis in the consolidated statements of operations.

In addition, all revenues are presented on a gross basis.

Vessel acquisitions

Vessel acquisitions

Vessels are stated at cost, which consists of the purchase price and any material expenses incurred upon acquisition, such as initial repairs, improvements, delivery expenses and other expenditures to prepare the vessel for its initial voyage. Subsequent expenditures for conversions and major improvements are also capitalized when they appreciably extend the life, increase the earnings capacity or improve the efficiency or safety of the vessels. Significant financing costs incurred during the construction period of the vessels are also capitalized and included in the vessels' cost.

Fuel and lubricant inventories

Fuel and lubricant inventories

Raw materials, fuel and certain operating supplies are accounted for on a first-in, first-out cost method (based on monthly averages). Raw materials and fuel are stated at the lower of actual cost (first-in, first-out method) or market. Operating supplies are stated at actual cost or average cost.

Intangible assets and goodwill

Intangible assets and goodwill

Intangible assets consist primarily of goodwill, deferred financing costs, trademarks, trade names and customer relationships and contracts. Intangible assets are amortized as follows:

Trademarks and trade names	10 years straight-line
Customer relationships and contracts	15 years straight-line

Deferred financing costs are amortized on a straight-line basis over the term of the related debt, which approximates the effective interest method.

Property and equipment

Property and equipment

Property and equipment are recorded at cost.  Depreciation methods for property and equipment are as follows:

Vessels	5 - 25 years straight-line
Leasehold improvements	7 - 11 years straight-line
Vehicles	20% declining-balance
Furniture and equipment	20% declining-balance
Computer equipment	45% declining-balance
Communication equipment	20% declining-balance

Impairment of fixed assets

Impairment of fixed assets

Fixed assets (e.g. property and equipment) and finite-lived intangible assets (e.g. customer lists) are tested for impairment upon the occurrence of a triggering event that indicates the carrying value of such an asset or asset group (e.g. tugs and barges), might be no longer recoverable. Examples of such triggering events include a significant disposal of a portion of such assets, an adverse change in the market involving the business employing the related asset(s), a significant decrease in the benefits realized from an acquired business, difficulties or delays in integrating the business, and a significant change in the operations of an acquired business.

Once a triggering event has occurred, the recoverability test employed is based on whether the intent is to hold the asset(s) for continued use or to hold the asset(s) for sale. If the intent is to hold the asset(s) for continued use, the recoverability test involves a comparison of undiscounted cash flows excluding interest expense, against the carrying value of the asset(s) as an initial test. If the carrying value of such asset(s) exceeds the undiscounted cash flow, the asset(s) would be deemed to be impaired. Impairment would then be measured as the difference between the fair value of the fixed or amortizing intangible asset and the carrying value of such asset(s). The Company generally determines fair value by using the discounted cash flow method. If the intent is to hold the asset(s) for sale and certain other criteria are met (i.e. the asset(s) can be disposed of currently, appropriate levels of authority have approved the sale and there is an actively pursuing buyer), the impairment test is a comparison of the asset’s carrying value to its fair value less costs to sell. To the extent that the carrying value is greater than the asset’s fair value less costs to sell, an impairment loss is recognized for the difference. The Company has determined that there were no adverse changes in our markets or other triggering events that could affect the valuation of our assets during the six month period ended September 30, 2014.

Impairment of goodwill

Impairment of goodwill

The Company annually reviews the carrying value of goodwill to determine whether impairment may exist. Accounting Standards Codification (“ASC”) 350 “Intangibles-Goodwill and Other” and Accounting Standards Update (“ASU”) 2011-08 Intangibles—Goodwill and Other (Topic 350) - Testing Goodwill for Impairment requires that goodwill and certain intangible assets be assessed annually for impairment using fair value measurement techniques. Specifically, goodwill impairment is determined using a three-step process. The first step of the goodwill impairment test is to perform a qualitative assessment before calculating the fair value of the reporting unit when testing goodwill for impairment. If the fair value of the reporting unit is determined, based on qualitative factors, to be more likely than not less than the carrying amount of the reporting unit, then entities are required to perform the two-step goodwill impairment test. The second step of the goodwill impairment test is used to identify potential impairment by comparing the fair value of a reporting unit with its carrying amount, including goodwill. The estimates of fair value of the Company’s two reporting units, which are the Company’s Canadian and US operations (excluding the parent), are determined using various valuation techniques with the primary techniques being a discounted cash flow analysis and peer analysis. A discounted cash flow analysis requires various judgmental assumptions, including assumptions about future cash flows, growth rates, and discount rates. The assumptions about future cash flows and growth rates are based on the Company’s forecast and long-term estimates. Discount rate assumptions are based on an assessment of the risk inherent in the respective reporting units. If the fair value of a reporting unit exceeds its carrying amount, goodwill of the reporting unit is considered not impaired and the third step of the impairment test is unnecessary. If the carrying amount of a reporting unit exceeds its fair value, the third step of the goodwill impairment test is performed to measure the amount of impairment loss, if any. The third step of the goodwill impairment test compares the implied fair value of the reporting unit’s goodwill with the carrying amount of that goodwill. If the carrying amount of the reporting unit’s goodwill exceeds the implied fair value of that goodwill, an impairment loss is recognized in an amount equal to that excess. The implied fair value of goodwill is determined in the same manner as the amount of goodwill recognized in a business combination. That is, the fair value of the reporting unit is allocated to all of the assets and liabilities of that unit (including any unrecognized intangible assets) as if the reporting unit had been acquired in a business combination and the fair value of the reporting unit was the purchase price paid to acquire the reporting unit.  As of March 31, 2014, the Company conducted the qualitative assessment and determined that the fair value of its two reporting units exceeded their carrying amounts and the remaining two-step impairment testing was therefore not necessary.  The Company has determined that there were no adverse changes in our markets or other triggering events that indicated that it is more likely than not that the fair value of our reporting units was less than the carrying value of our reporting units during the six month period ended September 30, 2014.

Drydock costs

Drydock costs

Drydock costs incurred during statutory Canadian and United States certification processes are capitalized and amortized on a straight-line basis over the benefit period, which is generally 60 months. Drydock costs include costs of work performed by third party shipyards and subcontractors and other direct expenses to complete the mandatory certification process.

Repairs and maintenance

Repairs and maintenance

The Company’s vessels require repairs and maintenance each year to ensure the fleet is operating efficiently during the shipping season.  The majority of repairs and maintenance are completed in January, February, and March of each year when the vessels are inactive.  The Company expenses such routine repairs and maintenance costs.  Significant repairs to the Company’s vessels (whether owned or available to the Company under a time charter), such as major engine overhauls and major hull steel repairs, are capitalized and amortized over the remaining useful life of the upgrade or asset repaired, or the remaining lease term.

Income taxes

Income taxes

The Company accounts for income taxes in accordance with ASC 740 “Income Taxes”, which requires the determination of deferred tax assets and liabilities based on the differences between the financial statement and income tax bases of tax assets and liabilities, using enacted tax rates in effect for the year in which the differences are expected to reverse.  A valuation allowance is recognized, if necessary, to measure tax benefits to the extent that, based on available evidence, it is more likely than not that they will be realized.

The Company classifies interest expense related to income tax liabilities, when applicable, as part of the interest expense in its consolidated statements of operations rather than income tax expense.  To date, the Company has not incurred material interest expenses or penalties relating to assessed taxation amounts.

There is a current examination taking place by the U.S. taxing authorities for the fiscal year ended March 31, 2012 with no adjustments proposed as of the date of this Quarterly Report on Form 10-Q. Lower Lakes was examined by the Canadian taxing authority for the tax years 2009 and 2010 and such examination is now complete.  This audit did not result in any material adjustments for such periods. The Company's primary U.S. state income tax jurisdictions are Illinois, Indiana, Michigan, Minnesota, Pennsylvania, Wisconsin and New York and its only international jurisdictions are Canada and its province of Ontario. The following table summarizes the open fiscal tax years for each major jurisdiction:

Jurisdiction	Open Tax Years
Federal (USA)	2010 – 2014
Various states	2010 – 2014
Federal (Canada)	2009 – 2014
Ontario	2009 – 2014

Foreign currency translation

Foreign currency translation

The Company uses the U.S. Dollar as its reporting currency.  The functional currency of the Company's Canadian subsidiaries is the Canadian Dollar.  The functional currency of the Company’s U.S. subsidiaries is the U.S. Dollar. Assets and liabilities denominated in foreign currencies are translated into U.S. Dollars at the rate of exchange at the balance sheet date, while revenue and expenses are translated at the average exchange rates prevailing during the respective month.  Components of stockholders’ equity are translated at historical exchange rates.  Exchange gains and losses resulting from translation are reflected in accumulated other comprehensive income or loss, except for financial assets and liabilities designated in foreign currency, which are reflected in the Company's consolidated statements of operations.

Advertising costs

Advertising costs

The Company expenses all advertising costs as incurred. These costs are included in general and administrative costs and were insignificant during the periods presented.

Use of estimates

Use of estimates

The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. Significant estimates used in the preparation of these financial statements include the assumptions used in determining the useful lives of long-lived assets, the assumptions used in determining whether assets are impaired, the assumptions used in determining the valuation allowance for deferred income tax assets and the assumptions used in stock based compensation awards. Actual results could differ from those estimates.

Stock-based compensation

Stock-based compensation

The Company recognizes compensation expense for all newly granted awards and awards modified, repurchased or cancelled based on fair value at the date of grant.

Financial instruments

The disclosure requirements of ASC 820 related to the Company’s financial assets and liabilities are presented in Note 21.

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EARNINGS PER SHARE

6 Months Ended

Sep. 30, 2014

Earnings Per Share [Abstract]

EARNINGS PER SHARE

EARNINGS PER SHARE

The Company had a total of 18,010,147 shares of common stock issued and outstanding as of September 30, 2014, out of an authorized total of 50,000,000 shares. The fully diluted calculation utilizes a total of 20,338,879 shares for the three month period ended September  30, 2013 and 20,317,211 for the six month period ended September 30, 2013. Since the calculation for three month and six month periods ended September 30, 2013 are anti-dilutive, the basic and fully diluted weighted average shares outstanding are 17,919,524 and 17,897,856, respectively. The convertible preferred shares convert to an aggregate of 2,419,355 common shares based on a conversion price of $6.20.

	Three months ended September 30, 2014			Three months ended September 30, 2013			Six months ended September 30, 2014			Six months ended September 30, 2013
Numerator:
Net income before preferred dividends	$	5,836		$	1,215		$	7,895		$	3,793
Preferred stock dividends	(290		)	(879		)	(581		)	(1,733		)
Net income applicable to common stockholders	$	5,546		$	336		$	7,314		$	2,060
Denominator:
Weighted average common shares for basic EPS	18,002,591			17,919,524			17,968,438			17,897,856
Effect of dilutive securities:
Average price during period	6.09			5.08			6.16			5.34
Long term incentive stock option plan	479,785			479,785			479,785			479,785
Average exercise price of stock options	5.66			5.66			5.66			5.66
Shares that could be acquired with the proceeds of options	446,172			—			440,554			—
Dilutive shares due to options	33,613			—			39,231			—
Restricted Stock Units (RSU)	30,050			—			15,764			—
Average exercise price of RSU	5.99			—			5.99			—
Shares that could be acquired with the proceeds of RSU	29,574			—			15,319			—
Dilutive shares due to RSU	476			—			445			—
Weighted average convertible preferred shares at $6.20	2,419,355			2,419,355			2,419,355			2,419,355
Weighted average common shares for diluted EPS	20,456,035			17,919,524			20,427,469			17,897,856
Basic EPS	$	0.31		$	0.02		$	0.41		$	0.12
Diluted EPS	$	0.29		$	0.02		$	0.39		$	0.12

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LONG-TERM DEBT (Schedule of Long-term Debt) (Details) In Thousands, unless otherwise specified	12 Months Ended							0 Months Ended									0 Months Ended					0 Months Ended							0 Months Ended																0 Months Ended
	Mar. 31, 2014 USD ($)	Mar. 31, 2013 USD ($)	Sep. 30, 2014 USD ($)	Sep. 30, 2014 Lower Lakes Towing Ltd. [Member] Loans Payable [Member] Canadian Term Loan [Member]	Mar. 31, 2014 Lower Lakes Towing Ltd. [Member] Loans Payable [Member] Canadian Term Loan [Member]	Sep. 30, 2014 Grand River Navigation Company, Inc. [Member] Loans Payable [Member] US Term Loan [Member]	Mar. 31, 2014 Grand River Navigation Company, Inc. [Member] Loans Payable [Member] US Term Loan [Member]	Sep. 01, 2012 Third Amended & Restated Credit Agreement-Dec 12 to Sept 14 [Member] [Member] Lower Lakes Towing Ltd. [Member] Loans Payable [Member] Canadian Term Loan [Member] CAD	Sep. 01, 2012 Third Amended & Restated Credit Agreement-Dec 12 to Sept 14 [Member] [Member] Grand River Navigation Company, Inc. [Member] Loans Payable [Member] US Term Loan [Member] USD ($)	Sep. 01, 2012 Third Amended & Restated Credit Agreement-Dec 12 to Sept 14 [Member] [Member] Black Creek Holdings, Inc. [Member] Loans Payable [Member] Black Creek US term loan [Member] USD ($)	Sep. 01, 2012 Third Amended & Restated Credit Agreement-Dec 14 to Jun 16 [Member] [Member] Lower Lakes Towing Ltd. [Member] Loans Payable [Member] Canadian Term Loan [Member] CAD	Sep. 01, 2012 Third Amended & Restated Credit Agreement-Dec 14 to Jun 16 [Member] [Member] Grand River Navigation Company, Inc. [Member] Loans Payable [Member] US Term Loan [Member] USD ($)	Sep. 01, 2012 Third Amended & Restated Credit Agreement-Dec 14 to Jun 16 [Member] [Member] Black Creek Holdings, Inc. [Member] Loans Payable [Member] Black Creek US term loan [Member] USD ($)	Mar. 13, 2014 Fourth Amended and Restated Credit Agreement Mar 14 to Apr 19 [Member] Lower Lakes Towing Ltd. [Member] Loans Payable [Member] Canadian Term Loan [Member] CAD	Sep. 30, 2014 Fourth Amended and Restated Credit Agreement Mar 14 to Apr 19 [Member] Lower Lakes Towing Ltd. [Member] Loans Payable [Member] Canadian Term Loan [Member] USD ($)	Mar. 31, 2014 Fourth Amended and Restated Credit Agreement Mar 14 to Apr 19 [Member] Lower Lakes Towing Ltd. [Member] Loans Payable [Member] Canadian Term Loan [Member] USD ($)	Mar. 13, 2014 Fourth Amended and Restated Credit Agreement Mar 14 to Apr 19 [Member] Lower Lakes Towing Ltd. [Member] Loans Payable [Member] Canadian Term Loan [Member] Canadian Prime Rate [Member]	Mar. 13, 2014 Fourth Amended and Restated Credit Agreement Mar 14 to Apr 19 [Member] Lower Lakes Towing Ltd. [Member] Loans Payable [Member] Canadian Term Loan [Member] Canadian BA Rate [Member]	Mar. 13, 2014 Fourth Amended and Restated Credit Agreement Mar 14 to Apr 19 [Member] Grand River Navigation Company, Inc. [Member] Loans Payable [Member] US Term Loan [Member] USD ($)	Sep. 30, 2014 Fourth Amended and Restated Credit Agreement Mar 14 to Apr 19 [Member] Grand River Navigation Company, Inc. [Member] Loans Payable [Member] US Term Loan [Member] USD ($)	Mar. 31, 2014 Fourth Amended and Restated Credit Agreement Mar 14 to Apr 19 [Member] Grand River Navigation Company, Inc. [Member] Loans Payable [Member] US Term Loan [Member] USD ($)	Mar. 13, 2014 Fourth Amended and Restated Credit Agreement Mar 14 to Apr 19 [Member] Grand River Navigation Company, Inc. [Member] Loans Payable [Member] US Term Loan [Member] LIBOR [Member]	Mar. 13, 2014 Fourth Amended and Restated Credit Agreement Mar 14 to Apr 19 [Member] Grand River Navigation Company, Inc. [Member] Loans Payable [Member] US Term Loan [Member] US Base Rate [Member]	Sep. 01, 2012 Third Amended & Restated Credit Agreement [Member] Lower Lakes Towing Ltd. [Member] Canadian Prime Rate [Member]	Sep. 01, 2012 Third Amended & Restated Credit Agreement [Member] Lower Lakes Towing Ltd. [Member] Canadian BA Rate [Member]	Aug. 30, 2012 Secured Debt [Member] Third Amended & Restated Credit Agreement [Member] Lower Lakes Towing Ltd. [Member] Canadian Term Loan [Member] CAD	Aug. 30, 2012 Secured Debt [Member] Third Amended & Restated Credit Agreement [Member] Grand River Navigation Company, Inc. [Member] US Term Loan [Member] USD ($)	Aug. 30, 2012 Secured Debt [Member] Third Amended & Restated Credit Agreement [Member] Black Creek Holdings, Inc. [Member] Black Creek US term loan [Member] USD ($)	Mar. 13, 2014 Subordinated Debt [Member] Lower Lakes Towing Ltd. [Member] Second Lien Canadian Term Loan [Member] LIBOR [Member]	Mar. 13, 2014 Subordinated Debt [Member] Lower Lakes Towing Ltd. [Member] Second Lien Canadian Term Loan [Member] US Base Rate [Member]	Mar. 13, 2014 Subordinated Debt [Member] Grand River Navigation Company, Inc. [Member] Second Lien US Term Loan [Member] LIBOR [Member]	Mar. 13, 2014 Subordinated Debt [Member] Grand River Navigation Company, Inc. [Member] Second Lien US Term Loan [Member] US Base Rate [Member]	Mar. 13, 2014 Canada, Dollars Fourth Amended and Restated Credit Agreement Mar 14 to Apr 19 [Member] Canadian Prime Rate [Member]	Sep. 01, 2012 Canada, Dollars Third Amended & Restated Credit Agreement [Member] Canadian Prime Rate [Member]	Mar. 11, 2014 Canada, Dollars Secured Debt [Member] Fourth Amended and Restated Credit Agreement Mar 14 to Apr 19 [Member] Lower Lakes Towing Ltd. [Member] Canadian Term Loan [Member] USD ($)	Mar. 11, 2014 Canada, Dollars Revolving Credit Facility [Member] Fourth Amended and Restated Credit Agreement Mar 14 to Apr 19 [Member] Lower Lakes Towing Ltd. [Member] USD ($)	Mar. 11, 2014 Canada, Dollars Revolving Credit Facility [Member] Fourth Amended and Restated Credit Agreement Mar 14 to Apr 19 [Member] Lower Lakes Towing Ltd. [Member] CAD	Aug. 30, 2012 Canada, Dollars Revolving Credit Facility [Member] Third Amended & Restated Credit Agreement [Member] Lower Lakes Towing Ltd. [Member] CAD	Mar. 11, 2014 Canada, Dollars Swing Line Facility [Member] Fourth Amended and Restated Credit Agreement Mar 14 to Apr 19 [Member] Lower Lakes Towing Ltd. [Member] USD ($)	Aug. 30, 2012 Canada, Dollars Swing Line Facility [Member] Third Amended & Restated Credit Agreement [Member] Lower Lakes Towing Ltd. [Member] CAD	Sep. 30, 2014 United States of America, Dollars Lower Lakes Towing Ltd. [Member] Second Lien Canadian Term Loan [Member] USD ($)	Mar. 31, 2014 United States of America, Dollars Lower Lakes Towing Ltd. [Member] Second Lien Canadian Term Loan [Member] USD ($)	Sep. 30, 2014 United States of America, Dollars Grand River Navigation Company, Inc. [Member] Second Lien US Term Loan [Member] USD ($)	Mar. 31, 2014 United States of America, Dollars Grand River Navigation Company, Inc. [Member] Second Lien US Term Loan [Member] USD ($)	Mar. 13, 2014 United States of America, Dollars Fourth Amended and Restated Credit Agreement Mar 14 to Apr 19 [Member] LIBOR [Member]	Mar. 13, 2014 United States of America, Dollars Fourth Amended and Restated Credit Agreement Mar 14 to Apr 19 [Member] US Base Rate [Member]	Sep. 01, 2012 United States of America, Dollars Third Amended & Restated Credit Agreement [Member] LIBOR [Member]	Sep. 01, 2012 United States of America, Dollars Third Amended & Restated Credit Agreement [Member] US Base Rate [Member]	Mar. 11, 2014 United States of America, Dollars Secured Debt [Member] Fourth Amended and Restated Credit Agreement Mar 14 to Apr 19 [Member] Grand River Navigation Company, Inc. [Member] US Term Loan [Member] USD ($)	Sep. 30, 2014 United States of America, Dollars Subordinated Debt [Member] USD ($)	Mar. 11, 2014 United States of America, Dollars Subordinated Debt [Member] Lower Lakes Towing Ltd. [Member] Second Lien Canadian Term Loan [Member] USD ($)	Mar. 11, 2014 United States of America, Dollars Subordinated Debt [Member] Grand River Navigation Company, Inc. [Member] Second Lien US Term Loan [Member] USD ($)	Mar. 11, 2014 United States of America, Dollars Revolving Credit Facility [Member] Fourth Amended and Restated Credit Agreement Mar 14 to Apr 19 [Member] Lower Lakes Transportation Company [Member] USD ($)	Mar. 11, 2014 United States of America, Dollars Revolving Credit Facility [Member] Fourth Amended and Restated Credit Agreement Mar 14 to Apr 19 [Member] Lower Lakes Transportation Company [Member] CAD	Aug. 30, 2012 United States of America, Dollars Revolving Credit Facility [Member] Third Amended & Restated Credit Agreement [Member] Lower Lakes Transportation Company [Member] USD ($)	Mar. 11, 2014 United States of America, Dollars Swing Line Facility [Member] Fourth Amended and Restated Credit Agreement Mar 14 to Apr 19 [Member] Lower Lakes Transportation Company [Member] USD ($)	Aug. 30, 2012 United States of America, Dollars Swing Line Facility [Member] Third Amended & Restated Credit Agreement [Member] Lower Lakes Transportation Company [Member] USD ($)	Mar. 11, 2014 Maximum [Member] Canada, Dollars Seasonal Overadvance Facility [Member] Fourth Amended and Restated Credit Agreement Mar 14 to Apr 19 [Member] Lower Lakes Towing Ltd. [Member] USD ($)	Mar. 11, 2014 Maximum [Member] United States of America, Dollars Seasonal Overadvance Facility [Member] Fourth Amended and Restated Credit Agreement Mar 14 to Apr 19 [Member] Lower Lakes Towing Ltd. [Member] USD ($)	Mar. 11, 2014 Maximum [Member] United States of America, Dollars Seasonal Overadvance Facility [Member] Fourth Amended and Restated Credit Agreement Mar 14 to Apr 19 [Member] Lower Lakes Transportation Company [Member] USD ($)	Aug. 30, 2012 Maximum [Member] United States of America, Dollars Seasonal Overadvance Facility [Member] Third Amended & Restated Credit Agreement [Member] USD ($)	Aug. 30, 2012 Maximum [Member] United States of America, Dollars Seasonal Overadvance Facility [Member] Third Amended & Restated Credit Agreement [Member] CAD
Debt Instrument [Line Items]
Subordinated Debt	$ 72,500		$ 72,500																																						$ 34,200	$ 34,200	$ 38,300	$ 38,300
Line of Credit Facility, Current Borrowing Capacity																																				17,500	17,500	13,500	4,000	4,000													17,500	17,500	13,500	50	50	17,500	17,000	17,000	12,000	12,000
Long-term Debt, Current and Noncurrent [Abstract]
Long-term debt	104,890		103,986												48,879	49,644				55,107	55,246
Less amounts due within 12 months	787		1,042
Long-term debt, excluding current maturities	104,103		102,944
Basis spread on variable rate																	3.00%	4.00%				4.00%	3.00%	3.75%	4.75%				9.50%	8.50%	9.50%	8.50%	3.00%	3.75%											4.00%	3.00%	4.75%	3.75%
Quarterly payment								331	401	181	662	802	362	137					138
Debt Instrument Periodic Payment Percentage of Initial Principal														1.00%					1.00%
Effective interest rate including effect of interest rate swap contracts				5.27%	5.26%	4.23%	4.24%
Debt Instrument, Face Amount																										52,979	64,127	28,934							54,882														55,246		34,200	38,300
Debt Instrument, Unused Borrowing Capacity, Amount																																																		32,500
Loss on extinguishment of debt	$ 1,267	$ 3,339

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SIGNIFICANT ACCOUNTING POLICIES (Details)	3 Months Ended
	Jun. 30, 2014
Significant Accounting Policies [Line Items]
Amortization period of drydock costs	60 months
Vehicles [Member]
Significant Accounting Policies [Line Items]
Depreciation rate	20.00%
Furniture and equipment [Member]
Significant Accounting Policies [Line Items]
Depreciation rate	20.00%
Computer equipment [Member]
Significant Accounting Policies [Line Items]
Depreciation rate	45.00%
Communication equipment [Member]
Significant Accounting Policies [Line Items]
Depreciation rate	20.00%
Trademarks and trade names [Member]
Significant Accounting Policies [Line Items]
Amortization period	10 years
Customer relationships and contracts [Member]
Significant Accounting Policies [Line Items]
Amortization period	15 years
Minimum [Member]
Significant Accounting Policies [Line Items]
Age of receivables	30 days
Minimum [Member] | Vessels [Member]
Significant Accounting Policies [Line Items]
Useful life	5 years
Minimum [Member] | Leasehold improvements [Member]
Significant Accounting Policies [Line Items]
Useful life	7 years
Maximum [Member]
Significant Accounting Policies [Line Items]
Age of receivables	60 days
Freight surcharges as a percent of revenue	5.00%
Maximum [Member] | Vessels [Member]
Significant Accounting Policies [Line Items]
Useful life	25 years
Maximum [Member] | Leasehold improvements [Member]
Significant Accounting Policies [Line Items]
Useful life	11 years

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SIGNIFICANT ACCOUNTING POLICIES (Tables)

6 Months Ended

Sep. 30, 2014

Accounting Policies [Abstract]

Amortization periods of intangible assets

Intangible assets consist primarily of goodwill, deferred financing costs, trademarks, trade names and customer relationships and contracts. Intangible assets are amortized as follows:

Trademarks and trade names	10 years straight-line
Customer relationships and contracts	15 years straight-line

Useful lives of property and equipment

Property and equipment are recorded at cost.  Depreciation methods for property and equipment are as follows:

Vessels	5 - 25 years straight-line
Leasehold improvements	7 - 11 years straight-line
Vehicles	20% declining-balance
Furniture and equipment	20% declining-balance
Computer equipment	45% declining-balance
Communication equipment	20% declining-balance

Open tax years

There is a current examination taking place by the U.S. taxing authorities for the fiscal year ended March 31, 2012 with no adjustments proposed as of the date of this Quarterly Report on Form 10-Q. Lower Lakes was examined by the Canadian taxing authority for the tax years 2009 and 2010 and such examination is now complete.  This audit did not result in any material adjustments for such periods. The Company's primary U.S. state income tax jurisdictions are Illinois, Indiana, Michigan, Minnesota, Pennsylvania, Wisconsin and New York and its only international jurisdictions are Canada and its province of Ontario. The following table summarizes the open fiscal tax years for each major jurisdiction:

Jurisdiction	Open Tax Years
Federal (USA)	2010 – 2014
Various states	2010 – 2014
Federal (Canada)	2009 – 2014
Ontario	2009 – 2014

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PREPAID EXPENSES AND OTHER CURRENT ASSETS (Tables)

6 Months Ended

Sep. 30, 2014

Prepaid Expense and Other Assets, Current [Abstract]

Components of prepaid expenses and other current assets

Prepaid expenses and other current assets are comprised of the following:

	September 30, 2014		March 31, 2014
Prepaid insurance	$	584	$	565
Fuel and lubricants	5,070		4,351
Deposits and other prepaids	2,340		2,428
	$	7,994	$	7,344

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DESCRIPTION OF BUSINESS

6 Months Ended

Sep. 30, 2014

Organization, Consolidation and Presentation of Financial Statements [Abstract]

DESCRIPTION OF BUSINESS

DESCRIPTION OF BUSINESS

Rand Logistics, Inc. (the “Company”), a Delaware corporation, is a leading provider of bulk freight shipping services throughout the Great Lakes region. The Company believes that it is the only company providing significant domestic port-to-port services to both Canada and the United States in the Great Lakes region. The Company maintains this operating flexibility by operating both U.S. and Canadian flagged vessels in compliance with the Shipping Act, 1916, and the Merchant Marine Act, 1920, commonly referred to as the Jones Act in the U.S. and the Coasting Trade Act in

Canada, respectively.

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PROPERTY AND EQUIPMENT (Tables)

6 Months Ended

Sep. 30, 2014

Property, Plant and Equipment [Abstract]

Schedule of property and equipment

Property and equipment are comprised of the following:

	September 30, 2014		March 31, 2014
Cost
Vessels	$	282,255	$	274,919
Leasehold improvements	3,834		3,834
Furniture and equipment	603		534
Vehicles	18		19
Computer, communication equipment and purchased software	3,027		2,937
	$	289,737	$	282,243
Accumulated depreciation
Vessels	$	71,059	$	62,694
Leasehold improvements	2,193		1,953
Furniture and equipment	284		249
Vehicles	14		13
Computer, communication equipment  and purchased software	1,964		1,847
	75,514		66,756
	$	214,223	$	215,487

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INTEREST EXPENSE (Tables)

6 Months Ended

Sep. 30, 2014

Interest Expense [Abstract]

Components of interest expense

Interest expense is comprised of the following:

	Three months ended September 30, 2014			Three months ended September 30, 2013		Six months ended September 30, 2014			Six months ended September 30, 2013
Bank indebtedness	$	155		$	245	$	334		$	526
Amortization of deferred financing costs	333			135		666			271
Long-term debt-senior	1,265			1,928		2,519			3,862
Long-term debt-subordinated	1,992			—		3,953			—
Interest rate caps	3			2		5			3
Deferred payment liability	27			35		55			72
Interest capitalized	(68		)	—		(68		)	—
	$	3,707		$	2,345	$	7,464		$	4,734

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VESSEL ACQUISITIONS (Details) (Lower Lakes Towing (17) Ltd. [Member], LalandiaSwan [Member], USD $) In Thousands, unless otherwise specified	Mar. 11, 2014
Lower Lakes Towing (17) Ltd. [Member] | LalandiaSwan [Member]
Schedule of Significant Acquisitions and Disposals [Line Items]
Vessel purchase price	$ 7,000

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Consolidated Balance Sheets (USD $) In Thousands, unless otherwise specified	Sep. 30, 2014	Mar. 31, 2014
CURRENT ASSETS
Cash and cash equivalents	$ 3,571	$ 2,602
Accounts receivable, net (Note 4)	17,391	2,629
Income Taxes Receivable, Current	96	96
Loan to employee	0	250
Prepaid expenses and other current assets (Notes 5 and 8)	7,994	7,344
Deferred income taxes (Note 6)	121	121
Total current assets	29,173	13,042
PROPERTY AND EQUIPMENT, NET (Note 7)	214,223	215,487
OTHER ASSETS (Note 8)	956	730
DEFERRED DRYDOCK COSTS, NET (Note 9)	8,924	9,321
INTANGIBLE ASSETS, NET (Note 10)	14,847	16,233
GOODWILL (Note 10)	10,193	10,193
Total assets	278,316	265,006
CURRENT
Bank indebtedness (Note 12)	8,679
Accounts payable	9,633	11,792
Accrued liabilities (Note 13)	7,466	7,956
Income taxes payable	0	100
Deferred income taxes (Note 6)	34	35
Current portion of deferred payment liability	517	499
Current portion of long-term debt (Note 14)	1,042	787
Total current liabilities	27,371	21,169
LONG-TERM PORTION OF DEFERRED PAYMENT LIABILITY	837	1,100
LONG-TERM DEBT (Note 14)	102,944	104,103
SUBORDINATED DEBT (Note 15)	72,500	72,500
OTHER LIABILITIES	253	253
DEFERRED INCOME TAXES (Note 6)	6,085	5,134
Total liabilities	209,990	204,259
COMMITMENTS AND CONTINGENCIES (Notes 16 and 17)
STOCKHOLDERS' EQUITY
Preferred stock, $.0001 par value, Authorized 1,000,000 shares, Issued and outstanding 300,000 shares (Note 18)	14,900	14,900
Common stock, $.0001 par value Authorized 50,000,000 shares, Issuable and outstanding 18,010,147 shares (Note 18)	1	1
Additional paid-in capital	90,040	89,486
Accumulated deficit	(33,070)	(40,277)
Accumulated other comprehensive loss	(3,545)	(3,363)
Total stockholders’ equity	68,326	60,747
Total liabilities and stockholders’ equity	$ 278,316	$ 265,006

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ACCOUNTS RECEIVABLE (Details) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2014	Mar. 31, 2014
Accounts, Notes, Loans and Financing Receivable, Gross, Allowance, and Net [Abstract]
Allowance for doubtful accounts	$ 50	$ 58

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Consolidated Statements of Stockholders' Equity (USD $) In Thousands, except Share data, unless otherwise specified	Total	Common Stock	Preferred Stock	Additional Paid-In Capital	Accumulated Deficit	Accumulated Other Comprehensive (Loss) Income
Balances at Mar. 31, 2013	$ 72,418	$ 1	$ 14,900	$ 89,077	$ (32,341)	$ 781
Balances (in shares) at Mar. 31, 2013		17,860,266	300,000
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net (loss) income	(4,507)				(4,507)
Preferred stock dividends	(3,429)				(3,429)
Restricted stock issued (Note 18) (in shares)		(54,337)	0
Restricted stock issued (Note 18)	301	0	0	301	0	0
Unrestricted stock issued (Note 18) (in shares)		(19,256)	0
Unrestricted stock issued (Note 18)	108	0	0	108	0	0
Translation adjustment	(4,144)					(4,144)
Balances at Mar. 31, 2014	60,747	1	14,900	89,486	(40,277)	(3,363)
Balances (in shares) at Mar. 31, 2014		17,933,859	300,000
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net (loss) income	2,059				2,059
Preferred stock dividends	(291)				(291)
Unrestricted stock issued (Note 18) (in shares)		(4,602)	0
Unrestricted stock issued (Note 18)	28	0	0	28	0	0
Translation adjustment	1,402					1,402
Balances at Jun. 30, 2014	63,945	1	14,900	89,514	(38,509)	(1,961)
Balances (in shares) at Jun. 30, 2014		17,938,461	300,000
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net (loss) income	5,836				5,836
Preferred stock dividends	(290)				(290)	0
Restricted stock issued (Note 18) (in shares)		(105,189)	0
Restricted stock issued (Note 18)	621	0	0	621	0	0
Unrestricted stock issued (Note 18) (in shares)		(4,870)	0
Unrestricted stock issued (Note 18)	28	0	0	28	0	0
Stock Repurchased and Retired During Period, Shares		(38,373)	0
Stock Repurchased and Retired During Period, Value	(250)	0	0	(143)	(107)	0
Adjustments to Additional Paid in Capital, Share-based Compensation, Restricted Stock Unit or Restricted Stock Award, Requisite Service Period Recognition	20	0	0	20	0	0
Translation adjustment	(1,584)					(1,584)
Balances at Sep. 30, 2014	$ 68,326	$ 1	$ 14,900	$ 90,040	$ (33,070)	$ (3,545)
Balances (in shares) at Sep. 30, 2014		18,010,147	300,000

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COMMITMENTS (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Sep. 30, 2014	Sep. 30, 2013	Sep. 30, 2014	Sep. 30, 2013	Mar. 31, 2014
Commitments [Line Items]
Rental payments	$ 191	$ 186	$ 376	$ 356
Operating Leases, Future Minimum Payments Due, Rolling Maturity [Abstract]
September 30, 2015	509		509
September 30, 2016	379		379
September 30, 2017	295		295
September 30, 2018	225		225
September 30, 2019	131		131
Thereafter	380		380
Total	1,919		1,919
Charter costs			0	254
Operating Leases, Future Minimum Charter Costs Due, Rolling Maturity [Abstract]
September 30, 2015	771		771
September 30, 2016	771		771
September 30, 2017	771		771
September 30, 2018	772		772
September 30, 2019	257		257
Total	3,342		3,342
Contractual commitments	17,453		17,453		1,801
Maximum [Member]
Operating Leases, Future Minimum Payments Due, Rolling Maturity [Abstract]
Annual increase of charter costs	3.00%		3.00%
Operating leases [Member]
Commitments [Line Items]
Rental payments	150	146	295	277
Operating sublease [Member]
Commitments [Line Items]
Rental payments	$ 41	$ 40	$ 81	$ 79

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INTANGIBLE ASSETS AND GOODWILL (Tables)

6 Months Ended

Sep. 30, 2014

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of intangible assets and goodwill

Intangibles are comprised of the following:

	September 30, 2014		March 31, 2014
Intangible assets:
Deferred financing costs	$	7,284	$	7,331
Trademarks and trade names	942		951
Customer relationships and contracts	16,730		16,884
Total identifiable intangibles	$	24,956	$	25,166
Accumulated amortization:
Deferred financing costs	$	731	$	75
Trademarks and trade names	808		768
Customer relationships and contracts	8,570		8,090
Total accumulated amortization	10,109		8,933
Net intangible assets	$	14,847	$	16,233
Goodwill	$	10,193	$	10,193

Schedule of expected amortization expense

Intangible asset amortization over the next five years is estimated as follows:

Twelve month period ending:

September 30, 2015	$	2,704
September 30, 2016	2,645
September 30, 2017	2,602
September 30, 2018	2,601
September 30, 2019	2,265
	$	12,817

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FINANCIAL INSTRUMENTS (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended			1 Months Ended
	Sep. 30, 2014	Sep. 30, 2013	Sep. 30, 2014	Sep. 30, 2013	Mar. 31, 2014	Dec. 31, 2012 Derivatives not designated as hedging instrument [Member] Interest Rate Cap [Member]	Dec. 12, 2012 Derivatives not designated as hedging instrument [Member] Interest Rate Cap [Member] interest_rate_swap_contracts	Sep. 30, 2014 Interest rate swap contracts [Member] Derivatives not designated as hedging instrument [Member] interest_rate_swap_contracts	Mar. 31, 2014 Interest rate swap contracts [Member] Derivatives not designated as hedging instrument [Member] interest_rate_swap_contracts	Sep. 30, 2014 Fair Value, Inputs, Level 1 [Member]	Mar. 31, 2014 Fair Value, Inputs, Level 1 [Member]	Sep. 30, 2014 Fair Value, Inputs, Level 2 [Member]	Mar. 31, 2014 Fair Value, Inputs, Level 2 [Member]	Dec. 12, 2012 United States Derivatives not designated as hedging instrument [Member] Interest Rate Cap [Member]	Dec. 12, 2012 Canada Derivatives not designated as hedging instrument [Member] Interest Rate Cap [Member]
Derivative [Line Items]
Foreign currency hedge contract	$ 95		$ 95		$ 0					$ 0	$ 0	$ 95	$ 0
Gain (Loss) on Foreign Currency Derivative Instruments Not Designated as Hedging Instruments	$ (379)	$ 0	$ (379)	$ 0
Number of interest rate swap contracts								2	2,000
Fixed interest rate														2.50%	3.00%
Number of contracts entered into							2
Percent of outstanding term debt covered						50.00%

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COMMITMENTS

6 Months Ended

Sep. 30, 2014

Commitments and Contingencies Disclosure [Abstract]

COMMITMENTS

COMMITMENTS

The Company did not have any leases which met the criteria of a capital lease as of September 30, 2014. Leases which do not qualify as capital leases are classified as operating leases. Operating lease rental and sublease rental payments included in general and administrative expenses are as follows:

	Three months ended September 30, 2014		Three months ended September 30, 2013		Six months ended September 30, 2014		Six months ended September 30, 2013
Operating leases	$	150	$	146	$	295	$	277
Operating sublease	41		40		81		79
	$	191	$	186	$	376	$	356

The Company’s future minimum rental commitments under other operating leases are as follows.

Twelve month period ending:

September 30, 2015	$	509
September 30, 2016	379
September 30, 2017	295
September 30, 2018	225
September 30, 2019	131
Thereafter	380
	$	1,919

The Company is party to a bareboat charter agreement for the McKee Sons barge that expires in December 2018.  The chartering cost included in vessel operating expenses was $Nil for the six month period ended September 30, 2014 ($254 for the six month period ended September 30, 2013). The lease was amended on February 22, 2008 to provide a lease payment deferment in return for leasehold improvements. The lease contains a clause whereby annual payments escalate at the Consumer Price Index, capped at a maximum annual increase of 3%. Total charter commitments for the McKee Sons vessel for the term of the lease before inflation adjustments are set forth below. 

Twelve month period ending:

September 30, 2015	$	771
September 30, 2016	771
September 30, 2017	771
September 30, 2018	772
September 30, 2019	257
	$	3,342

As of September 30, 2014, the Company had signed contractual commitments with several suppliers totaling $17,453 ($1,801 as of March 31, 2014) in connection with capital expenditures and shipyard projects due in less than one year.

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ACCRUED LIABILITIES (Tables)

6 Months Ended

Sep. 30, 2014

Payables and Accruals [Abstract]

Components of accrued liabilities

Accrued liabilities are comprised of the following:

	September 30, 2014		March 31, 2014
Deferred financing and other transaction costs	$	269	$	560
Payroll compensation and benefits	2,887		957
Preferred stock dividends	291		—
Professional fees	412		386
Interest	784		767
Winter work, deferred drydock expenditures and capital expenditures	419		3,961
Capital and franchise taxes	30		36
Other	2,374		1,289
	$	7,466	$	7,956

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STOCKHOLDERS' EQUITY

6 Months Ended

Sep. 30, 2014

Stockholders' Equity Note [Abstract]

STOCKHOLDERS' EQUITY

STOCKHOLDERS’ EQUITY

On September 21, 2011, the Company completed a public underwritten offering of 2,800,000 shares of the Company’s common stock for $6.00 per share.  The Company’s proceeds from the offering, net of underwriter’s commissions and expenses, were $15,525.

On February 11, 2011, in connection with the Company's acquisition of two vessels, the Company issued 1,305,963 shares of the Company’s common stock to the seller of such vessels. Such shares were valued at the average of high and low price on that day of $5.175.

The Company is authorized to issue 1,000,000 shares of preferred stock with such designations, voting and other rights and preferences that may be determined from time to time by the Board of Directors. The shares of the Company’s series A convertible preferred stock: rank senior to the Company’s common stock with respect to liquidation and dividends; are entitled to receive a cash dividend at the annual rate of 7.75% (based on the $50 per share issue price) payable quarterly (subject to increases of 0.5% for each six month period in respect of which the dividend is not timely paid, up to a maximum of 12%, subject to reversion to 7.75% upon payment of all accrued and unpaid dividends); are convertible into shares of the Company’s common stock at any time at the option of the series A preferred stockholder at a conversion price of $6.20 per share (based on the $50 per share issue price and subject to adjustment) or 8.065 shares of common stock for each Series A Preferred Share (subject to adjustment); are convertible into shares of the Company’s common stock (based on a conversion price of $6.20 per share, subject to adjustment) at the option of the Company if, after the third anniversary of the acquisition, the trading price of the Company’s common stock for 20 trading days within any 30 trading day period equals or exceeds $8.50 per share (subject to adjustment); may be redeemed by the Company in connection with certain change of control or acquisition transactions; will vote on an as-converted basis with the Company’s common stock; and have a separate vote over certain material transactions or changes involving the Company.

The accrued preferred stock dividends payable at September 30, 2014 were $291 and at March 31, 2014 were $Nil. As of September 30, 2014 and March 31, 2014, the effective dividend rate of the preferred stock was 7.75% .

18. STOCKHOLDERS’ EQUITY (continued)

Since January 2007, share-based compensation has been granted to management and directors from time to time.  The Company had no surviving, outstanding share-based compensation agreements with employees or directors prior to that date except as described below.  The Company has reserved 2,500,000 shares for issuance under the Company’s 2007 Long Term Incentive Plan (the “LTIP”) to employees, officers, directors and consultants.  At September 30, 2014, a total of 444,355 shares (589,066 shares at March 31, 2014) were available under the LTIP for future awards.

The following table summarizes shares issued to officers under employment agreements and restricted stock agreements from time to time.

Date issued	No. of Officers Covered	No. of Shares	Share Price	Reference	Expense
				Vesting	Three months ended September 30, 2014	Three months ended September 30, 2013	Six months ended September 30, 2014	Six months ended September 30, 2013
Oct 13, 2009	1	39,660	3.17	Employment Agreement	—	7	—	13
				20% in each of five fiscal years ending March 31, 2014.
Apr 8, 2011	6	86,217	7.94	Restricted Share Award Agreement	—	56	—	113
				Three years in equal installments on each anniversary date.
Apr 11, 2012	2	45,754	8.68	Restricted Share Award Agreement	33	33	66	66
				Three years in equal installments on each anniversary date.
Feb 22, 2013	4	32,387	5.96	Restricted Share Award Agreement	23	25	46	49
				Two years in equal installments on each anniversary date.
Jun 5, 2013	6	54,337	5.55	Restricted Share Award Agreement	25	25	50	33
				Three years in equal installments on each anniversary date.
Jul 22, 2014	10	105,189	5.90	Restricted Share Award Agreement	34	—	34	—
				Three years in equal installments on each anniversary date.

For all share-based compensation, as employees and directors render service over the vesting periods, expense is recorded in general and administrative expenses. Share capital and additional paid-in capital are increased on the grant date with an offset to prepaid assets. Grant date fair market value for all non-option share-based compensation is the average of the high and low trading prices on the date of grant.

18.STOCKHOLDERS’ EQUITY (continued)

The general characteristics of share-based awards granted under the LTIP through September 30, 2014 are as follows:

Stock Awards - All of the shares issued to non-employee outside directors vest immediately.  The first award to non-employee outside directors in the amount of 12,909 shares was made on February 13, 2008 for services through March 31, 2008.  During the fiscal year ended March 31, 2009, the Company awarded 15,948 shares for services from April 1, 2008 through December 31, 2008. The Company awarded 37,144 shares during the fiscal year ended March 31, 2010 for services from January 1, 2009 through March 31, 2010. During the fiscal year ended March 31, 2011, the Company awarded 14,007 shares for services provided from April 1, 2010 through March 31, 2011. During the fiscal year ended March 31, 2012, the Company awarded 10,722 shares for services from April 1, 2011 to March 31, 2012. During the fiscal year ended March 31, 2013, the Company awarded 10,854 shares for services provided from April 1, 2012 to March 31, 2013. During the fiscal year ended March 31, 2014, the Company awarded 19,256 shares for services rendered from April 1, 2013 to March 31, 2014. During the six month period ended September 30, 2014, the Company awarded 9,472 shares for services rendered from April 1, 2014 to September 30, 2014. Grant date fair market value for all these awards is the average of the high and low trading prices of the Company’s common stock on the date of grant.

On July 31, 2008, the Company’s Board of Directors authorized management to make payments effective as of that date to the participants in the management bonus program. Pursuant to the terms of the management bonus program, Rand issued 478,232 shares of common stock to such employee participants.

Stock Options - Stock options granted to management employees vest over three years in equal annual installments. All options issued through September 30, 2014 expire ten years from the date of grant. Stock option grant date fair values are determined at the date of grant using a Black-Scholes option pricing model, a closed-form fair value model based on market prices at the date of grant. At each grant date the Company has estimated a dividend yield of 0%.  The weighted average risk free interest rate within the contractual life of the option is based on the U.S. Treasury yield curve in effect at the time of the grant, which was 4.14% for the fiscal 2009 (July 2008) grant. Expected volatility for the fiscal 2009 grants was based on the prior 26 week period, which reflected trading and volume after the Company made major announcements on acquisitions and capital investments. Expected volatility was 39.49% for the fiscal 2009 grant. Options outstanding (479,785) at September 30, 2014, had a remaining weighted average contractual life of approximately three years.  The Company recorded compensation expenses related to such stock options of $Nil for each of the three and six month periods ended September 30, 2014 and September 30, 2013. All of the stock options granted in February 2008 (243,199) and July 2008 (236,586), had vested as of September 30, 2014.

Shares issued under Employees’ Retirement Savings Plans - The Company issued an aggregate of 204,336 shares to the individual retirement plans of all eligible Canadian employees under the LTIP from July 1, 2009 through September 30, 2014.  The Canadian employees’ plans are managed by independent brokerages. These shares vested immediately but are subject to the Company’s Insider Trading Policy. The shares were issued using the fair value share price, as defined by the LTIP, as of the first trading day of each month for that previous period’s accrued expense. The Company granted $Nil of equity of such accrued compensation expense for each of the three and six month periods ended September 30, 2014 and September 30, 2013.

Shares issued in lieu of cash compensation - The Company experienced a decrease in customer demand at the beginning of the 2009 sailing season and in an effort to maximize the Company’s liquidity, the Compensation Committee of the Company’s Board of Directors requested that five of the Company’s executive officers and all of its outside directors receive common stock as compensation in lieu of cash until the Company had better visibility about its outlook. As of November 16, 2009, the Company issued 158,325 shares to such officers and all of its outside directors at the average of the high and low sale prices Company’s common stock on the date of grant. The shares were issued under the LTIP and vested immediately. Beginning the third quarter of the fiscal year ended March 31, 2010, such executives' and outside directors’ compensation reverted back to cash.

18.STOCKHOLDERS’ EQUITY (continued)

Restricted Stock Units -On June 27, 2014, The Company issued 30,050 Restricted Stock Units (“RSU”) to eligible US and Canadian employees under the LTIP. Each RSU represents one share of the Company's common stock. The grant date fair value of each RSU was $5.99, which represents the average of the high and low sale prices of the Company’s common stock on the date of grant. One-third of the RSU's vest on March 31 of each year, beginning on March 31, 2015. RSUs are not entitled to dividends or voting rights, if any, until the underlying shares of common stock are delivered. The total compensation cost of this grant is $204, net of estimated forfeitures. The fair value of the RSU awards is recognized on a straight-line basis over the vesting period. The Company recorded expense of $20 for each of the three and six month periods ended September 30, 2014.

On September 16, 2010, the Company issued 15,153 shares to a key executive for payment of the fiscal year 2010 bonus at the average of the high and low sale prices of the Company’s common stock on the date of grant. The shares were issued under the LTIP and vested immediately. On February 15, 2013, the Company issued 94,993 shares to eligible Canadian and U.S. employees for a bonus at the average of the high and low trading prices of the Company’s common stock on the date of grant. The shares were issued under the LTIP and vested immediately.

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Consolidated Statements of Cash Flows (USD $) In Thousands, unless otherwise specified	6 Months Ended
	Sep. 30, 2014	Sep. 30, 2013
CASH FLOWS FROM OPERATING ACTIVITIES
Net (loss) income	$ 7,895	$ 3,793
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization of drydock costs	11,082	10,247
Amortization of intangibles and deferred financing costs	1,282	912
Deferred income taxes	1,048	8,168
Equity compensation granted	697	354
Foreign Currency Transaction Gain (Loss), Unrealized	301	0
Deferred drydock costs paid	(2,020)	(3,532)
Changes in operating assets and liabilities:
Accounts receivable	(14,762)	(13,242)
Prepaid expenses and other current assets	(650)	(509)
Accounts payable and accrued liabilities	6,152	(2,404)
Other assets and liabilities	24	137
Income taxes payable (net)	(100)	0
Net Cash Provided by (Used in) Operating Activities, Total	10,949	3,924
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of property and equipment	(17,610)	(5,520)
Net Cash Provided by (Used in) Investing Activities, Total	(17,610)	(5,520)
CASH FLOWS FROM FINANCING ACTIVITIES
Deferred payment liability obligation	(245)	(227)
Payments for Repurchase of Common Stock	(250)	0
Long-term debt repayment	(261)	(1,799)
Debt financing cost	(277)	(23)
Proceeds from bank indebtedness	19,767	17,414
Repayment of bank indebtedness	(11,000)	(11,559)
Payment of preferred stock dividend	(291)	0
Net Cash Provided by (Used in) Financing Activities, Total	7,443	3,806
EFFECT OF FOREIGN EXCHANGE RATES ON CASH	187	(18)
NET INCREASE IN CASH AND CASH EQUIVALENTS	969	2,192
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD	2,602	848
CASH AND CASH EQUIVALENTS, END OF PERIOD	3,571	3,040
SUPPLEMENTAL CASH FLOW DISCLOSURE
Payments for interest	6,849	4,634
Unpaid purchases of property and equipment	903	544
Unpaid purchases of deferred drydock cost	9	2
Payment of income taxes	100	0
Capitalized interest	$ 68	$ 0

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Consolidated Balance Sheets (Parentheticals) (USD $)	Sep. 30, 2014	Mar. 31, 2014
Statement of Financial Position [Abstract]
Common stock, par value (in dollars per share)	$ 0.0001	$ 0.0001
Common stock, shares authorized	50,000,000	50,000,000
Common stock, shares issuable	18,010,147	17,933,859
Common stock, shares outstanding	18,010,147	17,933,859
Preferred stock, par value (in dollars per share)	$ 0.0001	$ 0.0001
Preferred stock, shares authorized	1,000,000	1,000,000
Preferred stock, shares issued	300,000	300,000
Preferred stock, shares outstanding	300,000	300,000

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INTANGIBLE ASSETS AND GOODWILL

6 Months Ended

Sep. 30, 2014

Goodwill and Intangible Assets Disclosure [Abstract]

INTANGIBLE ASSETS AND GOODWILL

INTANGIBLE ASSETS AND GOODWILL

Intangibles are comprised of the following:

	September 30, 2014		March 31, 2014
Intangible assets:
Deferred financing costs	$	7,284	$	7,331
Trademarks and trade names	942		951
Customer relationships and contracts	16,730		16,884
Total identifiable intangibles	$	24,956	$	25,166
Accumulated amortization:
Deferred financing costs	$	731	$	75
Trademarks and trade names	808		768
Customer relationships and contracts	8,570		8,090
Total accumulated amortization	10,109		8,933
Net intangible assets	$	14,847	$	16,233
Goodwill	$	10,193	$	10,193

Intangible asset amortization over the next five years is estimated as follows:

Twelve month period ending:

September 30, 2015	$	2,704
September 30, 2016	2,645
September 30, 2017	2,602
September 30, 2018	2,601
September 30, 2019	2,265
	$	12,817

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Document and Entity Information	6 Months Ended
	Sep. 30, 2014	Nov. 05, 2014
Document and Entity Information [Abstract]
Entity Registrant Name	Rand Logistics, Inc.
Entity Central Index Key	0001294250
Trading Symbol	rlog
Entity Well-known Seasoned Issuer	No
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Current Fiscal Year End Date	--03-31
Entity Filer Category	Accelerated Filer
Entity Common Stock, Shares Outstanding		18,010,147
Document Type	10-Q
Document Period End Date	Sep. 30, 2014
Amendment Flag	false
Document Fiscal Year Focus	2015
Document Fiscal Period Focus	Q2

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VESSEL ACQUISITIONS

6 Months Ended

Sep. 30, 2014

Vessel Acquisitions [Abstract]

VESSEL ACQUISITIONS

VESSEL ACQUISITIONS

On March 11, 2014, Lower Lakes Towing entered into and consummated the transactions contemplated by a Memorandum of Agreement with Uni-Tankers M/T “Lalandia Swan” ApS (the "Seller"), pursuant to which Lower Lakes Towing purchased the LALANDIA SWAN from the Seller for a purchase price of $7,000. Lower Lakes Towing subsequently transferred the title of such vessel to Lower Lakes (17). This acquisition was funded with borrowings under the subordinated loan described in Note 15.

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Consolidated Statements of Operations (USD $) In Thousands, except Share data, unless otherwise specified	3 Months Ended		6 Months Ended
	Sep. 30, 2014	Sep. 30, 2013	Sep. 30, 2014	Sep. 30, 2013
REVENUE
Freight and related revenue	$ 46,102	$ 42,955	$ 82,715	$ 82,560
Fuel and other surcharges	8,168	7,586	14,864	16,382
TOTAL REVENUE	54,270	50,541	97,579	98,942
EXPENSES
Vessel operating expenses	33,612	31,608	61,639	64,291
Repairs and maintenance	(5)	118	1,177	935
General and administrative	3,299	3,195	6,199	6,076
Depreciation	4,693	4,275	9,370	8,580
Amortization of drydock costs	856	829	1,712	1,667
Amortization of intangibles	308	319	616	641
Loss (gain) on foreign exchange	1,261	(3)	463	60
Total Operating Expenses	44,024	40,341	81,176	82,250
OPERATING INCOME	10,246	10,200	16,403	16,692
OTHER (INCOME) AND EXPENSES
Interest expense (Note 19)	3,707	2,345	7,464	4,734
Interest income	(2)	(1)	(4)	(3)
TOTAL OTHER (INCOME) AND EXPENSES	3,705	2,344	7,460	4,731
INCOME BEFORE INCOME TAXES	6,541	7,856	8,943	11,961
PROVISION FOR INCOME TAXES (Note 6)
Deferred	705	6,641	1,048	8,168
TOTAL PROVISION FOR INCOME TAXES	705	6,641	1,048	8,168
NET INCOME BEFORE PREFERRED STOCK DIVIDENDS	5,836	1,215	7,895	3,793
PREFERRED STOCK DIVIDENDS	290	879	581	1,733
NET INCOME APPLICABLE TO COMMON STOCKHOLDERS	$ 5,546	$ 336	$ 7,314	$ 2,060
Earnings Per Share, Basic	$ 0.31	$ 0.02	$ 0.41	$ 0.12
Net income per share diluted (Note 23)	$ 0.29	$ 0.02	$ 0.39	$ 0.12
Weighted average shares basic	18,002,591	17,919,524	17,968,438	17,897,856
Weighted average shares diluted (in shares)	20,456,035	20,338,879	20,427,469	20,317,211
Weighted Average Number of Shares Outstanding, Basic and Diluted		17,919,524		17,897,856

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PREPAID EXPENSES AND OTHER CURRENT ASSETS

6 Months Ended

Sep. 30, 2014

Prepaid Expense and Other Assets, Current [Abstract]

PREPAID EXPENSES AND OTHER CURRENT ASSETS

PREPAIDEXPENSES AND OTHER CURRENT ASSETS

Prepaid expenses and other current assets are comprised of the following:

	September 30, 2014		March 31, 2014
Prepaid insurance	$	584	$	565
Fuel and lubricants	5,070		4,351
Deposits and other prepaids	2,340		2,428
	$	7,994	$	7,344

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ACCOUNTS RECEIVABLE

6 Months Ended

Sep. 30, 2014

Accounts, Notes, Loans and Financing Receivable, Gross, Allowance, and Net [Abstract]

ACCOUNTS RECEIVABLE

ACCOUNTS RECEIVABLE

Trade receivables are presented net of an allowance for doubtful accounts. The allowance was $50 as of September 30, 2014 and $58 as of March 31, 2014. The Company manages and evaluates the collectability of its trade receivables as follows: management reviews aged accounts receivable listings and contact is made with customers that have extended beyond agreed upon credit terms. Senior management and operations are notified so that when they are contacted by such customers for a future delivery, they can request that the customer pay any past due amounts before any future cargo is booked for shipment. Customer credit risk is also managed by reviewing the history of payments by the customer, the size and credit quality of the customer, the period of time remaining within the shipping season and demand for future cargos.

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CONTINGENCIES

6 Months Ended

Sep. 30, 2014

Loss Contingency [Abstract]

CONTINGENCIES

CONTINGENCIES

The Company is not involved in any legal proceedings which are expected to have a material effect on its business, financial position, results of operations or liquidity, nor is the Company aware of any proceedings that are pending or threatened which may have a material effect on the Company’s business, financial position, results of operations or liquidity.  From time to time, the Company may be subject to legal proceedings and claims in the ordinary course of business involving principally commercial charter party disputes, and claims for alleged property damages, personal injuries and other matters. Those claims, even if lacking merit, could result in the expenditure of significant financial and managerial resources.  It is expected that larger claims would be covered by insurance, subject to customary deductibles, if they involve liabilities that may arise from allision, other marine casualty, damage to cargoes, oil pollution, death or personal injuries to crew. The Company evaluates the need for loss accruals under the requirements of ASC 450 – Contingencies.  The Company records an estimated loss for any claim, lawsuit, investigation or proceeding when it is probable that a liability has been incurred and the amount of the loss can reasonably be estimated. If the reasonable estimate of a probable loss is a range, and no amount within the range is a better estimate, then the Company records the minimum amount in the range as the loss accrual. If a loss is not probable or a probable loss cannot be reasonably estimated, no liability is recorded. As of September 30, 2014 an accrual of $237 ($138 as of March 31, 2014) was recorded for various claims.  Management does not anticipate material variations in actual losses from the amounts accrued related to these claims.

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BANK INDEBTEDNESS

6 Months Ended

Sep. 30, 2014

Line of Credit Facility [Abstract]

BANK INDEBTEDNESS

BANK INDEBTEDNESS

As discussed in detail in Note 14, on March 11, 2014, Lower Lakes Towing, Lower Lakes Transportation, Grand River and Black Creek, as borrowers, and Rand LL Holdings, Rand Finance, Black Creek Holdings, Lower Lakes Ship Repair and Lower Lakes (17), and the Company as guarantors, entered into a Fourth Amended and Restated Credit Agreement (the "Fourth Amended and Restated Credit Agreement"), with General Electric Capital Corporation, as agent and a lender, and certain other lenders, which amends and restates the Third Amended and Restated Credit Agreement (the “Third Amended and Restated Credit Agreement”) entered on August 30, 2012, as the same was amended from time to time.

As of September 30, 2014, the Company had authorized operating lines of credit under the Fourth Amended and Restated Credit Agreement of CDN $17,500 and US $17,500 (CDN 17,500 and US 17,500 as of March 31, 2014), was utilizing CDN $3,000 as of September 30, 2014 and CDN $Nil as of March 31, 2014, was utilizing US $6,000 as of September 30, 2014 and US $Nil as of March 31, 2014, and maintained letters of credit of CDN $100 as of each of September 30, 2014 and March 31, 2014.

The Fourth Amended and Restated Credit Agreement provides that the line of credit bears interest, at the borrowers' option, at Canadian Prime Rate plus 3.00% or Canadian BA rate plus 4.00% on Canadian Dollar borrowings, and the U.S. Base rate plus 3.00% or LIBOR plus 4.00% on U.S. Dollar borrowings, compared to the Third Amended and Restated Credit Agreement, which bore interest at the Canadian Prime Rate plus 3.75% or Canadian BA rate plus 4.75% on Canadian Dollar borrowings, and the U.S. Base rate plus 3.75% or LIBOR plus 4.75% on U.S. Dollar borrowings. The Fourth Amended and Restated Credit Agreement is subject to the terms and conditions described in Note 14. Available collateral for borrowings and letters of credit are based on eligible accounts receivable, which are limited to 85% of those receivables that are not over 90 days old, not in excess of 20%-30% per customer in each line and certain other standard limitations. As of September 30, 2014, the Company had credit availability of US $5,648 on the combined lines of credit based on eligible receivables and the seasonal overadvance facilities.

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OTHER ASSETS

6 Months Ended

Sep. 30, 2014

Other Assets [Abstract]

OTHER ASSETS

OTHER ASSETS

Other assets includes certain customer contract related expenditures, which are amortized over a five year period.

	September 30, 2014		March 31, 2014
Customer contract costs	$	710	$	850
Prepaid expenses and other assets	8,240		7,224
Total	$	8,950	$	8,074
Current portion	7,994		7,344
Other long term assets	$	956	$	730

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CONTINGENCIES (Details) (Unasserted claim, USD $) In Thousands, unless otherwise specified	Sep. 30, 2014	Mar. 31, 2014
Unasserted claim
Contingencies:
Contingency accrual	$ 237	$ 138

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INCOME TAXES

6 Months Ended

Sep. 30, 2014

Income Tax Disclosure [Abstract]

INCOME TAXES

INCOME TAXES

The Company's effective tax rate was a deferred tax expense of 11.7% for the six month period ended September 30, 2014 compared to a deferred tax expense of 68.3% for the six month period ended September 30, 2013. The decrease in effective tax rate was primarily due to the implementation of the valuation allowance related to the net U.S. Federal deferred tax assets, which are primarily net operating losses and changes in forecasted full year pre-tax results compared to the prior year comparative period.

The effective tax rate for the six month period ended September 30, 2014 was lower than the statutory tax rate due to the implementation of the valuation allowance related to the net U.S. Federal deferred tax assets, which are primarily net operating losses.

The Company had no unrecognized tax benefits as of September 30, 2014. The Company did not incur any income tax related interest expense or penalties related to uncertain tax positions during each of the six month periods ended September 30, 2014 and September 30, 2013.

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PROPERTY AND EQUIPMENT

6 Months Ended

Sep. 30, 2014

Property, Plant and Equipment [Abstract]

PROPERTY AND EQUIPMENT

PROPERTY AND EQUIPMENT

Property and equipment are comprised of the following:

	September 30, 2014		March 31, 2014
Cost
Vessels	$	282,255	$	274,919
Leasehold improvements	3,834		3,834
Furniture and equipment	603		534
Vehicles	18		19
Computer, communication equipment and purchased software	3,027		2,937
	$	289,737	$	282,243
Accumulated depreciation
Vessels	$	71,059	$	62,694
Leasehold improvements	2,193		1,953
Furniture and equipment	284		249
Vehicles	14		13
Computer, communication equipment  and purchased software	1,964		1,847
	75,514		66,756
	$	214,223	$	215,487

Depreciable assets as at September 30, 2014 included $13,562 ($7,635 as at March 31, 2014) related to a recently acquired vessel. Depreciation on this asset will commence after the vessel is converted to a self-unloading dry-bulk vessel and is available for commercial sailing.

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DEFERRED DRYDOCK COSTS

6 Months Ended

Sep. 30, 2014

Deferred Drydock Costs [Abstract]

DEFERRED DRYDOCK COSTS

DEFERRED DRYDOCK COSTS

Deferred drydock costs are comprised of the following:

	September 30, 2014			March 31, 2014
Drydock expenditures	$	16,878		$	15,635
Accumulated amortization	(7,954		)	(6,314		)
	$	8,924		$	9,321

The following table shows periodic deferrals of drydock costs and amortization.

Balance as of March 31, 2013	$	10,895
Drydock costs accrued and incurred	2,150
Amortization of drydock costs	(3,290		)
Foreign currency translation adjustment	(434		)
Balance as of March 31, 2014	$	9,321
Drydock costs accrued and incurred	1,383
Amortization of drydock costs	(1,712		)
Foreign currency translation adjustment	(68		)
Balance as of September 30, 2014	$	8,924

XML

SEGMENT INFORMATION (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Sep. 30, 2014	Sep. 30, 2013	Sep. 30, 2014	Sep. 30, 2013	Mar. 31, 2014
Segment information:
Revenue	$ 54,270	$ 50,541	$ 97,579	$ 98,942
Property and equipment, net	214,223		214,223		215,487
Intangible assets	14,847		14,847		16,233
Goodwill	10,193		10,193		10,193
Assets	278,316		278,316		265,006
Canada
Segment information:
Revenue	31,012	28,522	55,212	56,966
Property and equipment, net	100,830		100,830		99,050
Intangible assets	8,788		8,788		9,666
Goodwill	8,284		8,284		8,284
Assets	140,626		140,626		130,817
United States
Segment information:
Revenue	23,258	22,019	42,367	41,976
Property and equipment, net	113,393		113,393		116,437
Intangible assets	6,059		6,059		6,567
Goodwill	1,909		1,909		1,909
Assets	$ 137,690		$ 137,690		$ 134,189

XML

EARNINGS PER SHARE (Details) (USD $) In Thousands, except Share data, unless otherwise specified	3 Months Ended			6 Months Ended		12 Months Ended	3 Months Ended		6 Months Ended		3 Months Ended		6 Months Ended		3 Months Ended		6 Months Ended		3 Months Ended		6 Months Ended
	Sep. 30, 2014	Jun. 30, 2014	Sep. 30, 2013	Sep. 30, 2014	Sep. 30, 2013	Mar. 31, 2014	Sep. 30, 2014 Series A Preferred Stock [Member]	Sep. 30, 2013 Series A Preferred Stock [Member]	Sep. 30, 2014 Series A Preferred Stock [Member]	Sep. 30, 2013 Series A Preferred Stock [Member]	Sep. 30, 2014 Stock Options [Member]	Sep. 30, 2013 Stock Options [Member]	Sep. 30, 2014 Stock Options [Member]	Sep. 30, 2013 Stock Options [Member]	Sep. 30, 2014 Restricted Stock [Member]	Sep. 30, 2013 Restricted Stock [Member]	Sep. 30, 2014 Restricted Stock [Member]	Sep. 30, 2013 Restricted Stock [Member]	Sep. 30, 2014 Restricted Stock, Dilutive Shares [Member]	Sep. 30, 2013 Restricted Stock, Dilutive Shares [Member]	Sep. 30, 2014 Restricted Stock, Dilutive Shares [Member]	Sep. 30, 2013 Restricted Stock, Dilutive Shares [Member]	Jun. 27, 2014 Long Term Incentive Plan 2007 [Member] Restricted Stock [Member]
Earnings Per Share [Line Items]
Common stock, shares issuable	18,010,147			18,010,147		17,933,859
Common stock, shares outstanding	18,010,147			18,010,147		17,933,859
Common stock, shares authorized	50,000,000			50,000,000		50,000,000
Numerator:
NET INCOME BEFORE PREFERRED STOCK DIVIDENDS	$ 5,836	$ 2,059	$ 1,215	$ 7,895	$ 3,793	$ (4,507)
PREFERRED STOCK DIVIDENDS	(290)		(879)	(581)	(1,733)
NET INCOME APPLICABLE TO COMMON STOCKHOLDERS	$ 5,546		$ 336	$ 7,314	$ 2,060
Denominator:
Weighted average common shares for basic EPS	18,002,591		17,919,524	17,968,438	17,897,856
Effect of dilutive securities:
Average price during period (in dollars per share)	$ 6.09		$ 5.08	$ 6.16	$ 5.34
Long term incentive stock option plan (in shares)	479,785		479,785	479,785	479,785
Average exercise price of stock options (in dollars per share)	$ 5.66		$ 5.66	$ 5.66	$ 5.66
Shares that could be acquired with the proceeds of options											446,172	0	440,554	0	29,574	0	15,319	0
Dilutive shares due to options											33,613	0	39,231	0	30,050	0	15,764	0	476	0	445	0
Average exercise price of RSU (in dollars per share)															$ 5.99	$ 0.00	$ 5.99	$ 0.00					$ 5.99
Weighted average convertible preferred shares at $6.20	2,419,355		2,419,355	2,419,355	2,419,355
Weighted Average Number of Shares Outstanding, Diluted	20,456,035		20,338,879	20,427,469	20,317,211
Weighted Average Number of Shares Outstanding, Basic and Diluted			17,919,524		17,897,856
Basic EPS (in dollars per share)	$ 0.31		$ 0.02	$ 0.41	$ 0.12
Diluted EPS (in dollars per share)	$ 0.29		$ 0.02	$ 0.39	$ 0.12
Earnings Per Share, Basic and Diluted			$ 0.02		$ 0.12
Conversion price per share							$ 6.20	$ 6.20	$ 6.20	$ 6.20

XML

INTEREST EXPENSE (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Sep. 30, 2014	Sep. 30, 2013	Sep. 30, 2014	Sep. 30, 2013
Interest Expense [Line Items]
Amortization of deferred financing costs	$ 333	$ 135	$ 666	$ 271
Gain (Loss) on Interest Rate Derivative Instruments Not Designated as Hedging Instruments	3	2	5	3
Deferred payment liability	27	35	55	72
Interest capitalized	(68)	0	(68)	0
Interest expense	3,707	2,345	7,464	4,734
Bank indebtedness
Interest Expense [Line Items]
Debt	155	245	334	526
Long-term debt - senior
Interest Expense [Line Items]
Debt	1,265	1,928	2,519	3,862
Subordinated note
Interest Expense [Line Items]
Debt	$ 1,992	$ 0	$ 3,953	$ 0

XML

DEFERRED DRYDOCK COSTS (Tables)

6 Months Ended

Sep. 30, 2014

Deferred Drydock Costs [Abstract]

Schedule of deferred drydock costs

Deferred drydock costs are comprised of the following:

	September 30, 2014			March 31, 2014
Drydock expenditures	$	16,878		$	15,635
Accumulated amortization	(7,954		)	(6,314		)
	$	8,924		$	9,321

Summary of changes in deferred drydock costs

The following table shows periodic deferrals of drydock costs and amortization.

Balance as of March 31, 2013	$	10,895
Drydock costs accrued and incurred	2,150
Amortization of drydock costs	(3,290		)
Foreign currency translation adjustment	(434		)
Balance as of March 31, 2014	$	9,321
Drydock costs accrued and incurred	1,383
Amortization of drydock costs	(1,712		)
Foreign currency translation adjustment	(68		)
Balance as of September 30, 2014	$	8,924

XML

DEFERRED DRYDOCK COSTS (Changes in Deferred Balances) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended		12 Months Ended
	Sep. 30, 2014	Sep. 30, 2013	Sep. 30, 2014	Sep. 30, 2013	Mar. 31, 2014
Deferred Drydock Costs [Roll Forward]
Balance at beginning of period			$ 9,321	$ 10,895	$ 10,895
Drydock costs accrued			1,383		2,150
Amortization of drydock costs	(856)	(829)	(1,712)	(1,667)	(3,290)
Foreign currency translation adjustment			(68)		(434)
Balance at end of period	$ 8,924		$ 8,924		$ 9,321

XML

LONG-TERM DEBT

6 Months Ended

Sep. 30, 2014

Debt Disclosure [Abstract]

LONG-TERM DEBT

LONG-TERM DEBT

		September 30, 2014		March 31, 2014
a)	Canadian term loan bearing interest at Canadian Prime rate plus 3.00% (3.00% at March 31, 2014) or Canadian BA rate plus 4.00% (4.00% at March 31, 2014) at the Company’s option.  The loan is repayable until April 1, 2019 with quarterly payments of CDN $137 commenced September 1, 2014 and the balance due April 1, 2019.	$	48,879	$	49,644
b)	U.S. term loan bearing interest at LIBOR rate plus 4.00% (4.00% at March 31, 2014) or U.S. base rate plus 3.00% (3.00% at March 31, 2014) at the Company’s option.  The loan is repayable until April 1, 2019 with quarterly payments of US $138 commenced September 1, 2014 and the balance due April 1, 2019.	55,107		55,246
		$	103,986	$	104,890
	Less amounts due within 12 months	1,042		787
		$	102,944	$	104,103

The effective interest rates on the term loans at September 30, 2014 were 5.27% (5.26% at March 31, 2014) on the Canadian term loan and 4.23% (4.24% at March 31, 2014) on the U.S. term loan.

Principal payments are due as follows:

Twelve month period ending:

September 30, 2015	$	1,042
September 30, 2016	1,042
September 30, 2017	1,042
September 30, 2018	1,043
September 30, 2019	99,817
	$	103,986

14. LONG-TERM DEBT (continued)

On March 11, 2014, Lower Lakes Towing, Lower Lakes Transportation, Grand River and Black Creek Shipping, as borrowers, Rand LL Holdings Corp. ("Rand LL Holdings"), Rand Finance, Black Creek Shipping Holdings Company, Inc. ("Black Creek Holdings"), Lower Lakes Ship Repair, Lower Lakes (17) and Rand, as guarantors, General Electric Capital Corporation, as agent and Lender, and certain other lenders, entered into a Fourth Amended and Restated Credit Agreement (the "Fourth Amended and Restated Credit Agreement"), which (i) amends and restates the existing Third Amended and Restated Credit Agreement to which the borrowers are a party, dated as of August 30, 2012, as the same has been amended from time to time, in its entirety, (ii) consolidates the existing U.S. term loans into a single term loan, (iii) provides for certain new loans and (iv) provides working capital financing, funds for other general corporate purposes and funds for other permitted purposes. The Fourth Amended and Restated Credit Agreement provides for (i) a revolving credit facility under which Lower Lakes Towing may borrow up to CDN $17,500 with a seasonal overadvance facility of the lesser of US $17,000 or CDN $17,500 less the principal amount outstanding under the seasonal overadvance facility for Lower Lakes Transportation, and a swing line facility of CDN $4,000, subject to limitations, (ii) a revolving credit facility under which Lower Lakes Transportation may borrow up to US $17,500 with a seasonal overadvance facility of US $17,000 less the principal amount outstanding under the seasonal overadvance facility for Lower Lakes Towing, and a swing line facility of US $50 subject to limitations, (iii) the continuation of an existing Canadian dollar denominated term loan facility under which Lower Lakes Towing is obligated to the lenders in the amount of CDN $54,882 as of the date of the Fourth Amended and Restated Credit Agreement (the “CDN Term Loan”) and (iv) the modification and continuation of a U.S. dollar denominated term loan facility under which Grand River and Black Creek are obligated to the lenders in the amount of $55,246 as of the date of the Fourth Amended and Restated Credit Agreement (the “U.S. Term Loan”).

Under the Fourth Amended and Restated Credit Agreement, the revolving credit facilities and swing line loans expire on April 1, 2019. The outstanding principal amount of the CDN Term Loan borrowings will be repayable as follows: (i) annual payments equal to one percent (1%) of the initial principal amount thereof paid quarterly commencing September 1, 2014 and (ii) a final payment in the outstanding principal amount of the CDN Term Loan upon the CDN Term Loan’s maturity on April 1, 2019. The outstanding principal amount of the U.S. Term Loan borrowings will be repayable as follows: (i) annual payments equal to one percent (1%) of the initial principal amount thereof paid quarterly commencing September 1, 2014, and (iii) a final payment in the outstanding principal amount of the U.S. Term Loan upon the U.S. Term Loan’s maturity on April 1, 2019. Borrowings under the Canadian revolving credit facility, the Canadian swing line facility and the CDN Term Loan will bear an interest rate per annum, at the borrowers' option, equal to (i) the Canadian Prime Rate (as defined in the Fourth Amended and Restated Credit Agreement), plus 3.00% per annum or (ii) the BA Rate (as defined in the Fourth Amended and Restated Credit Agreement) plus 4.00% per annum. Borrowings under the U.S. revolving credit facility, the U.S. swing line facility and the U.S. Term Loan will bear interest, at the borrowers’ option, equal to (i) LIBOR (as defined in the Fourth Amended and Restated Credit Agreement) plus 4.00% per annum, or (ii) the U.S. Base Rate (as defined in the Fourth Amended and Restated Credit Agreement) plus 3.00% per annum.

Obligations under the Fourth Amended and Restated Credit Agreement are secured by (i) a first priority lien and security interest on all of the borrowers’ and guarantors’ assets, tangible or intangible, real, personal or mixed, existing and newly acquired, (ii) a pledge by Rand LL Holdings of all of the outstanding capital stock of the borrowers other than Black Creek and Lower Lakes Towing, and a pledge of 65% of the outstanding capital stock of Lower Lakes Towing, (iii) a pledge by Black Creek Holdings of all of the outstanding capital stock of Black Creek, (iv) a pledge by Lower Lakes Towing of all of the outstanding capital stock of Lower Lakes Ship Repair and Lower Lakes (17) and (v) a pledge by Rand of all of the outstanding capital stock of Rand LL Holdings, Rand Finance and Black Creek Holdings. The indebtedness of each domestic borrower under the Fourth Amended and Restated Credit Agreement is unconditionally guaranteed by each other domestic borrower and by the guarantors which are domestic subsidiaries, and such guaranty is secured by a lien on substantially all of the assets of each borrower and each guarantor. Each domestic borrower also guarantees the obligations of the Canadian borrower and each Canadian guarantor guarantees the obligations of the Canadian borrower. Under the Fourth Amended and Restated Credit Agreement, the borrowers will be required to make mandatory prepayments of principal on term loan borrowings (i) if the outstanding balance of the term loans plus the outstanding balance of the seasonal facilities exceeds the sum of 85% of the orderly liquidation value of the vessels owned by the borrowers, less the amount of outstanding liens against the vessels with priority over the lenders’ liens, in an amount equal to such excess, (ii) in the event of certain dispositions of assets and insurance proceeds (all subject to certain exceptions), in an amount equal to 100% of the net proceeds received by the borrowers therefrom and (iii) in an amount

14. LONG-TERM DEBT (continued)

equal to 100% of the net proceeds to a borrower from any issuance of a borrower’s debt or equity securities (all subject to certain exceptions).

The Fourth Amended and Restated Credit Agreement contains certain covenants, including those limiting the guarantors’, the borrowers’, and their subsidiaries’ ability to incur indebtedness, incur liens, sell or acquire assets or businesses, change the nature of their businesses, engage in transactions with related parties, make certain investments or pay dividends. In addition, the Fourth Amended and Restated Credit Agreement requires the borrowers to maintain certain financial ratios. Failure of the borrowers or the guarantors to comply with any of these covenants or financial ratios could result in the loans under the Fourth Amended and Restated Credit Agreement being accelerated.

As a result of the execution of the Fourth Amended and Restated Credit Agreement discussed above, the Company recognized a loss on extinguishment of debt of $1,267 during the fiscal year ended March 31, 2014, that consisted of the unamortized deferred financing costs in connection with previously existing financing arrangement.

On August 30, 2012, Lower Lakes Towing, Lower Lakes Transportation, Grand River and Black Creek, as borrowers, Rand LL Holdings, Rand Finance, Black Creek Holdings and the Company, as guarantors, General Electric Capital Corporation, as agent and Lender, and certain other lenders, entered into the Third Amended and Restated Credit Agreement which (i) amended and restated the Second Amended and Restated Credit Agreement in its entirety, (ii) continued the tranches of loans provided for under the Second Amended and Restated Credit Agreement, (iii) refinanced the indebtedness of Black Creek under its then-existing credit facility and added Black Creek as a U.S. Borrower, (iv) provided for certain new loans and (v) provided working capital financing, funds for other general corporate purposes and funds for other permitted purposes.

The Third Amended and Restated Credit Agreement provided for (i) a revolving credit facility including letters of credit under which Lower Lakes Towing was able to borrow up to CDN $13,500 with a seasonal overadvance facility of US $12,000, less the principal amount outstanding under the seasonal overadvance facility for Lower Lakes Transportation, and a swing line facility of CDN $4,000, subject to limitations, (ii) a revolving credit facility under which Lower Lakes Transportation was able to borrow up to US $13,500 with a seasonal overadvance facility of US $12,000, less the principal amount outstanding under the seasonal overadvance facility for Lower Lakes Towing, and a swing line facility of US $50, subject to limitations, (iii) the modification and continuation of an existing Canadian dollar denominated term loan facility under which Lower Lakes Towing was obligated to the Lenders in the amount of CDN $52,979 as of the date of the Third Amended and Restated Credit Agreement (the “2012 CDN Term Loan”), (iv) the modification and continuation of a U.S. dollar denominated term loan facility under which Grand River was obligated to the Lenders in the amount of $64,127 as of the date of the Third Amended and Restated Credit Agreement (“Grand River Term Loan”) and (v) a U.S. dollar denominated term loan facility under which Black Creek was obligated to Lenders in the amount of $28,934 as of the date of the Third Amended and Restated Credit Agreement (“Black Creek Term Loan”).

Under the Third Amended and Restated Credit Agreement, the revolving credit facilities and swing line loans were to expire on August 1, 2016. The outstanding principal amount of the 2012 CDN Term Loan borrowings was repayable as follows: (i) quarterly payments of CDN $331 commencing on December 1, 2012 and ending September 2014, (ii) quarterly payments of CDN $662 commencing December 1, 2014 and ending June 1, 2016 and (iii) a final payment in the outstanding principal amount of the 2012 CDN Term Loan upon the 2012 CDN Term Loan's scheduled maturity on August 1, 2016. The outstanding principal amount of the Grand River Term Loan borrowings was repayable as follows: (i) quarterly payments of US $401 commencing on December 1, 2012 and ending on September 1, 2014, (ii) quarterly payments of US $802 commencing December 1, 2014 and ending June 1, 2016 and (iii) a final payment in the outstanding principal amount of the Grand River Term Loan upon the Grand River Term Loan's scheduled maturity on August 1, 2016. The outstanding principal amount of the Black Creek Term Loan borrowings was repayable as follows: (i) quarterly payments of US $181 commencing on December 1, 2012 and ending September 1, 2014, (ii) quarterly payments of US $362 commencing December 1, 2014 and ending June 1, 2016 and (iii) a final payment in the outstanding principal amount of the Black Creek Term Loan upon the Black Creek Term Loan's scheduled maturity on August 1, 2016.

14. LONG-TERM DEBT (continued)

Borrowings under the Canadian revolving credit facility, Canadian swing line facility and the 2012 CDN Term Loan bore an interest rate per annum, at the borrowers' option, equal to (i) the Canadian Prime Rate (as defined in the Third Amended and Restated Credit Agreement), plus 3.75% per annum or (ii) the BA Rate (as defined in the Third Amended and Restated Credit Agreement) plus 4.75% per annum. Borrowings under the U.S. revolving credit facility, the U.S. swing line facility, the Grand River Term Loan and Black Creek Term Loan bore interest, at the borrowers' option equal to (i) LIBOR (as defined in the Third amended and Restated Credit Agreement) plus 4.75% per annum, or (ii) the U.S. Base Rate (as defined in the Third Amended and Restated Credit Agreement), plus 3.75% per annum. Obligations under the Third Amended and Restated Credit Agreement were secured by (i) a first priority lien and security interest on all of the borrowers' and guarantors' assets, tangible or intangible, real, personal or mixed, existing and newly acquired, (ii) a pledge by Rand LL Holdings of all of the outstanding capital stock of the borrowers other than Black Creek; (iii) a pledge by Black Creek Holdings of most of the outstanding capital stock of Black Creek; and (iv) a pledge by Rand of all of the outstanding capital stock of Rand LL Holdings, Rand Finance and Black Creek Holdings. The indebtedness of each domestic borrower under the Third Amended and Restated Credit Agreement was unconditionally guaranteed by each other domestic borrower and by the guarantors which are domestic subsidiaries, and such guaranty was secured by a lien on substantially all of the assets of each borrower and each guarantor. Each domestic borrower also guaranteed the obligations of the Canadian borrower and each Canadian guarantor guaranteed the obligations of the Canadian borrower.

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

The Third Amended and Restated Credit Agreement contained certain covenants, including those limiting the guarantors', the borrowers' and their subsidiaries' ability to incur indebtedness, incur liens, sell or acquire assets or businesses, change the nature of their businesses, engage in transactions with related parties, make certain investments or pay dividends. In addition, the Third Amended and Restated Credit Agreement required the borrowers to maintain certain financial ratios.

As a result of the execution of the Third Amended and Restated Credit Agreement discussed above, the Company recognized a loss on extinguishment of debt of $3,339 during the fiscal year ended March 31, 2013, that consisted of the unamortized deferred financing costs in connection with previously existing financing arrangements.

As of September 30, 2014, the Company was in compliance with covenants contained in the Fourth Amended and Restated Credit Agreement.

SUBORDINATED DEBT

SUBORDINATED DEBT

		September 30, 2014		March 31, 2014
a)	U.S. Dollar denominated term loan (Second Lien CDN Term loan) bearing interest at LIBOR rate (as defined) plus 9.5% or U.S. base rate (as defined) plus 8.5% at the Company’s option. The loan is repayable upon maturity on March 11, 2020.	$	34,200	$	34,200
b)	U.S. Dollar denominated term loan (Second Lien U.S. Term loan) bearing interest at LIBOR rate (as defined) plus 9.5% or U.S. base rate (as defined) plus 8.5% at the Company’s option. The loan is repayable upon maturity on March 11, 2020.	$	38,300	$	38,300
		$	72,500	$	72,500

On March 11, 2014, Lower Lakes Towing, Grand River and Black Creek, as borrowers, Rand LL Holdings, Rand Finance , Black Creek Holdings and Rand, as guarantors, Guggenheim Corporate Funding, LLC, as agent and Lender, and certain other lenders, entered into a Term Loan Credit Agreement (the “Term Loan Credit Agreement”), which provides term loans to (i) partially repay outstanding indebtedness of borrowers under the Third Amended and Restated Credit Agreement, (ii) partially pay the acquisition and conversion costs for a new vessel, (iii) pay accrued but unpaid dividends due on our Series A Convertible Preferred Stock and (iv) provide working capital financing, funds for other general corporate purposes and funds for other permitted purposes. The Term Loan Credit Agreement provides for (i) a U.S. Dollar denominated term loan facility under which Lower Lakes Towing is obligated to the lenders in the amount of $34,200 (the “Second Lien CDN Term Loan”), (ii) U.S. dollar denominated term loan facility under which Grand River and Black Creek are obligated to the Lenders in the amount of $38,300 (the “Second Lien U.S. Term Loan”) and (iii) an uncommitted incremental term loan facility of up to $32,500.

The outstanding principal amount of the Second Lien CDN Term Loan borrowings will be repayable upon the Second Lien CDN Term Loan’s maturity on March 11, 2020. The outstanding principal amount of the Second Lien U.S. Term Loan borrowings will be repayable upon the Second Lien U.S. Term Loan’s maturity on March 11, 2020. The Second Lien CDN Term Loan and Second Lien U.S. Term Loan will bear an interest rate per annum at borrowers’ option, equal to (i) LIBOR (as defined in the Term Loan Credit Agreement) plus 9.50% per annum, or (ii) the U.S. Base Rate (as defined in the Term Loan Credit Agreement), plus 8.50% per annum.

Obligations under the Term Loan Credit Agreement are secured by (i) a first priority lien and security interest on all of the borrowers’ and guarantors’ assets, tangible or intangible, real, personal or mixed, existing and newly acquired, (ii) a pledge by Rand LL Holdings of all of the outstanding capital stock of the borrowers, other than Black Creek and Lower Lakes Towing, and a pledge of 65% of the outstanding capital stock of Lower Lakes Towing, (iii) a pledge by Black Creek Holdings of all of the outstanding capital stock of Black Creek, (iv) a pledge by Lower Lakes Towing of all of the outstanding capital stock of Lower Lakes Ship Repair and Lower Lakes (17) and (v) a pledge by Rand of all of the outstanding capital stock of Rand LL Holdings, Rand Finance and Black Creek Holding. The indebtedness of each domestic borrower under the Term Loan Credit Agreement is unconditionally guaranteed by each other domestic borrower and by the guarantors which are domestic subsidiaries, and such guaranty is secured by a lien on substantially all of the assets of each borrower and each guarantor. Each domestic borrower also guarantees the obligations of the Canadian borrower and each Canadian guarantor guarantees the obligations of the Canadian borrower. Under the Term Loan Credit Agreement and subject to the terms of the Intercreditor Agreement (as defined below), the borrowers will be required to make mandatory prepayments of principal on term loan borrowings (i) in the event of certain dispositions of assets and insurance proceeds (all subject to certain exceptions), in an amount equal to 100% of the net proceeds received by the borrowers therefrom, and (ii) in an amount equal to 100% of the net proceeds to a borrower from any issuance of a borrower’s debt or equity securities (all subject to certain exceptions). The Term Loan Credit Agreement contains certain covenants, including those limiting the guarantors, the borrowers, and their subsidiaries’ ability to incur indebtedness, incur liens, sell or acquire assets or businesses, change the nature of their businesses, engage in transactions with related parties, make certain investments or pay dividends. In addition, the Term Loan Credit Agreement requires the borrowers to

15.    SUBORDINATED DEBT (continued)

maintain certain financial ratios. Failure of the borrowers or the guarantors to comply with any of these covenants or financial ratios could result in the loans under the Term Loan Credit Agreement being accelerated. The obligations of the borrowers and the liens of the lenders under the Term Loan Credit Agreement are subject to the terms of an Intercreditor Agreement, which is further described below under the heading “Intercreditor Agreement”.

As of September 30, 2014, the Company was in compliance with covenants contained in the Term Loan Credit Agreement.

Intercreditor Agreement

Also on March 11, 2014, Lower Lakes Towing, Lower Lakes Transportation, Grand River, Black Creek, Lower Lakes Ship Repair, Rand, Rand LL Holdings, Rand Finance, Black Creek Holdings and Lower Lakes (17) (collectively, the “Credit Parties”), General Electric Capital Corporation, as agent for the lenders under the Fourth Amended and Restated Credit Agreement (the “First Lien Lenders”) and Guggenheim Corporate Funding , LLC, as agent for the lenders under the Term Loan Credit Agreement (the “Second Lien Lenders”), entered into an Intercreditor Agreement (the “Intercreditor Agreement”), pursuant to which the Second Lien Lenders have agreed to subordinate the obligations of the Credit Parties to them to the repayment of the obligations of the Credit Parties to the First Lien Lenders and have further agreed to subordinate their liens on the assets of the Credit Parties to the liens in granted in favor of the First Lien Lenders. Absent the occurrence of an Event of Default under the Fourth Amended and Restated Credit Agreement, the Second Lien Lenders are permitted to receive regularly scheduled principal and interest payments under the Term Loan Credit Agreement.

XML

SEGMENT INFORMATION

6 Months Ended

Sep. 30, 2014

Segment Reporting [Abstract]

SEGMENT INFORMATION

SEGMENT INFORMATION

The Company has identified only one reportable segment under ASC 280 “Segment Reporting”.

Information about geographic operations is as follows:

	Three months ended September 30, 2014		Three months ended September 30, 2013		Six months ended September 30, 2014		Six months ended September 30, 2013
Revenue by country:
Canada	$	31,012	$	28,522	$	55,212	$	56,966
United States	23,258		22,019		42,367		41,976
	$	54,270	$	50,541	$	97,579	$	98,942

Revenues from external customers are allocated based on the country of the legal entity of the Company in which the revenues were recognized.

	September 30, 2014		March 31, 2014
Property and equipment by country:
Canada	$	100,830	$	99,050
United States	113,393		116,437
	$	214,223	$	215,487
Intangible assets by country:
Canada	$	8,788	$	9,666
United States	6,059		6,567
	$	14,847	$	16,233
Goodwill by country:
Canada	$	8,284	$	8,284
United States	1,909		1,909
	$	10,193	$	10,193
Total assets by country:
Canada	$	140,626	$	130,817
United States	137,690		134,189
	$	278,316	$	265,006

XML

OTHER ASSETS (Details) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2014	Mar. 31, 2014
Other Assets [Abstract]
Customer contract costs	$ 710	$ 850
Prepaid expenses and other assets	8,240	7,224
Total	8,950	8,074
Current portion	7,994	7,344
Other long term assets	$ 956	$ 730

XML

SEGMENT INFORMATION (Tables)

6 Months Ended

Sep. 30, 2014

Segment Reporting [Abstract]

Revenue and long-lived assets by geographical segment

Information about geographic operations is as follows:

	Three months ended September 30, 2014		Three months ended September 30, 2013		Six months ended September 30, 2014		Six months ended September 30, 2013
Revenue by country:
Canada	$	31,012	$	28,522	$	55,212	$	56,966
United States	23,258		22,019		42,367		41,976
	$	54,270	$	50,541	$	97,579	$	98,942

Revenues from external customers are allocated based on the country of the legal entity of the Company in which the revenues were recognized.

	September 30, 2014		March 31, 2014
Property and equipment by country:
Canada	$	100,830	$	99,050
United States	113,393		116,437
	$	214,223	$	215,487
Intangible assets by country:
Canada	$	8,788	$	9,666
United States	6,059		6,567
	$	14,847	$	16,233
Goodwill by country:
Canada	$	8,284	$	8,284
United States	1,909		1,909
	$	10,193	$	10,193
Total assets by country:
Canada	$	140,626	$	130,817
United States	137,690		134,189
	$	278,316	$	265,006

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Consolidated Statements of Comprehensive Income (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Sep. 30, 2014	Sep. 30, 2013	Sep. 30, 2014	Sep. 30, 2013
Statement of Comprehensive Income [Abstract]
NET INCOME BEFORE PREFERRED STOCK DIVIDENDS	$ 5,836	$ 1,215	$ 7,895	$ 3,793
Change in foreign currency translation adjustment	(1,584)	871	(182)	(708)
COMPREHENSIVE INCOME BEFORE PREFERRED STOCK DIVIDENDS	$ 4,252	$ 2,086	$ 7,713	$ 3,085

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RECENTLY ISSUED PRONOUNCEMENTS

6 Months Ended

Sep. 30, 2014

Accounting Changes and Error Corrections [Abstract]

RECENTLY ISSUED PRONOUNCEMENTS

RECENTLY ISSUED PRONOUNCEMENTS

Revenue from Contracts with Customers

In May 2014, the Financial Accounting Standard Board issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606) ("ASU 2014-09"), which supersedes the revenue recognition requirements in ASC 605, Revenue Recognition. ASU 2014-09 requires entities to recognize revenue in a way that depicts the transfer of goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled to in exchange for those goods or services. ASU 2014-09 requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to obtain or fulfill a contract. ASU 2014-09 is effective retrospectively for fiscal years, and interim periods within those years, beginning after December 15, 2016. Early adoption is not permitted. The Company is currently evaluating the effect that this pronouncement will have on its financial statements and related disclosures.

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LONG-TERM DEBT (Additional Information) (Details) In Thousands, unless otherwise specified	12 Months Ended		0 Months Ended					0 Months Ended				0 Months Ended		0 Months Ended
	Mar. 31, 2014 USD ($)	Mar. 31, 2013 USD ($)	Sep. 01, 2012 Lower Lakes Towing Ltd. [Member] Canadian Prime Rate [Member] Third Amended & Restated Credit Agreement [Member]	Sep. 01, 2012 Lower Lakes Towing Ltd. [Member] Canadian BA Rate [Member] Third Amended & Restated Credit Agreement [Member]	Aug. 30, 2012 Lower Lakes Towing Ltd. [Member] Canadian Term Loan [Member] Third Amended & Restated Credit Agreement [Member] Secured Debt [Member] CAD	Sep. 30, 2014 Lower Lakes Towing Ltd. [Member] Loans Payable [Member] Canadian Term Loan [Member]	Mar. 31, 2014 Lower Lakes Towing Ltd. [Member] Loans Payable [Member] Canadian Term Loan [Member]	Sep. 01, 2012 Lower Lakes Towing Ltd. [Member] Loans Payable [Member] Canadian Term Loan [Member] Third Amended & Restated Credit Agreement-Dec 12 to Sept 14 [Member] [Member] CAD	Aug. 30, 2012 Grand River Navigation Company, Inc. [Member] US Term Loan [Member] Third Amended & Restated Credit Agreement [Member] Secured Debt [Member] USD ($)	Sep. 30, 2014 Grand River Navigation Company, Inc. [Member] Loans Payable [Member] US Term Loan [Member]	Mar. 31, 2014 Grand River Navigation Company, Inc. [Member] Loans Payable [Member] US Term Loan [Member]	Sep. 01, 2012 Grand River Navigation Company, Inc. [Member] Loans Payable [Member] US Term Loan [Member] Third Amended & Restated Credit Agreement-Dec 12 to Sept 14 [Member] [Member] USD ($)	Aug. 30, 2012 Black Creek Holdings, Inc. [Member] Black Creek US term loan [Member] Third Amended & Restated Credit Agreement [Member] Secured Debt [Member] USD ($)	Sep. 01, 2012 Black Creek Holdings, Inc. [Member] Loans Payable [Member] Black Creek US term loan [Member] Third Amended & Restated Credit Agreement-Dec 12 to Sept 14 [Member] [Member] USD ($)	Sep. 01, 2012 United States of America, Dollars LIBOR [Member] Third Amended & Restated Credit Agreement [Member]	Sep. 01, 2012 United States of America, Dollars US Base Rate [Member] Third Amended & Restated Credit Agreement [Member]
Debt Instrument [Line Items]
Debt Instrument, Interest Rate, Effective Percentage Including Effect of Interest Rate Swap Contracts						5.27%	5.26%			4.23%	4.24%
Basis spread on variable rate			3.75%	4.75%											4.75%	3.75%
Gains (Losses) on Extinguishment of Debt	$ (1,267)	$ (3,339)
Face amount					52,979				64,127				28,934
Quarterly payment								331				$ 401		$ 181

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FINANCIAL INSTRUMENTS

6 Months Ended

Sep. 30, 2014

Financial Instruments [Abstract]

FINANCIAL INSTRUMENTS

FINANCIAL INSTRUMENTS

Fair value of financial instruments

Financial instruments are comprised of cash and cash equivalents, accounts receivable, accounts payable, long-term debts, a deferred payment liability, accrued liabilities and bank indebtedness.  The estimated fair values of cash and cash equivalents, accounts receivable, accounts payable and accrued liabilities approximate book values because of the short-term maturities of these instruments.  The estimated fair value of senior debt approximates the carrying value as the debt bears interest at variable interest rates, which are based on rates for similar debt with similar credit rates in the open market.  The subordinated note and deferred payment liabilities are valued based on the interest rate of similar debt in the open market.

Fair value guidance establishes a valuation hierarchy for disclosure of the inputs to valuation used to measure fair value. A financial asset's or liability's classification within the hierarchy is determined based on the lowest level input that is significant to the fair value measurement.

In August 2014, the Company entered into a rolling foreign currency hedge contract to mitigate currency fluctuation risk on a portion of its subordinated US dollar denominated debt owed by Lower Lakes Towing.

Fair value guidance establishes a valuation hierarchy for disclosure of the inputs to valuation used to measure fair value. This hierarchy prioritizes the inputs into three broad levels as follows. Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities. Level 2 inputs are quoted prices for similar assets and liabilities in active markets or inputs that are observable for the asset or liability, either directly or indirectly through market corroboration, for substantially the full term of the financial instrument. Level 3 inputs are unobservable inputs based on our own assumptions used to measure assets and liabilities at fair value. A financial asset or liability's classification within the hierarchy is determined based on the lowest level input that is significant to the fair value measurement.

The following table provides the fair value of the foreign currency hedge contract measured on a recurring basis as of September 30, 2014 and March 31, 2014:

		Fair value measurements at September 30, 2014			Fair value measurements at March 31, 2014
	Carrying value at September 30, 2014	Quoted prices in active markets (Level 1)	Significant other observable inputs (Level 2)	Carrying value at March 31, 2014	Quoted prices in active markets (Level 1)	Significant other observable inputs (Level 2)
Foreign currency hedge contract	$95	$—	$95	$—	$—	$—

The foreign currency hedge contract is measured at fair value using available rates on the similar instruments and is classified within Level 2 of the valuation hierarchy. This contract is accounted for using the mark-to-market accounting method as if the contract were terminated at the day of valuation. There were no transfers into or out of Levels 1 and 2 of the fair value hierarchy during the six month period ended September 30, 2014.

The Company recorded a receivable of $95 as of September 30, 2014 for this foreign currency hedge contract on a portion of the Company’s US dollar denominated subordinated debt owed by Lower Lakes Towing. For each of the three and six month periods ended September 30, 2014, the fair value adjustment of the foreign currency hedge contract resulted in a gain of $379. This gain is included in the Company’s earnings and the fair value of settlement cost to terminate the contract is included in current assets on the Company's consolidated balance sheets.

21.FINANCIAL INSTRUMENTS (continued)

 The following table sets forth the fair value of the foreign currency hedge instrument as of the dates set forth below:

Derivatives not designated as hedging instrument:	Balance Sheet location	Fair Value as at September 30, 2014	Fair Value as at March 31, 2014
Foreign currency hedge contract	Current assets	$95	$—

The Company has not designated this contract as a hedging instrument. The changes in fair value of the foreign currency hedge contract is recorded in earnings as follows:

Derivatives not designated as hedging instrument:	Location of loss (gain) -Recognized in earnings	Three months ended September 30, 2014	Six month ended September 30, 2014	Three months ended September 30, 2013	Six month ended September 30, 2013
Foreign currency hedge contract	Loss (gain) on foreign exchange	$(379)	$(379)	$—	$—

Foreign exchange risk

Foreign currency exchange risk to the Company results primarily from changes in exchange rates between the Company’s reporting currency, the U.S. Dollar, and the Canadian dollar.  As discussed above, in August 2014, the Company entered into a rolling foreign currency hedge contract to mitigate currency fluctuation risk on a portion of its U.S. dollar denominated subordinated debt owed by Lower Lakes Towing. The Company is exposed to fluctuations in foreign exchange as a significant portion of revenue and operating expenses are denominated in Canadian dollars.

Interest rate risk

The Company is exposed to fluctuations in interest rates as a result of its banking facilities and senior debt bearing variable interest rates.

In December 2012, the Company entered into two interest rate cap contracts covering 50% of its outstanding term debt on the date of such contracts at a cap of three month Libor at 2.5% on its U.S. Term Debt borrowings and a cap of three month BA rates at 3.0% on its Canadian Term Debt borrowings. The notional amount on each of these instruments will decrease with each scheduled principal payment of the term loan under the Third Amended and Restated Credit Agreement, notwithstanding the termination of such agreement. The interest rate cap contracts will terminate on December 1, 2015. Such contracts cover approximately 64% of first lien term debt as of September 30, 2014.

Credit risk

Accounts receivable credit risk is mitigated by the diversification of the Company’s customers among industries and the short shipping season.

Liquidity risk

The ongoing tightened credit in financial markets and continued general economic downturn in some markets may adversely affect the ability of the Company’s customers and suppliers to obtain financing for significant operations and purchases and to perform their obligations under agreements with the Company.  The tightening of credit could (i) result in a decrease in, or cancellation of, existing business, (ii) limit new business, (iii) negatively impact the Company’s ability to collect accounts receivable on a timely basis and (iv) affect the eligible receivables that are collateral for the Company’s lines of credit.  The Company makes seasonal net borrowings under its revolving credit facility during the first quarter of each fiscal year to fund working capital needed to commence the sailing season. Such borrowings are then reduced during the second half of each fiscal year.

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COMMITMENTS (Tables)

6 Months Ended

Sep. 30, 2014

Commitments and Contingencies Disclosure [Abstract]

Schedule of operating lease rental and sublease rental payments

Operating lease rental and sublease rental payments included in general and administrative expenses are as follows:

	Three months ended September 30, 2014		Three months ended September 30, 2013		Six months ended September 30, 2014		Six months ended September 30, 2013
Operating leases	$	150	$	146	$	295	$	277
Operating sublease	41		40		81		79
	$	191	$	186	$	376	$	356

Schedule of future minimum rental commitments

The Company’s future minimum rental commitments under other operating leases are as follows.

Twelve month period ending:

September 30, 2015	$	509
September 30, 2016	379
September 30, 2017	295
September 30, 2018	225
September 30, 2019	131
Thereafter	380
	$	1,919

Schedule of charter commitments

Twelve month period ending:

September 30, 2015	$	771
September 30, 2016	771
September 30, 2017	771
September 30, 2018	772
September 30, 2019	257
	$	3,342

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ACCRUED LIABILITIES

6 Months Ended

Sep. 30, 2014

Payables and Accruals [Abstract]

ACCRUED LIABILITIES

ACCRUED LIABILITIES

Accrued liabilities are comprised of the following:

	September 30, 2014		March 31, 2014
Deferred financing and other transaction costs	$	269	$	560
Payroll compensation and benefits	2,887		957
Preferred stock dividends	291		—
Professional fees	412		386
Interest	784		767
Winter work, deferred drydock expenditures and capital expenditures	419		3,961
Capital and franchise taxes	30		36
Other	2,374		1,289
	$	7,466	$	7,956