ATB Arlington Tankers Ltd

 

 

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q/A

(Amendment No. 1)

(Mark One)

þ		QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES AND EXCHANGE ACT OF 1934.

For the quarterly period ended June 30, 2008

OR

o		TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES AND EXCHANGE ACT OF 1934.

For the period from                      to                     

Commission file number: 001-32343

Arlington Tankers Ltd.

(Exact name of Registrant as specified in its charter)

Bermuda (Jurisdiction of incorporation or organization)		98-0460376 (I.R.S. Employer Identification No.)

First Floor, The Hayward Building
22 Bermudiana Road
Hamilton HM 11, Bermuda
(Address of principal executive offices)

Registrant’s telephone number, including area code: (441) 292-4456

Former name, former address and former fiscal year, if changes since last report: Not applicable.

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

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 the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act)

Yes  o   No  þ

THE NUMBER OF SHARES OUTSTANDING OF EACH OF THE ISSUER’S CLASSES OF COMMON STOCK, AS OF AUGUST 8, 2008: Common Stock, par value $0.01 per share: 15,500,000 shares

 

 

ARLINGTON TANKERS LTD. AND SUBSIDIARIES
INDEX

PART I:		FINANCIAL INFORMATION
ITEM 2.		Management’s Discussion and Analysis of Financial Condition and Results of Operations			4
PART II:		OTHER INFORMATION			18
ITEM 6.		Exhibits			18
SIGNATURES					19
EXHIBIT INDEX
Ex-31.2 Section 302 Certification of CEO & CFO

EXPLANATORY NOTE

     The Registrant is filing this Amendment No. 1 to its Quarterly Report on Form 10-Q for the quarter ended June 30, 2008, as originally filed with the SEC on August 11, 2008, for the purpose of revising Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations in response to a comment letter from the SEC. This Amendment No. 1 does not reflect the restatement of any previously reported financial statements or, except as noted above, change any other disclosures.

     This Amendment No. 1 continues to speak as of the date of the original Form 10-Q for the quarter ended June 30, 2008 and the Registrant has not updated or amended the disclosures contained herein to reflect events that have occurred since the filing of the original Form 10-Q, or modified or updated those disclosures in any way other than as described in the preceding paragraph. Accordingly, this Amendment No. 1 should be read in conjunction with the Registrant’s filings made with the SEC subsequent to the filing of the original Form 10-Q on August 11, 2008.

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

Forward Looking Statements

     This Quarterly Report on Form 10-Q contains certain forward-looking statements and information relating to us that are based on beliefs of our management as well as assumptions made by us and information currently available to us, in particular in this “Item 2. Management’s Discussions and Analysis of Financial Condition and Results of Operations.” When used in this document, words such as “believe,” “intend,” “anticipate,” “estimate,” “project,” “forecast,” “plan,” “potential,” “will,” “may,” “should,” and “expect” and similar expressions are intended to identify forward-looking statements but are not the exclusive means of identifying such statements. All statements in this document that are not statements of historical fact are forward-looking statements. Forward-looking statements include, but are not limited to, such matters as:

	•		our ability to consummate our pending combination with General Maritime Corporation;
	•		future operating or financial results;
	•		future payments of quarterly dividends and the availability of cash for payment of quarterly dividends;
	•		statements about future, pending or recent acquisitions, business strategy, areas of possible expansion, and expected capital spending or operating expenses;
	•		statements about tanker market trends, including charter rates and factors affecting vessel supply and demand;
	•		expectations about future revenues from sub-charters;
	•		expectations about the availability of vessels to purchase, the time which it may take to construct new vessels, or vessels’ useful lives; and
	•		our ability to repay our secured credit facility at maturity, to obtain additional financing and to obtain replacement charters for our Vessels.

     Such statements reflect our current views with respect to future events and are subject to certain risks, uncertainties and assumptions. Many factors could cause our actual results, performance or achievements to be materially different from any future results, performance or achievements that may be expressed or implied by such forward-looking statements, including, among others, the factors described in Part II, Item 1A below under the heading “Risk Factors” and the factors otherwise referenced in this report. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those described in the forward-looking statements included herein. We do not intend, and do not assume any obligation, to update these forward-looking statements.

     You should read this information together with our consolidated financial statements and related notes included in “Item 1. Financial Statements.”

OVERVIEW

     We are an international seaborne transporter of crude oil and petroleum products. We were incorporated in September 2004 under the laws of Bermuda.

     In November 2004, we completed our initial public offering by issuing and selling to the public 11,450,000 common shares, par value $0.01 per share, at a price to the public of $20.00 per share, raising gross proceeds of $229 million before the deduction of underwriting discounts, commissions and expenses of approximately $17.7 million. Affiliates of Stena, Concordia and Fram sold an additional 1,717,500 shares in the initial public offering in connection with the underwriters’ exercise of their over-allotment option. We did not receive any proceeds from the sale of these shares by Stena, Concordia, and Fram. Concurrently with the closing of our initial public offering, we completed the acquisition of our six initial vessels, which we refer to as the Initial Vessels. In order to fund a portion of the purchase price of our Initial Vessels, we issued a total of 4,050,000 common shares at a price of $20.00 per share to Stena, Concordia and Fram, for total consideration of $81 million. We financed the remainder of the purchase price of our Initial Vessels through a secured debt financing of $135 million, before expenses of approximately $0.8 million, which we terminated in

December of 2005. On the date that we purchased our Initial Vessels, we made a deemed distribution of $143.3 million to Stena, Concordia and Fram which consisted of the difference between the $426.5 million purchase price of our Initial Vessels and the historical book value of $283.2 million at which Stena, Concordia and Fram carried the Initial Vessels on their books.

     Stena and Concordia continue to be shareholders of the Company and, based on their filings with the SEC, purchased an additional 3.6% of our outstanding common shares in 2007 such that, as of May 7, 2008, they directly and indirectly owned an aggregate of approximately 18.0% of our outstanding common shares. As a result of Stena’s purchase of additional common shares in 2007, Stena and Concordia may be considered “interested shareholders” for purposes of our bye-laws. Please see “Part II. Item 1A. Risk Factors — Company Specific Risk Factors — Stena and Concordia’s ownership interest in our company can have significant influence over our company, including the outcome of shareholder votes and our ability to conduct future business or modify existing agreements with Stena or Concordia.”

     In December 2005, we entered into a five-year term loan agreement with The Royal Bank of Scotland in order to (1) refinance our indebtedness under our prior debt facility, (2) finance the purchase price of our two additional vessels, which we refer to as the Additional Vessels, from Stena and (3) general corporate purposes. We completed the refinancing of our previous debt facility in December 2005 and completed the acquisition of the Additional Vessels in January 2006. The term loan agreement provides for a credit facility of $229.5 million. The term loan agreement matures on January 5, 2011. All amounts outstanding under the term loan agreement must be repaid on that maturity date. There is no principal amortization prior to maturity. Borrowings under the term loan agreement bear interest at LIBOR plus a margin of 75 basis points. The margin would increase to 85 basis points if the ratio of the fair market value of our Vessels to the amount outstanding under the loan facility falls below 2.0, which we refer to as the Ratio. The increased interest margin is equivalent to approximately $229,500 per year in increased interest costs in the event the Ratio falls below 2.0. In connection with the term loan agreement, we entered into an interest rate swap agreement with The Royal Bank of Scotland. As a result of this swap, we have effectively fixed the interest rate on the term loan agreement at 5.7325%, or 5.8325% if the Ratio falls below 2.0. The net annual cash interest costs will approximate 5.38%, or 5.48% if the ratio described above falls below 2.0, due to the benefit that we received in December 2005 from a swap associated with our prior debt facility. That cash benefit has been designated by our Board of Directors to offset the interest cost over the life of the new $229.5 million term loan facility.

     On January 5, 2006, we entered into a series of agreements with Stena Maritime, certain subsidiaries of Stena, Stena Bulk and Northern Marine, pursuant to which we, through our wholly-owned subsidiaries, purchased two Additional Vessels, the Stena Concept and the Stena Contest , from subsidiaries of Stena Maritime for a purchase price per Additional Vessel of $46 million. In connection with the acquisition of our Additional Vessels, we also entered into certain related agreements with the Stena Parties relating to our Additional Vessels and amended certain of our prior agreements with the Stena Parties relating to our six Initial Vessels which are described in greater detail below under the headings “Our Charters” and “Our Ship Management Agreements”.

     Our eight Vessels are currently owned by eight subsidiaries that we wholly own. The primary activity of each Vessel Subsidiary is the ownership and operation of a Vessel. The flag state of each of our Vessels is Bermuda.

     The following table sets out certain details relating to our Vessels:

Initial Charter

Latest Charter

Vessel Type

Year Built

Dwt

Date Acquired

Expiration Date(1)

Expiration Date (1)

V-MAX

Stena Victory

2001

314,000

November 10, 2004

November 9, 2009

November 9, 2012

Stena Vision

2001

314,000

November 10, 2004

November 9, 2009

November 9, 2012

Panamax

Stena Companion

2004

72,000

November 10, 2004

November 9, 2008

November 9, 2011

Stena Compatriot

2004

72,000

November 10, 2004

November 9, 2010

November 9, 2013

Product

Stena Concord

2004

47,400

November 10, 2004

November 9, 2008

November 9, 2011

Stena Consul

2004

47,400

November 10, 2004

November 9, 2010

November 9, 2013

Stena Concept

2005

47,400

January 5, 2006

January 4, 2009

July 4, 2011

Stena Contest

2005

47,400

January 5, 2006

January 4, 2009

July 4, 2011

RECENT DEVELOPMENTS

     On August 5, 2008, we entered into a definitive Agreement and Plan of Merger and Amalgamation (the “Merger Agreement”) with General Maritime Corporation (“General Maritime”). The Merger Agreement provides that, upon the terms and subject to the conditions set forth in the Merger Agreement, Galileo Merger Corporation, a wholly-owned subsidiary of Galileo Holding Corporation (which we refer to as “New Parent”), a newly-formed subsidiary of us and General Maritime, will merge with and into General Maritime, with General Maritime continuing as the surviving corporation of such merger, and we will amalgamate with Archer Amalgamation Limited, a wholly owned subsidiary of New Parent, with the resulting amalgamated company continuing as the surviving entity. As a result of such merger and amalgamation: (i) we and General Maritime will each become a wholly-owned subsidiary of New Parent, which will be renamed “General Maritime Corporation”; and (ii) our shareholders will receive 1 share in New Parent for each of our common shares held, and General Maritime’s shareholders will receive 1.34 shares in New Parent for each General Maritime share held. Upon consummation of the transactions contemplated by the Merger Agreement, including the merger and the amalgamation, our shareholders will hold approximately 27% of the outstanding common stock of New Parent and shareholders of General Maritime will hold approximately 73% of the outstanding common stock of New Parent. The Merger Agreement is subject to approval by our shareholders and by General Maritime’s shareholders, required regulatory approvals, and certain other conditions. Although the transaction is expected to be completed by the end of the fourth quarter of 2008, there can be no assurance that the transaction will be completed in a timely manner, or at all.

OUR CHARTERS

     Effective November 10, 2004 for the Initial Vessels and January 5, 2006 for the Additional Vessels, we have chartered our Vessels to subsidiaries of Stena and Concordia, who we refer to as the Charterers, under fixed rate charters with initial periods of three, four and five-years.

     At the closing of the purchase of the Additional Vessels, our subsidiaries that purchased the Additional Vessels and Stena Bulk entered into new time charter party agreements with respect to the Additional Vessels. Under the new time charter parties, which are substantially similar to the time charter parties that our subsidiaries have entered into for the Initial Vessels, our subsidiaries that purchased the Additional Vessels time chartered the Additional Vessels to Stena Bulk for an initial period of three years at a fixed daily Basic Hire without any Additional Hire provision. In May 2008, Stena Bulk exercised its option to extend the time charters for both Additional Vessels for an additional 30 months, at the fixed daily Basic Hire. As a result, there will be an Additional Hire provision during the 30-month period. Furthermore, as a result of Stena Bulk exercising the 30-month option, there are two additional one-year options, exercisable by Stena Bulk, at the fixed daily Basic Hire set forth below, but without an Additional Hire provision.

     At the closing of the acquisition of the Additional Vessels, we also amended the time charter parties for our four previously acquired Product tankers and Panamax tankers. These amendments modified the charter periods for these four Vessels and made changes to the calculation of Additional Hire under these time charter parties. The amendments to the terms of the charters provided that (1) the initial five-year fixed term for one of the Product tankers ( Stena Consul ) and one of the Panamax tankers ( Stena Compatriot ) was extended to November 2010, followed by three one-year options exercisable by Stena Bulk and (2) the initial five-year fixed term for one of the Product tankers ( Stena Concord ) and one of the Panamax tankers ( Stena Companion ) was reduced so that it expired in November 2008, followed by three one-year options exercisable by Stena Bulk. In May 2008, Stena Bulk exercised the first of its three one-year options for the Stena Concord and the Stena Companion , effective November 11, 2008. The term of the charters for the V-MAX tankers was not amended. The amendments to the Additional Hire provisions provided for certain favorable adjustments to fuel consumption metrics used in the calculation of Additional Hire for the Product tankers and Panamax tankers.

      Basic Hire under Our Charters

     The Charters provide for the payment of Basic Hire fees that increase annually by an amount equal to the annual increase in the fees under our ship management agreements, which are described below under the heading “Our Ship Management Agreements.” The Basic Hire rate for each of the Vessels is payable monthly in advance and will increase annually by an amount equal to the annual increase in the fee payable under the applicable ship management agreement. Stena and Concordia have each agreed to guarantee the obligations of their respective subsidiaries under the Charters.

     The following table sets forth the daily Basic Hire, daily base operating costs and operating margin for our two V-MAX vessels, the Stena Vision and the Stena Victory . The operating margin is calculated by subtracting the amount of the base operating costs from the amount of Basic Hire.

Period		Basic Hire				Base Operating Costs				Operating Margin
Nov. 11, 2007 — Nov. 10, 2008		$	36,882			$	8,682			$	28,200
Nov. 11, 2008 — Nov. 10, 2009			37,316				9,116				28,200
Nov. 11, 2009 — Nov. 10, 2010 (Option Year 1)(1)			37,772				9,572				28,200
Nov. 11, 2010 — Nov. 10, 2011 (Option Year 2)			38,251				10,051				28,200
Nov. 11, 2011 — Nov. 10, 2012 (Option Year 3)			38,753				10,553				28,200

     The following table sets forth the daily Basic Hire, daily base operating costs and operating margin for two of our vessels, the Stena Companion and the Stena Concord , with initial charter expiration dates in 2008 .

		Stena Companion												Stena Concord
Period		Basic Hire				Base Operating Costs				Operating Margin				Basic Hire				Base Operating Costs				Operating Margin
Nov. 11, 2007 — Nov. 10, 2008		$	18,306			$	6,656			$	11,650			$	16,335			$	6,135			$	10,200
Nov. 11, 2008 — Nov. 10, 2009 (Option Year 1)(1)			18,639				6,989				11,650				16,642				6,442				10,200
Nov. 11, 2009 — Nov. 10, 2010 (Option Year 2)			18,989				7,339				11,650				16,964				6,764				10,200
Nov. 11, 2010 — Nov. 10, 2011 (Option Year 3)			19,356				7,706				11,650				17,303				7,103				10,200

     The following table sets forth the daily Basic Hire, daily base operating costs and operating margin for two of our vessels, the Stena Compatriot and the Stena Consul, with initial charter expiration dates in 2010 .

		Stena Compatriot												Stena Consul
Period		Basic Hire				Base Operating Costs				Operating Margin				Basic Hire				Base Operating Costs				Operating Margin
Nov. 11, 2007 — Nov. 10, 2008		$	18,306			$	6,656			$	11,650			$	16,335			$	6,135			$	10,200
Nov. 11, 2008 — Nov. 10, 2009			18,639				6,989				11,650				16,642				6,442				10,200
Nov. 11, 2009 — Nov. 10, 2010			18,989				7,339				11,650				16,964				6,764				10,200
Nov. 11, 2010 — Nov. 10, 2011 (Option Year 1)(1)			19,356				7,706				11,650				17,303				7,103				10,200
Nov. 11, 2011 — Nov. 10, 2012 (Option Year 2)			19,741				8,091				11,650				17,658				7,458				10,200
Nov. 11, 2012 — Nov. 10, 2013 (Option Year 3)			20,145				8,495				11,650				18,031				7,831				10,200

     The following table sets forth the daily Basic Hire, daily base operating costs and operating margin for our two Additional Vessels, the Stena Concept and the Stena Contest.

Period		Basic Hire				Base Operating Costs				Operating Margin
Jan. 5, 2007 — Jan 4, 2008		$	20,043			$	5,843			$	14,200
Jan. 5, 2008 — Jan. 4, 2009			20,335				6,135				14,200
Jan. 5, 2009 — Jan. 4, 2010 (Option Period 1)(1)			17,942				6,442				11,500
Jan. 5, 2010 — Jan. 4, 2011 (Option Period 1)			18,264				6,764				11,500
Jan. 5, 2011 — July 4, 2011 (Option Period 1)			18,603				7,103				11,500
July 5, 2011 — July 4, 2012 (Option Period 2) (2)			21,158				7,458				13,700
July 5, 2012 — July 4, 2013 (Option Period 3)			21,531				7,831				13,700

      Additional Hire under Our Charters

     Under the Charters, in addition to the fixed rate Basic Hire, each Initial Vessel has the possibility of receiving Additional Hire from the Charterers through profit sharing arrangements related to the performance of the tanker markets on specified geographic routes, or from actual time charter rates. The Additional Hire, if any, in respect of each Initial Vessel, is payable on the 25th day following the end of each calendar quarter. Additional Hire is not guaranteed under our Charters.

     The Additional Hire, if any, payable in respect of an Initial Vessel, other than the V-MAX tankers as described below, for any calendar quarter is an amount equal to 50% of the weighted average hire, calculated as described below, for the quarter after deduction of the Basic Hire in effect for that quarter. The weighted average hire is a daily rate equal to the weighted average of the following amounts:

	•		a weighted average of the time charter hire per day received by the Charterer for any periods during the calculation period, determined as described below, that the Initial Vessel is sub-chartered by the Charterer under a time charter, less ship broker commissions paid by the Charterer in an amount not to exceed 2.5% of such time charter hire and commercial management fees paid by the Charterer in an amount not to exceed 1.25% of such time charter hire; and
	•		the time charter equivalent hire for any periods during the calculation period that the Vessel is not sub-chartered by the Charterer under a time charter.

     The calculation period is the twelve-month period ending on the last day of each calendar quarter, except that in the case of the first three full calendar quarters following the commencement of our Charters, the calculation period is the three, six and nine month periods, respectively, ending on the last day of such calendar quarter and the first calendar quarter also includes the period from the date of the commencement of our charters to the commencement of the first full calendar quarter.

     As a result of Stena Bulk exercising its option to extend the Charters for the Additional Vessels, we will become eligible to earn Additional Hire for those Vessels during the 30-month period commencing January 5, 2009.

     At the time we acquired our two V-MAX tankers, these Vessels were sub-chartered by Concordia to Sun International Limited Bermuda, which we refer to as Sun International, an indirect wholly owned subsidiary of Sunoco, Inc.

     The sub-charter with Sun International relating to the Stena Victory expired on October 20, 2007. The sub-charter with Sun International relating to the Stena Vision is due to expire within 30 days of September 30, 2008.

     The sub-charter rate that Concordia received from Sun International with respect to the Stena Victory , and the sub-charter rate that Concordia continues to receive from Sun International with respect to the Stena Vision , is greater than the Basic Hire rate that we receive from Concordia. Therefore, we earned Additional Hire revenue while the Stena Victory was sub-chartered to Sun International, and we continue to earn Additional Hire revenue while the Stena Vision is sub-chartered to Sun International. The amount of this Additional Hire is equal to the difference between the amount paid by Sun International under its sub-charters with Concordia and the Basic Hire rate in effect, less ship broker commissions paid by the Charterer in an amount not to exceed 2.5% of the charterhire received by the Charterer and commercial management fees paid by the Charterer in an amount not to exceed 1.25% of the charterhire received by the Charterer. The Additional Hire revenue associated with the ongoing Sun International sub-charter of the Stena Vision is guaranteed, meaning that we are paid the Additional Hire revenue by Concordia whether or not the Vessel is in service during the term of the Sun International sub-charter.

     Immediately following the expiration of the sub-charter of the Stena Victory with Sun International, that Vessel commenced operating under a new two-year sub-charter agreement between Concordia and Eiger Shipping S.A., an affiliate of the shipping branch of LukOil commonly know as Litasco. In addition, immediately following the expiration of the sub-charter of the Stena Vision with Sun International, we expect the Vessel to commence operating under a new two-year sub-charter agreement between Concordia and Eiger Shipping. The sub-charter rate that Eiger Shipping is obligated to pay to Concordia is greater than the Basic Hire rate that we will receive from Concordia. Therefore, we expect to earn Additional Hire revenue while the V-MAX vessels are under the Eiger Shipping sub-charters in addition to the Basic Hire. The Additional Hire revenue will not be exposed to fluctuations in spot market rates. Additional Hire for the V-MAX tankers under the Eiger Shipping sub-charters will be based on the time charter hire received by Concordia under the sub-charters. Additional Hire revenues under the Eiger Shipping sub-charters are not guaranteed, meaning that we will earn Additional Hire only when the Vessels are in service. In the event that the V-MAX tankers are off-hire, we will not be eligible to earn Additional Hire revenue from the profit sharing provisions on the days that the Vessel is off-hire. Based on the time charter rates under the Eiger Shipping sub-charters and assuming that both V-MAX vessels operate for 90 days per quarter, we expect

the V-MAX tankers to generate Additional Hire revenues of approximately $350,000 per Vessel per quarter in addition to the Basic Hire levels, while the Vessels are sub-chartered to Eiger Shipping.

OUR SHIP MANAGEMENT AGREEMENTS

     Our Vessel Subsidiaries have entered into fixed-rate ship management agreements with Northern Marine. Under the ship management agreements, Northern Marine is responsible for all technical management of the Vessels, including crewing, maintenance, repair, drydockings, vessel taxes and other vessel operating and voyage expenses. Northern Marine has outsourced some of these services to third-party providers. We have agreed to guarantee the obligations of each of our Vessel Subsidiaries under the ship management agreements.

     At the closing of the acquisition of the Additional Vessels, the ship management agreements for our Initial Vessels were amended. These amendments included modifications to the provisions relating to drydocking of the Vessels. Specifically, the amendments provided that all drydockings that occur during the term of the ship management agreements are to be at the sole cost and expense of Northern Marine. Under the terms of the amended ship management agreements, the cost of these intermediate and special surveys is covered by a portion of the monthly vessel management fees that we pay to Northern Marine. We refer to such portion of the vessel management fees as the “Drydocking Provision.” Upon redelivery of the Vessels to us at the expiration of the ship management agreements, Northern Marine has agreed to return to us any Drydocking Provision paid, but not used, from the completion of the last drydocking during the term of the applicable Ship Management Agreement (or if no drydocking occurs during the term of such agreement, from the date of commencement of such agreement), to the date of redelivery. The amount of the Drydocking Provision that may be paid to us will be paid at the daily rates specified in the applicable ship management agreement.

     Under the ship management agreements, Northern Marine has agreed to return the Vessels in-class and in the same good order and condition as when delivered, except for ordinary wear and tear.

     Northern Marine is also obligated under the ship management agreements to maintain insurance for each of our Vessels, including marine hull and machinery insurance, protection and indemnity insurance (including pollution risks and crew insurances), war risk insurance and off-hire insurance. Under the ship management agreements, we pay Northern Marine a fixed fee per day per Vessel for all of the above services, which increases 5% per year, for so long as the relevant charter is in place. Under the ship management agreements, Northern Marine has agreed to indemnify us for the loss of the Basic Hire for each of the Vessels in the event, for circumstances specified under the charters, the Vessel is off-hire or receiving reduced hire for more than five days during any twelve-month period, net of amounts received by us from off-hire insurance. Stena has agreed to guarantee this indemnification by Northern Marine. Both we and Northern Marine have the right to terminate any of the ship management agreements if the relevant charter has been terminated.

     Tables setting forth the daily base operating costs for each of our Vessels can be found above in the section entitled “—Basic Hire under Our Charters.”

     We have also agreed to pay to Northern Marine an incentive fee for each day a Vessel is on hire for over 360 days during any twelve-month period following the date the applicable Vessel was delivered to us in amount equal to the daily Basic Hire for such Vessel. If we terminate the ship management agreements with Northern Marine because Northern Marine has failed to perform its obligations under such agreements, Stena has agreed to provide a replacement ship manager to perform the obligations set forth in the ship management agreements on the same terms and for the same fixed amounts payable to Northern Marine.

     Northern Marine provides technical and crewing management and payroll and support services to the Stena Sphere shipping divisions and several other clients, including ChevronTexaco Corporation, Technip Offshore UK and Gulf Marine Management. Northern Marine has offices in Glasgow, Aberdeen, Mumbai, Kiel, Houston, Manila, Rotterdam and Singapore and has over 4,400 seafarers employed on approximately 90 vessels.

DIVIDEND POLICY

     We have paid quarterly cash dividends on our common shares since our initial public offering in November 2004 in amounts substantially equal to the charterhire received by us under the Charters, less cash expenses and any cash reserves established by our Board of Directors. We have generally declared these dividends in January, April, July and October of each year and made payments in the subsequent month. Distributions to shareholders are applied first to retained earnings. When retained earnings are not sufficient, distributions are applied to additional paid-in capital.

     There are restrictions that limit our ability to declare dividends, including those established under Bermuda law and under our existing secured term loan agreement. The terms of any future indebtedness we may enter into, including indebtedness that refinances

our existing secured credit facility, may have stricter restrictions on our ability to pay dividends. Furthermore, higher interest rates or different repayment terms of future indebtedness, such as principal amortization requirements, may reduce the amount of cash that we would have available to pay future dividends. In addition to the discussion below, please see “Part II. Item 1A. Risk Factors — Company Specific Risk Factors — We cannot assure you that we will pay any dividends,” “— If we cannot refinance our secured credit facility, or in the event of a default under the facility, we may have to sell our Vessels, which may leave no additional funds for distributions to shareholders” and “—We may not be able to re-charter our Vessels profitably after they expire, unless they are extended at the option of the Charterers.”

     Under Bermuda law a company may not declare or pay dividends if there are reasonable grounds for believing either that the company is, or would after the payment be, unable to pay its liabilities as they become due, or that the realizable value of its assets would thereby be less than the sum of its liabilities and its issued share capital, which is the par value of our shares and share premium accounts, which is the amount of consideration paid for the subscription of shares in excess of the par value of those shares. As a result, in future years, if the realizable value of our assets decreases, our ability to pay dividends may require our shareholders to approve resolutions reducing our share premium account by transferring an amount to our contributed surplus account.

     The declaration and payment of any dividends must be approved by our Board of Directors. Under the terms of our credit facility, we may not declare or pay any dividends if we are in default under the credit facility.

     There can be no assurance that we will not have other cash expenses, including extraordinary expenses, which could include the costs of claims and related litigation expenses. There can be no assurance that we will not have additional expenses or liabilities, that the amounts currently anticipated for the items set forth above will not increase, that we will not have to fund any required capital expenditures for our Vessels or that our Board of Directors will not determine to establish cash reserves. The vessel operating expenses payable under our ship management agreements are fixed over the periods specified in those agreements. However, our cash administrative expenses, primarily related to salaries and benefits, travel and entertainment expenses, office costs, general insurance and other administrative costs, are not fixed, and may increase or decrease each year based on the factors described above in this paragraph.

     The table below sets forth amounts that would be available to us for the payment of dividends for each of the fiscal years set forth below assuming that:

	•		we do not complete our pending combination with General Maritime;
	•		the Basic Hire is paid on all of our Vessels, all of our Vessels are on hire for 360 days per fiscal year and the options to extend the charters are exercised by the Charterers;
	•		no Additional Hire is paid on our two Panamax Tankers or our two Product Tankers that are currently eligible to earn Additional Hire other than the $524,000 earned in the first six months of 2008;
	•		the Additional Hire continues to be paid in connection with the sub-charter of the Stena Vision to Sun International, which is expected to expire within 30 days of September 30, 2008;
	•		Additional Hire of approximately $350,000 per Vessel per quarter is paid on the V-MAX Vessels in connection with the Eiger Shipping sub-charters, assuming that the V-MAX Vessels operate for 90 days per quarter (the Eiger Shipping sub-charger for the Stena Victory commenced on October 20, 2007 and the Eiger Shipping sub-charter for the Stena Vision is expected to commence within 30 days of September 30, 2008);
	•		the V-MAX Vessels are returned on the notional termination dates of the sub-charter within the 60-day delivery window;
	•		we have no cash expenses or liabilities other than the ship management agreements, our current directors’ fees, the current salaries and benefits of our employees, currently anticipated administrative and other expenses and interest under our secured credit facility;
	•		we pay no U.S. federal income taxes and minimal U.S. and state payroll taxes;
	•		we have no requirement to fund any required capital expenditures with respect to our Vessels;
	•		we do not suffer the loss or constructive loss of any of our Vessels;
	•		no material cash reserves or requirements are established by the actions of our Board of Directors or management;
	•		we remain in compliance with our secured credit facility which requires, among other things, that the fair market value of our Vessels exceeds 140% of our borrowings under the facility (or 125% if the loan amount at the time of such dividend all of our Vessels are on time charter for a remaining period of at least 12 months) in order to pay dividends; and
	•		we do not issue any additional common shares or other securities or borrow any additional funds.

     The table below does not reflect non-cash charges that we will incur, primarily depreciation on our Vessels. The timing and amount of dividend payments will be determined by our Board of Directors and will depend on our cash earnings, financial condition, cash requirements and availability and the provisions of Bermuda law affecting the payment of dividends and other factors. The table

below does not take into account any expenses we will incur if the subsidiaries of Concordia and Stena and the two companies owned by Stena and Fram exercise their rights to have us register their shares under the registration rights agreement.

We cannot assure you that our dividends will in fact be equal to the amounts set forth below. The amount of future dividends set forth in the table below represents only an estimate of future dividends based on the list of assumptions set forth above. The amount of future dividends, if any, could be affected by various factors, including whether or not our pending combination with General Maritime is completed, the loss of a Vessel, required capital expenditures, cash reserves established by our Board of Directors, increased or unanticipated expenses, a change in our dividend policy, increased borrowings, more restrictive debt covenants, higher interest rates, principal amortization requirements or future issuances of securities, many of which will be beyond our control. As a result, the amount of dividends actually paid may vary from the amounts currently estimated and such variations may be material. There can be no assurance that any dividends will be paid. See “Part II. Item 1A. — Risk Factors — Company Specific Risk Factors — We cannot assure you that we will pay any dividends,” “— If we cannot refinance our secured credit facility, or in the event of a default under the facility, we may have to sell our Vessels, which may leave no additional funds for distributions to shareholders” and “—We may not be able to re-charter our Vessels profitably after they expire, unless they are extended at the option of the Charterers.”

     The following table sets forth:

	•		the amount of cash that was available for dividends in the fiscal year ended December 31, 2007; and
	•		based on the assumptions and the other matters in the preceding paragraphs, our estimate of the amount of cash likely to be available for dividends for each of the 2008, 2009, and 2010 fiscal years.

		2007				2008				2009				2010
		(In millions of dollars, except
		per share amounts)
Basic Hire(1)		$	65.9			$	66.3			$	65.3			$	66.4
V-MAX Additional Hire — Sun International sub-charters(2)			2.0				0.7				—				—
V-MAX Additional Hire — Eiger Shipping sub-charters(3)			.3				1.9				2.6				1.1
Additional Hire — Panamax and Product tankers(4)			2.0				.5				—				—
Vessel operating expenses			(20.0	)			(20.3	)			(21.2	)			(22.3	)
Cash administrative expenses(5)			(2.2	)			(4.8	)			(2.5	)			(2.5	)
Drawdown of cash reserves(6)			—				2.4				—				—
Cash interest costs(7)			(12.0	)			(12.3	)			(13.3	)			(13.3	)
Cash available for dividends			36.1				34.4				30.9				29.4
Estimated dividends per share(8)		$	2.32			$	2.22			$	1.99			$	1.90

     In January 2008, we declared a dividend of $0.56 per share, and paid that dividend on February 12, 2008 to shareholders of record as of February 8, 2008. The January 2008 dividend was based on our operating results for the fourth quarter ended December 31, 2007. In that period, we earned Additional Hire of $900,000, including Additional Hire on our V-MAX vessels of approximately $600,000 and Additional Hire of approximately $300,000 on our two Product tankers and our two Panamax tankers that are currently eligible to earn Additional Hire. In April 2008, we declared a dividend of $0.56 per share and paid that dividend on May 6, 2008 to shareholders of record as of May 2, 2008. The April 2008 dividend was based on our operating results for the first quarter ended March 31, 2008. In that period, we earned Additional Hire of $800,000, including Additional Hire on our V-MAX vessels of approximately $600,000 and Additional Hire of approximately $200,000 on our two Product tankers and our two Panamax tankers that are currently eligible to earn Additional Hire. In July 2008, we declared a dividend of $0.56 per share and paid that dividend on August 5, 2008 to shareholders of record as of August 1, 2008. The July 2008 dividend was based on our operating results for the second quarter ended June 30, 2008. In that period, we earned Additional Hire of $900,000, including Additional Hire on our V-MAX vessels of approximately $600,000 and Additional Hire of approximately $300,000 on our two Product tankers and our two Panamax tankers that are currently eligible to earn Additional Hire.

     In January 2007, we declared a dividend of $0.57 per share, and paid that dividend on February 12, 2007 to shareholders of record as of February 9, 2007. The January 2007 dividend was based on our operating results for the fourth quarter ended December 31, 2006. In that period, we earned Additional Hire of $1.0 million, including Additional Hire on our V-MAX vessels of $600,000 and Additional Hire of $400,000 on our Product and Panamax tankers. In April 2007, we declared a dividend of $0.58 per share, and paid that dividend on May 7, 2007 to shareholders of record as of May 4, 2007. The April 2007 dividend was based on our operating results for the first quarter ended March 31, 2007. In that period, we earned Additional Hire of $1.1 million, including Additional Hire on our V-MAX vessels of $539,000 and Additional Hire of $514,000 on our two Product tankers and our two Panamax tankers that are currently eligible to earn Additional Hire. In July 2007, we declared a dividend of $0.59 per share, and paid that dividend on August 6, 2007 to shareholders of record as of August 3, 2007. The July 2007 dividend was based on our operating results for the second quarter ended June 30, 2007. In that period, we earned Additional Hire of $1.3 million, including Additional Hire on our V-MAX vessels of $545,000 and Additional Hire of $751,000 on our two Product tankers and our two Panamax tankers that are currently eligible to earn Additional Hire. In October 2007, we declared a dividend of $0.59 per share, and paid that dividend on November 6, 2007 to shareholders of record as of November 2, 2007. The October 2007 dividend was based on our operating results for the third quarter ended September 30, 2007. In that period, we earned Additional Hire of $1.0 million, including Additional Hire on our V-MAX vessels of approximately $600,000 and Additional Hire of approximately $400,000 on our two Product tankers and our two Panamax tankers that are currently eligible to earn Additional Hire.

RESULTS OF OPERATIONS

Three Months Ended June 30, 2008 Compared to the Three Months Ended June 30, 2007

      Total operating revenues

     Total operating revenues were $17.4 million for the three months ended June 30, 2008 compared to $17.8 million for the three months ended June 30, 2007. Revenues for the three months ended June 30, 2008 consisted of $16.5 million of Basic Hire and approximately $900,000 of Additional Hire. During the three months ended June 30, 2008, the Charterers operated our two Product tankers that are currently eligible to earn Additional Hire in the spot market. During that same period, our two Panamax tankers, both of which are eligible to earn Additional Hire, were operated on time charters at a rate of $27,000 per day. These operations resulted in payment to us of approximately $300,000 of Additional Hire. In addition, the two V-MAX tankers generated approximately $600,000 of Additional Hire during that quarter.

     We expect that total operating revenues for 2008, including anticipated Additional Hire revenues from our V-MAX tankers in 2008, and June 2008 year-to-date Additional Hire revenues from our profit sharing arrangements for the two Product and two Panamax tankers, will be approximately $69.5 million.

     The Vessels had 7.5 days and 0 days, respectively, off-hire during the three months ended June 30, 2008 and 2007.

      Total vessel operating expenses

     Total vessel operating expenses were $5.2 million for the three months ended June 30, 2008 compared to $5.0 million for the three months ended June 30, 2007. The increase in vessel operating expenses reflects the increase in the vessel management fees under the vessel management agreements with Northern Marine. We expect vessel operating expenses in 2008 to be approximately $20.3 million principally due to the annual increases in vessel management fees to Northern Marine.

      Depreciation

     Depreciation was $3.8 million for the three months ended June 30, 2008 and 2007. We estimate that depreciation in 2008 will be approximately $15.6 million.

      Administrative expenses

     Administrative expenses were $834,000 for the three months ended June 30, 2008 compared to $614,000 for the three months ended June 30, 2007. The administrative expenses in the second quarter of 2008 were higher than in the second quarter of 2007, primarily as a result of costs associated with our strategic alternatives analysis process, which resulted in our entering into the Merger Agreement with General Maritime. We estimate that administrative expenses for 2008 will be approximately $4.8 million. This estimate includes $2.4 million of advisory and legal fees related to our pending combination with General Maritime.

      Net Other Income

     Net other income represents interest income and other financial items, net of interest expense. Net other income was $3.9 million for the three months ended June 30, 2008, compared to $200,000 for the three months ended June 30, 2007. For the three months ended June 30, 2008, net other income includes $7.3 million of unrealized gain on our interest rate swap and $67,000 of interest income offset by $3.4 million in interest expense related to our credit facility with The Royal Bank of Scotland, which matures in January 2011. Net other income of $200,000 for the three months ended June 30, 2007 reflects an unrealized gain of $3.4 million on our interest rate swap and interest income of $213,000 offset by interest expense of $3.4 million on our credit facility with The Royal Bank of Scotland.

     With respect to our $229.5 million term loan credit facility, by entering into an interest rate swap agreement, we have effectively fixed the interest rate under the facility at 5.7325% (5.8325% if the ratio of the value of our Vessels to the amount outstanding under the loan facility falls below 2.0) for the five-year term. The interest rate swap agreement was not designated nor qualified as a cash flow hedge pursuant to SFAS No. 133. Accordingly, changes in the fair value of this swap are recorded in current earnings. The fair value of the swap at June 30, 2008 was a liability of $7.3 million. The fair value of the swap at March 31, 2008 was a liability of $14.6

million. Accordingly, we recorded a non-cash increase in the fair value of the interest rate swap of $7.3 million in current earnings as an unrealized gain in the second quarter of 2008. In the second quarter of 2007, we recorded a non-cash increase in the fair value of the interest rate swap of $3.4 million in current earnings as an unrealized gain.

     Based upon the effectively fixed interest rate under the terms of the swap agreement, we estimate that interest expense under the $229.5 million secured credit facility with The Royal Bank of Scotland plc, which matures in January 2011, will be approximately $13.2 million per year.

Six Months Ended June 30, 2008 Compared to the Six Months Ended June 30, 2007

      Total operating revenues

     Total operating revenues were $35.0 million for the six months ended June 30, 2008 compared to $35.1 million for the six months ended June 30, 2007. Revenues for the six months ended June 30, 2008 consisted of $33.2 million in Basic Hire and $1.7 million in Additional Hire. During the six months ended June 30, 2008, the Charterers operated our two Product tankers that are currently eligible to earn Additional Hire in the spot market. Beginning in January 2008, the Charterers operated our two Panamax tankers pursuant to time charters at a rate of $27,000 per day. This resulted in payment to us of $500,000 of Additional Hire. In addition, the two V-MAX tankers generated $1.2 million of Additional Hire for the six months ended June 30, 2008.

     The Vessels had 7.8 days and .3 days, respectively, off-hire during the six months ended June 30, 2008 and 2007.

      Total vessel operating expenses

     Total vessel operating expenses were $10.4 million for the six months ended June 30, 2008 compared to $10.0 million for the six months ended June 30, 2007. Vessel operating expenses for the six months ended June 30, 2008 were higher than the same period in 2007 reflecting the annual increase in daily vessel management fees under our ship management agreements.

      Depreciation

     Depreciation was $7.6 million for the six months ended June 30, 2008 and 2007.

      Administrative expenses

     Administrative expenses were $1.5 million for the six months ended June 30, 2008 compared to $1.1 million for the six months ended June 30, 2007. The increase in administrative expenses reflects higher costs in the first six months of 2008 associated with our strategic alternatives analysis.

      Net Other Expenses

     Net other expenses represent interest expense, net of interest income and other financial items. Net other expenses were $6.5 million for the six months ended June 30, 2008, compared to $4.0 million for the six months ended June 30, 2007. For the six months ended June 30, 2008, net other expenses include $6.8 million in interest expense related to our credit facility with The Royal Bank of Scotland, partially offset by an unrealized gain of $170,000 on our interest rate swap and $200,000 of interest income. Net other expenses for the six months ended June 30, 2007 include $6.8 million in interest expense related to our credit facility with The Royal Bank of Scotland, plc., partially offset by an unrealized gain of $2.3 million on our interest rate swap of $2.3 million and $429,000 of interest income.

     The fair value of the swap at June 30, 2008 was a liability of $7.3 million. The fair value of the swap at December 31, 2007 was a liability of $7.5 million. Accordingly, we recorded a non-cash decrease in the fair value of the interest rate swap of $170,000 in current earnings as an unrealized gain for the six months ended June 30, 2008. For the six months ended June 30, 2007, we recorded a non-cash increase in the fair value of the interest rate swap of $2.3 million in current earnings as an unrealized gain.

      Liquidity and Capital Resources

     We operate in a capital intensive industry. Our liquidity requirements relate to our operating expenses, including payments under our ship management agreements, quarterly payments of interest and the payment of principal at maturity under our $229.5 million secured credit facility and maintaining cash reserves to provide for contingencies.

     In December 2005, we entered into a five-year term loan agreement with The Royal Bank of Scotland. The term loan agreement provides for a facility of $229.5 million. The purpose of the term loan agreement was to (1) refinance our existing indebtedness, (2) finance the purchase price of two Product tankers from Stena and (3) general corporate purposes. We completed the refinancing of our indebtedness in December 2005 and completed the Additional Vessel acquisition in January 2006. The term loan agreement matures on January 5, 2011. All amounts outstanding under the term loan agreement must be repaid on that maturity date. There is no principal amortization prior to maturity. Borrowings under the term loan agreement bear interest at LIBOR plus a margin of 75 basis points. The margin would increase to 85 basis points if the ratio of the fair market value of our Vessels to the amount outstanding under the credit facility, which we refer to as the Ratio, falls below 2.0. The increased interest margin is equivalent to approximately $229,500 per year in increased interest costs in the event the Ratio falls below 2.0. In connection with the term loan agreement, we have entered into an interest rate swap agreement with The Royal Bank of Scotland. As a result of this swap, we effectively fixed the interest rate on the term loan agreement at 5.7325%. The annual cash interest costs will approximate 5.38% due to the cash benefit that we received in December 2005 from the $4.8 million termination of a prior swap. That cash benefit has been designated by our Board of Directors to offset the higher interest costs over the life of the $229.5 million credit facility. The term loan agreement provides that if at any time the aggregate market value of our Vessels that secure the obligations under the Loan Agreement is less than 125% of the loan amount, we must either provide additional security or prepay a portion of the loan to reinstate such percentage. The term loan agreement also contains financial covenants requiring that at the end of each financial quarter (1) our total assets (adjusted to give effect to the market value of the Vessels) less total liabilities is equal to or greater than 30% of such total assets and (2) we have positive working capital.

     We had outstanding long term debt of $229.5 million as of June 30, 2008 and December 31, 2007. This amount reflects outstanding borrowings under our secured credit facility, which matures in January 2011. By entering into an interest rate swap agreement, we have effectively fixed the interest rate under the facility at approximately 5.7325% per year.

     We anticipate that we will seek to refinance our secured credit facility at or prior to its maturity. There can be no assurance that we will be able to do so on acceptable terms. Interest rates may be higher than current rates at the time we seek to refinance our secured credit facility and the prevailing market terms for loans such as the type we would need to refinance our secured credit may require periodic payments to amortize the outstanding principal. Such higher rates, principal amortization requirements or other terms could prevent our ability to complete a refinancing or could adversely impact our future results, including the amount of cash available for future dividends. Please see “Part II. Item 1A. Risk Factors — Company Specific Risk Factors — We cannot assure you that we will pay any dividends,” “— If we cannot refinance our secured credit facility, or in the event of a default under the facility, we may have to sell our Vessels, which may leave no additional funds for distributions to shareholders” and “— We may not be able to recharter our Vessels profitably after they expire, unless they are extended at the option of the Charterers.”

     As of June 30, 2008, we had cash and cash equivalents of $12.4 million. Net cash provided by operating activities for the three months ended June 30, 2008 was $11.0 million.

     Net cash provided by investing activities for the three months ended June 30, 2008 was 12.5 million. This amount relates to the sale of $12.5 million in marketable securities during the six months ended June 30, 2008 with original maturities greater than 90 days. We did not purchase any marketable securities during the first six months of 2008.

     Net cash used in financing activities for the three months ended June 30, 2008 was $17.4 million, which consisted solely of dividend payments made in February and May 2008.

     We collect our Basic Hire monthly in advance and pay our ship management fees monthly in advance. We receive Additional Hire payable quarterly in arrears. We expect charter revenues will be sufficient to cover our ship management fees, interest payments, administrative expenses and other costs and to continue to pay quarterly dividends as described above under the caption “Dividend Policy”.

     We believe that our cash flow from our Charters will be sufficient to fund our interest payments under our secured credit facility and our working capital requirements for the short and medium term. To the extent we pursue additional vessel acquisitions, we will need to obtain additional debt or equity capital. Our longer term liquidity requirements include repayment of the principal balance of our secured credit facility in January 2011. We anticipate requiring new borrowings, issuances of equity, or funds from a combination of these sources to meet this repayment obligation.

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

     Our accounting policies are more fully described in Note 2 to the Notes to Condensed Consolidated Financial Statements included elsewhere in this report. As disclosed in Note 2 to the Notes to Consolidated Financial Statements, the preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions about future events that affect the amounts reported in the financial statements and accompanying notes. Future events and their effects cannot be determined with absolute certainty. Therefore, the determination of estimates requires the exercise of judgment. The process of determining significant estimates is fact specific and takes into account factors such as historical experience, current and expected economic and industry conditions, present and expected conditions in the financial markets, and in some cases, the credit worthiness of counterparties to contracts. We regularly reevaluate these significant factors and make adjustments where facts and circumstances dictate. The following is a discussion of the accounting policies that we apply and that we consider to involve a higher degree of judgment in their application.

Revenue Recognition

     Revenues are generated from time charters and the spot market. Charter revenues are earned over the term of the charter as the service is provided. Probable losses on voyage charters are accrued in full at the time such losses can be estimated.

Vessels, Depreciation and Impairment

     Our Vessels represent our most significant assets and we state them at cost less accumulated depreciation. Depreciation of our Vessels is computed using the straight-line method over their estimated useful lives of 25 years. This is a common life expectancy applied in the shipping industry. Significant vessel improvement costs are capitalized as additions to the vessel rather than being expensed as a repair and maintenance activity. Should certain factors or circumstances cause us to revise our estimate of vessel service lives, depreciation expense could be materially lower or higher. If circumstances cause us to change our assumptions in making determinations as to whether vessel improvements should be capitalized, the amounts we expense each year as repairs and maintenance costs could increase, partially offset by a decrease in depreciation expense.

     We review long-lived assets used in our business on an annual basis for impairment, or whenever events or changes in circumstances indicate that the carrying amount of an asset or a group of assets may not be recoverable. We assess recoverability of the carrying value of the asset by estimating the future net cash flows expected to result from the asset, including eventual disposition. If the future undiscounted net cash flows are less than the carrying value of the asset, an impairment loss is recorded equal to the difference between the asset’s carrying value and its fair value. We estimate fair value based on sales price negotiations, active markets, if available, and projected future cash flows discounted at a rate determined by management to be commensurate with our business risk. The estimation of fair value using these methods is subject to numerous uncertainties which require our significant judgment when making assumptions of revenues, operating costs, selling and administrative expenses, interest rates and general economic business conditions, among other factors.

PART II: OTHER INFORMATION

Item 6.		Exhibits.

(A) Exhibits:

Exhibit
Number		Description of Exhibit
2.1		Agreement and Plan of Merger and Amalgamation, by and among Arlington Tankers Ltd., Galileo Holding Corporation, Archer Amalgamation Limited, Galileo Merger Corporation and General Maritime Corporation, dated as of August 5, 2008.†
3.1		Bye-laws.††
4.1		Amendment to Rights Agreement, dated as of August 5, 2008, by and between Arlington Tankers Ltd. and American Stock Transfer & Trust Company, LLC.†
12.1		Statement re: Computation of Ratio of Earnings to Fixed Charges*
31.1		Certification of Chief Executive Officer and Chief Financial Officer pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934*
31.2		Certification of Chief Executive Officer and Chief Financial Officer pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934
32.1		Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes Oxley Act of 2002*

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.

Date: October 10, 2008

Exhibit
Number		Description of Exhibit
2.1		Agreement and Plan of Merger and Amalgamation, by and among Arlington Tankers Ltd., Galileo Holding Corporation, Archer Amalgamation Limited, Galileo Merger Corporation and General Maritime Corporation, dated as of August 5, 2008.†
3.1		Bye-laws.††
4.1		Amendment to Rights Agreement, dated as of August 5, 2008, by and between Arlington Tankers Ltd. and American Stock Transfer & Trust Company, LLC.†
12.1		Statement re: Computation of Ratio of Earnings to Fixed Charges*
31.1		Certification of Chief Executive Officer and Chief Financial Officer pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934*
31.2		Certification of Chief Executive Officer and Chief Financial Officer pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934
32.1		Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes Oxley Act of 2002*

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