##### Table of Contents





UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549





FORM 20-F





(Mark One)

| ̈ | REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934
|- | ----------------------------------------------------------------------------------------------

OR



|x | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|- | ------------------------------------------------------------------------------------

For the fiscal year ended December 31, 2012

OR



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

OR



| ̈ | SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|- | -------------------------------------------------------------------------------------------

Date of event requiring this shell company report

For the transition period from  to

Commission file number

001-34104





Navios Maritime Acquisition Corporation

(Exact name of Registrant as specified in its charter)





Not
Applicable

(Translation of Registrants Name into English)

Republic of Marshall Islands

(Jurisdiction of incorporation or organization)

85

Akti Miaouli Street

Piraeus, Greece 185 38

(011) +30-210-4595000

(Address of principal executive offices)

Todd E. Mason

Thompson Hine LLP

335 Madison Ave

New York, NY 10017

Todd.Mason@thompsonhine.com

(212) 908-3946

(Name, Telephone, E-mail and/or Facsimile number and Address of Company Contact Person)

Securities registered or to be registered pursuant to Section 12(b) of the Act.



|                                                                                           |  |                                          
|------------------------------------------------------------------------------------------ |  | -----------------------------------------
|Title of each class                                                                        |  | Name of each exchange on which registered
|Common Stock, par value $.0001 per share                                                   |  | New York Stock Exchange LLC              
|Units                                                                                      |  | New York Stock Exchange LLC              
|Warrants                                                                                   |  | New York Stock Exchange LLC              
|Securities registered or to be registered pursuant to Section 12 (g) of the Act.           |  | None                                     
|Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act. |  | None                                     





Indicate the number of outstanding shares of each of the issuers classes of capital or common stock as of the close of the period covered by the
annual report:

40,504,661 Shares of Common Stock

12,752 Units

6,025,242 Warrants

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities
Act.    Yes   ̈    No  x

If this report is an annual or transition report, indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or (15)(d) of the Securities Exchange Act of
1934.    Yes   ̈    No  x

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 periods that the registrant was required to file such reports), and (2) has been subject to such reporting requirements for the past
90 days.    Yes  x    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 (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes  x    No   ̈

Indicate
by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of accelerated filer and large accelerated filer in Rule 12b-2 of the Exchange Act. (Check one):

Large Accelerated Filer   ̈       
          Accelerated Filer   ̈                 Non-Accelerated
Filer  x

Indicate by check mark which basis of accounting the registrant has used
to prepare the financial statements included in this filing:



|             |  |                                                                                                          |  |         
|------------ |  | -------------------------------------------------------------------------------------------------------- |  | --------
|U.S. GAAP  x |  | International Financial Reporting Standards as issued by the International Accounting Standards Board   ̈ |  | Other   ̈

If this is an annual report, indicate by check mark whether the registrant is a shell company (as defined in
Rule 12b-2 of the Exchange Act).    Yes   ̈    No  x









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##### Table of Contents

TABLE OF CONTENTS



|                                                                                  |  |  |  |   
|--------------------------------------------------------------------------------- |  |  |  | --
|PART I                                                                            |  |  |  |   
|Item 1. Identity of Directors, Senior Management and Advisers                     |  |  |  | 2 
|Item 2. Offer Statistics and Expected Timetable                                   |  |  |  | 2 
|Item 3. Key Information                                                           |  |  |  | 2 
|Item 4. Information on the Company                                                |  |  |  | 28
|Item 4A. Unresolved Staff Comments                                                |  |  |  | 44
|Item 5. Operating and Financial Review and Prospects                              |  |  |  | 44
|Item 6. Directors, Senior Management and Employees                                |  |  |  | 66
|Item 7. Major Stockholders and Related Party Transactions                         |  |  |  | 71
|Item 8. Financial Information                                                     |  |  |  | 76
|Item 9. Listing Details                                                           |  |  |  | 77
|Item 10. Additional Information                                                   |  |  |  | 78
|Item 11. Quantitative and Qualitative Disclosures about Market Risks              |  |  |  | 89
|Item 12. Description of Securities Other than Equity Securities                   |  |  |  | 89
|PART II                                                                           |  |  |  |   
|Item 13. Defaults, Dividend Arrearages and Delinquencies                          |  |  |  | 90
|Item 14. Material Modifications to the Rights of Shareholders and Use of
Proceeds |  |  |  | 90
|Item 15. Controls and Procedures                                                  |  |  |  | 90
|Item 16A. Audit Committee Financial Expert                                        |  |  |  | 90
|Item 16B. Code of Ethics                                                          |  |  |  | 91
|Item 16C. Principal Accountant Fees and Services                                  |  |  |  | 91
|Item 16D. Exemptions from the Listing Standards for Audit Committees              |  |  |  | 91
|Item 16E. Purchases of Equity Securities by the Issuer and Affiliated
Purchasers  |  |  |  | 91
|Item 16F. Change in Registrants Certifying Accountant                            |  |  |  | 91
|Item 16G. Corporate Governance                                                    |  |  |  | 91
|Item 16H. Mine Safety Disclosures                                                 |  |  |  | 92
|Item 17. Financial Statements                                                     |  |  |  | 92
|Item 18. Financial Statements                                                     |  |  |  | 92
|Item 19. Exhibits                                                                 |  |  |  | 92
|Signatures                                                                        |  |  |  |   
|EX-8.1                                                                            |  |  |  |   
|EX-12.1                                                                           |  |  |  |   
|EX-12.2                                                                           |  |  |  |   
|EX-13.1                                                                           |  |  |  |   
|EX-15.1                                                                           |  |  |  |   



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##### Table of Contents

FORWARD-LOOKING STATEMENTS

This Annual Report should be read in conjunction with the financial statements and accompanying notes included herein.

Statements included in this Annual Report on Form 20-F (this Annual Report) which are not historical facts (including our statements concerning plans and objectives of management for future
operations or economic performance, or assumptions related thereto) are forward-looking statements. In addition, we and our representatives may from time to time make other oral or written statements which are also forward-looking statements. Such
statements include, in particular, statements about our plans, strategies, business prospects, changes and trends in our business, and the markets in which we operate as described in this Annual Report. In some cases, you can identify the
forward-looking statements by the use of words such as may, could, should, would, expect, plan, anticipate, intend, forecast,
believe, estimate, predict, propose, potential, continue or the negative of these terms or other comparable terminology.

Forward-looking statements appear in a number of places and include statements with respect to, among other things:



| |  |  | our ability to maintain or develop new and existing customer relationships, including our ability to enter into charters for our vessels;
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------



| |  |  | our ability to successfully grow our business and our capacity to manage our expanding business;
| | - |  | ------------------------------------------------------------------------------------------------



| |  |  | our future operating and financial results, including the amount of fixed hire and profit share that we may receive;
| | - |  | --------------------------------------------------------------------------------------------------------------------



| |  |  | our ability to identify and consummate desirable acquisitions, joint ventures or strategic alliances, business strategy, areas of possible expansion,
and expected capital expenditure or operating expenses;
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | tanker industry trends, including charter rates and vessel values and factors affecting vessel supply and demand;
| | - |  | -----------------------------------------------------------------------------------------------------------------



| |  |  | our ability to take delivery of, integrate into our fleet, and employ the newbuildings we have on firm order or any newbuildings we may order in the
future and the ability of shipyards to deliver vessels on a timely basis;
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | the aging of our vessels and resultant increases in operation and drydocking costs;
| | - |  | -----------------------------------------------------------------------------------



| |  |  | the ability of our vessels to pass classification inspection and vetting inspections by oil majors;
| | - |  | ---------------------------------------------------------------------------------------------------



| |  |  | significant changes in vessel performance, including increased vessel breakdowns;
| | - |  | ---------------------------------------------------------------------------------



| |  |  | the creditworthiness of our charterers and the ability of our contract counterparties to fulfill their obligations to us;
| | - |  | -------------------------------------------------------------------------------------------------------------------------



| |  |  | our ability to repay outstanding indebtedness, to obtain additional financing and to obtain replacement charters for our vessels, in each case, at
commercially acceptable rates or at all;
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | changes to governmental rules and regulations or action taken by regulatory authorities and the expected costs thereof;
| | - |  | -----------------------------------------------------------------------------------------------------------------------



| |  |  | potential liability from litigation and our vessel operations, including discharge of pollutants;
| | - |  | -------------------------------------------------------------------------------------------------



| |  |  | changes in general economic and business conditions;
| | - |  | ----------------------------------------------------



| |  |  | general domestic and international political conditions, including wars, acts of piracy and terrorism;
| | - |  | ------------------------------------------------------------------------------------------------------



| |  |  | changes in production of or demand for oil and petroleum products, either globally or in particular regions; and
| | - |  | ----------------------------------------------------------------------------------------------------------------



| |  |  | changes in the standard of service or the ability of our technical manager to be approved as required.
| | - |  | ------------------------------------------------------------------------------------------------------

These and other forward-looking statements are made based upon managements current plans, expectations, estimates, assumptions and beliefs
concerning future events impacting us and therefore involve a number of risks and uncertainties, including those set forth below, as well as those risks discussed in Item 3. Key Information.

The forward-looking statements, contained in this Annual Report, are based on our current expectations and beliefs concerning future developments and
their potential effects on us. There can be no assurance that future developments affecting us will be those that we have anticipated.

The
risks, uncertainties and assumptions involve known and unknown risks and are inherently subject to significant uncertainties and contingencies, many of which are beyond our control. We caution that forward-looking statements are not guarantees and
that actual results could differ materially from those expressed or implied in the forward-looking statements.

We undertake no obligation to
update any forward-looking statement or statements to reflect events or circumstances after the date on which such statement is made or to reflect the occurrence of unanticipated events. New factors emerge from time to time, and it is not possible
for us to predict all of these factors. Further, we cannot assess the impact of each such factor on our business or the extent to which any factor, or combination of factors, may cause actual results to be materially different from those contained
in any forward-looking statement.



1



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##### Table of Contents

PART I

Item 1. Identity of Directors, Senior Management and Advisers

Not Applicable.

Item 2. Offer Statistics and Expected Timetable

Not Applicable.

Item 3. Key Information

A. Selected Financial Data

Navios
Maritime Acquisition Corporation (sometimes referred to herein as Navios Acquisition, the Company, we or us) was incorporated in the Republic of Marshall Islands on March 14, 2008 (refer to
Item 4. Information on the company).

Navios Acquisitions selected historical financial information and operating results for the
years ended December 31, 2012, 2011, 2010, 2009 and for the period from March 14, 2008 (Inception) to December 31, 2008 were derived from the audited consolidated financial statements of Navios Acquisition. The consolidated statement
of operations data for the years ended December 31, 2012, 2011 and 2010 and the consolidated balance sheet data as of December 31, 2012 and 2011 have been derived from our audited consolidated financial statements included elsewhere in
this Annual Report. The consolidated statement of operations data for the year ended December 31, 2009 and for the period from March 14, 2008 (Inception) to December 31, 2008, and the balance sheet data as of December 31, 2010, 2009
and as of December 31, 2008, have been derived from our audited financial statements which are not included in this document. The selected consolidated financial data should be read in conjunction with Item 5. Operating and Financial
Review and Prospects. the consolidated financial statements, related notes and other financial information included elsewhere in this Annual Report. The information is only a summary and should be read in conjunction with the consolidated
financial statements and related notes included elsewhere in this Annual Report and section Item 5. Operating and Financial Review and Prospects. The selected consolidated financial data is a summary of, is derived from, and is
qualified by reference to, our audited consolidated financial statements and notes thereto, which have been prepared in accordance with U.S. generally accepted accounting principles (U.S. GAAP). The historical data included below and
elsewhere in this Annual Report is not necessarily indicative of our future performance.



|                                                           |  |                            |         |   |                             |   |         |                             |  |   |                             |   |  |                                                                     |       |   |  |   |       |  
|---------------------------------------------------------- |  | -------------------------- | ------- | - | --------------------------- | - | ------- | --------------------------- |  | - | --------------------------- | - |  | ------------------------------------------------------------------- | ----- | - |  | - | ----- | -
|(In thousands of U.S. dollars)                             |  | Year endedDecember 31,2012 |         |   | Year endedDecember 
31,2011 |   |         | Year endedDecember 
31,2010 |  |   | Year endedDecember 
31,2009 |   |  | For the periodMarch 
14, 2008(date of inception)to December 31,2008 |      
|Revenue                                                    |  | $                          | 151,097 |   |                             | $ | 121,925 |                             |  | $ | 33,568                      |   |  | $                                                                   |      |   |  | $ |      |  
|Time charter expenses                                      |  |                            | (2,824  | ) |                             |   | (3,499  | )                           |  |   | (355                        | ) |  |                                                                     |      |   |  |   |      |  
|Direct vessel expenses                                     |  |                            | (2,622  | ) |                             |   | (633    | )                           |  |   |                            |   |  |                                                                     |      |   |  |   |      |  
|Management fees                                            |  |                            | (47,043 | ) |                             |   | (35,679 | )                           |  |   | (9,752                      | ) |  |                                                                     |      |   |  |   |      |  
|General and administrative expenses                        |  |                            | (3,853  | ) |                             |   | (4,241  | )                           |  |   | (1,902                      | ) |  |                                                                     | (994  | ) |  |   | (393  | )
|Share based compensation                                   |  |                            |        |   |                             |   |        |                             |  |   | (2,140                      | ) |  |                                                                     |      |   |  |   |      |  
|Transaction costs                                          |  |                            |        |   |                             |   |        |                             |  |   | (8,019                      | ) |  |                                                                     |      |   |  |   |      |  
|Depreciation and amortization                              |  |                            | (49,644 | ) |                             |   | (38,638 | )                           |  |   | (10,120                     | ) |  |                                                                     |      |   |  |   |      |  
|Prepayment penalties & write- off of deferred finance fees |  |                            |        |   |                             |   | (935    | )                           |  |   | (5,441                      | ) |  |                                                                     |      |   |  |   |      |  
|Interest income                                            |  |                            | 445     |   |                             |   | 1,414   |                             |  |   | 862                         |   |  |                                                                     | 346   |   |  |   | 1,440 |  
|Interest expenses and finance cost, net                    |  |                            | (49,432 | ) |                             |   | (43,165 | )                           |  |   | (10,651                     | ) |  |                                                                     |      |   |  |   |      |  
|Other income/(expense), net                                |  |                            | 78      |   |                             |   | (406    | )                           |  |   | 404                         |   |  |                                                                     |       |   |  |   |       |  
|                                                           |  |                            |         |   |                             |   |         |                             |  |   |                             |   |  |                                                                     |       |   |  |   |       |  
|Net (loss)/income                                          |  | $                          | (3,798  | ) |                             | $ | (3,857  | )                           |  | $ | (13,546                     | ) |  | $                                                                   | (648  | ) |  | $ | 1,047 |  
|                                                           |  |                            |         |   |                             |   |         |                             |  |   |                             |   |  |                                                                     |       |   |  |   |       |  
|Net (loss)/ income per share, basic                        |  | $                          | (0.08   | ) |                             | $ | (0.08   | )                           |  | $ | (0.43                       | ) |  | $                                                                   | (0.03 | ) |  | $ | 0.08  |  
|                                                           |  |                            |         |   |                             |   |         |                             |  |   |                             |   |  |                                                                     |       |   |  |   |       |  
|                                                           |  |                            |         |   |                            
|Net (loss)/ income per share, diluted                      |  | $                          | (0.08   | ) |                             | $ | (0.08   | )                           |  | $ | (0.43                       | ) |  | $                                                                   | (0.02 | ) |  | $ | 0.06  |  



2



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|                                                     |  |                            |           |   |                             |  |           |                             |  |  |                             |   |  |                                                                    |         |   |  |  |          |  
|---------------------------------------------------- |  | -------------------------- | --------- | - | --------------------------- |  | --------- | --------------------------- |  |  | --------------------------- | - |  | ------------------------------------------------------------------ | ------- | - |  |  | -------- | -
|Balance Sheet Data (at period end)                   |  | Year EndedDecember 31,2012 |           |   | Year endedDecember 
31,2011 |  |           | Year endedDecember 
31,2010 |  |  | Year endedDecember 
31,2009 |   |  | For the periodMarch 14, 2008(date of inception)to
December 31,2008 |        
|Current assets, including cash                       |  |                            | 71,795    |   |                             |  | 78,907    |                             |  |  | 81,202                      |   |  |                                                                    | 142     |   |  |  | 57       |  
|Vessels, net                                         |  |                            | 940,738   |   |                             |  | 774,624   |                             |  |  | 529,659                     |   |  |                                                                    |        |   |  |  |         |  
|Total assets                                         |  |                            | 1,370,644 |   |                             |  | 1,195,469 |                             |  |  | 1,005,087                   |   |  |                                                                    | 251,635 |   |  |  | 252,258  |  
|Current portion of long-term debt                    |  |                            | 19,724    |   |                             |  | 11,928    |                             |  |  | 5,086                       |   |  |                                                                    |        |   |  |  |         |  
|Total long-term debt, excluding current portion      |  |                            | 974,362   |   |                             |  | 833,483   |                             |  |  | 704,332                     |   |  |                                                                    |        |   |  |  |         |  
|Redeemable Convertible Preferred Stock               |  |                            | 6,000     |   |                             |  |          |                             |  |  |                            |   |  |                                                                    |        |   |  |  |         |  
|Total Stockholders equity                            |  |                            | 225,304   |   |                             |  | 238,849   |                             |  |  | 253,728                     |   |  |                                                                    | 141,990 |   |  |  | 100,289  |  
|Cash Flow Data                                       |  |                            |           |   |                             |  |           |                             |  |  |                             |   |  |                                                                    |         |   |  |  |          |  
|Net cash provided by /(used in) operating activities |  |                            | 81,877    |   |                             |  | 64,233    |                             |  |  | 11,300                      |   |  |                                                                    | (623    | ) |  |  | 1,467    |  
|Net cash (used in)/provided by investing activities  |  |                            | (205,956  | ) |                             |  | (225,777  | )                           |  |  | (103,602                    | ) |  |                                                                    | 708     |   |  |  | (252,201 | )
|Net cash provided by financing activities            |  |                            | 125,625   |   |                             |  | 141,484   |                             |  |  | 154,575                     |   |  |                                                                    |        |   |  |  | 250,736  |  
|Cash dividends declared per common share             |  |                            | 0.20      |   |                             |  | 0.20      |                             |  |  | 0.05                        |   |  |                                                                    |        |   |  |  |         |  
|Fleet Data:                                          |  |                            |           |   |                             |  |           |                             |  |  |                             |   |  |                                                                    |         |   |  |  |          |  
|Vessels at end of period                             |  |                            | 19        |   |                             |  | 14        |                             |  |  | 9                           |   |  |                                                                    |        |   |  |  |         |  

B.Capitalization and indebtedness.

Not applicable.

C.Reasons for the offer and use of proceeds.

Not applicable.

D.Risk factors

Risks Relating to Our Business

We have a limited operating history, and you will have a limited basis on which to evaluate our ability to achieve our business
objectives. We may not operate profitably in the future.

We are a company with limited combined operating results to date.
Accordingly, you will have a limited basis upon which to evaluate our ability to achieve our business objectives. We completed our initial public offering (IPO) on July 1, 2008. Pursuant to the Acquisition Agreement dated
April 8, 2010 and approved by our stockholders on May 25, 2010 (the Acquisition Agreement), we completed the Product and Chemical Tanker Acquisition which constituted the initial business combination. Of the 13 vessels and the
two purchase options that were exercised in July 2011, three were delivered during 2010, one delivered during 2011, four delivered during 2012 and two delivered in January and February 2013 with the remaining vessels under the Acquisition Agreement
scheduled to be delivered during 2013. Most of the vessels acquired with the Product and Chemical Tanker Acquisition have no operating history, and the ten vessels delivered up to date have only been chartered since their respective delivery. On
September 10, 2010, we completed the acquisition of seven very large crude carriers (VLCC), referred to herein as the VLCC Acquisition, with six operating vessels and one vessel delivered in our fleet in June 2011. On
October 26, 2010, we entered into an agreement to acquire two newbuild vessels that were delivered in the fourth quarter of 2011 and first quarter of 2012, respectively. Both of the vessels were immediately chartered. In July 2011, we took
delivery of two MR2 product tankers, which continue to trade under charters in place at the time of acquisition. In January 2012, Navios Acquisition concluded the asset acquisition of three newbuild MR2 product tankers scheduled to be delivered from
a South Korean shipyard in the second, third and fourth quarters of 2014, respectively.



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Delays in deliveries of our newbuild vessels, or our decision to cancel, or our inability to otherwise
complete the acquisitions of any newbuildings we may decide to acquire in the future, could harm our operating results and lead to the termination of any related charters.

Our newbuilding vessels, as well as any newbuildings we may contract to acquire or order in the future, could be delayed, not completed or cancelled, which would delay or eliminate our expected receipt of
revenues under any charters for such vessels. The shipbuilder or third party seller could fail to deliver the newbuilding vessel or any other vessels we acquire or order, or we could cancel a purchase or a newbuilding contract because the
shipbuilder has not met its obligations, including its obligation to maintain agreed refund guarantees in place for our benefit. For prolonged delays, the customer may terminate the time charter.

Our receipt of newbuildings could be delayed, cancelled, or otherwise not completed because of:



| |  |  | quality or engineering problems or failure to deliver the vessel in accordance with the vessel specifications;
| | - |  | --------------------------------------------------------------------------------------------------------------



| |  |  | changes in governmental regulations or maritime self-regulatory organization standards;
| | - |  | ---------------------------------------------------------------------------------------



| |  |  | work stoppages or other labor disturbances at the shipyard;
| | - |  | -----------------------------------------------------------



| |  |  | bankruptcy or other financial or liquidity problems of the shipbuilder;
| | - |  | -----------------------------------------------------------------------



| |  |  | a backlog of orders at the shipyard;
| | - |  | ------------------------------------



| |  |  | political or economic disturbances in the country or region where the vessel is being built;
| | - |  | --------------------------------------------------------------------------------------------



| |  |  | weather interference or catastrophic event, such as a major earthquake or fire;
| | - |  | -------------------------------------------------------------------------------



| |  |  | shortages of or delays in the receipt of necessary equipment or construction materials, such as steel; and
| | - |  | ----------------------------------------------------------------------------------------------------------



| |  |  | our inability to finance the purchase of the vessel.
| | - |  | ----------------------------------------------------

If delivery of any newbuild vessel acquired, or any vessel we contract to acquire in the future is materially delayed, it could materially adversely affect our results of operations and financial
condition.

If we fail to manage our planned growth properly, we may not be able to expand our fleet successfully, which may adversely
affect our overall financial position.

While we have no specific plans, we do intend to continue to expand our fleet in the future.
Our growth will depend on:



| |  |  | locating and acquiring suitable vessels;
| | - |  | ----------------------------------------



| |  |  | identifying reputable shipyards with available capacity and contracting with them for the construction of new vessels;
| | - |  | ----------------------------------------------------------------------------------------------------------------------



| |  |  | integrating any acquired vessels successfully with our existing operations;
| | - |  | ---------------------------------------------------------------------------



| |  |  | enhancing our customer base;
| | - |  | ----------------------------



| |  |  | managing our expansion; and
| | - |  | ---------------------------



| |  |  | obtaining required financing, which could include debt, equity or combinations thereof.
| | - |  | ---------------------------------------------------------------------------------------

Additionally, the marine transportation and logistics industries are capital intensive, traditionally using substantial amounts of indebtedness to
finance vessel acquisitions, capital expenditures and working capital needs. If we finance the purchase of our vessels through the issuance of debt securities, it could result in:



| |  |  | default and foreclosure on our assets if our operating cash flow after a business combination or asset acquisition were insufficient to pay our debt
obligations;
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | acceleration of our obligations to repay the indebtedness even if we have made all principal and interest payments when due if the debt security
contained covenants that required the maintenance of certain financial ratios or reserves and any such covenant were breached without a waiver or renegotiation of that covenant;
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | our immediate payment of all principal and accrued interest, if any, if the debt security was payable on demand; and
| | - |  | --------------------------------------------------------------------------------------------------------------------



| |  |  | our inability to obtain additional financing, if necessary, if the debt security contained covenants restricting our ability to obtain additional
financing while such security was outstanding.
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

In addition, our business plan and strategy is predicated on buying vessels
in a distressed market at what we believe is near the low end of the cycle in what has typically been a cyclical industry. However, there is no assurance that charter rates and vessels asset values will not sink lower, or that there will be an
upswing in shipping costs or vessel asset values in the near-term or at all, in which case our business plan and strategy may not succeed in the near-term or at all. Growing any business by acquisition presents numerous risks such as undisclosed
liabilities and obligations, difficulty experienced in obtaining additional qualified personnel and managing relationships with customers and suppliers and integrating newly acquired operations into existing infrastructures. We may not be successful
in growing and may incur significant expenses and losses.



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We may not have adequate insurance to compensate us for damage to or loss of our vessels, which may
have a material adverse effect on our financial condition and results of operation.

We procure hull and machinery insurance,
protection and indemnity insurance, which includes environmental damage and pollution insurance coverage and war risk insurance for our fleet. We do not maintain for our vessels insurance against loss of hire, which covers business interruptions
that result from the loss of use of a vessel. We may not be adequately insured against all risks. We may not be able to obtain adequate insurance coverage for our fleet in the future. The insurers may not pay particular claims. Our insurance
policies may contain deductibles for which we will be responsible and limitations and exclusions that may increase our costs or lower our revenue. Moreover, insurers may default on claims they are required to pay. If our insurance is not enough to
cover claims that may arise, the deficiency may have a material adverse effect on our financial condition and results of operations.

We
may face unexpected maintenance costs, which could materially adversely affect our business, financial condition and results of operations.

If our vessels suffer damage or require upgrade work, they may need to be repaired at a drydocking facility. Our vessels may occasionally require upgrade work in order to maintain their classification
society rating or as a result of changes in regulatory requirements. In addition, our vessels will be off-hire periodically for intermediate surveys and special surveys in connection with each vessels certification by its classification
society. The costs of drydock repairs are unpredictable and can be substantial and the loss of earnings while these vessels are being repaired and reconditioned, as well as the actual cost of these repairs, would decrease our earnings. Our insurance
generally only covers a portion of drydocking expenses resulting from damage to a vessel and expenses related to maintenance of a vessel will not be reimbursed. In addition, space at drydocking facilities is sometimes limited and not all drydocking
facilities are conveniently located. We may be unable to find space at a suitable drydocking facility on a timely basis or may be forced to move a damaged vessel to a drydocking facility that is not conveniently located to the vessels
position. The loss of earnings while any of our vessels are forced to wait for space or to relocate to drydocking facilities that are far away from the routes on which our vessels trade would further decrease our earnings.

We rely on our technical managers to provide essential services to our vessels and run the day-to-day operations of our vessels.

Pursuant to technical management agreements our current technical manager provides services essential to the business of our vessels,
including vessel maintenance, crewing, purchasing, shipyard supervision, insurance and assistance with vessel regulatory compliance. The current technical manager of the VLCC vessels, an affiliate of the seller of such vessels, is a technical ship
management company that has provided technical management to the acquired VLCC vessels prior to the consummation of the business combination. This technical manager will continue to provide such services for an interim period subsequent to the
closing of the VLCC Acquisition, after which the technical management of our fleet is expected to be provided directly by a subsidiary of Navios Holdings. However, in the event Navios Holdings does not obtain the required vetting approvals, it will
not be able to take over technical management. Our operational success and ability to execute our strategy will depend significantly upon the satisfactory performance of these services by the current technical manager, and, subsequently, by the
Navios Holdings subsidiary. The failure of either of these technical managers to perform these services satisfactorily and/or the failure of the Navios Holdings subsidiary to garner the approvals necessary to become our technical manager
for the VLCC vessels could have a material adverse effect on our business, financial condition and results of operations.

Our vessels
may be subject to unbudgeted periods of off-hire, which could materially adversely affect our business, financial condition and results of operations.

Under the terms of the charter agreements under which our vessels operate, or are expected to operate in the case of the newbuildings, when a vessel is off-hire, or not available for service
or otherwise deficient in its condition or performance, the charterer generally is not required to pay the hire rate, and we will be responsible for all costs (including the cost of bunker fuel) unless the charterer is responsible for the
circumstances giving rise to the lack of availability. A vessel generally will be deemed to be off-hire if there is an occurrence preventing the full working of the vessel due to, among other things:



| |  |  | operational deficiencies;
| | - |  | -------------------------



| |  |  | the removal of a vessel from the water for repairs, maintenance or inspection, which is referred to as drydocking;
| | - |  | ------------------------------------------------------------------------------------------------------------------



| |  |  | equipment breakdowns;
| | - |  | ---------------------



| |  |  | delays due to accidents or deviations from course;
| | - |  | --------------------------------------------------



| |  |  | occurrence of hostilities in the vessels flag state or in the event of piracy;
| | - |  | -------------------------------------------------------------------------------



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| |  |  | crewing strikes, labor boycotts, certain vessel detentions or similar problems; or
| | - |  | ----------------------------------------------------------------------------------



| |  |  | our failure to maintain the vessel in compliance with its specifications, contractual standards and applicable country of registry and international
regulations or to provide the required crew.
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Risks Relating to Our Industry

The cyclical nature of the tanker industry may lead to volatility in charter rates and vessel values, which could materially adversely affect our
future earnings.

Oil has been one of the worlds primary energy sources for a number of decades. The global economic growth of
previous years had a significant impact on the demand for oil and subsequently on the oil trade and shipping demand. However, from the second half of 2008, through today, the worlds economies experienced a major economic slowdown and
uncertainty with effects that are ongoing, the duration of which is very difficult to forecast is expected to continue to have, a significant impact on world trade, including the oil trade. If the tanker market, which has historically been cyclical,
is depressed in the future, our earnings and available cash flow may be materially adversely affected. Our ability to employ our vessels profitably will depend upon, among other things, economic conditions in the tanker market. Fluctuations in
charter rates and tanker values result from changes in the supply and demand for tanker capacity and changes in the supply and demand for liquid cargoes, including petroleum and petroleum products.

Historically, the crude oil markets have been volatile as a result of the many conditions and events that can affect the price, demand, production and
transport of oil, including competition from alternative energy sources. Decreased demand for oil transportation may have a material adverse effect on our revenues, cash flows and profitability. The factors affecting the supply and demand for
tankers are outside of our control, and the nature, timing and degree of changes in industry conditions are unpredictable. The current global financial crisis has intensified this unpredictability.

The factors that influence demand for tanker capacity include:



| |  |  | demand for and supply of liquid cargoes, including petroleum and petroleum products;
| | - |  | ------------------------------------------------------------------------------------



| |  |  | developments in international trade;
| | - |  | ------------------------------------



| |  |  | waiting days in ports;
| | - |  | ----------------------



| |  |  | changes in oil production and refining capacity and regional availability of petroleum refining capacity;
| | - |  | ---------------------------------------------------------------------------------------------------------



| |  |  | environmental and other regulatory developments;
| | - |  | ------------------------------------------------



| |  |  | global and regional economic conditions;
| | - |  | ----------------------------------------



| |  |  | the distance chemicals, petroleum and petroleum products are to be moved by sea;
| | - |  | --------------------------------------------------------------------------------



| |  |  | changes in seaborne and other transportation patterns, including changes in distances over which cargo is transported due to geographic changes in
where oil is produced, refined and used;
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | competition from alternative sources of energy;
| | - |  | -----------------------------------------------



| |  |  | armed conflicts and terrorist activities;
| | - |  | -----------------------------------------



| |  |  | political developments; and
| | - |  | ---------------------------



| |  |  | embargoes and strikes.
| | - |  | ----------------------

The factors that influence the supply of tanker capacity include:



| |  |  | the number of newbuilding deliveries;
| | - |  | -------------------------------------



| |  |  | the scrapping rate of older vessels;
| | - |  | ------------------------------------



| |  |  | port or canal congestion;
| | - |  | -------------------------



| |  |  | the number of vessels that are used for storage or as floating storage offloading service vessels;
| | - |  | --------------------------------------------------------------------------------------------------



| |  |  | the conversion of tankers to other uses, including conversion of vessels from transporting oil and oil products to carrying drybulk cargo and the
reverse conversion;
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | availability of financing for new tankers;
| | - |  | ------------------------------------------



| |  |  | the phasing out of single-hull tankers due to legislation and environmental concerns;
| | - |  | -------------------------------------------------------------------------------------



| |  |  | the price of steel;
| | - |  | -------------------



| |  |  | the number of vessels that are out of service;
| | - |  | ----------------------------------------------



| |  |  | national or international regulations that may effectively cause reductions in the carrying capacity of vessels or early obsolescence of tonnage; and
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | environmental concerns and regulations.
| | - |  | ---------------------------------------

Furthermore, the extension of refinery capacity in India and particularly the Middle East through 2016 is expected to exceed the immediate consumption in these areas, and an increase in exports of refined
oil products is expected as a result. This coupled with announced refinery closures in North America, the Caribbean and Europe should increase trade in refined oil products.



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Historically, the tanker markets have been volatile as a result of the many conditions and factors that can
affect the price, supply and demand for tanker capacity. The recent global economic crisis may further reduce demand for transportation of oil over long distances and supply of tankers that carry oil, which may materially affect our future revenues,
profitability and cash flows.

We believe that the current order book for tanker vessels represents a significant percentage of the existing
fleet; however the percentage of the fleet on order as a percent of the total fleet declined from 2011 to 2012. An over-supply of tanker capacity may result in a reduction of charter hire rates. If a reduction in charter rates occurs, we may only be
able to charter our vessels at unprofitable rates or we may not be able to charter these vessels at all, which could lead to a material adverse effect on our results of operations.

Charter rates in the crude oil, product and chemical tanker sectors of the seaborne transportation industry in which we operate have significantly declined from historically high levels in 2008 and
may remain depressed or decline further in the future, which may adversely affect our earnings.

Charter rates in the crude oil,
product and chemical tanker sectors have significantly declined from historically high levels in 2008 and may remain depressed or decline further. For example, the Baltic Dirty Tanker Index declined from a high of 2,347 in July 2008 to 453 in
mid-April 2009, which represents a decline of approximately 81%. Since January 2011 it has traded between a low of 604 and a high of 1,065; as of February 25, 2012, it stood at 683. The Baltic Clean Tanker Index fell from 1,509 in the early
summer of 2008 to 345 in April 2009, or approximately 77%. It has traded between a low of 553 and a high of 908 since January 2011 and stood at 688 as of February 25, 2012. Of note is that Chinese imports of crude oil have steadily increased
from 3 million barrels per day in 2008 to about 5.9 million barrels per day in January 2013 and the US has steadily increased its total petroleum product exports to 3.3 million barrels per day in November 2012 from 1 million
barrels per day in January 2006. If the tanker sector of the seaborne transportation industry, which has been highly cyclical, is depressed in the future at a time when we may want to sell a vessel, our earnings and available cash flow may be
adversely affected. We cannot assure you that we will be able to successfully charter our vessels in the future at rates sufficient to allow us to operate our business profitably or to meet our obligations, including payment of debt service to our
lenders. Our ability to renew the charters on vessels that we may acquire in the future, the charter rates payable under any replacement charters and vessel values will depend upon, among other things, economic conditions in the sector in which our
vessels operate at that time, changes in the supply and demand for vessel capacity and changes in the supply and demand for the seaborne transportation of energy resources and commodities.

Spot market rates for tanker vessels are highly volatile and are currently at relatively low levels historically and may further decrease in the future, which may adversely affect our earnings in
the event that our vessels are chartered in the spot market.

We intend to deploy at least some of our product and chemical tankers in
the spot market. Although spot chartering is common in the product and chemical tanker sectors, product and chemical tanker charter hire rates are highly volatile and may fluctuate significantly based upon demand for seaborne transportation of crude
oil and oil products and chemicals, as well as tanker supply. The world oil demand is influenced by many factors, including international economic activity; geographic changes in oil production, processing, and consumption; oil price levels;
inventory policies of the major oil and oil trading companies; and strategic inventory policies of countries such as the United States and China. The successful operation of our vessels in the spot charter market depends upon, among other things,
obtaining profitable spot charters and minimizing, to the extent possible, time spent waiting for charters and time spent traveling unladen to pick up cargo. Furthermore, as charter rates for spot charters are fixed for a single voyage that may last
up to several weeks, during periods in which spot charter rates are rising, we will generally experience delays in realizing the benefits from such increases.

The spot market is highly volatile, and, in the past, there have been periods when spot rates have declined below the operating cost of vessels. Currently, charter hire rates are at relatively low rates
historically and there is no assurance that the crude oil, product and chemical tanker charter market will recover over the next several months or will not continue to decline further.

Additionally, if the spot market rates or short-term time charter rates become significantly lower than the time charter equivalent rates that some of our charterers are obligated to pay us under our
existing charters, the charterers may have incentive to default under that charter or attempt to renegotiate the charter. If our charterers fail to pay their obligations, we would have to attempt to re-charter our vessels at lower charter rates,
which would affect our ability to comply with our loan covenants and operate our vessels profitably. If we are not able to comply with our loan covenants and our lenders choose to accelerate our indebtedness and foreclose their liens, we could be
required to sell vessels in our fleet and our ability to continue to conduct our business would be impaired.

Our VLCC vessels are
contractually committed to time charters, with the remaining terms of these charters expiring during the period from and including 2014 through 2026. We are not permitted to unilaterally terminate the charter agreements of



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the VLCC vessels due to upswings in the tanker industry cycle, when spot market voyages might be more profitable. We may also decide to sell a vessel in the future. In such a case, should we sell
a vessel that is committed to a long-term charter, we may not be able to realize the full charter free fair market value of the vessel during a period when spot market charters are more profitable than the charter agreement under which the vessel
operates. We may re-charter the VLCC vessels on long-term charters or charter them in the spot market upon expiration or termination of the vessels current charters. If we are not able to employ the VLCC vessels profitably under time charters
or in the spot market, our results of operations and operating cash flow may suffer.

Any decrease in shipments of crude oil from the
Arabian Gulf or West Africa may materially adversely affect our financial performance.

The demand for VLCC oil tankers derives
primarily from demand for Arabian Gulf and West African crude oil, which, in turn, primarily depends on the economies of the worlds industrial countries and competition from alternative energy sources. A wide range of economic, social and
other factors can significantly affect the strength of the worlds industrial economies and their demand for Arabian Gulf and West African crude oil.

Among the factors that could lead to a decrease in demand for exported Arabian Gulf and West African crude oil are:



| |  |  | increased use of existing and future crude oil pipelines in the Arabian Gulf or West African regions;
| | - |  | -----------------------------------------------------------------------------------------------------



| |  |  | a decision by the Organization of the Petroleum Exporting Countries (OPEC) to increase its crude oil prices or to further decrease or limit
their crude oil production;
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | armed conflict or acts of piracy in the Arabian Gulf or West Africa and political or other factors;
| | - |  | ---------------------------------------------------------------------------------------------------



| |  |  | increased oil production in other regions, such as Russia and Latin America; and
| | - |  | --------------------------------------------------------------------------------



| |  |  | the development and the relative costs of nuclear power, natural gas, coal and other alternative sources of energy.
| | - |  | -------------------------------------------------------------------------------------------------------------------

Any significant decrease in shipments of crude oil from the Arabian Gulf or West Africa may materially adversely affect our financial performance.

Ten of the vessels we have acquired are second-hand vessels, and we may acquire more second-hand vessels in the future. The acquisition
and operation of such vessels may result in increased operating costs and vessel off-hire, which could materially adversely affect our earnings.

Two of LR1 product tanker vessels, two of MR2 product tanker vessels and six of VLCC vessels that we have acquired are second-hand vessels, and we may acquire more second-hand vessels in the future. Our
inspection of second-hand vessels prior to purchase does not provide us with the same knowledge about their condition and cost of any required or anticipated repairs that we would have had if these vessels had been built for and operated exclusively
by us. Generally, we will not receive the benefit of warranties on second-hand vessels.

In general, the costs to maintain a vessel in good
operating condition increase with the age of the vessel. Due to improvements in engine technology, older vessels are typically less fuel efficient and more costly to maintain than more recently constructed vessels. Cargo insurance rates increase
with the age of a vessel, making older vessels less desirable to charterers.

Governmental regulations, safety or other equipment standards
related to the age of vessels may require expenditures for alterations or the addition of new equipment, to our vessels and may restrict the type of activities in which the vessels may engage or the geographic regions in which we may operate. We
cannot predict what alterations or modifications our vessels may be required to undergo in the future. As our vessels age, market conditions may not justify those expenditures or enable us to operate our vessels profitably during the remainder of
their useful lives.

Although we have considered the age and condition of the vessels in budgeting for operating, insurance and maintenance
costs, we may encounter higher operating and maintenance costs due to the age and condition of these vessels, or any additional vessels we acquire in the future. The age of some of the VLCC vessels may result in higher operating costs and increased
vessel off-hire periods relative to our competitors that operate newer fleets, which could have a material adverse effect on our results of operations.



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Our growth depends on continued growth in demand for crude oil, refined petroleum products (clean and
dirty) and bulk liquid chemicals and the continued demand for seaborne transportation of such cargoes.

Our growth strategy focuses on
expansion in the crude oil, product and chemical tanker sectors. Accordingly, our growth depends on continued growth in world and regional demand for crude oil, refined petroleum (clean and dirty) products and bulk liquid chemicals and the
transportation of such cargoes by sea, which could be negatively affected by a number of factors, including:



| |  |  | the economic and financial developments globally, including actual and projected global economic growth;
| | - |  | --------------------------------------------------------------------------------------------------------



| |  |  | fluctuations in the actual or projected price of crude oil, refined petroleum (clean and dirty) products or bulk liquid chemicals;
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------



| |  |  | refining capacity and its geographical location;
| | - |  | ------------------------------------------------



| |  |  | increases in the production of oil in areas linked by pipelines to consuming areas, the extension of existing, or the development of new, pipeline
systems in markets we may serve, or the conversion of existing non-oil pipelines to oil pipelines in those markets;
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | decreases in the consumption of oil due to increases in its price relative to other energy sources, other factors making consumption of oil less
attractive or energy conservation measures;
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | availability of new, alternative energy sources; and
| | - |  | ----------------------------------------------------



| |  |  | negative or deteriorating global or regional economic or political conditions, particularly in oil-consuming regions, which could reduce energy
consumption or its growth.
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------

The refining and chemical industries may respond to the economic downturn and demand weakness by
reducing operating rates partially or completely closing refineries and by reducing or cancelling certain investment expansion plans, including plans for additional refining capacity, in the case of the refining industry. Continued reduced demand
for refined petroleum (clean and dirty) products and bulk liquid chemicals and the shipping of such cargoes or the increased availability of pipelines used to transport refined petroleum (clean and dirty) products, would have a material adverse
effect on our future growth and could harm our business, results of operations and financial condition.

Our growth depends on our
ability to obtain customers, for which we face substantial competition. In the highly competitive tanker industry, we may not be able to compete for charters with new entrants or established companies with greater resources, which may adversely
affect our results of operations.

We will employ our tanker vessels in the highly competitive crude oil tanker sectors of the
shipping industry that is capital intensive and fragmented. Competition arises primarily from other vessel owners, including major oil companies as well as independent tanker companies, some of whom have substantially greater resources and
experience than us. Competition for the chartering of tankers can be intense and depends on price, location, size, age, condition and the acceptability of the vessel and its managers to the charterers. Such competition has been enhanced as a result
of the downturn in the shipping industry, which has resulted in an excess supply of vessels and reduced charter rates.

Medium- to long-term
time charters and bareboat charters have the potential to provide income at pre-determined rates over more extended periods of time. However, the process for obtaining longer term time charters and bareboat charters is highly competitive and
generally involves a lengthy, intensive and continuous screening and vetting process and the submission of competitive bids that often extends for several months. In addition to the quality, age and suitability of the vessel, longer term shipping
contracts tend to be awarded based upon a variety of other factors relating to the vessel operator. Competition for the transportation of crude oil, refined petroleum products (clean and dirty) and bulk liquid chemicals can be intense and depends on
price, location, size, age, condition and acceptability of the vessel and our managers to the charterers.

In addition to having to meet the
stringent requirements set out by charterers, it is likely that we will also face substantial competition from a number of competitors who may have greater financial resources, stronger reputations or experience than we do when we try to re-charter
our vessels. It is also likely that we will face increased numbers of competitors entering into the crude oil, product and chemical tanker sectors, including in the ice class sector. Increased competition may cause greater price competition,
especially for medium- to long-term charters. Due in part to the highly fragmented markets, competitors with greater resources could operate larger fleets through consolidations or acquisitions that may be able to offer better prices and fleets than
ours.

As a result of these factors, we may be unable to obtain customers for medium- to long-term time charters or bareboat charters on a
profitable basis, if at all. Even if we are successful in employing our vessels under longer term time charters or bareboat charters, our vessels will not be available for trading in the spot market during an upturn in the crude oil, product and
chemical tanker market cycles, when spot trading may be more profitable. If we cannot successfully employ our vessels in profitable time charters our results of operations and operating cash flow could be adversely affected.



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The market values of our vessels, which have declined from historically high levels, may fluctuate
significantly, which could cause us to breach covenants in our credit facilities and result in the foreclosure of certain of our vessels. Depressed vessel values could also cause us to incur impairment charges.

Due to the sharp decline in world trade and tanker charter rates, the market values of our contracted new buildings and of tankers generally, are
currently significantly lower than prior to the downturn in the second half of 2008. Within the past year smaller product tanker yard resale prices have remained flat or declined slightly. Vessel values may remain at current low, or lower,
levels for a prolonged period of time and can fluctuate substantially over time due to a number of different factors, including:



| |  |  | prevailing level of charter rates;
| | - |  | ----------------------------------



| |  |  | general economic and market conditions affecting the shipping industry;
| | - |  | -----------------------------------------------------------------------



| |  |  | competition from other shipping companies;
| | - |  | ------------------------------------------



| |  |  | types and sizes of vessels;
| | - |  | ---------------------------



| |  |  | supply and demand for vessels;
| | - |  | ------------------------------



| |  |  | other modes of transportation;
| | - |  | ------------------------------



| |  |  | cost of newbuildings;
| | - |  | ---------------------



| |  |  | governmental or other regulations; and
| | - |  | --------------------------------------



| |  |  | technological advances.
| | - |  | -----------------------

If the market value of our vessels decreases, we may breach some of the covenants contained in the financing agreements relating to our indebtedness at
the time. The credit facilities contain covenants including maximum total net liabilities over total net assets (effective in general after delivery of the vessels), minimum net worth and loan to value ratio covenants initially of 130% or lower,
applicable after delivery of the vessels. If we breach any such covenants in the future and we are unable to remedy the relevant breach, our lenders could accelerate our debt and foreclose on our vessels. In addition, if the book value of a vessel
is impaired due to unfavorable market conditions, we would incur a loss that could have a material adverse effect on our business, financial condition and results of operations.

In addition, as vessels grow older, they generally decline in value. We will review our vessels for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets
may not be recoverable. We review certain indicators of potential impairment, such as undiscounted projected operating cash flows expected from the future operation of the vessels, which can be volatile for vessels employed on short-term charters or
in the spot market. Any impairment charges incurred as a result of declines in charter rates would negatively affect our financial condition and results of operations. In addition, if we sell any vessel at a time when vessel prices have fallen and
before we have recorded an impairment adjustment to our financial statements, the sale may be at less than the vessels carrying amount on our financial statements, resulting in a loss and a reduction in earnings.

Future increases in vessel operating expenses, including rising fuel prices, could materially adversely affect our business, financial condition
and results of operations.

Under our time charter agreements, the charterer is responsible for substantially all of the voyage
expenses, including port and canal charges and fuel costs and we are generally responsible for vessel operating expenses. Vessel operating expenses are the costs of operating a vessel, primarily consisting of crew wages and associated costs,
insurance premiums, management fees, lubricants and spare parts and repair and maintenance costs. In particular, the cost of fuel is a significant factor in negotiating charter rates. As a result, an increase in the price of fuel beyond our
expectations may adversely affect our profitability. The price and supply of fuel is unpredictable and fluctuates based on events outside our control, including geopolitical developments, supply and demand for oil, actions by members of OPEC and
other oil and gas producers, war, terrorism and unrest in oil producing countries and regions, regional production patterns and environmental concerns and regulations.

We receive a daily rate for the use of our vessels, which is fixed through the term of the applicable charter agreement. Our charter agreements do not provide for any increase in the daily hire rate in
the event that vessel-operating expenses increase during the term of the charter agreement. The charter agreements for the seven VLCC vessels expire during the period from and including 2014 through 2026. Because of the long-term nature of these
charter agreements, incremental increases in our vessel operating expenses over the term of a charter agreement will effectively reduce our operating income and, if such increases in operating expenses are significant, adversely affect our business,
financial condition and results of operations.

The crude oil, product and chemical tanker sectors are subject to seasonal fluctuations
in demand and, therefore, may cause volatility in our operating results.

The crude oil, product and chemical tanker sectors of the
shipping industry have historically exhibited seasonal variations in demand and, as a result, in charter hire rates. This seasonality may result in quarter-to-quarter volatility in our operating results. The product and chemical tanker markets are
typically stronger in the fall and winter months in anticipation of increased consumption of oil and natural gas in the northern hemisphere. In addition, unpredictable weather patterns in these months tend to disrupt vessel scheduling and supplies
of certain commodities. As a result, revenues are typically weaker during the fiscal quarters ended June 30 and September 30, and, conversely, typically stronger in fiscal quarters ended December 31 and March 31. Our operating
results, therefore, may be subject to seasonal fluctuations.



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The current global economic downturn may negatively impact our business.

In recent years, there has been a significant adverse shift in the global economy, with operating businesses facing tightening credit, weakening demand
for goods and services, deteriorating international liquidity conditions, and declining markets. Lower demand for tanker cargoes as well as diminished trade credit available for the delivery of such cargoes may create downward pressure on charter
rates. If the current global economic environment persists or worsens, we may be negatively affected in the following ways:



| |  |  | We may not be able to employ our vessels at charter rates as favorable to us as historical rates or operate such vessels profitably.
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------



| |  |  | The market value of our vessels could decrease significantly, which may cause us to recognize losses if any of our vessels are sold or if their values
are impaired. In addition, such a decline in the market value of our vessels could prevent us from borrowing under our credit facilities or trigger a default under one of their covenants.
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Charterers could have difficulty meeting their payment obligations to us.
| | - |  | -------------------------------------------------------------------------

If the contraction of the global credit markets and the resulting volatility in the financial markets continues or worsens that could have a material adverse impact on our results of operations, financial
condition and cash flows, and could cause the market price of our common stock to decline.

The employment of our vessels could be
adversely affected by an inability to clear the oil majors risk assessment process, and we could be in breach of our charter agreements with respect to the VLCC vessels.

The shipping industry, and especially the shipment of crude oil, refined petroleum products (clean and dirty) and bulk liquid chemicals, has been, and will remain, heavily regulated. The so-called
oil majors companies, such as Exxon Mobil, BP p.l.c., Royal Dutch Shell plc., Chevron, ConocoPhillips and Total S.A. together with a number of commodities traders, represent a significant percentage of the production, trading and
shipping logistics (terminals) of crude oil and refined products worldwide. Concerns for the environment have led the oil majors to develop and implement a strict ongoing due diligence process when selecting their commercial partners. This
vetting process has evolved into a sophisticated and comprehensive risk assessment of both the vessel operator and the vessel, including physical ship inspections, completion of vessel inspection questionnaires performed by accredited inspectors and
the production of comprehensive risk assessment reports. In the case of term charter relationships, additional factors are considered when awarding such contracts, including:



| |  |  | office assessments and audits of the vessel operator;
| | - |  | -----------------------------------------------------



| |  |  | the operators environmental, health and safety record;
| | - |  | -------------------------------------------------------



| |  |  | compliance with the standards of the International Maritime Organization (the IMO), a United Nations agency that issues international trade
standards for shipping;
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | compliance with heightened industry standards that have been set by several oil companies;
| | - |  | ------------------------------------------------------------------------------------------



| |  |  | shipping industry relationships, reputation for customer service, technical and operating expertise;
| | - |  | ----------------------------------------------------------------------------------------------------



| |  |  | shipping experience and quality of ship operations, including cost-effectiveness;
| | - |  | ---------------------------------------------------------------------------------



| |  |  | quality, experience and technical capability of crews;
| | - |  | ------------------------------------------------------



| |  |  | the ability to finance vessels at competitive rates and overall financial stability;
| | - |  | ------------------------------------------------------------------------------------



| |  |  | relationships with shipyards and the ability to obtain suitable berths;
| | - |  | -----------------------------------------------------------------------



| |  |  | construction management experience, including the ability to procure on-time delivery of new vessels according to customer
specifications;
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | willingness to accept operational risks pursuant to the charter, such as allowing termination of the charter for force majeure events; and
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | competitiveness of the bid in terms of overall price.
| | - |  | -----------------------------------------------------

Under the terms of our charter agreements, our charterers require that these vessels and the technical manager are vetted and approved to transport oil products by multiple oil majors. Our failure to
maintain any of our vessels to the standards required by the oil majors could put us in breach of the applicable charter agreement and lead to termination of such agreement, and could give rise to impairment in the value of our vessels.

Should we not be able to successfully clear the oil majors risk assessment processes on an ongoing basis, the future employment of our vessels, as
well as our ability to obtain charters, whether medium- or long-term, could be adversely affected. Such a situation may lead to the oil majors terminating existing charters and refusing to use our vessels in the future, which would adversely
affect our results of operations and cash flows.



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We depend on significant customers for part of our revenue. Charterers may terminate or default on
their obligations to us, which could materially adversely affect our results of operations and cash flow, and breaches of the charters may be difficult to enforce.

We derive a significant part of our revenue from a number of charterers. For the fiscal year ended December 31, 2012, DOSCO and STX Panocean Co. LTD accounted for approximately 43.0% and 10.7%,
respectively, of our total revenue. The loss of these or any of our customers, a customers failure to make payments or perform under any of the applicable charters, a customers termination of any of the applicable charters, the loss or
damage beyond repair to any of our vessels, our failure to deliver the vessel within a fixed period of time or a decline in payments under the charters could have a material adverse effect on our business, results of operations and financial
condition. In addition, the charterers of the VLCC vessels are based in, and have their primary assets and operations in, the Asia-Pacific region, including the Peoples Republic of China. The charter agreements for the VLCC vessels are
governed by English law and provide for dispute resolution in English courts or London-based arbitral proceedings. There can be no assurance that we would be able to enforce any judgments against these charterers in jurisdictions where they are
based or have their primary assets and operations. Even after a charter contract is entered, charterers may terminate charters early under certain circumstances. The events or occurrences that will cause a charter to terminate or give the charterer
the option to terminate the charter generally include a total or constructive total loss of the related vessel, the requisition for hire of the related vessel, the vessel becoming subject to seizure for more than a specified number of days or the
failure of the related vessel to meet specified performance criteria. In addition, the ability of a charterer to perform its obligations under a charter will depend on a number of factors that are beyond our control.

These factors may include general economic conditions, the condition of the crude oil, product and chemical tanker sectors of the shipping industry, the
charter rates received for specific types of vessels and various operating expenses. The costs and delays associated with the default by a charterer of a vessel may be considerable and may adversely affect our business, results of operations, cash
flows and financial condition.

We cannot predict whether our charterers will, upon the expiration of their charters, re-charter our vessels
on favorable terms or at all. If our charterers decide not to re-charter our vessels, we may not be able to re-charter them on terms similar to our current charters or at all. In the future, we may also employ our vessels on the spot charter market,
which is subject to greater rate fluctuation than the time charter market. If we receive lower charter rates under replacement charters or are unable to re-charter all of our vessels, our results of operations and financial condition could be
materially adversely affected.

If we experienced a catastrophic loss and our insurance is not adequate to cover such loss, it could
lower our profitability and be detrimental to operations.

The ownership and operation of vessels in international trade is affected
by a number of inherent risks, including mechanical failure, personal injury, vessel and cargo loss or damage, business interruption due to political conditions in foreign countries, hostilities, piracy, terrorism, labor strikes and/or boycotts,
adverse weather conditions and catastrophic marine disaster, including environmental accidents and collisions. All of these risks could result in liability, loss of revenues, increased costs and loss of reputation. We maintain hull and machinery
insurance, protection and indemnity insurance, which include environmental damage and pollution and war risk insurance, consistent with industry standards, against these risks on our vessels and other business assets. However, we cannot assure you
that we will be able to insure against all risks adequately, that any particular claim will be paid out of our insurance, or that we will be able to procure adequate insurance coverage at commercially reasonable rates in the future. Our insurers
also require us to pay certain deductible amounts, before they will pay claims, and insurance policies may contain limitations and exclusions, which, although we believe will be standard for the shipping industry, may nevertheless increase our costs
and lower our profitability. Additionally, any increase in environmental and other regulations may also result in increased costs for, or the lack of availability of, insurance against the risks of environmental damage, pollution and other claims.
Our inability to obtain insurance sufficient to cover potential claims or the failure of insurers to pay any significant claims could lower our profitability and be detrimental to our operations.

Furthermore, even if insurance coverage is adequate to cover our losses, we may not be able to timely obtain a replacement ship in the event of a loss.
We may also be subject to calls, or premiums, in amounts based not only on our own claim records but also the claim records of all other members of the protection and indemnity associations through which we receive indemnity insurance coverage for
tort liability. In addition, our protection and indemnity associations may not have enough resources to cover claims made against them. Our payment of these calls could result in significant expenses to us, which could reduce our cash flows and
place strains on our liquidity and capital resources.



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We are subject to various laws, regulations and conventions, including environmental and safety laws
that could require significant expenditures both to maintain compliance with such laws and to pay for any uninsured environmental liabilities including any resulting from a spill or other environmental incident.

The shipping business and vessel operation are materially affected by government regulation in the form of international conventions, national, state and
local laws, and regulations in force in the jurisdictions in which vessels operate, as well as in the country or countries of their registration. Governmental regulations, safety or other equipment standards, as well as compliance with standards
imposed by maritime self-regulatory organizations and customer requirements or competition, may require us to make capital and other expenditures. Because such conventions, laws and regulations are often revised, we cannot predict the ultimate cost
of complying with such conventions, laws and regulations, or the impact thereof on the fair market price or useful life of our vessels. In order to satisfy any such requirements, we may be required to take any of our vessels out of service for
extended periods of time, with corresponding losses of revenues. In the future, market conditions may not justify these expenditures or enable us to operate our vessels, particularly older vessels, profitably during the remainder of their economic
lives. This could lead to significant asset write downs. In addition, violations of environmental and safety regulations can result in substantial penalties and, in certain instances, seizure or detention of our vessels.

Additional conventions, laws and regulations may be adopted that could limit our ability to do business, require capital expenditures or otherwise
increase our cost of doing business, which may materially adversely affect our operations, as well as the shipping industry generally. For example, in various jurisdictions legislation has been enacted, or is under consideration, that would impose
more stringent requirements on air pollution and water discharges from our vessels. For example, the International Maritime Organization (IMO) periodically proposes and adopts amendments to revise the International Convention for the
Prevention of Pollution from Ships (MARPOL), such as the revision to Annex VI which came into force on July 1, 2010. The revised Annex VI implements a phased reduction of the sulfur content of fuel and allows for stricter
sulfur limits in designated emission control areas (ECAs). Thus far, ECAs have been formally adopted for the Baltic Sea and the North Sea including the English Channel. The North American ECA came into effect from August 1, 2012,
and the United States Caribbean Sea ECA will come into force on January 1, 2013, having effect from January 1, 2014. These ECAs will limit SOx, NOx and particulate matter emissions. California has adopted more stringent low sulfur fuel
requirements within California-regulated waters. In addition, the IMO, the U.S. and states within the U.S. have proposed or implemented requirements relating to the management of ballast water to prevent the harmful effects of foreign
invasive species.

The operation of vessels is also affected by the requirements set forth in the International Safety Management
(ISM) Code. The ISM Code requires shipowners and bareboat charterers to develop and maintain an extensive Safety Management System that includes the adoption of a safety and environmental protection policy setting forth
instructions and procedures for safe vessel operation and describing procedures for dealing with emergencies. Further to this, the IMO has introduced the first ever mandatory measures for an international greenhouse gas reduction regime for a global
industry sector. The Energy Efficiency measures took effect on January 1, 2013 and apply to all ships of 400 gross tonnage and above. They include the development of a ship energy efficiency management plan (SEEMP) which is akin to
a safety management plan, which the industry will have to comply with. The failure of a ship owner or bareboat charterer to comply with the ISM Code and IMO measures may subject such party to increased liability, may decrease available insurance
coverage for the affected vessels, and may result in a denial of access to, or detention in, certain ports.

We operate a fleet of crude,
product and chemical tankers that are subject to national and international laws governing pollution from such vessels. Several international conventions impose and limit pollution liability from vessels. An owner of a tanker vessel carrying a cargo
of persistent oil as defined by the International Convention for Civil Liability for Oil Pollution Damage (the CLC) is subject under the convention to strict liability for any pollution damage caused in a contracting state by
an escape or discharge from cargo or bunker tanks. This liability is subject to a financial limit calculated by reference to the tonnage of the ship, and the right to limit liability may be lost if the spill is caused by the shipowners
intentional or reckless conduct. Liability may also be incurred under the CLC for a bunker spill from the vessel even when she is not carrying such cargo, but is in ballast.

When a tanker is carrying clean oil products that do not constitute persistent oil that would be covered under the CLC, liability for any pollution damage will generally fall outside the CLC
and will depend on other international conventions or domestic laws in the jurisdiction where the spillage occurs. The same principle applies to any pollution from the vessel in a jurisdiction which is not a party to the CLC. The CLC applies in over
100 jurisdictions around the world, but it does not apply in the United States, where the corresponding liability laws such as the Oil Pollution Act of 1990 (The OPA) discussed below, are particularly stringent.

For vessel operations not covered by the CLC, including those operated under our fleet, at present, international liability for oil pollution is governed
by the International Convention on Civil Liability for Bunker Oil Pollution Damage (the Bunker Convention). In 2001, the IMO adopted the Bunker Convention, which imposes strict liability on shipowners for pollution damage and response
costs incurred in contracting states caused by discharges, or threatened discharges, of bunker oil from all classes of ships not covered by the CLC. The Bunker Convention also requires registered owners of ships over a certain size to maintain
insurance to cover their liability for pollution damage in an amount equal to the limits of liability under the applicable national or international limitation regime, including liability limits calculated in accordance with the Convention on
Limitation of Liability for Maritime Claims 1976, as amended (the 1976 Convention), discussed in more detail in the



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following paragraph. The Bunker Convention became effective in contracting states on November 21, 2008 and as of January 31, 2013 was in effect in 68 states. In non-contracting
states, liability for such bunker oil pollution typically is determined by the national or other domestic laws in the jurisdiction where the spillage occurs.

The CLC and Bunker Convention also provide vessel owners a right to limit their liability, depending on the applicable national or international regime. The CLC includes its own liability limits. The 1976
Convention is the most widely applicable international regime limiting maritime pollution liability. Rights to limit liability under the 1976 Convention are forfeited where a spill is caused by a shipowners intentional or reckless conduct.
Certain jurisdictions have ratified the IMOs Protocol of 1996 to the 1976 Convention, referred to herein as the Protocol of 1996. The Protocol of 1996 provides for substantially higher liability limits in those jurisdictions than
the limits set forth in the 1976 Convention. Finally, some jurisdictions, such as the United States, are not a party to either the 1976 Convention or the Protocol of 1996, and, therefore, a shipowners rights to limit liability for maritime
pollution in such jurisdictions may be uncertain.

Environmental legislation in the United States merits particular mention as it is in many
respects more onerous than international laws, representing a high-water mark of regulation with which ship owners and operators must comply, and of liability likely to be incurred in the event of non-compliance or an incident causing pollution.
Such regulation may become even stricter if laws are changed as a result of the April 2010 Deepwater Horizon oil spill in the Gulf of Mexico. In the United States, the OPA establishes an extensive regulatory and liability regime for the protection
and cleanup of the environment from cargo and bunker oil spills from vessels, including tankers. The OPA covers all owners and operators whose vessels trade in the United States, its territories and possessions or whose vessels operate in United
States waters, which includes the United States territorial sea and its 200 nautical mile exclusive economic zone. Under the OPA, vessel owners, operators and bareboat charterers are responsible parties and are jointly, severally
and strictly liable (unless the spill results solely from the act or omission of a third party, an act of God or an act of war) for all containment and clean-up costs and other damages arising from discharges or substantial threats of discharges, of
oil from their vessels. In response to the 2010 Deepwater Horizon oil incident in the Gulf of Mexico, the U.S. House of Representatives passed and the U.S. Senate considered but did not pass a bill to strengthen certain requirements of the
OPA; similar legislation may be introduced in the future 112th Congress.

In addition to potential liability under the federal OPA,
vessel owners may in some instances incur liability on an even more stringent basis under state law in the particular state where the spillage occurred. For example, California regulations prohibit the discharge of oil, require an oil contingency
plan be filed with the state, require that the ship owner contract with an oil response organization and require a valid certificate of financial responsibility, all prior to the vessel entering state waters.

In the last decade, the EU has become increasingly active in the field of regulation of maritime safety and protection of the environment. In some areas
of regulation the EU has introduced new laws without attempting to procure a corresponding amendment to international law. Notably, the EU adopted in 2005 a directive, as amended in 2009, on ship-source pollution, imposing criminal sanctions for
pollution not only where pollution is caused by intent or recklessness (which would be an offence under MARPOL), but also where it is caused by serious negligence. The concept of serious negligence may be interpreted in
practice to be little more than ordinary negligence. The directive could therefore result in criminal liability being incurred in circumstances where it would not be incurred under international law. Criminal liability for a pollution incident could
not only result in us incurring substantial penalties or fines, but may also, in some jurisdictions, facilitate civil liability claims for greater compensation than would otherwise have been payable.

We maintain insurance coverage for each owned vessel in our fleet against pollution liability risks in the amount of $1.0 billion in the aggregate
for any one event. The insured risks include penalties and fines as well as civil liabilities and expenses resulting from accidental pollution. However, this insurance coverage is subject to exclusions, deductibles and other terms and conditions. If
any liabilities or expenses fall within an exclusion from coverage, or if damages from a catastrophic incident exceed the aggregate liability of $1.0 billion for any one event, our cash flow, profitability and financial position would be
adversely impacted.

Please also refer to Item 4. Information on the Company for a more detailed discussion of Governmental
and Other Regulations.

Climate change and government laws and regulations related to climate change could negatively impact our
financial condition.

We are and will be, directly and indirectly, subject to the effects of climate change and may, directly or
indirectly, be affected by government laws and regulations related to climate change. A number of countries have adopted or are considering the adoption of regulatory frameworks to reduce greenhouse gas emissions, such as carbon dioxide and methane.
In the United States, the United States Environmental Protection Agency (U.S. EPA) has declared greenhouse gases to be



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dangerous pollutants and has issued greenhouse gas reporting requirements for emissions sources in certain industries (which do not include the shipping industry). The U.S. EPA is also
considering petitions to regulate greenhouse gas emissions from marine vessels.

In addition, while the emissions of greenhouse gases from
international shipping are not subject to the Kyoto Protocol to the United Nations Framework Convention on Climate Change, which requires adopting countries to implement national programs to reduce greenhouse gas emissions, the IMO intends to
develop limits on greenhouse gases from international shipping. It has responded to the global focus on climate change and greenhouse gas emissions by developing specific technical and operational efficiency measures and a work plan for market-based
mechanisms in 2011. These include the mandatory measures of the ship energy efficiency management plan (SEEMP), outlined above, and an energy efficiency design index (EEDI) for new ships. The IMO is also considering its
position on market-based measures through an expert working group, which was expected to report back to its Marine Environment Protection Committee in late 2012. Among the numerous proposals being considered by the working group are the following: a
port state levy based on the amount of fuel consumed by the vessel on its voyage to the port in question; a global emissions trading scheme which would allocate emissions allowances and set an emissions cap; and an international fund establishing a
global reduction target for international shipping, to be set either by the UNFCCC or the IMO. At its 64th session in October 2012, the MEPC indicated that 2015 was the target year for Member States to identify market-based measures for
international shipping.

In December 2011, UN climate change talks took place in Durban and concluded with an agreement referred to as the
Durban Platform for Enhanced Action. The Durban Conference did not result in any proposals specifically addressing the shipping industrys role in climate change but the progress that has been made by the IMO in this area was widely
acknowledged throughout the negotiating bodies of the UNFCCC process.

The European Union announced in April 2007 that it planned to expand
the European Union emissions trading scheme by adding vessels, and a proposal from the European Commission was expected if no global regime for reduction of seaborne emissions had been agreed to by the end of 2011. That deadline has now expired and
it remains to be seen what position the EU takes in this regard in the period ahead. As of January 31, 2013 the Commission has stopped short of proposing that emissions from ships be included in the EUs emissions-trading scheme (ETS).
However, on October 1, 2012 it announced that it would propose measures to monitor verify and report on greenhouse-gas emissions from the shipping sector in early 2013. This may be seen as indicative of an intention to maintain pressure on the
international negotiating process.

We cannot predict with any degree of certainty what effect, if any, possible climate change and government
laws and regulations related to climate change will have on our operations, whether directly or indirectly. However, we believe that climate change, including the possible increase in severe weather events resulting from climate change, and
government laws and regulations related to climate change may affect, directly or indirectly, (i) the cost of the vessels we may acquire in the future, (ii) our ability to continue to operate as we have in the past, (iii) the cost of
operating our vessels, and (iv) insurance premiums, deductibles and the availability of coverage. As a result, our financial condition could be negatively impacted by significant climate change and related governmental regulation, and that
impact could be material.

Please also refer to Item 4. Information on the Company for a more detailed discussion of
Governmental and Other Regulations.

We are subject to vessel security regulations and we incur costs to comply with adopted
regulations. We may be subject to costs to comply with similar regulations that may be adopted in the future in response to terrorism.

Since the terrorist attacks of September 11, 2001, there have been a variety of initiatives intended to enhance vessel security. On
November 25, 2002, the Maritime Transportation Security Act of 2002, or MTSA, came into effect. To implement certain portions of the MTSA, in July 2003, the U.S. Coast Guard issued regulations requiring the implementation of certain
security requirements aboard vessels operating in waters subject to the jurisdiction of the United States. Similarly, in December 2002, amendments to the International Convention for the Safety of Life at Sea, or SOLAS, created a new chapter of
the convention dealing specifically with maritime security. The new chapter went into effect in July 2004, and imposes various detailed security obligations on vessels and port authorities, most of which are contained in the International Ship
and Port Facilities Security (ISPS) Code. Among the various requirements are:



| |  |  | on-board installation of automatic information systems, or AIS, to enhance vessel-to-vessel and vessel-to-shore communications;
| | - |  | -------------------------------------------------------------------------------------------------------------------------------



| |  |  | on-board installation of ship security alert systems;
| | - |  | -----------------------------------------------------



| |  |  | the development of vessel security plans; and
| | - |  | ---------------------------------------------



| |  |  | compliance with flag state security certification requirements.
| | - |  | ---------------------------------------------------------------



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The U.S. Coast Guard regulations, intended to be aligned with international maritime security standards,
exempt non-U.S. vessels from MTSA vessel security measures, provided such vessels have on board a valid International Ship Security Certificate (ISSC) that attests to the vessels compliance with SOLAS security requirements and the ISPS
Code. We will implement the various security measures addressed by the MTSA, SOLAS and the ISPS Code and take measures for our vessels or vessels that we charter to attain compliance with all applicable security requirements within the prescribed
time periods. Although management does not believe these additional requirements will have a material financial impact on our operations, there can be no assurance that there will not be an interruption in operations to bring vessels into compliance
with the applicable requirements and any such interruption could cause a decrease in charter revenues. Furthermore, additional security measures could be required in the future that could have significant financial impact on us.

Our international activities increase the compliance risks associated with economic and trade sanctions imposed by the United States, the European
Union and other jurisdictions.

Our international operations could expose us to trade and economic sanctions or other restrictions
imposed by the United States or other governments or organizations, including the United Nations, the European Union and its member countries. Under economic and trading sanctions laws, governments may seek to impose modifications to business
practices, and modifications to compliance programs, which may increase compliance costs, and may subject us to fines, penalties and other sanctions.

During 2011 and continuing into 2012, the scope of sanctions imposed against the government of Iran and persons engaging in certain activities or doing certain business with and relating to Iran has been
expanded by a number of jurisdictions, including the United States, the European Union and Canada. In 2010, the U.S. enacted the Comprehensive Iran Sanctions Accountability and Divestment Act (CISADA), which expanded the scope of the
former Iran Sanctions Act. Among other things, CISADA expands the application of the prohibitions to non-U.S. companies, such as our company, and introduces limits on the ability of companies and persons to do business or trade with Iran when such
activities relate to the investment, supply or export of refined petroleum or petroleum products (our tankers have called on ports in Iran but do not engage in the activities specifically identified by these sanctions). Although we believe that we
are in compliance with all applicable sanctions and embargo laws and regulations, and intend to maintain such compliance, there can be no assurance that we will be in compliance in the future, particularly as the scope of certain laws may be unclear
and may be subject to changing interpretations. Moreover, our charterers may violate applicable sanctions and embargo laws and regulations as a result of actions that do not involve us or our vessels, and those violations could in turn
negatively affect our reputation.

We are monitoring developments in the United States, the European Union and other jurisdictions that
maintain sanctions programs, including developments in implementation and enforcement of such sanctions programs. Expansion of sanctions programs, embargoes and other restrictions in the future (including additional designations of countries subject
to sanctions), or modifications in how existing sanctions are interpreted or enforced, could prevent our tankers from calling on ports in sanctioned countries or could limit their cargoes. If any of the risks described above materialize, it could
have a material adverse impact on our business and results of operations.

Increased inspection procedures and tighter import and export
controls could increase costs and disrupt our business.

International shipping is subject to various security and customs inspections
and related procedures in countries of origin and destination. Inspection procedures can result in the seizure of contents of vessels, delays in the loading, offloading or delivery and the levying of customs, duties, fines and other penalties.

It is possible that changes to inspection procedures could impose additional financial and legal obligations on us. Furthermore, changes to
inspection procedures could also impose additional costs and obligations on our future customers and may, in certain cases, render the shipment of certain types of cargo impractical. Any such changes or developments may have a material adverse
effect on our business, financial condition, and results of operations.

A failure to pass inspection by classification societies could
result in our vessels becoming unemployable unless and until they pass inspection, resulting in a loss of revenues from such vessels for that period and a corresponding decrease in operating cash flows.

The hull and machinery of every commercial vessel must be classed by a classification society authorized by its country of registry. The classification
society certifies that a vessel is safe and seaworthy in accordance with the applicable rules and regulations of the country of registry of the vessel and with SOLAS. A vessel must undergo an annual survey, an intermediate survey and a special
survey. In lieu of a special survey, a vessels machinery may be on a continuous survey cycle, under which the machinery would be surveyed periodically over a five-year period. Every vessel is also required to be drydocked every two to three
years for inspection of the underwater parts of such vessel. If any of our vessels fail any annual survey, intermediate survey, or special survey, the vessel may be unable to trade between ports and, therefore, would be unemployable, potentially
causing a negative impact on our revenues due to the loss of revenues from such vessel until it was able to trade again.



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The operation of ocean-going vessels entails the possibility of marine disasters including damage or
destruction of a vessel due to accident, the loss of a vessel due to piracy, terrorism or political conflict, damage or destruction of cargo and similar events that are inherent operational risks of the tanker industry and may cause a loss of
revenue from affected vessels and damage to our business reputation and condition, which may in turn lead to loss of business.

The
operation of ocean-going vessels entails certain inherent risks that may adversely affect our business and reputation. Our vessels and their cargoes are at risk of being damaged or lost due to events such as:



| |  |  | damage or destruction of vessel due to marine disaster such as a collision;
| | - |  | ---------------------------------------------------------------------------



| |  |  | the loss of a vessel due to piracy and terrorism;
| | - |  | -------------------------------------------------



| |  |  | cargo and property losses or damage as a result of the foregoing or less drastic causes such as human error, mechanical failure and bad weather;
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | environmental accidents as a result of the foregoing;
| | - |  | -----------------------------------------------------



| |  |  | business interruptions and delivery delays caused by mechanical failure, human error, acts of piracy, war, terrorism, political action in various
countries, stowaways, labor strikes, potential government expropriation of our vessels or adverse weather conditions; and
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | other events and circumstances.
| | - |  | -------------------------------

In addition, increased operational risks arise as a consequence of the complex nature of the crude oil, product and chemical tanker industry, the nature of services required to support the industry,
including maintenance and repair services, and the mechanical complexity of the tankers themselves. Compared to other types of vessels, tankers are exposed to a higher risk of damage and loss by fire, whether ignited by a terrorist attack, collision
or other cause, due to the high flammability and high volume of the oil transported in tankers. Damage and loss could also arise as a consequence of a failure in the services required to support the industry, for example, due to inadequate dredging.
Inherent risks also arise due to the nature of the product transported by our vessels. Any damage to, or accident involving, our vessels while carrying crude oil could give rise to environmental damage or lead to other adverse consequences. Each of
these inherent risks may also result in death or injury to persons, loss of revenues or property, higher insurance rates, damage to our customer relationships, delay or rerouting.

Any of these circumstances or events could substantially increase our costs. For example, the costs of replacing a vessel or cleaning up environmental damage could substantially lower our revenues by
taking vessels out of operation permanently or for periods of time. Furthermore, the involvement of our vessels in a disaster or delays in delivery, damage or the loss of cargo may harm our reputation as a safe and reliable vessel operator and cause
us to lose business. Our vessels could be arrested by maritime claimants, which could result in the interruption of business and decrease revenue and lower profitability.

Some of these inherent risks could result in significant damage, such as marine disaster or environmental incidents, and any resulting legal proceedings may be complex, lengthy, costly and, if decided
against us, any of these proceedings or other proceedings involving similar claims or claims for substantial damages may harm our reputation and have a material adverse effect on our business, results of operations, cash flow and financial position.
In addition, the legal systems and law enforcement mechanisms in certain countries in which we operate may expose us to risk and uncertainty. Further, we may be required to devote substantial time and cost defending these proceedings, which could
divert attention from management of our business. Crew members, tort claimants, claimants for breach of certain maritime contracts, vessel mortgagees, suppliers of goods and services to a vessel, shippers of cargo and other persons may be entitled
to a maritime lien against a vessel for unsatisfied debts, claims or damages, and in many circumstances a maritime lien holder may enforce its lien by arresting a vessel through court processes. Additionally, in certain jurisdictions,
such as South Africa, under the sister ship theory of liability, a claimant may arrest not only the vessel with respect to which the claimants lien has arisen, but also any associated vessel owned or controlled by the
legal or beneficial owner of that vessel. If any vessel ultimately owned and operated by us is arrested, this could result in a material loss of revenues, or require us to pay substantial amounts to have the arrest lifted.

Any of these factors may have a material adverse effect on our business, financial conditions and results of operations.

The smuggling of drugs or other contraband onto our vessels may lead to governmental claims against us.

We expect that our vessels will call in ports in South America and other areas where smugglers attempt to hide drugs and other contraband on vessels,
with or without the knowledge of crew members. To the extent our vessels are found with contraband, whether inside or attached to the hull of our vessel and whether with or without the knowledge of any of our crew, we may face governmental or other
regulatory claims which could have an adverse effect on our business, results of operations, cash flows and financial condition.



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Acts of piracy on ocean-going vessels have increased in frequency and magnitude, which could adversely
affect our business.

The shipping industry has historically been affected by acts of piracy in regions such as the South China Sea
and the Gulf of Aden. In 2009 acts of piracy saw a steep rise, particularly off the coast of Somalia in the Gulf of Aden. A recent and significant example of the heightened level of piracy came in February 2011 when the M/V Irene SL, a crude oil
tanker and the Arabian Sea which was not affiliated with us, was captured by pirates in the Arabian Sea while carrying crude oil estimated to be worth approximately $200 million. In December 2009, the Navios Apollon, a vessel owned by our
affiliate, Navios Maritime Partners L.P. (Navios Partners), was seized by pirates 800 miles off the coast of Somalia while transporting fertilizer from Tampa, Florida to Rozi, India and was released on February 27, 2010. These
piracy attacks resulted in regions (in which our vessels are deployed) being characterized by insurers as war risk zones or Joint War Committee (JWC) war and strikes listed areas, premiums payable for such insurance coverage
could increase significantly and such insurance coverage may be more difficult to obtain. Crew costs, including those due to employing onboard security guards, could increase in such circumstances. In addition, while we believe the charterer remains
liable for charter payments when a vessel is seized by pirates, the charterer may dispute this and withhold charter hire until the vessel is released. A charterer may also claim that a vessel seized by pirates was not on-hire for a
certain number of days and it is therefore entitled to cancel the charter party, a claim that we would dispute. We may not be adequately insured to cover losses from these incidents, which could have a material adverse effect on us. In addition,
detention hijacking as a result of an act of piracy against our vessels, or an increase in cost, or unavailability of insurance for our vessels, could have a material adverse impact on our business, financial condition, results of operations and
cash flows. Acts of piracy on ocean-going vessels have increased in frequency, which could adversely affect our business and operations.

Terrorist attacks, increased hostilities or war could lead to further economic instability, increased costs and disruption of our business.

Terrorist attacks, such as the attacks in the United States on September 11, 2001 and the United States continuing
response to these attacks, the attacks in London on July 7, 2005, as well as the threat of future terrorist attacks, continue to cause uncertainty in the world financial markets, including the energy markets. The continuing conflicts in Iraq
and Afghanistan and other current and future conflicts, may adversely affect our business, operating results, financial condition, ability to raise capital and future growth. Continuing hostilities in the Middle East may lead to additional armed
conflicts or to further acts of terrorism and civil disturbance in the United States or elsewhere, which may contribute further to economic instability.

In addition, oil facilities, shipyards, vessels, pipelines and oil and gas fields could be targets of future terrorist attacks. Any such attacks could lead to, among other things, bodily injury or loss of
life, vessel or other property damage, increased vessel operational costs, including insurance costs, and the inability to transport oil and other refined products to or from certain locations. Terrorist attacks, war or other events beyond our
control that adversely affect the distribution, production or transportation of oil and other refined products to be shipped by us could entitle our customers to terminate our charter contracts, which would harm our cash flow and our business.

Terrorist attacks on vessels, such as the October 2002 attack on the M/V Limburg, a very large crude carrier not related to us, may in
the future also negatively affect our operations and financial condition and directly impact our vessels or our customers. Future terrorist attacks could result in increased volatility and turmoil in the financial markets in the United States and
globally. Any of these occurrences could have a material adverse impact on our revenues and costs.

Governments could requisition
vessels of a target business during a period of war or emergency, resulting in a loss of earnings.

A government could requisition a
business vessels for title or hire. Requisition for title occurs when a government takes control of a vessel and becomes her owner, while requisition for hire occurs when a government takes control of a vessel and effectively becomes her
charterer at dictated charter rates. Generally, requisitions occur during periods of war or emergency, although governments may elect to requisition vessels in other circumstances. Although a target business would be entitled to compensation in the
event of a requisition of any of its vessels, the amount and timing of payment would be uncertain.



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Disruptions in world financial markets and the resulting governmental action in Europe, the United
States and in other parts of the world could have a material adverse impact on our ability to obtain financing required to acquire vessels or new businesses. Furthermore, such a disruption would adversely affect our results of operations, financial
condition and cash flows.

Concerns relating to the European sovereign debt crisis have recently intensified. While Greece, Portugal,
Ireland, Spain and Cyprus have been the most affected countries thus far, with each agreeing to a rescue package with the European Union and the International Monetary Fund, there are fears that other European countries may be further affected by
increasing public debt burdens and weakening economic growth prospects. On January 13, 2012, Standard and Poors Rating Services downgraded the long-term credit ratings for nine Eurozone nations, including France, Italy and Spain. On
February 13, 2012, Moodys Investors Service (Moodys) downgraded the sovereign debt ratings of Italy, Malta, Portugal, Slovakia, Slovenia and Spain, while initiating negative outlooks on the United Kingdom, France and
Austria. Additionally, on March 2, 2012, Moodys downgraded Greeces sovereign debt rating to C from Ca. Since then, Standard and Poors, Moodys Investors Service and other credit ratings agencies have further
downgraded certain Eurozone nations, most recently with Fitch Ratings downgrade of Italys sovereign credit rating on March 8, 2013. Such downgrades could negatively affect those countries ability to access the public debt
markets at reasonable rates or at all, materially affecting the financial conditions of banks in those countries, including those with which we maintain cash deposits and equivalents, or on which we rely on to finance our vessel and new business
acquisitions. Cash deposits and cash equivalents in excess of amounts covered by government-provided insurance are exposed to loss in the event of non-performance by financial institutions. We maintain cash deposits and equivalents in excess of
government-provided insurance limits at banks in Greek and other European banks, which may expose us to a loss of cash deposits or cash equivalents.

Furthermore, the United States and other parts of the world are exhibiting volatile economic trends and were recently in a recession. Despite signs of recovery, the outlook for the world economy remains
uncertain. For example, the credit markets worldwide and in the U.S. have experienced significant contraction, de-leveraging and reduced liquidity, and the U.S. federal government, state governments and foreign governments have implemented
and are considering a broad variety of governmental action and/or new regulation of the financial markets. Securities and futures markets and the credit markets are subject to comprehensive statutes, regulations and other requirements. The
Securities and Exchange Commission (the SEC), other regulators, self-regulatory organizations and exchanges are authorized to take extraordinary actions in the event of market emergencies, and may effect changes in law or interpretations
of existing laws. Recently, a number of financial institutions have experienced serious financial difficulties and, in some cases, have entered bankruptcy proceedings or are in regulatory enforcement actions. These issues, along with the reprising
of credit risk and the difficulties currently experienced by financial institutions have made, and will likely continue to make, it difficult to obtain financing. As a result of the disruptions in the credit markets, many lenders have increased
margins on lending rates, enacted tighter lending standards, required more restrictive terms (including higher collateral ratios for advances, shorter maturities and smaller loan amounts), or have refused to refinance existing debt at all.
Additionally, certain banks that have historically been significant lenders to the shipping industry have reduced or ceased lending activities in the shipping industry. New banking regulations, including larger capital requirements and the resulting
policies adopted by lenders, could reduce lending activities. We may experience difficulties obtaining financing commitments, including commitments to refinance our existing debt as balloon payments come due under our credit facilities, in the
future if lenders are unwilling to extend financing to us or unable to meet their funding obligations due to their own liquidity, capital or solvency issues. Due to the fact that we would possibly cover all or a portion of the cost of any new vessel
acquisition with debt financing, such uncertainty, combined with restrictions imposed by our current debt, could hamper our ability to finance vessels or new business acquisitions.

In addition, economic uncertainty worldwide has markedly reduced demand for shipping services and has decreased charter rates, which may adversely affect our results of operations and financial condition.
Currently, the economies of China, Japan, other Pacific Asian countries and India are the main driving force behind the development in seaborne transportation. Reduced demand from such economies has driven decreased rates and vessel values.

We could face risks attendant to changes in economic environments, changes in interest rates, and instability in certain securities markets,
among other factors. Major market disruptions and the uncertainty in market conditions and the regulatory climate in the U.S., Europe and worldwide could adversely our business or impair our ability to borrow amounts under any future financial
arrangements. The current market conditions may last longer than we anticipate. These recent and developing economic and governmental factors could have a material adverse effect on our results of operations, financial condition or cash flows.

Because international tanker companies often generate most or all of their revenues in U.S. dollars but incur a portion of their
expenses in other currencies, exchange rate fluctuations could cause us to suffer exchange rate losses, thereby increasing expenses and reducing income.

We engage in worldwide commerce with a variety of entities. Although our operations may expose us to certain levels of foreign currency risk, our transactions are predominantly U.S. dollar-denominated.
Transactions in currencies other than the functional currency are translated at the exchange rate in effect at the date of each transaction. Expenses incurred in foreign currencies against which the U.S. dollar falls in value can increase,
decreasing our income a greater percentage of our transactions and expenses in the future may be denominated in currencies other than U.S. dollar. As part of our overall risk management policy, we will attempt to hedge these risks in exchange rate
fluctuations from time to time. We may not always be successful in such hedging activities and, as a result, our operating results could suffer as a result of un-hedged losses



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incurred as a result of exchange rate fluctuations. For example, as of December 31, 2012, the value of the U.S. dollar as compared to the Euro increased by approximately 2.0% compared
with the respective value as of December 31, 2011. A greater percentage of our transactions and expenses in the future may be denominated in currencies other than the U.S. dollar.

Labor interruptions and problems could disrupt our business.

Certain of our
vessels are manned by masters, officers and crews that are employed by third parties. If not resolved in a timely and cost-effective manner, industrial action or other labor unrest could prevent or hinder our operations from being carried out
normally and could have a material adverse effect on our business, results of operations, cash flow and financial condition.

The market
value of our vessels that we have constructed, acquired or may acquire in the future may fluctuate, which could limit the amount of funds that we can borrow, cause us to fail to meet certain financial covenants in our credit facilities and adversely
affect our ability to purchase new vessels and our operating results.

The market value of tankers has been volatile. Vessel values
may fluctuate due to a number of different factors, including: general economic and market conditions affecting the shipping industry; competition from other shipping companies; the types and sizes of available vessels; the availability of other
modes of transportation; increases in the supply of vessel capacity; the cost of new buildings; governmental or other regulations; prevailing charter rates; the age of the vessel; and the need to upgrade secondhand vessels as a result of charterer
requirements, technological advances in vessel design or equipment or otherwise. In addition, as vessels grow older, they generally decline in value. To the extent that we incur debt that is secured by any of our vessels, if the market value of such
vessels declines, we may be required to prepay a portion of these secured borrowings.

If the market value of our vessels decreases, we may
breach some of the covenants contained in the financing agreements relating to our indebtedness at the time. The credit facilities contain covenants including maximum total net liabilities over total net assets (effective in general after delivery
of the vessels), minimum net worth and loan to value ratio covenants applicable after delivery of the vessels initially of 130% or lower. If we breach any such covenants in the future and we are unable to remedy the relevant breach, our lenders
could accelerate our debt and foreclose on our vessels. In addition, if the book value of a vessel is impaired due to unfavorable market conditions, we would incur a loss that could have a material adverse effect on our business, financial condition
and results of operations.

If for any reason we sell any of our vessels at a time when prices are depressed, we could incur a loss and our
business, financial condition and results of operations could be adversely affected. Conversely, if vessel values are elevated at a time when we wish to acquire additional vessels, the cost of acquisition may increase and this could materially
adversely affect our business, financial condition and results of operations.

In the highly competitive product and chemical tanker
sectors of the shipping industry, we may not be able to compete for charters with new entrants or established companies with greater resources, which may adversely affect our results of operations.

We employ our vessels in the product and chemical tanker sectors, highly competitive markets that are capital intensive and highly fragmented.
Competition arises primarily from other vessel owners, some of whom have substantially greater resources than us. Competition for the transportation of refined petroleum products (clean and dirty) and bulk liquid chemicals can be intense and depends
on price, location, size, age, condition and the acceptability of the vessel and our managers to the charterers. Due in part to the highly fragmented markets, competitors with greater resources could operate larger fleets through consolidations or
acquisitions that may be able to offer better prices and fleets than ours.

Risks Relating to Our VLCC Vessels

The indemnity may be inadequate to cover any damages.

The Securities Purchase Agreement for the VLCC vessels has a cap on indemnity obligations, subject to certain exceptions, of $58.7 million. Although we performed substantial due diligence with
respect to the VLCC Acquisition, there can be no assurance that there will not be undisclosed liabilities or other matters not discovered in the course of such due diligence and the $58.7 million indemnity may be inadequate to cover these or other
damages related to breaches of such agreement. In addition, after the return to Navios Acquisition of 217,159 shares on November 4, 2011 in settlement of claims relating to representation and warranties attributable to the sellers and the
return of the balance of the escrow shares to the sellers, it may be difficult to enforce an arbitration award for any amount of damages.



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A large proportion of the revenue from the VLCC vessels is derived from a Chinese state-owned company,
and changes in the economic and political environment in China or in Chinese relations with other countries could adversely affect our ability to continue this customer relationship.

DOSCO, a wholly owned subsidiary of the Chinese state-owned COSCO, charters four of the seven VLCC vessels (including the newbuilding delivered in June 2011). Changes in political, economic and social
conditions or other relevant policies of the Chinese government, such as changes in laws, regulations or export and import restrictions, could restrict DOSCOs ability to continue its relationship with us. If DOSCO becomes unable to perform
under its charter agreements with us, we could suffer a loss of revenue that could materially adversely affect our business, financial condition, and results of operations. In addition, we may have limited ability in Chinese courts to enforce any
awards for damages that we may suffer if DOSCO were to fail to perform its obligations under our charter agreements.

One of the vessels
is subject to a mutual sale provision between the subsidiary that owns the vessel and the charterer of the vessel, which, if exercised, could reduce the size of our fleet and reduce our future revenue.

The Shinyo Ocean is subject to a mutual sale provision whereby we or the charterer can request the sale of the vessel provided that a price can be
obtained that is at least $3,000,000 greater than the agreed depreciated value of the vessel as set forth in the charter agreement. If this provision is exercised, we may not be able to obtain a replacement vessel for the price at which the vessel
is sold. In such a case, the size of our fleet would be reduced and we may experience a reduction in our future revenue.

Risks Related to
Our Relationship with Navios Holdings and Its Affiliates

Navios Holdings has limited recent experience in the crude oil, product and
chemical tanker sectors.

Navios Tankers Management Inc. (the Manager), a wholly owned subsidiary of Navios Holdings,
oversees the commercial and administrative management of our entire fleet and the technical management of a portion of our fleet. Navios Holdings is a vertically-integrated seaborne shipping and logistics company with over 55 years of operating
history in the shipping industry that held approximately 47.4% of our shares of common stock as of February 26, 2013. Other than with respect to South American operations, Navios Holdings has limited recent experience in the crude oil, chemical
and product tanker sectors.

Such limited experience could cause Navios Holdings or the Manager to make decisions that a more experienced
operator in the sector might not make. If Navios Holdings or the Manager is not able to properly assess or ascertain a particular aspect of the crude oil, product or chemical tanker sectors, it could have a material adverse effect on our operations.

Navios Holdings may compete directly with us, causing certain officers to have a conflict of interest.

Angeliki Frangou and Ted C. Petrone are each officers and/or directors of both Navios Holdings and Navios Acquisition. We operate in the crude oil,
product and chemical tanker sectors of the shipping industry, and although Navios Holdings does not currently operate in those sectors, there is no assurance it will not enter them. If it does, we may compete directly with Navios Holdings for
business opportunities.

Navios Holdings, Navios Partners and Navios Acquisition share certain officers and directors who may not be
able to devote sufficient time to our affairs, which may affect our ability to conduct operations and generate revenues.

Angeliki
Frangou and Ted C. Petrone are each officers and/or directors of both Navios Holdings and Navios Acquisition, and Ms. Frangou is an officer and director of Navios Partners. As a result, demands for our officers time and attention as
required from Navios Acquisition, Navios Partners and Navios Holdings may conflict from time to time and their limited devotion of time and attention to our business may hurt the operation of our business.

The loss of key members of our senior management team could disrupt the management of our business.

We believe that our success depends on the continued contributions of the members of our senior management team, including Ms. Angeliki Frangou, our
Chairman and Chief Executive Officer. The loss of the services of Ms. Frangou or one of our other executive officers or senior management members could impair our ability to identify and secure new charter contracts, to maintain good customer
relations and to otherwise manage our business, which could have a material adverse effect on our financial performance and our ability to compete.

We are dependent on a subsidiary of Navios Holdings for the commercial and administrative management of our fleet and the technical management of a portion of our fleet, which may create conflicts
of interest.

As we subcontract the technical and commercial management of our fleet, including crewing, maintenance and repair, to
our Manager, a subsidiary of Navios Holdings, and on an interim basis to other third party managers, the loss of these services or



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the failure of the Manager to perform these services could materially and adversely affect the results of our operations. Although we may have rights against the Manager if it defaults on its
obligations to us, you will have no recourse directly against it. Further, we expect that we will need to seek approval from our respective lenders to change our commercial and technical managers.

Navios Holdings has responsibilities and relationships to owners other than Navios Acquisition that could create conflicts of interest between us and
Navios Holdings or our Manager. These conflicts may arise in connection with the provision of chartering services to us for our fleet versus carriers managed by Navios Holdings subsidiaries or other companies affiliated with Navios Holdings.

Navios Holdings, our affiliate and a greater than 5% holder of our common stock, Angeliki Frangou, our Chairman and Chief Executive
Officer, and certain of our officers and directors collectively own a substantial interest in us, and, as a result, may influence certain actions requiring stockholder vote.

Navios Holdings, Angeliki Frangou, our Chairman and Chief Executive Officer, and certain of our officers and directors beneficially own, in the aggregate, 50.2% of our issued and outstanding shares of
common stock, which permits them to influence the outcome of effectively all matters requiring approval by our stockholders at such time, including the election of directors and approval of significant corporate transactions. Furthermore, if Navios
Holdings and Ms. Frangou or an affiliate ceases to hold a minimum of 30% of our common stock then we will be in default under our credit facilities.

Risks Related to Our Common Stock and Capital Structure

We are incorporated in the
Republic of the Marshall Islands, a country that does not have a well-developed body of corporate law, which may negatively affect the ability of public stockholders to protect their interests.

Our corporate affairs are governed by our amended and restated articles of incorporation and bylaws, and by the Marshall Islands Business Corporations
Act, or the BCA. The provisions of the BCA resemble provisions of the corporation laws of a number of states in the United States. However, there have been few judicial cases in the Republic of the Marshall Islands interpreting the BCA. The rights
and fiduciary responsibilities of directors under the law of the Republic of the Marshall Islands are not as clearly established as the rights and fiduciary responsibilities of directors under statutes or judicial precedent in existence in certain
United States jurisdictions. Stockholder rights may differ as well. While the BCA does specifically incorporate the non-statutory law, or judicial case law, of the State of Delaware and other states with substantially similar legislative provisions,
public stockholders may have more difficulty in protecting their interests in the face of actions by the management, directors or controlling stockholders than would stockholders of a corporation incorporated in a United States jurisdiction.

We are incorporated under the laws of the Marshall Islands and our directors and officers are non-U.S. residents, and although you may
bring an original action in the courts of the Marshall Islands or obtain a judgment against us, our directors or our management based on U.S. laws in the event you believe your rights as a stockholder have been infringed, it may be difficult to
enforce judgments against us, our directors or our management.

We are incorporated under the laws of the Republic of the Marshall
Islands, and all of our assets are located outside of the United States. Our business will be operated primarily from our offices in Athens, Greece. In addition, our directors and officers are non-residents of the United States, and all or a
substantial portion of the assets of these non-residents are located outside the United States. As a result, it may be difficult or impossible for you to bring an action against us or against these individuals in the United States if you believe
that your rights have been infringed under securities laws or otherwise. Even if you are successful in bringing an action of this kind, the laws of the Marshall Islands and of other jurisdictions may prevent or restrict you from enforcing a judgment
against our assets or the assets of our directors and officers. Although you may bring an original action against us or our affiliates in the courts of the Marshall Islands based on U.S. laws, and the courts of the Marshall Islands may impose civil
liability, including monetary damages, against us or our affiliates for a cause of action arising under Marshall Islands law, it may impracticable for you to do so given the geographic location of the Marshall Islands.

Since we are a foreign private issuer, we are not subject to certain SEC regulations that companies incorporated in the United States would be
subject to.

We are a foreign private issuer within the meaning of the rules promulgated under the Securities Exchange Act
of 1934, as amended (the Exchange Act). As such, we are exempt from certain provisions applicable to United States public companies including:



| |  |  | the rules under the Exchange Act requiring the filing with the Securities and Exchange Commission, or the SEC, of quarterly reports on Form 10-Q or
current reports on Form 8-K;
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| |  |  | the sections of the Exchange Act regulating the solicitation of proxies, consents or authorizations in respect of a security registered under the
Exchange Act;
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | the provisions of Regulation FD aimed at preventing issuers from making selective disclosures of material information;
and
| | - |  | --------------------------------------------------------------------------------------------------------------------------



| |  |  | the sections of the Exchange Act requiring insiders to file public reports of their stock ownership and trading activities and establishing insider
liability for profits realized from any short-swing trading transaction (i.e., a purchase and sale, or sale and purchase, of the issuers equity securities within less than six months).
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Accordingly, investors in our common stock may not be able to obtain all of the information of the type described above, and our stockholders may not be
afforded the same protections or information generally available to investors holding shares in public companies in the United States.

Anti-takeover provisions in our amended and restated articles of incorporation could make it difficult for our stockholders to replace or remove
our current board of directors or could have the effect of discouraging, delaying or preventing a merger or acquisition, which could adversely affect the market price of our common stock.

Several provisions of our amended and restated articles of incorporation and bylaws could make it difficult for our stockholders to change the
composition of our board of directors in any one year, preventing them from changing the composition of our management. In addition, the same provisions may discourage, delay or prevent a merger or acquisition that stockholders may consider
favorable. These provisions include those that:



| |  |  | authorize our board of directors to issue blank check preferred stock without stockholder approval;
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| |  |  | provide for a classified board of directors with staggered, three-year terms;
| | - |  | -----------------------------------------------------------------------------



| |  |  | require a super-majority vote in order to amend the provisions regarding our classified board of directors with staggered, three-year terms; and
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | prohibit cumulative voting in the election of directors.
| | - |  | --------------------------------------------------------

These anti-takeover provisions could substantially impede the ability of stockholders to benefit from a change in control and, as a result, may adversely affect the market price of our common stock and
your ability to realize any potential change of control premium.

We may choose to redeem our outstanding warrants included in the units
sold in our IPO at a time that is disadvantageous to our warrant holders.

We may redeem the warrants issued as part of our units sold
in our IPO in whole and not in part, at a price of $0.01 per warrant, upon a minimum of 30 days prior written notice of redemption, if and only if, the last sales price of our common stock equals or exceeds $13.75 per share for any 20
trading days within a 30 trading day period ending three business days before we send the notice of redemption; provided, however, a current registration statement under the Securities Act of 1933, as amended (the Securities Act)
relating to the shares of our common stock underlying the warrants is then effective. Redemption of the warrants could force the warrant holders: (i) to exercise the warrants and pay the exercise price therefore at a time when it may be
disadvantageous for the holders to do so; (ii) to sell the warrants at the then-current market price when they might otherwise wish to hold the warrants; or (iii) to accept the nominal redemption price that, at the time the warrants are
called for redemption, is likely to be substantially less than the market value of the warrants. We may not redeem any warrant if it is not exercisable.

Registration rights held by our initial stockholders and others may have an adverse effect on the market price of our common stock.

Certain stockholders, which include Navios Holdings and certain members of the management of Navios Acquisition, Navios Holdings and Navios Partners, are entitled to demand that we register the resale of
their common stock totaling 37,895,138 shares. In addition, one third-party holder has an effective resale registration statement with respect to 1,677,759 shares of common stock. If all of these stockholders exercise their registration rights with
respect to all of their shares of common stock, including the effective resale registration statement, there will be an additional 39,572,897 shares of common stock eligible for trading in the public market. The presence of these additional shares
may have an adverse effect on the market price of our common stock.

The New York Stock Exchange may delist our securities from
quotation on its exchange, which could limit your ability to trade our securities and subject us to additional trading restrictions.

Our securities are listed on the New York Stock Exchange (NYSE), a national securities exchange. Although we currently satisfy the NYSE
minimum listing standards, which only requires that we meet certain requirements relating to stockholders equity, number of round-lot holders, market capitalization, aggregate market value of publicly held shares and distribution requirements,
we cannot assure you that our securities will continue to be listed on NYSE in the future.



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If NYSE delists our securities from trading on its exchange, we could face significant material adverse
consequences, including:



| |  |  | a limited availability of market quotations for our securities;
| | - |  | ---------------------------------------------------------------



| |  |  | a limited amount of news and analyst coverage for us;
| | - |  | -----------------------------------------------------



| |  |  | a decreased ability for us to issue additional securities or obtain additional financing in the future; and
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| |  |  | limited liquidity for our stockholders due to thin trading.
| | - |  | -----------------------------------------------------------

Risks Related to Our Indebtedness

We may not be able to access our debt financing,
which may affect our ability to make payments with respect to our vessels.

Our ability to borrow amounts under our current and future
credit facilities will be subject to the satisfaction of customary conditions precedent and compliance with terms and conditions included in the loan documents, including a minimum liquidity financial covenant, and to circumstances that may be
beyond our control such as world events, economic conditions, the financial standing of the bank or its willingness to lend to shipping companies such as us. Prior to each drawdown, we will be required, among other things, to provide our lenders
with satisfactory evidence that certain conditions precedent have been met. To the extent that we are not able to satisfy these requirements, including as a result of a decline in the value of our vessels, we may not be able to draw down the full
amount under certain of our credit facilities without obtaining a waiver or consent from the respective lenders.

We have substantial
indebtedness and may incur substantial additional indebtedness, which could adversely affect our financial health and our ability to obtain financing in the future, react to changes in our business and make debt service payments.

We have substantial indebtedness, and we may also increase the amount of our indebtedness in the future. The terms of our credit facilities and other
instruments and agreement governing our indebtedness do not prohibit us from doing so. Our substantial indebtedness could have important consequences for our stockholders.

Because of our substantial indebtedness:



| |  |  | our ability to obtain additional financing for working capital, capital expenditures, debt service requirements, vessel or other acquisitions or
general corporate purposes may be impaired in the future;
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | if new debt is added to our existing debt levels, the related risks that we now face would increase and we may not be able to meet all of our debt
obligations;
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | a substantial portion of our cash flow from operations must be dedicated to the payment of principal and interest on our indebtedness, thereby reducing
the funds available to us for other purposes, and there can be no assurance that our operations will generate sufficient cash flow to service this indebtedness;
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | we will be exposed to the risk of increased interest rates because our borrowings under the credit facilities will be at variable rates of interest;
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | it may be more difficult for us to satisfy our obligations to our lenders, resulting in possible defaults on and acceleration of such indebtedness;
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | we may be more vulnerable to general adverse economic and industry conditions;
| | - |  | ------------------------------------------------------------------------------



| |  |  | we may be at a competitive disadvantage compared to our competitors with less debt or comparable debt at more favorable interest rates and, as a
result, we may not be better positioned to withstand economic downturns;
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | our ability to refinance indebtedness may be limited or the associated costs may increase; and
| | - |  | ----------------------------------------------------------------------------------------------



| |  |  | our flexibility to adjust to changing market conditions and ability to withstand competitive pressures could be limited, or we may be prevented from
carrying out capital spending that is necessary or important to our growth strategy and efforts to improve operating margins or our business.
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Highly leveraged companies are significantly more vulnerable to unanticipated downturns and set backs, whether directly related to their business or flowing from a general economic or industry condition,
and therefore are more vulnerable to a business failure or bankruptcy.

The agreements and instruments governing our indebtedness do or
will contain restrictions and limitations that could significantly impact our ability to operate our business and adversely affect our stockholders.

The agreements and instruments governing our indebtedness impose certain operating and financial restrictions on us.



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Among other restrictions, these restrictions may limit our ability to:



| |  |  | incur or guarantee additional indebtedness or issue certain preferred stock;
| | - |  | ----------------------------------------------------------------------------



| |  |  | create liens on our assets;
| | - |  | ---------------------------



| |  |  | make investments;
| | - |  | -----------------



| |  |  | engage in mergers and acquisitions in sell all or substantially all of our properties or assets;
| | - |  | ------------------------------------------------------------------------------------------------



| |  |  | redeem or repurchase capital stock, pay dividends or make other restricted payments and investments;
| | - |  | ----------------------------------------------------------------------------------------------------



| |  |  | make capital expenditures;
| | - |  | --------------------------



| |  |  | change the management of our vessels or terminate the management agreements we have relating to our vessels;
| | - |  | ------------------------------------------------------------------------------------------------------------



| |  |  | enter into long-term charter arrangements without the consent of the lender;
| | - |  | ----------------------------------------------------------------------------



| |  |  | transfer or sell any of our vessels; and
| | - |  | ----------------------------------------



| |  |  | enter into certain transactions with our affiliates.
| | - |  | ----------------------------------------------------

Therefore, we will need to seek permission from our lenders in order to engage in some corporate and commercial actions that we believe would be in the best interest of our business, and a denial of
permission may make it difficult for us to successfully execute our business strategy or effectively compete with companies that are not similarly restricted. Our lenders interests may be different from our interests, and we cannot guarantee
that we will be able to obtain our lenders permission when needed. This may prevent us from taking actions that are in our best interest. Any future credit agreement may include similar or more restrictive restrictions.

Our credit facilities contain requirements that the value of the collateral provided pursuant to the credit facilities must equal or exceed by a certain
percentage the amount of outstanding borrowings under the credit facilities and that we maintain a minimum liquidity level. In addition, our credit facilities contain additional restrictive covenants, including a minimum net worth requirement and
maximum total net liabilities over net assets. It is an event of default under our credit facilities if such covenants are not complied with or if Navios Holdings, Ms. Angeliki Frangou, our Chairman and Chief Executive Officer, and their
respective affiliates cease to hold a minimum percentage of our issued stock. In addition, the indenture governing the notes also contains certain provisions obligating us in certain instances to make offers to purchase outstanding notes with the
net proceeds of certain sales or other dispositions of assets or upon the occurrence of an event of loss with respect to a mortgaged vessel, as defined in the indenture. Our ability to comply with the covenants and restrictions contained in our
agreements and instruments governing our indebtedness may be affected by economic, financial and industry conditions and other factors beyond our control. If we are unable to comply with these covenants and restrictions, our indebtedness could be
accelerated. If we are unable to repay indebtedness, our lenders could proceed against the collateral securing that indebtedness. In any such case, we may be unable to borrow under our credit facilities and may not be able to repay the amounts due
under our agreements and instruments governing our indebtedness. This could have serious consequences to our financial condition and results of operations and could cause us to become bankrupt or insolvent. Our ability to comply with these covenants
in future periods will also depend substantially on the value of our assets, our charter rates, our success at keeping our costs low and our ability to successfully implement our overall business strategy. Any future credit agreement or amendment or
debt instrument may contain similar or more restrictive covenants.

We and our subsidiaries may be able to incur substantially more
indebtedness, including secured indebtedness. This could further exacerbate the risks associated with our substantial indebtedness.

We and our subsidiaries may be able to incur substantial additional indebtedness in the future. The agreements governing our credit facilities and the
indenture governing our notes do not prohibit us or our subsidiaries from doing so. If new indebtedness is added to our current indebtedness levels, the related risks that we now face would increase and we may not be able to meet all our
indebtedness obligations.

Our ability to generate the significant amount of cash needed to service our other indebtedness and our
ability to refinance all or a portion of our indebtedness or obtain additional financing depends on many factors beyond our control.

Our ability to make scheduled payments on or to refinance our obligations under, our indebtedness will depend on our financial and operating performance,
which, in turn, will be subject to prevailing economic and competitive conditions and to the financial and business factors, many of which may be beyond our control.

We will use cash to pay the principal and interest on our indebtedness. These payments limit funds otherwise available for working capital, capital expenditures, vessel acquisitions and other purposes. As
a result of these obligations, our current liabilities may exceed our current assets. We may need to take on additional indebtedness as we expand our fleet, which could increase our ratio of indebtedness to equity. The need to service our
indebtedness may limit funds available for other purposes and our inability to service indebtedness in the future could lead to acceleration of our indebtedness and foreclosure on our owned vessels.



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Our credit facilities mature on various dates through 2022 and our ship mortgage notes mature on
November 1, 2017. In addition, borrowings under certain of the credit facilities have amortization requirements prior to final maturity. We cannot assure you that we will be able to refinance any of our indebtedness or obtain additional
financing, particularly because of our anticipated high levels of indebtedness and the indebtedness incurrence restrictions imposed by the agreements governing our indebtedness, as well as prevailing market conditions.

We could face substantial liquidity problems and might be required to dispose of material assets or operations to meet our indebtedness service and other
obligations. Our credit facilities, the indenture governing our notes and any future indebtedness may, restrict our ability to dispose of assets and use the proceeds from any such dispositions. If we do not reinvest the proceeds of asset sales in
our business (in the case of asset sales of no collateral with respect to such indebtedness) or in new vessels or other related assets that are mortgaged in favor of the lenders under our credit facilities (in the case of assets sales of collateral
securing), we may be required to use the proceeds to repurchase senior indebtedness. We cannot assure you we will be able to consummate any asset sales, or if we do, what the timing of the sales will be or whether the proceeds that we realize will
be adequate to meet indebtedness service obligations when due.

Most of our credit facilities require that we maintain loan to collateral
value ratios in order to remain in compliance with the covenants set forth therein. If the value of such collateral falls below such required level, we would be required to either prepay the loans or post additional collateral to the extent
necessary to bring the value of the collateral as compared to the aggregate principal amount of the loan back to the required level. We cannot assure you that we will have the cash on hand or the financing available to prepay the loans or have any
unencumbered assets available to post as additional collateral. In such case, we would be in default under such credit facility and the collateral securing such facility would be subject to foreclosure by the applicable lenders.

Moreover, certain of our credit facilities are secured by vessels currently under construction pursuant to shipbuilding contracts. Because we rely on
these facilities to finance the scheduled payments as they come due under the shipbuilding contracts, it is possible that any default under such a facility would result, in the absence of other available funds, in default by us under the associated
shipbuilding contract. In such a case, our rights in the related newbuild would be subject to foreclosure by the applicable creditor. In addition, a payment default under a shipbuilding contract would give the shipyard the right to terminate the
contract without any further obligation to finish construction and may give it rights against us for having failed to make the required payments.

An increase or continuing volatility in interest rates would increase the cost of servicing our indebtedness and could reduce our profitability, earnings and cash flow.

Amounts borrowed under our term loan facilities fluctuate with changes in LIBOR. LIBOR has been volatile, with the spread between LIBOR and the prime
lending rate widening significantly at times. We may also incur indebtedness in the future with variable interest rates. As a result, an increase in market interest rates would increase the cost of servicing our indebtedness and could materially
reduce our profitability, earnings and cash flows. The impact of such an increase would be more significant for us than it would be for some other companies because of our substantial indebtedness. Because the interest rates borne by our outstanding
indebtedness may fluctuate with changes in LIBOR, if this volatility were to continue, it could affect the amount of interest payable on our debt, which in turn, could have an adverse effect on our profitability, earnings and cash flow.

The international nature of our operations may make the outcome of any bankruptcy proceedings difficult to predict.

We are incorporated under the laws of the Republic of the Marshall Islands and our subsidiaries are also incorporated under the laws of the Republic of
the Marshall Islands, the Cayman Islands, Hong Kong, the British Virgin Islands and certain other countries other than the United States, and we conduct operations in countries around the world. Consequently, in the event of any bankruptcy,
insolvency or similar proceedings involving us or one of our subsidiaries, bankruptcy laws other than those of the United States could apply. We have limited operations in the United States. If we become a debtor under the United States bankruptcy
laws, bankruptcy courts in the United States may seek to assert jurisdiction over all of our assets, wherever located, including property situated in other countries. There can be no assurance, however, that we would become a debtor in the United
States or that a United States bankruptcy court would be entitled to, or accept, jurisdiction over such bankruptcy case or that courts in other countries that have jurisdiction over us and our operations would recognize a United States bankruptcy
courts jurisdiction if any other bankruptcy court would determine it had jurisdiction.

We may be unable to raise funds necessary
to finance the change of control repurchase offer required by the indenture governing our notes.

If we experience specified changes
of control, we would be required to make an offer to repurchase all of our outstanding notes (unless otherwise redeemed) at a price equal to 101% of the principal amount thereof plus accrued and unpaid interest, if any, to the repurchase date. The
occurrence of specified events that could constitute a change of control will constitute a



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default under our credit facilities. There are also change of control events that would constitute a default under the credit facilities that would not be a change of control under the indenture.
In addition, our credit facilities prohibit the purchase of notes by us in the event of a change of control, unless and until such time as the indebtedness under our credit facilities is repaid in full. As a result, following a change of control
event, we would not be able to repurchase notes unless we first repay all indebtedness outstanding under our credit facilities and any of our other indebtedness that contains similar provisions; or obtain a waiver from the holders of such
indebtedness to permit us to repurchase the notes. We may be unable to repay all of that indebtedness or obtain a waiver of that type. Any requirement to offer to repurchase outstanding notes may therefore require us to refinance our other
outstanding debt, which we may not be able to do on commercially reasonable terms, if at all. In addition, our failure to purchase the notes after a change of control in accordance with the terms of the indenture would constitute an event of default
under the indenture, which in turn would result in a default under our credit facilities.

Our inability to repay the indebtedness under our
credit facilities will constitute an event of default under the indenture governing our notes, which could have materially adverse consequences to us. In the event of a change of control, we cannot assure you that we would have sufficient assets to
satisfy all of our obligations under our credit facilities and the notes. Our future indebtedness may also require such indebtedness to be repurchased upon a change.

We may require additional financing to acquire vessels or businesses or to exercise vessel purchase options, and such financing may not be available.

In the future, we may be required to make substantial cash outlays to exercise options or to acquire vessels or business and will need additional
financing to cover all or a portion of the purchase prices. We may seek to cover the cost of such items with new debt collateralized by the vessels to be acquired, if applicable, but there can be no assurance that we will generate sufficient cash or
that debt financing will be available. Moreover, the covenants in our credit facilities, the indenture or other debt, may make it more difficult to obtain such financing by imposing restrictions on what we can offer as collateral.

Tax Risks

In addition to the following
risk factors, you should read Item 10 Additional Information for a more complete discussion of the expected material U.S. federal and non-U.S. income tax considerations relating to us and the ownership and disposition of our common
stock.

U.S. tax authorities could treat us as a passive foreign investment company, which could have adverse U.S. federal
income tax consequences to U.S. holders.

We will be treated as a passive foreign investment company, or PFIC, for U.S.
federal income tax purposes if either (1) at least 75% of our gross income for any taxable year consists of certain types of passive income or (2) at least 50% of the average value of our assets produce or are held for the
production of those types of passive income. For purposes of these tests, passive income includes dividends, interest, and gains from the sale or exchange of investment property and rents and royalties other than rents and
royalties that are received from unrelated parties in connection with the active conduct of a trade or business. For purposes of these tests, income derived from the performance of services does not constitute passive income. U.S.
stockholders of a PFIC may be subject to a disadvantageous U.S. federal income tax regime with respect to the income derived by the PFIC, the distributions they receive from the PFIC and the gain, if any, they derive from the sale or other
disposition of their shares in the PFIC.

Based on our current and projected methods of operations, and an opinion of counsel, we believe that
we were not a PFIC for the 2012 and 2011 taxable years (we were treated as a PFIC for the 2008 and 2009 taxable years), and we do not believe that we will be a PFIC for 2013 and subsequent taxable years. For post-2010 taxable years, our U.S.
counsel, Thompson Hine LLP, is of the opinion that (1) the income we receive from the time chartering activities and assets engaged in generating such income should not be treated as passive income or assets, respectively, and (2) so long
as our income from time charters exceeds 25.0% of our gross income for each taxable year after our 2010 taxable year and the value of our vessels contracted under time charters exceeds 50.0% of the average value of our assets for each taxable year
after our 2010 taxable year, we should not be a PFIC for any taxable year after our 2010 taxable year. This opinion is based on representations and projections provided to our counsel by us regarding our assets, income and charters, and its validity
is conditioned on the accuracy of such representations and projections.

We may have to pay tax on United States source income, which
would reduce our earnings.

Under the U.S. Internal Revenue Code (the Code), 50% of the gross shipping income of a
vessel-owning or chartering corporation, such as us and our subsidiaries, that is attributable to transportation that begins or ends, but that does not both begin and end, in the United States is characterized as U.S.-source shipping income and such
income is subject to a 4% U.S. federal income tax without allowance for deduction, unless that corporation qualifies for exemption from tax under



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Section 883 of the Code and the treasury regulations promulgated there under (Treasury Regulations). In general, the exemption from U.S. federal income taxation under
Section 883 of the Code provides that if a non-U.S. corporation satisfies the requirements of Section 883 of the Code and the Treasury Regulations, it will not be subject to the net basis and branch profit taxes or the 4% gross basis tax
described below on its U.S.-Source International Transportation Income.

We expect that we and each of our vessel-owning subsidiaries will
qualify for this statutory tax exemption and we will take this position for U.S. federal income tax return reporting purposes. However, there are factual circumstances beyond our control that could cause us to lose the benefit of this tax exemption
and thereby become subject to U.S. federal income tax on our U.S.-source income.

If we or our vessel-owning subsidiaries are not entitled to
this exemption under Section 883 for any taxable year, we or our subsidiaries would be subject for those years to a 4% U.S. federal income tax on its U.S.-source shipping income. The imposition of this taxation could have a negative effect on
our business and would result in decreased earnings.

Other Tax Jurisdictions

As of January 1, 2013, foreign flagged vessels that are managed by Greek or foreign ship management companies in Greece are subject to Greek tonnage
tax. The payment of tonnage tax exhausts the tax liability of the foreign ship owning company against any tax, duty, charge or contribution payable on income from the exploitation of the foreign flagged vessel.

Item 4. Information on the Company

A. History and development of Navios Acquisition

Navios Acquisition was formed on
March 14, 2008 under the laws of the Republic of the Marshall Islands and has its principal offices located at 85 Akti Miaouli Street, Piraeus, Greece 185 38, and its telephone number is (011) +30-210-4595000. Our agent for service is
Trust Company of the Marshall Islands, Inc., located at Trust Company Complex, Ajeltake Island, P.O. Box 1405, Majuro, Marshall Islands MH96960.

On May 25, 2010, after its special meeting of stockholders, Navios Acquisition announced the approval of: (a) the acquisition from Navios Holdings of 13 vessels (11 product tankers and two
chemical tankers) for an aggregate purchase price of $457.7 million, of which $128.7 million was to be paid from existing cash and the $329.0 million balance with existing and new debt financing pursuant to the terms and conditions of
the Acquisition Agreement by and between Navios Acquisition and Navios Holdings and (b) certain amendments to Navios Acquisitions amended and restated articles of incorporation.

On May 28, 2010, Navios Acquisition consummated the vessel acquisition, which constituted its initial business combination. In connection with the stockholder vote to approve the vessel acquisition,
holders of 10,021,399 shares of common stock voted against the vessel acquisition and elected to redeem their shares in exchange for an aggregate of approximately $99.3 million, which amount was disbursed from the trust account on May 28,
2010. In addition, on May 28, 2010, Navios Acquisition disbursed an aggregate of $8.9 million from the trust account to the underwriters of our IPO for deferred fees. After disbursement of approximately $76.5 million to Navios
Holdings to reimburse it for the first equity installment payment on the vessels of $38.8 million and other associated payments, the balance of the trust account of $66.1 million was released to us for general operating expenses.

The initial business combination was treated as an asset acquisition and the consideration paid and fair values of assets and liabilities
assumed on May 28, 2010 (See note 3 of the audited financial statements included herein).

On August 27, 2010, Navios Acquisition
completed the Warrant Exercise Program under which holders of its publicly traded and private warrants had the opportunity to exercise their warrants on enhanced terms (see note 19 of the audited financial statements included herein).

On September 10, 2010, Navios Acquisition consummated the VLCC Acquisition of seven VLCCs for an aggregate purchase price of
$587.0 million, adjusted for net working capital acquired of $20.6 million. The purchase price was financed as follows: (a) $410.5 million of bank debt, assumed at closing, consisting of six credit facilities with a consortium of
banks; (b) $134.3 million of cash paid at closing; (c) $11.0 million through the issuance of 1,894,918 Navios Acquisition shares of common stock (based on the closing trading price averaged over the 15 trading days immediately
prior to closing on September 10, 2010) of which 1,378,122 shares of common stock were deposited into a one-year escrow to provide for indemnity or other claims (see note 19 of the audited financial statements included herein); and
(d) $51.4 million due to a shipyard in 2011 for the newbuilding that was delivered in June 2011. The VLCC Acquisition was accounted for as a business combination.



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On October 21, 2010, Navios Acquisition and Navios Acquisition Finance (US) Inc., its wholly owned
finance subsidiary (Navios Acquisition Finance), completed the sale of $400.0 million of 8 5/8% First Priority Ship Mortgage notes due 2017 (the Existing Notes).

On May 26, 2011, Navios Acquisition and Navios Acquisition Finance completed the sale of $105.0 million of 8 5/8% first priority ship mortgage notes due 2017 (the Additional Notes)
at 102.25% plus accrued interest from May 1, 2011.

Equity Transactions

On September 17, 2010, Navios Acquisition issued 3,000 shares of preferred stock to an independent third party holder in connection with the payment
of certain consultant and advisory fees. The preferred stock issued to the consultant was recorded at fair value as an expense in our statement of income totaling $5.6 million.

On October 29, 2010, Navios Acquisition issued 540 shares of Series B Convertible preferred stock (fair value $1.6 million) to the seller of two newbuild LR1 product tankers. The preferred
stock contains a 2% per annum dividend payable quarterly starting on January 1, 2011, and mandatorily converts into shares of common stock at various dates in the future subject to the terms and conditions of such preferred stock. The
holders of the preferred stock also have the right to convert their shares to common stock subject to certain terms and conditions. The preferred stock does not have any voting rights.

On November 19, 2010, the Company completed the public offering of 6,500,000 shares of common stock at $5.50 per share and raised gross proceeds of $35.8 million. The net proceeds of this
offering, including the underwriting discount of $1.8 million and excluding offering costs of $0.6 million were approximately $34.0 million.

Pursuant to an Exchange Agreement entered into March 30, 2011, Navios Holdings exchanged 7,676,000 shares of Navios Acquisitions common stock it held for 1,000 shares of non-voting Series C
Convertible Preferred Stock of Navios Acquisition. After giving effect to this exchange, Navios Holdings owned 45.0% of our outstanding common stock. Each holder of shares of Series C Convertible Preferred Stock is entitled at their option at any
time, after March 31, 2013, to convert all or any of their outstanding shares into shares of our common stock determined by multiplying each share of Series C Convertible Preferred Stock to be converted by 7,676 subject to certain limitations.
Upon the declaration of a common stock dividend, the holders of Series C Convertible Preferred Stock are entitled to receive dividends in an amount equal to the amount that would have been received on the number of shares of our common stock into
which the shares of Series C Convertible Preferred Stock held by each holder could be converted.

On November 4, 2011, from the 1,378,122
contingently returnable shares of common stock issued on September 10, 2010 and deposited into escrow for the VLCC Acquisition, 1,160,963 were released to the sellers and the remaining 217,159 were returned to Navios Acquisition. The returned
shares were cancelled on December 30, 2011. Following the release, Navios Holdings ownership of the outstanding voting stock of Navios Acquisition increased to 45.24%, and its economic interest in Navios Acquisition increased to 53.96%.

On each of August 31, 2012, October 31, 2012 and February 13, 2013, Navios Acquisition issued 300 shares (900 in the
aggregate) of its authorized Series D Preferred Stock (nominal value $9.0 million) to a shipyard, in partial settlement of the purchase price of the three newbuild LR1 product tankers, the Nave Cassiopeia, the Nave Cetus and the Nave Rigel. The
preferred stock contains a 6% per annum dividend payable quarterly, starting one year after delivery of each vessel. The Series D Preferred Stock will mandatorily convert into shares of common stock 30 months after the issuance, at a price per
share of common stock equal to $10.00. The holder of the preferred stock shall have the right to convert the shares of preferred stock into common stock prior to the scheduled maturity date at a price of $7.00 per share of common stock. The
preferred stock does not have any voting rights. Navios Acquisition is obligated to redeem the Series D Preferred Stock (or converted common shares), at the holders option exercisable beginning 18 months after the issuance, at par payable at
up to 12 equal quarterly installments. The convertible preferred stock is classified as temporary equity (i.e. apart from permanent equity) as a result of the redemption feature upon exercise of the put option granted to the holder of the
preferred stock.

In February 2013, Navios Acquisition completed multiple offerings, issuing a total of 35,246,791 shares of its common stock,
at a price of $2.85 per share representing gross proceeds of $100.5 million. The offerings were conducted as follows:



| |  |  | The first registered direct offering of 7,719,300 shares of common stock was completed on February 21, 2013, raising $22.0 million of gross
proceeds. The net proceeds of this offering, including the agents fees of $0.9 million and excluding estimated offering costs of approximately $0.3 million were $21.1 million.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | The second registered direct offering of 9,825,000 shares of common stock was completed on February 26, 2013, raising $28.0 million of gross
proceeds. The net proceeds of this offering, including the agents fees of $1.1 million and excluding estimated offering costs of approximately $0.3 million were $26.9 million.
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | In addition, Navios Holdings and certain members of the management of Navios Acquisition, Navios Holdings and Navios Partners purchased an aggregate of
17,702,491 shares of common stock in a private placement that was completed on February 26, 2013 raising $50.5 million of gross proceeds. The net proceeds of this private placement, including the agents fees of $2.0 million, were $48.4
million.
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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Vessel Deliveries and Acquisitions

On February 13, 2013, Navios Acquisition took delivery of the Nave Rigel, a 74,673 dwt LR1 product tanker vessel, from a South Korean shipyard. The vessel is chartered out to a high quality
counterparty for one year at a rate of $11,850 net per day, plus 50% profit sharing. The charterer has been granted an option to extend the charter for six months on the same terms.

On January 24, 2013, Navios Acquisition took delivery of the Nave Bellatrix, a 49,999 dwt MR2 product tanker vessel, from a South Korean shipyard. The vessel is chartered out to a high quality
counterparty for three years at a rate of $13,331 net per day plus 50% profit sharing. The charterer will receive the first $1,000 of profits above the base rate and the owner will receive next $1,000 of profits. Thereafter, all profits will be
split equally to each party. The charterer has been granted an option for an additional year at a rate of $14,813 net per day plus 50% profit sharing.

On November 9, 2012, Navios Acquisition took delivery of the Nave Aquila, a 49,991 dwt South Korean  built MR2 product tanker, for a total cost of $37.8 million. Cash paid was $12.7 million and
$25.1 million was transferred from vessel deposits.

On October 30, 2012, Navios Acquisition took delivery of the Nave Cetus, a 74,581
dwt South Korean  built LR1 product tanker, for a total cost of $44.0 million. Cash paid was $27.5 million, $3.0 million shares of Series D Preferred Stock were issued and $13.5 million was transferred from vessel deposits.

On August 31, 2012, Navios Acquisition took delivery of the Nave Cassiopeia, a 74,711 dwt South Korean  built LR1 product tanker, for a total
cost of $43.8 million. Cash paid was $27.3 million, $3.0 million shares of Series D Preferred Stock were issued and $13.5 million was transferred from vessel deposits.

On July 31, 2012, Navios Acquisition took delivery of the Nave Atria, a 49,992 dwt South Korean  built MR2 product tanker, for a total cost of $37.6 million. Cash paid was $9.0 million and
$28.6 million was transferred from vessel deposits.

On January 20, 2012, Navios Acquisition took delivery of the Nave Estella, a 75,000
dwt South Korean  built LR1 product tanker, for a total cost of $44.6 million. Cash paid was $11.0 million and $33.6 million was transferred from vessel deposits.

B. Business Overview

Introduction

Navios Acquisition owns a large fleet of modern crude oil, refined petroleum product and chemical tankers providing world-wide marine transportation
services. Our strategy is to charter our vessels to international oil companies, refiners and large vessel operators under long, medium and short-term charters. We are committed to providing quality transportation services and developing and
maintaining long-term relationships with our customers. We believe that the Navios brand will allow us to take advantage of increasing global environmental concerns that have created a demand in the petroleum products/crude oil seaborne
transportation industry for vessels and operators that are able to conform to the stringent environmental standards currently being imposed throughout the world.

Navios Acquisitions Fleet

As of March 21, 2013, our current fleet consists of a
total of 29 double-hulled tanker vessels, aggregating approximately 3.3 million deadweight tons, or dwt. The fleet includes seven VLCC tankers (over 200,000 dwt per ship), which transport crude oil, eight Long Range 1 (LR1) product
tankers (50,000-79,999 dwt per ship), 12 Medium Range 2 (MR2) product tankers (30,000-49,999 dwt per ship) and two chemical tankers (25,000 dwt per ship), which transport refined petroleum products and bulk liquid chemicals. Of the 29
vessels in our current fleet, we have taken delivery of seven VLCC tankers,



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seven LR1 tankers, five MR2 product tankers and two chemical tankers, and we expect to take delivery of five vessels in the remaining of 2013, and three vessels in 2014 based on current
construction schedule. All the vessels that we have taken delivery of, as well as three of the MR2 and one of the LR1 product tankers that we will take delivery of during 2013, are currently chartered-out to high-quality counterparties, including
affiliates of Shell, Formosa Petrochemical Corporation, Sinochem Group, SK Shipping and DOSCO (a wholly owned subsidiary of COSCO) with an average remaining charter period of approximately 2.8 years. As of March 19, 2013, we had charters
covering 91.1% of available days in 2013, 56.4% of available days in 2014 and 36.2% of available days in 2015, based on the estimated scheduled delivery dates for vessels under construction.



|                              |  |                    |  |                    |  |     |         |  |                   |  |        |              |  |                    |  |               
|----------------------------- |  | ------------------ |  | ------------------ |  | --- | ------- |  | ----------------- |  | ------ | ------------ |  | ------------------ |  | --------------
|Vessels                       |  | Type               |  | Built/DeliveryDate |  | DWT |         |  | NetCharterRate(1) |  |        | Profit Share |  | ExpirationDate(2) 
|                              |  |                    |  |                    |  |    
|Owned Vessels                 |  |                    |  |                    |  |     |         |  |                   |  |        |              |  |                    |  |               
|Nave Cielo                    |  | LR1 Product Tanker |  | 2007               |  |     | 74,671  |  |                   |  | 11,850 | (3,4)        |  | 50%/50%            |  | November 2013 
|Nave Ariadne                  |  | LR1 Product Tanker |  | 2007               |  |     | 74,671  |  |                   |  | 11,850 | (3,4)        |  | 50%/50%            |  | November 2013 
|Nave Cosmos                   |  | Chemical Tanker    |  | 2010               |  |     | 25,130  |  |                   |  | 11,700 | (5)          |  | 50%/50%            |  | August 2013   
|Nave Polaris                  |  | Chemical Tanker    |  | 2011               |  |     | 25,145  |  |                   |  | 11,700 | (5)          |  | 50%/50%            |  | July 2013     
|Shinyo Splendor               |  | VLCC               |  | 1993               |  |     | 306,474 |  |                   |  | 38,019 |              |  | None               |  | May 2014      
|Shinyo Navigator              |  | VLCC               |  | 1996               |  |     | 300,549 |  |                   |  | 42,705 |              |  | None               |  | December 2016 
|C. Dream                      |  | VLCC               |  | 2000               |  |     | 298,570 |  |                   |  | 29,625 |              |  | 50% above $30,000  |  | March 2019    
|                              |  |                    |  |                    |  |     |         |  |                   |  |        |              |  | 40% above $40,000  |  |               
|Shinyo Ocean                  |  | VLCC               |  | 2001               |  |     | 281,395 |  |                   |  | 38,400 |              |  | 50% above $43,500  |  | January 2017  
|Shinyo Kannika                |  | VLCC               |  | 2001               |  |     | 287,175 |  |                   |  | 38,025 |              |  | 50% above $44,000  |  | February 2017 
|Shinyo Saowalak               |  | VLCC               |  | 2010               |  |     | 298,000 |  |                   |  | 48,153 |              |  | 35% above $54,388  |  | June 2025     
|                              |  |                    |  |                    |  |     |         |  |                   |  |        |              |  | 40% above 59,388   |  |               
|                              |  |                    |  |                    |  |     |         |  |                   |  |        |              |  | 50% above 69,388   |  |               
|Shinyo Kieran                 |  | VLCC               |  | 2011               |  |     | 297,066 |  |                   |  | 48,153 |              |  | 35% above $54,388  |  | June 2026     
|                              |  |                    |  |                    |  |     |         |  |                   |  |        |              |  | 40% above $59,388  |  |               
|                              |  |                    |  |                    |  |     |         |  |                   |  |        |              |  | 50% above $69,388  |  |               
|Buddy                         |  | MR2 Product Tanker |  | 2009               |  |     | 50,470  |  |                   |  | 21,503 |              |  | None               |  | October 2014  
|Bull                          |  | MR2 Product Tanker |  | 2009               |  |     | 50,542  |  |                   |  | 21,503 |              |  | None               |  | September 2014
|Nave Andromeda                |  | LR1 Product Tanker |  | 2011               |  |     | 75,000  |  |                   |  | 12,000 | (6)          |  | 100% up to $15,000 |  | November 2014 
|                              |  |                    |  |                    |  |     |         |  |                   |  |        |              |  | 50% above $15,000  |  |               
|Nave Estella                  |  | LR1 Product Tanker |  | 2012               |  |     | 75,000  |  |                   |  | 11,850 | (7)          |  | 90% up to 15,000   |  | January 2015  
|                              |  |                    |  |                    |  |     |         |  |                   |  |        |              |  | 50% above $15,000  |  |               
|Nave Atria                    |  | MR2 Product Tanker |  | 2012               |  |     | 49,992  |  |                   |  | 13,331 | (8)          |  | 50% /50%           |  | July 2015     
|Nave Cassiopeia               |  | LR1 Product Tanker |  | 2012               |  |     | 74,711  |  |                   |  | 11,850 | (9)          |  | 50% /50%           |  | August 2013   
|Nave Cetus                    |  | LR1 Product Tanker |  | 2012               |  |     | 74,581  |  |                   |  | 11,850 | (9)          |  | 50% /50%           |  | October 2013  
|Nave Aquila                   |  | MR2 Product Tanker |  | 2012               |  |     | 49,991  |  |                   |  | 13,331 | (8)          |  | 50% /50%           |  | November 2015 
|Nave Bellatrix                |  | MR2 Product Tanker |  | 2013               |  |     | 49,999  |  |                   |  | 13,331 | (10)         |  | 50% /50%           |  | January 2016  
|Nave Rigel                    |  | LR1 Product Tanker |  | 2013               |  |     | 75,000  |  |                   |  | 11,850 | (9)          |  | 50% /50%           |  | February 2014 
|                              |  |                    |  |                    |  |    
|Owned Vessels to be Delivered |  |                    |  |                    |  |     |         |  |                   |  |        |              |  |                    |  |               
|                              |  |                    |  |                    |  |    
|TBN                           |  | LR1                |  | Q2 2013            |  |     | 75,000  |  |                   |  | 11,850 | (9)          |  | 50% /50%           |  |               
|TBN                           |  | MR2                |  | Q1 2013            |  |     | 50,000  |  |                   |  | 13,331 | (10)         |  | 50% /50%           |  |               
|TBN                           |  | MR2                |  | Q1 2013            |  |     | 50,000  |  |                   |  | 13,825 | (11)         |  | 50%/50%            |  |               
|TBN                           |  | MR2                |  | Q2 2013            |  |     | 50,000  |  |                   |  | 13,825 | (12)         |  |                    |  |               
|TBN                           |  | MR2                |  | Q2 2013            |  |     | 50,000  |  |                   |  |        |              |  |                    |  |               
|TBN                           |  | MR2                |  | Q2 2014            |  |     | 50,000  |  |                   |  |        |              |  |                    |  |               
|TBN                           |  | MR2                |  | Q3 2014            |  |     | 50,000  |  |                   |  |        |              |  |                    |  |               
|TBN                           |  | MR2                |  | Q4 2014            |  |     | 50,000  |  |                   |  |        |              |  |                    |  |               



|(1) | Net time charter-out rate per day (net of commissions).
|--- | -------------------------------------------------------



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|(2) | Estimated dates assuming midpoint of redelivery of charterers.
|--- | --------------------------------------------------------------

|(3) | On October 28, 2011, the charter contracts for the Nave Cielo and the Nave Ariadne were terminated prior to their original expiration in June 2013. Navios
Acquisition entered into certain settlement agreements with the charterers that provide for an amount of approximately $5.0 million to compensate for the early termination of the charters and to cover any outstanding receivables, out of which $2.0
million will be settled in installments through June 2015.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(4) | Charterers option to extend the charter for 6 months at same rate.
|--- | -------------------------------------------------------------------

|(5) | Charterers option to extend for additional 6 months at $12,188 (net) plus 50%/50% profit sharing.
|--- | --------------------------------------------------------------------------------------------------

|(6) | Charterers option to extend the charter for 1+1 years at $13,000 (net) 1st optional year plus 100% profit up to $16,000 plus 50/50% profit sharing above $16,000;
$14,000 (net) 2nd optional year plus 100% profit up to $17,000 plus 50/50% profit sharing above $17,000. Profit sharing formula is calculated monthly and incorporates $2,000 premium above the relevant index.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(7) | Charterers option to extend the charter for 1+1 years at $11,850 (net) 1st optional year plus 90% profit up to $16,000 plus 50/50% profit sharing above $16,000;
$11,850 (net) 2nd optional year plus 90% profit up to $17,000 plus 50/50% profit sharing above $17,000. Profit sharing formula is calculated monthly and incorporates $2,000 premium above the relevant index.
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(8) | Charter duration three years. Charterers option to extend the charter for 1+ 1 years at $14,566 (net) 1st optional year plus profit sharing;
$15,553 (net) 2ndoptional year plus profit sharing. The
profit sharing will be calculated monthly and profits will be split equally between each party. Profit sharing formula incorporates $1,000 premium above the relevant index.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(9) | Charter duration one year. Charterers option to extend the charter for another 6 months at $11,850 (net) plus 50% profit sharing.
|--- | ----------------------------------------------------------------------------------------------------------------------------------

|(10) | Charter duration three years. Charterers option to extend the charter for 1 year at $14,813 (net) plus profit sharing. The charterers will receive 100% of the
first $1,000 in profits above the base rate and the owners will receive 100% of the next $1,000. Thereafter, all profits will be split equally to each party.
|---- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(11) | Charter duration three years. Charterers option to extend the charter for 1 year at $15,306 (net) plus profit sharing. The charterers will receive 100% of the
first $1,000 in profits above the base rate and the owners will receive 100% of the next $1,000. Thereafter, all profits will be split equally to each party.
|---- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(12) | Charter duration one year. Charterers option to extend for 1 year at $14,813.
|---- | ------------------------------------------------------------------------------

Competitive Strengths

We believe that the following strengths will allow us to
maintain a competitive advantage within the international shipping market:



| |  | Modern, HighQuality Fleet. We own a large fleet of modern, highquality doublehull tankers that are designed for enhanced
safety and low operating costs. We believe that the increased enforcement of stringent environmental standards currently being imposed throughout the world has resulted in a shift in major charterers preference towards greater use of modern
doublehull vessels. We also have a large proportion of young product and chemical tankers in our fleet. Since our inception, we have committed to and have fully financed investments of over $1.0 billion, including investments of
approximately $0.6 billion in newbuilding constructions. As of March 19, 2013, our fleet had an average age of approximately 5.9 years. Once we have taken delivery of all of our vessels, scheduled to occur by the end of the fourth quarter
of 2014, the average age of our fleet will be 5.3 years. We believe that owning and maintaining a modern, highquality fleet reduces offhire time and operating costs, improves safety and environmental performance and provides us with
a competitive advantage in securing employment for our vessels.
|- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | Operating Visibility Through Contracted Revenues. All of the vessels that we have taken delivery of as of March 21, 2013, as well as the
three MR2 and one LR1 product tanker vessels that we will take delivery of in the first and second quarter of 2013, are chartered out with an average remaining charter period of approximately 2.8 years, and we believe our existing charter
coverage provides us with predictable, contracted revenues and operating visibility. As of March 21, 2013, we had charters covering 91.1% of available days in 2013, 56.4% of available days in 2014 and 36.2% of available days in 2015, based on
the estimated scheduled delivery dates for vessels under construction. The charter arrangements for our seven VLCC tankers, eight contracted LR1 tankers, eight MR2 product tankers and two chemical tankers represent $ 179.4 million in 2013,
$142.0 million in 2014 and $111.5 million in 2015 of aggregate contracted net charter revenue, exclusive of any profit sharing.
|- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | Diversified Fleet. Our diversified fleet, which includes VLCC, product and chemical tankers, allows us to serve our customers
international crude oil, petroleum product and liquid bulk chemical transportation needs. VLCC tankers transport crude oil and operate on primarily longhaul trades from the Arabian Gulf to the Far East, North America and Europe. Product
tankers transport a large number of different refined oil products, such as naphtha, gasoline, kerosene, jetfuel and gasoil, and principally operate on short to mediumhaul routes. Chemical tankers transport primarily organic and
inorganic chemicals, vegetable oils and animal fats. We believe that our fleet of vessels servicing the crude oil, product and chemical tanker transportation sectors provides us with more balanced exposure to oil and commodities and more diverse
opportunities to generate revenues than would a focus on any single shipping sector.
|- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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| |  | HighQuality Counterparties. Our strategy is to charter our vessels to international oil companies, refiners and large vessel operators
under long, medium and shortterm charters. We are committed to providing safe and quality transportation services and developing and maintaining longterm relationships with our customers, and we believe that our modern fleet will allow
us to charterout our vessels to what management views as highquality counterparties and for long periods of time. Our current charterers include Shell, one of the largest global groups of energy and petrochemical companies, operating in
over 90 countries, Dalian Ocean Shipping Company (DOSCO), a wholly owned subsidiary of COSCO, one of Chinas largest stateowned enterprises specializing in global shipping, logistics and ship building and repairing, Sinochem,
a Fortune Global 500 company; Formosa Petrochemical Corporation, a leading Taiwanese energy company; Navig8, a company that controls a substantial fleet of product tankers and SK Shipping Company Limited, a leading Korean shipowner and
transportation company and part of the Korean multinational business conglomerate, the SK Group; or their affiliates.
|- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | An Experienced Management Team and a Strong Brand. We have an experienced management team that we believe is well regarded in the shipping
industry. The members of our management team have considerable experience in the shipping and financial industries. We also believe that we will be able to leverage the management structure at Navios Holdings, which benefits from a reputation for
reliability and performance and operational experience in both the tanker and drybulk markets. Our management team is led by Angeliki Frangou, our Chairman and Chief Executive Officer, who has over 20 years of experience in the shipping
industry. Ms. Frangou is also the Chairman and CEO of Navios Holdings and Navios Partners and has been a Chief Executive Officer of various shipping and finance companies in the past. Ms. Frangou is a member of a number of recognized
shipping committees. We believe that our well respected management team and strong brand may present us with market opportunities not afforded to other industry participants.
|- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Business Strategy

We seek to generate
predictable and growing cash flow through the following:



| |  | Strategically Manage Sector Exposure. We operate a fleet of crude carriers and product and chemical tankers, which we believe provides us with
diverse opportunities with a range of producers and consumers. As we grow our fleet, we expect to adjust our relative emphasis among the crude oil, product and chemical tanker sectors according to our view of the relative opportunities in these
sectors. We believe that having a mixed fleet of tankers provides the flexibility to adapt to changing market conditions and will allow us to capitalize on sectorspecific opportunities through varying economic cycles.
|- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | Enhance Operating Visibility With CharterOut Strategy. We believe that we are a safe, costefficient operator of modern and
wellmaintained tankers. We also believe that these attributes, together with our strategy of proactively working towards meeting our customers chartering needs, will contribute to our ability to attract leading charterers as customers
and to our success in obtaining attractive longterm charters. We will also seek profit sharing arrangements in our longterm time charters, to provide us with potential incremental revenue above the contracted minimum charter rates.
Depending on then applicable market conditions, we intend to deploy our vessels to leading charterers on a mix of long, medium and shortterm time charters, with a greater emphasis on longterm charters and profit sharing. We believe that
this chartering strategy will afford us opportunities to capture increased profits during strong charter markets, while benefiting from the relatively stable cash flows and high utilization rates associated with longer term time charters. As of
March 19, 2013, we had charters covering 91.1% of available days in 2013, 56.4% of available days in 2014 and 36.2% of available days in 2015, based on the estimated scheduled delivery dates for vessels under construction. We will look to
secure employment for the newbuilding product tankers scheduled for delivery over the next three years, as we draw nearer to taking delivery of the vessels.
|- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | Capitalize on Low Vessel Prices. We intend to grow our fleet using Navios Holdings global network of relationships and extensive
experience in the marine transportation industry to make selective acquisitions of young, highquality, modern, doublehulled vessels in the crude oil, product and chemical tanker transportation sectors. We are focused on purchasing tanker
assets at favorable prices. We believe that the recent financial crisis and developments in the marine transportation industry created significant opportunities to acquire vessels in the tanker market near historically low prices on an inflation
adjusted basis. Developments in the banking industry continue to limit the availability of credit to shipping industry participants, creating opportunities for wellcapitalized companies with access to additional available financing. Although
there has been a trend towards consolidation over the past 15 years, the tanker market remains fragmented. In the ordinary course of our business, we engage in the evaluation of potential candidates for acquisitions and strategic transactions.
|- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | Leverage the Experience, Brand, Network and Relationships of Navios Holdings. We intend to capitalize on the global network of relationships
that Navios Holdings has developed during its long history of investing and operating in the marine transportation industry. This includes decadeslong relationships with leading charterers, financing sources and key shipping industry players.
When charter markets and vessel prices are depressed and vessel financing is difficult to obtain, as is currently the case, we believe the relationships and experience of Navios Holdings and its management enhances our ability to acquire young,
technically advanced vessels at cyclically low prices and employ them under attractive charters with leading charterers. Navios Holdings long involvement and reputation for reliability in the Asia Pacific region have also allowed it to
|- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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| | develop privileged relationships with many of the largest institutions in Asia. Through its established reputation and relationships, Navios Holdings has had access to opportunities not readily
available to most other industry participants that lack Navios Holdings brand recognition, credibility and track record.
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | Benefit from Navios Holdings Leading Risk Management Practices and Corporate Managerial Support. Risk management requires the balancing of
a number of factors in a cyclical and potentially volatile environment. Fundamentally, the challenge is to appropriately allocate capital to competing opportunities of owning or chartering vessels. In part, this requires a view of the overall health
of the market, as well as an understanding of capital costs and returns. Navios Holdings actively engages in assessing financial and other risks associated with fluctuating market rates, fuel prices, credit risks, interest rates and foreign exchange
rates.
|- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Navios Holdings closely monitors credit exposure to charterers and other counterparties. Navios Holdings has
established policies designed to ensure that contracts are entered into with counterparties that have appropriate credit history. Counterparties and cash transactions are limited to highcredit, qualitycollateralized corporations and
financial institutions. Navios Holdings has strict guidelines and policies that are designed to limit the amount of credit exposure. We believe that Navios Acquisition will benefit from these established policies.



| |  | Implement and Sustain a Competitive Cost Structure. Pursuant to the Management Agreement, the Manager, a subsidiary of Navios Holdings,
coordinates and oversees the commercial, technical and administrative management of our fleet. The current technical managers of the VLCC vessels, affiliates of the seller of such vessels, are technical ship management companies that have provided
technical management to the VLCC vessels prior to the consummation of the VLCC Acquisition. These technical managers will continue to provide such services for an interim period, after which the technical management of our fleet is expected to be
provided solely by the Manager. We believe that the Manager will be able to do so at rates competitive with those that would be available to us through independent vessel management companies. For example, pursuant to our management agreement with
Navios Holdings, management fees of our vessels are fixed for the first two years of the agreement. We believe this external management arrangement will enhance the scalability of our business by allowing us to grow our fleet without incurring
significant additional overhead costs. We believe that we will be able to leverage the economies of scale of Navios Holdings and manage operating, maintenance and corporate costs. At the same time, we believe the young age and highquality of
the vessels in our fleet, coupled with Navios Holdings safety and environmental record, will position us favorably within the crude oil, product and chemical tanker transportation sectors with our customers and for future business
opportunities.
|- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Our Customers

We provide or will provide seaborne shipping services under charters with customers that we believe are creditworthy. Our major customers during 2012 were: DOSCO and STX Panocean Co. LTD. For the year
ended December 31, 2012, these two customers accounted for 43.3% and 10.7%, respectively, of Navios Acquisitions revenue. For the year ended December 31, 2011, DOSCO, Blue Light Chartering Inc and Jacob Tank Chartering
GMBH & CO. KG accounted for 43.9%, 11.5% and 11.3%, respectively, of Navios Acquisitions revenue. For the year ended December 31, 2010, Jacob Tank Chartering GMBH & CO. KG, SK Shipping Company Ltd, DOSCO, Formosa
Petrochemical Corporation, Blue Light Chartering Inc and Navig8 Chemicals Shipping and Trading Co. accounted for 42.5%, 18.6%, 12.9%, 12.9% and 10.9%, respectively, of Navios Acquisitions revenue.

Although we believe that if any one of our charters were terminated we could re-charter the related vessel at the prevailing market rate relatively
quickly, the permanent loss of a significant customer or a substantial decline in the amount of services requested by a significant customer could harm our business, financial condition and results of operations if we were unable to re-charter our
vessel on a favorable basis due to thencurrent market conditions, or otherwise.

Expenses

Management fees:Pursuant to a Management Agreement dated May 28, 2010, Navios Tankers Management Inc. (the Manager), a subsidiary
of Navios Holdings, provides for five years from the closing of the Companys initial vessel acquisition, commercial and technical management services to Navios Acquisitions vessels for a daily fee of $6,000 per owned MR2 product tanker
and chemical tanker vessel and $7,000 per owned LR1 product tanker vessel and $10,000 per VLCC tanker vessel for the first two years. On May 4, 2012, Navios Acquisition amended its existing Management Agreement with the Manager, to fix the fees
for ship management services of its owned fleet at current rates for two additional years, through May 28, 2014. This daily fee covers all of the vessels operating expenses, other than certain fees and costs. During the remaining one year
of the term of the Management Agreement, Navios Acquisition expects it will reimburse Navios Holdings for all of the actual operating costs and expenses it incurs in connection with the management of



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its fleet. Actual operating costs and expenses will be determined in a manner consistent with how the initial fixed fees were determined. Drydocking expenses are fixed for the first four years
under these agreements for up to $0.3 million per LR1 and MR2 product tanker vessel and will be reimbursed at cost for VLCC vessels. Commencing as of March 30, 2012, Navios Acquisition can, upon request to the Manager, partially or fully defer
the reimbursement of drydocking and other extraordinary fees and expenses under the Agreement to a later date, but not later than January 4, 2014, and if reimbursed on a later date, such amounts will bear interest at a rate of 1% per
annum over LIBOR. Commencing as of September 28, 2012, Navios Acquisition could, upon request, reimburse the Manager partially or fully, for any fixed management fees outstanding for a period of not more than nine months under the Agreement at
a later date, but not later than December 31, 2014, and if reimbursed on a later date, such amounts will bear interest at a rate of 1% per annum over LIBOR. Total management fees for the years ended December 31, 2012, 2011 and 2010
amounted to $47.0 million, $35.7 million and $9.8 million, respectively.

General and administrative expenses: On May 28, 2010,
Navios Acquisition entered into an administrative services agreement with Navios Holdings, expiring on May 28, 2015, pursuant to which a subsidiary of Navios Holdings provides certain administrative management services to Navios Acquisition
which include: bookkeeping, audit and accounting services, legal and insurance services, administrative and clerical services, banking and financial services, advisory services, client and investor relations and other. Navios Holdings is reimbursed
for reasonable costs and expenses incurred in connection with the provision of these services. For the years ended December 31, 2012, 2011 and 2010, the fees for administrative services rendered by Navios Holdings amounted to $2.1 million, $1.5
million and $0.4 million, respectively.

Off-hire

When the vessel is off-hire, the charterer generally is not required to pay the basic hire rate, and we are responsible for all costs. Prolonged off-hire may lead to vessel substitution or
termination of the time charter. A vessel generally will be deemed off-hire if there is a loss of time due to, among other things:



| |  |  | operational deficiencies; drydocking for repairs, maintenance or inspection; equipment breakdowns; or delays due to accidents, crewing strikes, certain
vessel detentions or similar problems; or
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | the shipowners failure to maintain the vessel in compliance with its specifications and contractual standards or to provide the required crew.
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------

Under some of our charters, the charterer is permitted to terminate the time charter if the vessel is off-hire for an
extended period, which is generally defined as a period of 90 or more consecutive off-hire days.

Termination

We are generally entitled to suspend performance under the time charters covering our vessels if the customer defaults in its payment obligations. Under
some of our time charters, either party may terminate the charter in the event of war in specified countries or in locations that would significantly disrupt the free trade of the vessel. Under some of our time charters covering our vessels require
us to return to the charterer, upon the loss of the vessel, all advances paid by the charterer but not earned by us.

Management of Ship
Operations, Administration and Safety

Navios Holdings provides, through a wholly owned subsidiary, expertise in various functions critical
to our operations. Pursuant to a management agreement and an administrative services agreement with Navios Holdings, we have access to human resources, financial and other administrative functions, including:



| |  |  | bookkeeping, audit and accounting services;
| | - |  | -------------------------------------------



| |  |  | administrative and clerical services;
| | - |  | -------------------------------------



| |  |  | banking and financial services; and
| | - |  | -----------------------------------



| |  |  | client and investor relations.
| | - |  | ------------------------------

Technical management services are also provided, including:



| |  |  | commercial management of the vessel;
| | - |  | ------------------------------------



| |  |  | vessel maintenance and crewing;
| | - |  | -------------------------------



| |  |  | purchasing and insurance; and
| | - |  | -----------------------------



| |  |  | shipyard supervision.
| | - |  | ---------------------

For
more information on the management agreement we have with Navios Holdings and the administrative services agreement we have with Navios Holdings, please read Item 7.  Unit holders and Related Party Transactions.



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Oil Company Tanker Vetting Process

Traditionally there have been relatively few charterers in the oil transportation business and that part of the industry has been undergoing consolidation. The so called oil majors, such as
Exxon Mobil, BP p.l.c., Royal Dutch Shell plc. Chevron, ConocoPhillips and Total S.A., together with a few smaller companies, represent a significant percentage of the production, trading and, especially, seaborne transportation of crude oil and
refined petroleum products worldwide. Concerns about the environment have led oil majors to develop and implement a strict due diligence process, known as vetting, when selecting vessels and considering their managers. Vetting has evolved into a
sophisticated and comprehensive assessment of both the vessel and the vessel manager. While numerous factors are considered and evaluated prior to a commercial decision, the oil majors, through their association, Oil Companies International Marine
Forum (OCIMF), have developed two basic tools: the Ship Inspection Report program, which is known as SIRE and the Tanker Management & Self Assessment program, which is known as TMSA. Based upon commercial risk, there are three levels of
assessment used by oil majors:



| |  |  | terminal use, which clears a vessel to call at one of the oil majors terminals;
| | - |  | --------------------------------------------------------------------------------



| |  |  | voyage charter, which clears the vessel for a single voyage; and
| | - |  | ----------------------------------------------------------------



| |  |  | period charter, which clears the vessel for use for an extended period of time.
| | - |  | -------------------------------------------------------------------------------

The depth and complexity of each of these levels of assessment varies. Each of charter agreements for our vessels requires that the applicable vessel
have a valid SIRE report (less than six months old) in the OCIMF website as recommended by OCIMF. In addition, under the terms of the charter agreements, the charterers require that our vessels and their technical managers be vetted and approved to
transport crude oil by multiple oil majors. The technical manager is responsible for obtaining and maintaining the vetting approvals required to operate our vessels. The current technical manager of the VLCC vessels, an affiliate of the seller of
such vessels, is a technical ship management company that has provided technical management to the acquired VLCC vessels prior to the consummation of the VLCC Acquisition, and such technical manager has been vetted and approved. This technical
manager will continue to provide such services for an interim period after which the technical management of our fleet is expected to be provided solely by the Manager.

Competition

The market for international seaborne crude oil transportation services is
fragmented and highly competitive. Seaborne crude oil transportation services generally are provided by two main types of operators: major oil company captive fleets (both private and state-owned) and independent ship owner fleets. In addition,
several owners and operators pool their vessels together on an ongoing basis, and such pools are available to customers to the same extent as independently owned and operated fleets. Many major oil companies and other oil trading companies also
operate their own vessels and use such vessels not only to transport their own crude oil but also to transport crude oil for third party charterers in direct competition with independent owners and operators in the tanker charter market. Competition
for charters is intense and is based upon price, location, size, age, condition and acceptability of the vessel and its manager. Due in part to the fragmented tanker market, competitors with greater resources could enter the tanker market and
operate larger fleets through acquisitions or consolidations and may be willing or able to accept lower prices than us, which could result in our achieving lower revenues from our vessels.

Governmental and Other Regulations

Sources of applicable rules and standards

Shipping is one of the worlds most heavily regulated industries, and, in addition, it is subject to many industry standards.
Government regulation significantly affects the ownership and operation of vessels. These regulations consist mainly of rules and standards established by international conventions, but they also include national, state, and local laws and
regulations in force in jurisdictions where vessels may operate or are registered, and which are commonly more stringent than international rules and standards. This is the case particularly in the United States and, increasingly, in Europe.

A variety of governmental and private entities subject vessels to both scheduled and unscheduled inspections. These entities include local
port authorities (the U.S. Coast Guard, harbor masters or equivalent entities), classification societies, flag state administration (country vessel of registry), and charterers, particularly terminal operators. Certain of these entities require
vessel owners to obtain permits, licenses, and certificates for the operation of their vessels. Failure to maintain necessary permits or approvals could require a vessel owner to incur substantial costs or temporarily suspend operation of one or
more of its vessels.

Heightened levels of environmental and quality concerns among insurance underwriters, regulators, and charterers
continue to lead to greater inspection and safety requirements on all vessels and may accelerate the scrapping of older vessels



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throughout the industry. Increasing environmental concerns have created a demand for vessels that conform to stricter environmental standards. Vessel owners are required to maintain operating
standards for all vessels that will emphasize operational safety, quality maintenance, continuous training of officers and crews and compliance with U.S. and international regulations.

The International Maritime Organization, or IMO, has adopted a number of international conventions concerned with ship safety and with preventing, reducing or controlling pollution from ships. These fall
into two main categories, consisting firstly of those concerned generally with ship safety standards, and secondly of those specifically concerned with measures to prevent pollution.

Ship safety regulation

In the former category the primary international instrument
is the Safety of Life at Sea Convention of 1974, as amended, or SOLAS, together with the regulations and codes of practice that form part of its regime. Much of SOLAS is not directly concerned with preventing pollution, but some of its safety
provisions are intended to prevent pollution as well as promote safety of life and preservation of property. These regulations have been and continue to be regularly amended as new and higher safety standards are introduced with which we are
required to comply.

An amendment of SOLAS introduced the International Safety Management (ISM) Code, which has been effective since July
1998. Under the ISM Code the party with operational control of a vessel is required to develop an extensive safety management system that includes, among other things, the adoption of a safety and environmental protection policy setting forth
instructions and procedures for operating its vessels safely and describing procedures for responding to emergencies. The ISM Code requires that vessel operators obtain a safety management certificate for each vessel they operate. This certificate
evidences compliance by a vessels management with code requirements for a safety management system. No vessel can obtain a certificate unless its manager has been awarded a document of compliance, issued by the flag state for the vessel, under
the ISM Code. Noncompliance with the ISM Code and other IMO regulations, such as the mandatory ship energy efficiency management plan (SEEMP) which is akin to a safety management plan and came into effect on January 1, 2013, may
subject a ship owner to increased liability, may lead to decreases in available insurance coverage for affected vessels, and may result in the denial of access to, or detention in, some ports. For example, the United States Coast Guard and European
Union authorities have indicated that vessels not in compliance with the ISM Code will be prohibited from trading in ports in the United States and European Union.

Security Regulations

Since the terrorist attacks of September 11, 2001, there
have been a variety of initiatives intended to enhance vessel security. On November 25, 2002, MTSA came into effect. To implement certain portions of the MTSA, in July 2003, the U.S. Coast Guard issued regulations requiring the
implementation of certain security requirements aboard vessels operating in waters subject to the jurisdiction of the United States. Similarly, in December 2002, amendments to SOLAS created a new chapter of the convention dealing specifically
with maritime security. The new chapter went into effect on July 1, 2004, and imposes various detailed security obligations on vessels and port authorities, most of which are contained in the ISPS Code. Among the various requirements are:



| |  |  | on-board installation of automatic information systems to enhance vessel-to-vessel and vessel-to shore communications;
| | - |  | ----------------------------------------------------------------------------------------------------------------------



| |  |  | on-board installation of ship security alert systems;
| | - |  | -----------------------------------------------------



| |  |  | the development of vessel security plans; and
| | - |  | ---------------------------------------------



| |  |  | compliance with flag state security certification requirements.
| | - |  | ---------------------------------------------------------------

The U.S. Coast Guard regulations, intended to be aligned with international maritime security standards, exempt non-U.S. vessels from MTSA vessel security measures, provided such vessels had on board, by
July 1, 2004, a valid ISSC that attests to the vessels compliance with SOLAS security requirements and the ISPS Code.

International regulations to prevent pollution from ships

In the second main category of international regulation, the primary instrument is the International Convention for the Prevention of Pollution from Ships, or MARPOL, which imposes environmental standards
on the shipping industry set out in Annexes I-VI of MARPOL. These contain regulations for the prevention of pollution by oil (Annex I), by noxious liquid substances in bulk (Annex II), by harmful substances in packaged forms within
the scope of the International Maritime Dangerous Goods Code (Annex III), by sewage (Annex IV), by garbage (Annex V), and by air emissions (Annex VI).



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These regulations have been and continue to be regularly amended as new and higher standards of pollution
prevention are introduced with which we are required to comply.

For example, MARPOL Annex VI, together with the NOx Technical Code
established thereunder, sets limits on sulphur oxide and nitrogen oxide emissions from ship exhausts and prohibits deliberate emissions of ozone depleting substances, such as chlorofluorocarbons. It also includes a global cap on the sulphur content
of fuel oil and allows for special areas to be established with more stringent controls on emissions. Originally adopted in September 1997, Annex VI came into force in May 2005 and was amended in October 2008 (as was the NOx Technical Code) to
provide for progressively more stringent limits on such emissions from 2010 onwards. The revised Annex VI provides, in particular, for a reduction of the global sulfur cap, initially to 3.5% (from the previous cap of 4.5%), with effect from
January 1, 2012, then progressively reducing to 0.50% effective from January 1, 2020, subject to a feasibility review to be completed no later than 2018; and the establishment of new tiers of stringent nitrogen oxide emissions
standards for marine engines, depending on their date of installation. We anticipate incurring costs in complying with these more stringent standards.

The revised Annex VI further allows for designation, in response to proposals from member parties, of Emission Control Areas (ECAs) that impose accelerated and/or more stringent requirements for
control of sulfur oxide, particulate matter, and nitrogen oxide emissions. Such ECAs have been formally adopted for the Baltic Sea and the North Sea including the English Channel and North America, including Canada and the United States. In
addition, the United States Caribbean Sea ECA came into force on January 1, 2013having effect from January 1, 2014. For the currently-designated ECAs, much lower sulfur limits on fuel oil content are being phased in (1% from July 2010 and
0.1% from January 1, 2015), as well as nitrogen oxide after treatment requirements that will become applicable to the Baltic and North Sea ECAs in 2016. These more stringent fuel standards, when fully in effect, are expected to require measures
such as fuel switching, vessel modification adding distillate fuel storage capacity, or addition of exhaust gas cleaning scrubbers, to achieve compliance, and may require installation and operation of further control equipment at significant
increased cost.

The revised Annex I to the MARPOL Convention entered into force in January 2007. It incorporates various amendments to
the MARPOL Convention and imposes construction requirements for oil tankers delivered on or after January 1, 2010. On August 1, 2007, Regulation 12A (an amendment to Annex I) came into force imposing performance standards for
accidental oil fuel outflow and requiring oil fuel tanks to be located inside the double-hull in all ships with an aggregate oil fuel capacity of 600 cubic meters and above, and which are delivered on or after August 1, 2010, including ships
for which the building contract is entered into on or after August 1, 2007 or, in the absence of a contract, for which keel is laid on or after February 1, 2008. All of our newbuild tanker vessels will comply with Regulation 12A.

Greenhouse gas emissions

In February 2005, the Kyoto Protocol to the United Nations Framework Convention on Climate Change entered into force. Pursuant to the Kyoto Protocol, adopting countries are required to implement national
programs to reduce emissions of certain gases, generally referred to as greenhouse gases, which are suspected of contributing to global warming. Currently, the greenhouse gas emissions from international shipping do not come under the Kyoto
Protocol.

In December 2011, UN climate change talks took place in Durban and concluded with an agreement referred to as the Durban Platform
for Enhanced Action. In preparation for the Durban Conference, the International Chamber of Shipping (ICS) produced a briefing document, confirming the shipping industrys commitment to cut shipping emissions by 20% by 2020, with
significant further reductions thereafter. The ICS called on the participants in the Durban Conference to give the IMO a clear mandate to deliver emissions reductions through market-based measures, for example a shipping industry environmental
compensation fund. Notwithstanding the ICS request for global regulation of the shipping industry, the Durban Conference did not result in any proposals specifically addressing the shipping industrys role in climate change. The European
Union announced in April 2007 that it planned to expand the European Union emissions trading scheme by adding vessels, and a proposal from the European Commission was expected if no global regime for reduction of seaborne emissions had been agreed
by the end of 2011. That deadline has now expired and it remains to be seen what position the EU takes in this regard in period ahead. As of January 31, 2013, the Commission stopped short of proposing that emissions from ships be included in
the EUs emissions-trading scheme (ETS). However, on October 1, 2012, it announced that it would propose measures to monitor, verify and report on greenhouse gas emissions from the shipping sector in early 2013. This may be
seen as indicative of an intention to maintain pressure on the international negotiating process. In the United States, in 2007 the California Attorney General and a coalition of environmental groups petitioned the U.S. Environmental Protection
Agency, or EPA, in October 2007 to regulate greenhouse gas emissions from ocean-going ships under the Clean Air Act, and in 2010 another coalition of environmental groups filed suit to require the EPA to do the same. Any passage of climate control
legislation or other regulatory initiatives by the IMO, European Union, or individual countries where we operate, including the U.S. that restrict emissions of greenhouse gases from vessels could require us to make significant financial
expenditures we cannot predict with certainty at this time.



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Other international regulations to prevent pollution

In addition to MARPOL, other more specialized international instruments have been adopted to prevent different types of pollution or environmental harm
from ships. In February 2004, the IMO adopted an International Convention for the Control and Management of Ships Ballast Water and Sediments, or the BWM Convention. The BWM Conventions implementing regulations call for a phased
introduction of mandatory ballast water exchange requirements, to be replaced in time with mandatory concentration limits. The BWM Convention will not enter into force until 12 months after it has been adopted by 30 states, the combined
merchant fleets of which represent not less than 35% of the gross tonnage of the worlds merchant shipping. To date, there has not been sufficient adoption of this standard by member-states representing enough of the gross tonnage of the
worlds fleet for it to take force. However, as of January 31, 2013, the Convention has been ratified by 36 states, representing 29.07% of the global merchant shipping fleets gross tonnage and its entry-into-force with attendant
compliance costs may therefore be anticipated in the foreseeable future.

European regulations

European regulations in the maritime sector are in general based on international law. However, since the Erika incident in 1999, the European
Community has become increasingly active in the field of regulation of maritime safety and protection of the environment. It has been the driving force behind a number of amendments of MARPOL (including, for example, changes to accelerate the
time-table for the phase-out of single hull tankers, and to prohibit the carriage in such tankers of heavy grades of oil), and if dissatisfied either with the extent of such amendments or with the time-table for their introduction it has been
prepared to legislate on a unilateral basis. In some instances where it has done so, international regulations have subsequently been amended to the same level of stringency as that introduced in Europe, but the risk is well established that EU
regulations may from time to time impose burdens and costs on shipowners and operators which are additional to those involved in complying with international rules and standards.

In some areas of regulation the EU has introduced new laws without attempting to procure a corresponding amendment of international law. Notably, it adopted in 2005 a directive on ship-source pollution,
imposing criminal sanctions for pollution not only where this is caused by intent or recklessness (which would be an offence under MARPOL), but also where it is caused by serious negligence. The directive could therefore result in
criminal liability being incurred in circumstances where it would not be incurred under international law. Experience has shown that in the emotive atmosphere often associated with pollution incidents, retributive attitudes towards ship interests
have found expression in negligence being alleged by prosecutors and found by courts on grounds which the international maritime community has found hard to understand. Moreover, there is skepticism that the notion of serious negligence
is likely to prove any narrower in practice than ordinary negligence. Criminal liability for a pollution incident could not only result in us incurring substantial penalties or fines but may also, in some jurisdictions, facilitate civil liability
claims for greater compensation than would otherwise have been payable.

United States environmental regulations and laws governing
civil liability for pollution

Environmental legislation in the United States merits particular mention as it is in many respects more
onerous than international laws, representing a high-water mark of regulation with which shipowners and operators must comply, and of liability likely to be incurred in the event of non-compliance or an incident causing pollution.

U.S. federal legislation, including notably the Oil Pollution Act of 1990, or OPA, establishes an extensive regulatory and liability regime for the
protection and cleanup of the environment from oil spills, including cargo or bunker oil spills from tankers. OPA affects all owners and operators whose vessels trade in the United States, its territories and possessions or whose vessels operate in
United States waters, which includes the United States territorial sea and its 200 nautical mile exclusive economic zone. Under OPA, vessel owners, operators and bareboat charterers are responsible parties and are jointly,
severally and strictly liable (unless the spill results solely from the act or omission of a third party, an act of God or an act of war) for all containment and clean-up costs and other damages arising from discharges or substantial threats of
discharges, of oil from their vessels. In addition to potential liability under OPA as the relevant federal legislation, vessel owners may in some instances incur liability on an even more stringent basis under state law in the particular state
where the spillage occurred.

Title VII of the Coast Guard and Maritime Transportation Act of 2004, or the CGMTA, amended OPA to require
the owner or operator of any non-tank vessel of 400 gross tons or more, that carries oil of any kind as a fuel for main propulsion, including bunkers, to prepare and submit a response plan for each vessel on or before August 8, 2005. The
vessel response plans must include detailed information on actions to be taken by vessel personnel to prevent or mitigate any discharge or substantial threat of such a discharge of ore from the vessel due to operational activities or casualties.

OPA currently limits liability of the responsible party for single-hull tank vessels over 3,000 gross tons liability to the greater of $3,200
per gross ton or $23.5 million (this amount is reduced to $6.4 million if the vessel is less than 3,000 gross tons).



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For tank vessels over 3,000 gross tons, other than a single-hull vessel, liability is limited to $2,000 per
gross ton or $17.0 million (or $4.27 million for a vessel less than 3,000 gross tons), whichever is greater. These amounts are periodically adjusted for inflation.

These limits of liability do not apply if an incident was directly caused by violation of applicable United States federal safety, construction or operating regulations or by a responsible partys
gross negligence or willful misconduct, or if the responsible party fails or refuses to report the incident or to cooperate and assist in connection with oil removal activities.

In response to the Deepwater Horizon incident in the Gulf of Mexico, in 2010 the U.S. Congress has proposed, but has not formally adopted legislation that would amend OPA to mandate stronger safety
standards and increased liability and financial responsibility for offshore drilling operations, but the bill did not seek to change the OPA liability limits applicable to vessels. While Congressional activity on this topic is expected to continue
to focus on offshore facilities rather than on vessels generally, it cannot be known with certainty what form any such new legislative initiatives may take.

In addition, the Comprehensive Environmental Response, Compensation, and Liability Act, or CERCLA, which applies to the discharge of hazardous substances (other than oil) whether on land or at sea,
contains a similar liability regime and provides for cleanup, removal and natural resource damages. Liability under CERCLA is limited to the greater of $300 per gross ton or $0.5 million for vessels not carrying hazardous substances as cargo or
residue, unless the incident is caused by gross negligence, willful misconduct, or a violation of certain regulations, in which case liability is unlimited.

We currently maintain, for each of our owned vessels, insurance coverage against pollution liability risks in the amount of $1.0 billion per incident. The insured risks include penalties and fines as
well as civil liabilities and expenses resulting from accidental pollution. However, this insurance coverage is subject to exclusions, deductibles and other terms and conditions. If any liabilities or expenses fall within an exclusion from coverage,
or if damages from a catastrophic incident exceed the $1.0 billion limitation of coverage per incident, our cash flow, profitability and financial position could be adversely impacted.

Under OPA, an owner or operator of a fleet of vessels is required only to demonstrate evidence of financial responsibility in an amount sufficient to cover the vessel in the fleet having the greatest
maximum liability under OPA. Under the self-insurance provisions, the shipowner or operator must have a net worth and working capital, measured in assets located in the United States against liabilities located anywhere in the world, that exceeds
the applicable amount of financial responsibility. We have complied with the U.S. Coast Guard regulations by providing a certificate of responsibility from third party entities that are acceptable to the U.S. Coast Guard evidencing
sufficient self-insurance.

The U.S. Coast Guards regulations concerning certificates of financial responsibility provide, in
accordance with OPA, that claimants may bring suit directly against an insurer or guarantor that furnishes certificates of financial responsibility. In the event that such insurer or guarantor is sued directly, it is prohibited from asserting any
contractual defense that it may have had against the responsible party and is limited to asserting those defenses available to the responsible party and the defense that the incident was caused by the willful misconduct of the responsible party.
Certain organizations, which had typically provided certificates of financial responsibility under pre-OPA laws, including the major protection and indemnity organizations, have declined to furnish evidence of insurance for vessel owners and
operators if they are subject to direct actions or required to waive insurance policy defenses. This requirement may have the effect of limiting the availability of the type of coverage required by the Coast Guard and could increase our costs of
obtaining this insurance as well as the costs of our competitors that also require such coverage.

OPA specifically permits individual states
to impose their own liability regimes with regard to oil pollution incidents occurring within their boundaries, and some states environmental laws impose unlimited liability for oil spills. In some cases, states which have enacted such
legislation have not yet issued implementing regulations defining vessels owners responsibilities under these laws. We intend to comply with all applicable state regulations in the ports where our vessels call.

The United States Clean Water Act prohibits the discharge of oil or hazardous substances in U.S. navigable waters and imposes strict liability in
the form of penalties for unauthorized discharges. The Clean Water Act also imposes substantial liability for the costs of removal, remediation and damages and complements the remedies available under CERCLA. The EPA regulates the discharge of
ballast water and other substances incidental to the normal operation of vessels in U.S. waters using a Vessel General Permit, or VGP, system pursuant to the CWA, in order to combat the risk of harmful organisms that can travel in ballast water
carried from foreign ports. Compliance with the conditions of the VGP is required for commercial vessels 79 feet in length or longer (other than commercial fishing vessels.) In November 2011, the EPA issued a revised draft Vessel General Permit
that is expected to go into effect in 2013. This new VGP will impose a numeric standard to control the release of non-indigenous invasive species in ballast water discharges. In addition, through the CWA certification provisions that allow US states
to place additional conditions on use of the VGP within state waters, a number of states have proposed or implemented a variety of stricter ballast water requirements including, in some states, specific treatment standards.



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Compliance with new U.S. federal and state requirements could require the installation of equipment on our vessels to treat ballast water before it is discharged or the implementation of
other port facility disposal arrangements or procedures at potentially substantial cost, and/or otherwise restrict our vessels from entering U.S. waters.

The Federal Clean Air Act (CAA) requires the EPA to promulgate standards applicable to emissions of volatile organic compounds and other air contaminants. Our vessels are subject to CAA vapor
control and recovery standards (VCS) for cleaning fuel tanks and conducting other operations in regulated port areas, and to CAA emissions standards for so-called Category 3 marine diesel engines operating in
U.S. waters. In April 2010, EPA adopted regulations implementing the provision of MARPOL Annex VI regarding emissions from Category 3 marine diesel engines. Under these regulations, both U.S. and foreign-flagged ships must comply with
the applicable engine and fuel standards of MARPOL Annex VI, including the stricter North America Emission Control Area (ECA) standards which took effect in August 2012, when they enter U.S. ports or operate in most internal
U.S. waters including the Great Lakes. MARPOL Annex VI requirements are discussed in greater detail above under International regulations to prevent pollution from ships. We may incur costs to install control equipment on our
vessels to comply with the new standards.

Also under the CAA, the U.S. Coast Guard has since 1990 regulated the safety of VCSs that are
required under EPA and state rules. Our vessels operating in regulated port areas have installed VCSs that are compliant with EPA, state and U.S. Coast Guard requirements. In October 2010, the U.S. Coast Guard proposed a rule that would
make its VCS requirements more compatible with new EPA and State regulations, reflect changes in VCS technology, and codify existing U.S. Coast Guard guidelines. It appears unlikely that the updated U.S. Coast Guard rule when finalized
will impose a material increase in costs.

We intend to comply with all applicable state and U.S. federal regulations in the ports where
our vessels call.

International laws governing civil liability to pay compensation or damages

We operate a fleet of product and chemical tankers that are subject to national and international laws governing pollution from such vessels. Several
international conventions impose and limit pollution liability from vessels. An owner of a tanker vessel carrying a cargo of persistent oil as defined by the International Convention for Civil Liability for Oil Pollution Damage (the
CLC) is subject under the convention to strict liability for any pollution damage caused in a contracting state by an escape or discharge from cargo or bunker tanks. This liability is subject to a financial limit calculated by reference
to the tonnage of the ship, and the right to limit liability may be lost if the spill is caused by the shipowners intentional or reckless conduct. Liability may also be incurred under the CLC for a bunker spill from the vessel even when she is
not carrying such cargo, but is in ballast.

When a tanker is carrying clean oil products that do not constitute persistent oil
that would be covered under the CLC, liability for any pollution damage will generally fall outside the CLC and will depend on other international conventions or domestic laws in the jurisdiction where the spillage occurs. The same principle applies
to any pollution from the vessel in a jurisdiction which is not a party to the CLC. The CLC applies in over 100 jurisdictions around the world, but it does not apply in the United States, where the corresponding liability laws such as the Oil
Pollution Act of 1990 (The OPA) discussed below, are particularly stringent.

In 2001, the IMO adopted the International
Convention on Civil Liability for Bunker Oil Pollution Damage, or the Bunker Convention, which imposes strict liability on shipowners for pollution damage in jurisdictional waters of ratifying states caused by discharges of bunker oil.
The Bunker Convention defines bunker oil as any hydrocarbon mineral oil, including lubricating oil, used or intended to be used for the operation or propulsion of the ship, and any residues of such oil. The Bunker Convention
also requires registered owners of ships over a certain size to maintain insurance for pollution damage in an amount equal to the limits of liability under the applicable national or international limitation regime (but not exceeding the amount
calculated in accordance with the Convention on Limitation of Liability for Maritime Claims of 1976, as amended, or the 1976 Convention). The Bunker Convention entered into force on November 21, 2008, and as of January 31, 2013 it was in
effect in 68 states. In other jurisdictions liability for spills or releases of oil from ships bunkers continues to be determined by the national or other domestic laws in the jurisdiction where the events or damages occur.

Outside the United States, national laws generally provide for the owner to bear strict liability for pollution, subject to a right to limit liability
under applicable national or international regimes for limitation of liability. The most widely applicable international regime limiting maritime pollution liability is the 1976 Convention. Rights to limit liability under the 1976 Convention are
forfeited where a spill is caused by a shipowners intentional or reckless conduct. Some states have ratified the 1996 LLMC Protocol to the 1976 Convention, which provides for liability limits substantially higher than those set forth in the
1976 Convention to apply in such states. Finally, some jurisdictions are not a party to either the 1976 Convention or the 1996 LLMC Protocol, and, therefore, shipowners rights to limit liability for maritime pollution in such jurisdictions may
be uncertain.



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Inspection by Classification Societies

Every sea going vessel must be classed by a classification society. The classification society certifies that the vessel is in class, signifying that the vessel has been built and
maintained in accordance with the rules of the classification society and complies with applicable rules and regulations of the vessels country of registry and the international conventions of which that country is a member. In addition, where
surveys are required by international conventions and corresponding laws and ordinances of a flag state, the classification society will undertake them on application or by official order, acting on behalf of the authorities concerned.

The classification society also undertakes, on request, other surveys and checks that are required by regulations and requirements of the flag state.
These surveys are subject to agreements made in each individual case or to the regulations of the country concerned. For maintenance of the class, regular and extraordinary surveys of hull, machinery (including the electrical plant) and any special
equipment classed are required to be performed as follows:



| |  | Annual Surveys: For ocean-going ships, annual surveys are conducted for the hull and the machinery (including the electrical plant) and, where
applicable, for special equipment classed, at intervals of 12 months from the date of commencement of the class period indicated in the certificate.
|- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | Intermediate Surveys: Extended annual surveys are referred to as intermediate surveys and typically are conducted two and a half years after
commissioning and each class renewal. Intermediate surveys may be carried out on the occasion of the second or third annual survey.
|- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | Class Renewal Surveys: Class renewal surveys, also known as special surveys, are carried out for the ships hull, machinery (including
the electrical plant), and for any special equipment classed, at the intervals indicated by the character of classification for the hull. At the special survey, the vessel is thoroughly examined, including audio-gauging, to determine the thickness
of its steel structure. Should the thickness be found to be less than class requirements, the classification society would prescribe steel renewals. The classification society may grant a one year grace period for completion of the special survey.
Substantial amounts of money may have to be spent for steel renewals to pass a special survey if the vessel experiences excessive wear and tear. In lieu of the special survey every four or five years, depending on whether a grace period was granted,
a shipowner has the option of arranging with the classification society for the vessels integrated hull or machinery to be on a continuous survey cycle, in which every part of the vessel would be surveyed within a five-year cycle.
|- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Risk of Loss and Liability Insurance

General

The operation of any cargo vessel includes risks such as mechanical failure,
physical damage, collision, property loss, and cargo loss or damage and business interruption due to political circumstances in foreign countries, hostilities and labor strikes. In addition, there is always an inherent possibility of marine
disaster, including oil spills and other environmental mishaps, and the liabilities arising from owning and operating vessels in international trade. The OPA, which imposes virtually unlimited liability upon owners, operators and demise charterers
of any vessel trading in the United States exclusive economic zone for certain oil pollution accidents in the United States, has made liability insurance more expensive for ship owners and operators trading in the United States market. While Navios
Acquisition believes that its insurance coverage is adequate, not all risks can be insured, and there can be no guarantee that any specific claim will be paid, or that we will always be able to obtain adequate insurance coverage at reasonable rates.

Hull and Machinery Insurance

Navios Acquisition has obtained marine hull and machinery and war risk insurance, which includes the risk of actual or constructive total loss, for all of
its vessels. The vessels will each be covered up to at least fair market value, with deductibles in amounts ranging between $100,000 and $250,000, depending on the size of the tanker vessel. Navios Acquisition has also extended its war risk
insurance to include war loss of hire for any loss of time to the vessel, including for physical repairs, caused by a warlike incident, including a piracy seizure.

Navios Acquisition has arranged, as necessary, increased value insurance for its vessels. With the increased value insurance, in case of total loss of the vessel, Navios Acquisition will be able to
recover the sum insured under the increased value policy in addition to the sum insured under the hull and machinery policy. Increased value insurance also covers excess liabilities that are not recoverable in full by the hull and machinery policies
by reason of under insurance. Navios Acquisition does not expect to maintain loss of hire insurance for its vessels. Loss of hire insurance covers business interruptions that result in the loss of use of a vessel.



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Protection and Indemnity Insurance

Protection and indemnity insurance is provided by mutual protection and indemnity associations, or P&I Associations, which covers Navios Acquisitions third-party liabilities in connection with
the operation of its ships. This includes third-party liability and other related expenses of injury or death of crew, passengers and other third parties, loss or damage to cargo, claims arising from collisions with other vessels, damage to other
third-party property, pollution arising from oil or other substances, and salvage, towing and other related costs, including wreck removal. Protection and indemnity insurance is a form of mutual indemnity insurance, extended by protection and
indemnity mutual associations.

Navios Acquisitions protection and indemnity insurance coverage for oil pollution is limited to
$1.0 billion per event. The 13 P&I Associations that comprise the International Group insure approximately 95% of the worlds commercial tonnage and have entered into a pooling agreement to reinsure each associations liabilities.
Each vessel that Navios Acquisition acquires will be entered with P&I Associations of the International Group. Under the International Group reinsurance program for the current policy year, each P&I club in the International Group is
responsible for the first $9.0 million of every claim. In every claim the amount in excess of $9.0 million and up to $70.0 million is shared by the clubs under a pooling agreement. Any claim in excess of $70.0 million is
reinsured by the International Group under the General Excess of Loss Reinsurance Contract. This policy currently provides an additional $2.0 billion of coverage for non-oil pollution claims. Further to this, overspill protection has been
placed by the International Group for claims up to $1 billion in excess of $2.07 billion, i.e. $3.07 billion in total. For passengers and crew claims the overall limit is $3.0 billion any one even any one vessel with a sub-limit of $2.0 billion for
passengers.

As a member of a P&I Association, which is a member of the International Group, Navios Acquisition will be subject to calls
payable to the associations based on its claim records as well as the claim records of all other members of the individual associations, and members of the pool of P&I Associations comprising the International Group. The P&I
Associations policy year commences on February 20th. Calls are levied by means of Estimated Total Premiums (ETP) and the amount of the final installment of the ETP varies according to the actual total premium ultimately
required by the club for a particular policy year. Members have a liability to pay supplementary calls which might be levied by the board of directors of the club if the ETP is insufficient to cover amounts paid out by the club.

Exchange Controls

Under Marshall
Islands law, there are currently no restrictions on the export or import of capital, including foreign exchange controls or restrictions that affect the remittance of dividends, interest or other payments to non-resident holders of Navios
Acquisitions securities.

Facilities

We do not own any real estate or other physical property. Our headquarters are located at 85 Akti Miaouli Street, Piraeus, Greece 185 38. We believe that our office facilities are suitable and adequate
for our business as it is presently conducted. We presently occupy office space provided by Navios Holdings. Navios Holdings has agreed that it will make such office space, as well as certain office and secretarial services, available to us, as may
be required by us from time to time.

Crewing and Staff

The Manager crews its vessels primarily with Greek, Filipino, Romanian, Russian and Ukranian officers and Filipino seamen. The Manager is responsible for selecting its Greek officers. For other
nationalities, officers and seamen are referred to us by local crewing agencies. Navios Acquisition requires that all of its seamen have the qualifications and licenses required to comply with international regulations and shipping conventions.

Administrative Services

On
May 28, 2010, Navios Acquisition entered into an administrative services agreement with Navios Holdings, expiring on May 28, 2015, pursuant to which Navios Holdings provides certain administrative management services to Navios Acquisition,
which include bookkeeping, audit and accounting services, legal and insurance services, administrative and clerical services, banking and financial services, advisory services, client and investor relations and other services. Navios Holdings is
reimbursed for reasonable costs and expenses incurred in connection with the provision of these services. See Item 7B-Related Party Transactions  the Administrative Services Agreement.



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Legal Proceedings

To the knowledge of management, there is no litigation currently pending or contemplated against us or any of our officers or directors in their capacity as such.

C. Organizational Structure

The
table below lists the Companys wholly-owned subsidiaries as of December 31, 2012.



|                                                          |  |                       |  |                         
|--------------------------------------------------------- |  | --------------------- |  | ------------------------
|Navios Maritime Acquisition Corporation and Subsidiaries: |  | Nature                |  | Country of Incorporation
|Company Name                                              |  |                       |  |                         
|Aegean Sea Maritime Holdings Inc.                         |  | Sub-Holding Company   |  | Marshall Is.            
|Amorgos Shipping Corporation                              |  | Vessel Owning Company |  | Marshall Is.            
|Andros Shipping Corporation                               |  | Vessel Owning Company |  | Marshall Is.            
|Antikithira Shipping Corporation                          |  | Vessel Owning Company |  | Marshall Is.            
|Antiparos Shipping Corporation                            |  | Vessel Owning Company |  | Marshall Is.            
|Amindra Shipping Co.                                      |  | Sub-Holding Company   |  | Marshall Is.            
|Crete Shipping Corporation                                |  | Vessel Owning Company |  | Marshall Is.            
|Folegandros Shipping Corporation                          |  | Vessel Owning Company |  | Marshall Is.            
|Ikaria Shipping Corporation                               |  | Vessel Owning Company |  | Marshall Is.            
|Ios Shipping Corporation                                  |  | Vessel Owning Company |  | Cayman Is.              
|Kithira Shipping Corporation                              |  | Vessel Owning Company |  | Marshall Is.            
|Kos Shipping Corporation(1)                               |  | Vessel Owning Company |  | Marshall Is.            
|Mytilene Shipping Corporation(1)                          |  | Vessel Owning Company |  | Marshall Is.            
|Navios Acquisition Finance (U.S.) Inc.                    |  | Co-Issuer             |  | Delaware                
|Rhodes Shipping Corporation                               |  | Vessel Owning Company |  | Marshall Is.            
|Navios Maritime Acquisition Corporation                   |  | Holding Company       |  | Marshall Is.            
|Serifos Shipping Corporation                              |  | Vessel Owning Company |  | Marshall Is.            
|Shinyo Dream Limited                                      |  | Vessel Owning Company |  | Hong Kong               
|Shinyo Kannika Limited                                    |  | Vessel Owning Company |  | Hong Kong               
|Shinyo Kieran Limited                                     |  | Vessel Owning Company |  | British Virgin Is.      
|Shinyo Loyalty Limited                                    |  | Vessel Owning Company |  | Hong Kong               
|Shinyo Navigator Limited                                  |  | Vessel Owning Company |  | Hong Kong               
|Shinyo Ocean Limited                                      |  | Vessel Owning Company |  | Hong Kong               
|Shinyo Saowalak Limited                                   |  | Vessel Owning Company |  | British Virgin Is.      
|Sifnos Shipping Corporation(1)                            |  | Vessel Owning Company |  | Marshall Is.            
|Skiathos Shipping Corporation(1)                          |  | Vessel Owning Company |  | Marshall Is.            
|Skopelos Shipping Corporation                             |  | Vessel Owning Company |  | Cayman Is.              
|Syros Shipping Corporation(1)                             |  | Vessel Owning Company |  | Marshall Is.            
|Thera Shipping Corporation(1)                             |  | Vessel Owning Company |  | Marshall Is.            
|Tinos Shipping Corporation(1)                             |  | Vessel Owning Company |  | Marshall Is.            
|Oinousses Shipping Corporation(1)                         |  | Vessel Owning Company |  | Marshall Is.            
|Psara Shipping Corporation(1)                             |  | Vessel Owning Company |  | Marshall Is.            
|Antipsara Shipping Corporation(1)                         |  | Vessel Owning Company |  | Marshall Is.            



|(1) | Each company has the rights over a shipbuilding contract of a tanker vessel.
|--- | ----------------------------------------------------------------------------

D. Property, plants and equipment

Other than our vessels, we do not have any other
material property, plant or equipment.

Item 4A. Unresolved Staff Comments

None.

Item 5. Operating and Financial Review and Prospects

Overview

Navios Acquisition was incorporated in the Republic of the Marshall Islands on
March 14, 2008.

On May 25, 2010, we consummated the Product and Chemical Tanker Acquisition, the acquisition of 13 vessels (11
product tankers and two chemical tankers), for an aggregate purchase price of $457.7 million, including amounts to be paid for future contracted vessels to be delivered. On September 10, 2010, we consummated the VLCC Acquisition, for an
aggregate purchase price of $587.0 million.



44



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On October 21, 2010, Navios Acquisition and Navios Acquisition Finance (US) Inc., its wholly owned
finance subsidiary (Navios Acquisition Finance), completed the sale of $400.0 million of 8 5/8% First Priority Ship Mortgage notes due 2017 (the Existing Notes).

On May 26, 2011, Navios Acquisition and Navios Acquisition Finance completed the sale of $105.0 million of 8 5/8% first priority ship mortgage notes due 2017 (the Additional Notes)
at 102.25% plus accrued interest from May 1, 2011.

Equity Transactions

On September 17, 2010, Navios Acquisition issued 3,000 shares of preferred stock to an independent third party holder in connection with the payment
of certain consultant and advisory fees. The preferred stock issued to the consultant was recorded at fair value as an expense in our statement of income totaling $5.6 million.

On October 29, 2010, Navios Acquisition issued 540 shares of Series B Convertible preferred stock (fair value $1.6 million) to the seller of the two newbuild LR1 product tankers the Company
recently acquired. The preferred stock contains a 2% per annum dividend payable quarterly starting on January 1, 2011, and mandatorily converts into shares of common stock at various dates in the future subject to the terms and conditions
of such preferred stock. The holders of the preferred stock also have the right to convert their shares to common stock subject to certain terms and conditions. The preferred stock does not have any voting rights.

On November 19, 2010, the Company completed the public offering of 6,500,000 shares of common stock at $5.50 per share and raised gross proceeds of
$35.8 million. The net proceeds of this offering, including the underwriting discount of $1.8 million and excluding offering costs of $0.6 million were approximately $34.0 million.

Pursuant to an Exchange Agreement entered into March 30, 2011, Navios Holdings exchanged 7,676,000 shares of Navios Acquisitions common stock
it held for 1,000 shares of non-voting Series C Convertible Preferred Stock of Navios Acquisition. After giving effect to this exchange, Navios Holdings owned 45.0% of our outstanding common stock. Each holder of shares of Series C Convertible
Preferred Stock is entitled at their option at any time, after March 31, 2013, to convert all or any of their outstanding shares into shares of our common stock determined by multiplying each share of Series C Convertible Preferred Stock to be
converted by 7,676, subject to certain limitations. Upon the declaration of a common stock dividend, the holders of Series C Convertible Preferred Stock are entitled to receive dividends in an amount equal to the amount that would have been received
on the number of shares of our common stock into which the shares of Series C Convertible Preferred Stock held by each holder could be converted.

On November 4, 2011, with respect to the shares held in escrow for the VLCC Acquisition, a total of 1,160,963 shares of common stock were released to the sellers and the remaining 217,159 were
returned to Navios Acquisition in settlement of claims for breaches of representations and warranties attributable to the sellers. The returned shares were cancelled on December 30, 2011.

On each of August 31, 2012, October 31, 2012 and February 13, 2013, Navios Acquisition issued 300 shares (900 in the aggregate) of
its authorized Series D Preferred Stock (nominal value $9.0 million) to a shipyard, in partial settlement of the purchase price of the three newbuild LR1 product tankers, the Nave Cassiopeia, the Nave Cetus and the Nave Rigel. The preferred stock
contains a 6% per annum dividend payable quarterly, starting one year after delivery of each vessel. The Series D Preferred Stock will mandatorily convert into shares of common stock 30 months after the issuance, at a price per share of common
stock equal to $10.00. The holder of the preferred stock shall have the right to convert the shares of preferred stock into common stock prior to the scheduled maturity date at a price of $7.00 per share of common stock. The preferred stock does not
have any voting rights. Navios Acquisition is obligated to redeem the Series D Preferred Stock (or converted common shares), at the holders option exercisable beginning 18 months after the issuance, at par payable at up to 12 equal quarterly
installments. The convertible preferred stock is classified as temporary equity (i.e. apart from permanent equity) as a result of the redemption feature upon exercise of the put option granted to the holder of the Series D Preferred Stock.

In February 2013, Navios Acquisition completed multiple offerings, issuing a total of 35,246,791 shares of its common stock, at a price of
$2.85 per share representing gross proceeds of $100.5 million. The offerings were conducted as follows:



| |  |  | The first registered direct offering of 7,719,300 shares of common stock was completed on February 21, 2013, raising $22.0 million of gross
proceeds. The net proceeds of this offering including the agents fees of $0.9 million and excluding estimated offering costs of approximately $0.3 million, were $21.1 million.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | The second registered direct offering of 9,825,000 shares of common stock was completed on February 26, 2013, raising $28.0 million of gross
proceeds. The net proceeds of this offering, including the agents fees of $1.1 million and excluding estimated offering costs of approximately $0.3 million, were $26.9 million.
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | In addition Navios Holdings and certain members of the management of Navios Acquisition, Navios Holdings and Navios Partners purchased an aggregate of
17,702,491 shares of common stock in a private placement that was completed on February 26, 2013 raising $50.5 million of gross proceeds. The net proceeds of this private placement, including the agents fees of $2.0 million, were $48.4
million.
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



45



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As of March 21, 2013 Navios Acquisition had outstanding: 75,764,204 shares of common stock, 4,540
shares of preferred stock and 900 shares of convertible preferred stock, 6,037,994 public warrants. Included in the number of shares and warrants are 12,752 units (one unit consists of one share of common stock and one warrant).

Fleet Development

On
January 27, 2011, Navios Acquisition took delivery of the Nave Polaris, a 25,145 dwt South Korean-built chemical tanker, for a total cost of $31.7 million. Cash paid was $4.5 million and $27.2 million was transferred from vessel deposits.

On June 8, 2011, Navios Acquisition took delivery of a 297,066 dwt VLCC, the Shinyo Kieran, from a Chinese shipyard, for a total cost of
$119.4 million. Cash paid was $29.3 million and $90.1 million was transferred from vessel deposits.

On July 12, 2011, Navios Acquisition
took delivery of the Bull, a 2009  built MR2 product tanker vessel of 50,542 dwt and attached time charter, for a total cost of $42.4 million that was paid in cash. Favorable lease terms recognized through this transaction amounted to
$5.1 million and the balance of $37.3 million was classified under vessels, net.

On July 18, 2011, Navios Acquisition took
delivery of the Buddy, a 2009-built MR2 product tanker vessel of 50,470 dwt and attached time charter, for a total cost of $42.5 million that was paid in cash. Favorable lease terms recognized through this transaction amounted to
$5.2 million and the balance of $37.3 million was classified under vessels, net.

On November 14, 2011, Navios Acquisition took
delivery of the Nave Andromeda, a 75,000 dwt LR1 South Korean  built product tanker, for a total cost of $44.3 million. Cash paid was $27.0 million and $17.3 million was transferred from vessel deposits.

On January 20, 2012, Navios Acquisition took delivery of the Nave Estella, a 75,000 dwt South Korean built LR1 product tanker, for a total
cost of $44.6 million. Cash paid was $11.0 million and $33.6 million was transferred from vessel deposits.

On July 31, 2012, Navios
Acquisition took delivery of the Nave Atria, a 49,992 dwt South Korean built MR2 product tanker, for a total cost of $37.6 million. Cash paid was $9.0 million and $28.6 million was transferred from vessel deposits.

On August 31, 2012, Navios Acquisition took delivery of the Nave Cassiopeia, a 74,711 dwt South Korean built LR1 product tanker, for a total
cost of $43.8 million. Cash paid was $27.3 million, $3.0 million shares of Series D Preferred Stock were issued and $13.5 million was transferred from vessel deposits.

On October 30, 2012, Navios Acquisition took delivery of the Nave Cetus, a 74,581 dwt South Korean built LR1 product tanker, for a total cost of $44.0 million. Cash paid was $27.5 million, $3.0
million shares of Series D Preferred Stock were issued and $13.5 million was transferred from vessel deposits.

On November 9, 2012,
Navios Acquisition took delivery of the Nave Aquila, a 49,991 dwt South Korean built MR2 product tanker, for a total cost of $37.8 million. Cash paid was $12.7 million and $25.1 million was transferred from vessel deposits.

On January 24, 2013, Navios Acquisition took delivery of the Nave Bellatrix, a 49,999 dwt MR2 product tanker vessel, from a South Korean shipyard.

On February 13, 2013, Navios acquisition took delivery of the Nave Rigel, a 74,673 dwt LR1 product tanker vessel, from a South Korean
shipyard.



46



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|                                                         |        |                       |               |                    |      |                         |      |              |      |              
|-------------------------------------------------------- | ------ | --------------------- | ------------- | ------------------ | ---- | ----------------------- | ---- | ------------ | ---- | -------------
|Navios Maritime Acquisition Corporation andSubsidiaries: |        |                       |               | Country of         |      | Statement of operations
|                                                         | Nature |                       | Incorporation |                    | 2012 |                         | 2011 |              | 2010
|Company Name                                             |        |                       |               |                    |      |                         |      |              |      |              
|Aegean Sea Maritime Holdings Inc.                        |        | Sub-Holding Company   |               | Marshall Is.       |      | 1/1 - 12/31             |      | 1/1 - 12/31  |      | 5/28 - 12/31 
|Amorgos Shipping Corporation                             |        | Vessel Owning Company |               | Marshall Is.       |      | 1/1 - 12/31             |      | 1/1 - 12/31  |      | 5/28 - 12/31 
|Andros Shipping Corporation                              |        | Vessel Owning Company |               | Marshall Is.       |      | 1/1 - 12/31             |      | 1/1 - 12/31  |      | 5/28 - 12/31 
|Antikithira Shipping Corporation                         |        | Vessel Owning Company |               | Marshall Is.       |      | 1/1 - 12/31             |      | 6/7 - 12/31  |      |             
|Antiparos Shipping Corporation                           |        | Vessel Owning Company |               | Marshall Is.       |      | 1/1 - 12/31             |      | 1/1 - 12/31  |      | 5/28 - 12/31 
|Amindra Shipping Co.                                     |        | Sub-Holding Company   |               | Marshall Is.       |      | 1/1 - 12/31             |      | 4/28 - 12/31 |      |             
|Crete Shipping Corporation                               |        | Vessel Owning Company |               | Marshall Is.       |      | 1/1 - 12/31             |      | 1/1 - 12/31  |      | 5/28 - 12/31 
|Folegandros Shipping Corporation                         |        | Vessel Owning Company |               | Marshall Is.       |      | 1/1 - 12/31             |      | 1/1 - 12/31  |      | 10/26 - 12/31
|Ikaria Shipping Corporation                              |        | Vessel Owning Company |               | Marshall Is.       |      | 1/1 - 12/31             |      | 1/1 - 12/31  |      | 5/28 - 12/31 
|Ios Shipping Corporation                                 |        | Vessel Owning Company |               | Cayman Is.         |      | 1/1 - 12/31             |      | 1/1 - 12/31  |      | 5/28 - 12/31 
|Kithira Shipping Corporation                             |        | Vessel Owning Company |               | Marshall Is.       |      | 1/1 - 12/31             |      | 6/7 - 12/31  |      |             
|Kos Shipping Corporation(1)                              |        | Vessel Owning Company |               | Marshall Is.       |      | 1/1 - 12/31             |      | 1/1 - 12/31  |      | 5/28 - 12/31 
|Mytilene Shipping Corporation(1)                         |        | Vessel Owning Company |               | Marshall Is.       |      | 1/1 - 12/31             |      | 1/1 - 12/31  |      | 5/28 - 12/31 
|Navios Acquisition Finance (U.S.) Inc.                   |        | Co-Issuer             |               | Delaware           |      | 1/1 - 12/31             |      | 1/1 - 12/31  |      | 10/05 -12/31 
|Navios Maritime Acquisition Corporation                  |        | Holding Company       |               | Marshall Is.       |      | 1/1 - 12/31             |      | 1/1 - 12/31  |      | 1/1 - 12/31  
|Rhodes Shipping Corporation                              |        | Vessel Owning Company |               | Marshall Is.       |      | 1/1 - 12/31             |      | 1/1 - 12/31  |      | 5/28 - 12/31 
|Serifos Shipping Corporation                             |        | Vessel Owning Company |               | Marshall Is.       |      | 1/1 - 12/31             |      | 1/1 - 12/31  |      | 10/26 -12/31 
|Shinyo Dream Limited                                     |        | Vessel Owning Company |               | Hong Kong          |      | 1/1 - 12/31             |      | 1/1 - 12/31  |      | 9/10 - 12/31 
|Shinyo Kannika Limited                                   |        | Vessel Owning Company |               | Hong Kong          |      | 1/1 - 12/31             |      | 1/1 - 12/31  |      | 9/10 - 12/31 
|Shinyo Kieran Limited                                    |        | Vessel Owning Company |               | British Virgin Is. |      | 1/1 - 12/31             |      | 1/1 - 12/31  |      | 9/10 - 12/31 
|Shinyo Loyalty Limited                                   |        | Vessel Owning Company |               | Hong Kong          |      | 1/1 - 12/31             |      | 1/1 - 12/31  |      | 9/10 - 12/31 
|Shinyo Navigator Limited                                 |        | Vessel Owning Company |               | Hong Kong          |      | 1/1 - 12/31             |      | 1/1 - 12/31  |      | 9/10 - 12/31 
|Shinyo Ocean Limited                                     |        | Vessel Owning Company |               | Hong Kong          |      | 1/1 - 12/31             |      | 1/1 - 12/31  |      | 9/10 - 12/31 
|Shinyo Saowalak Limited                                  |        | Vessel Owning Company |               | British Virgin Is. |      | 1/1 - 12/31             |      | 1/1 - 12/31  |      | 9/10 - 12/31 
|Sifnos Shipping Corporation(1)                           |        | Vessel Owning Company |               | Marshall Is.       |      | 1/1 - 12/31             |      | 1/1 - 12/31  |      | 5/28 - 12/31 
|Skiathos Shipping Corporation(1)                         |        | Vessel Owning Company |               | Marshall Is.       |      | 1/1 - 12/31             |      | 1/1 - 12/31  |      | 5/28 - 12/31 
|Skopelos Shipping Corporation                            |        | Vessel Owning Company |               | Cayman Is.         |      | 1/1 - 12/31             |      | 1/1 - 12/31  |      | 5/28 - 12/31 
|Syros Shipping Corporation(1)                            |        | Vessel Owning Company |               | Marshall Is.       |      | 1/1 - 12/31             |      | 1/1 - 12/31  |      | 5/28 - 12/31 
|Thera Shipping Corporation(1)                            |        | Vessel Owning Company |               | Marshall Is.       |      | 1/1 - 12/31             |      | 1/1 - 12/31  |      | 5/28 - 12/31 
|Tinos Shipping Corporation(1)                            |        | Vessel Owning Company |               | Marshall Is.       |      | 1/1 - 12/31             |      | 1/1 - 12/31  |      | 5/28 - 12/31 
|Oinousses Shipping Corporation(1)                        |        | Vessel Owning Company |               | Marshall Is.       |      | 1/1 - 12/31             |      | 10/5 -12/31  |      |             
|Psara Shipping Corporation(1)                            |        | Vessel Owning Company |               | Marshall Is.       |      | 1/1 - 12/31             |      | 10/5 - 12/31 |      |             
|Antipsara Shipping Corporation(1)                        |        | Vessel Owning Company |               | Marshall Is.       |      | 1/1 - 12/31             |      | 10/5 - 12/31 |      |             



|(1) | Each company has the rights over a shipbuilding contract of a tanker vessel.
|--- | ----------------------------------------------------------------------------

Our Charters

For the year ended December 31, 2012, Navios Acquisitions
customers representing 10% or more of total revenue were, Dalian Ocean Shipping Co., and STX Panocean Co. LTD which accounted for 43.3% and 10.7%, respectively. For the year ended December 31, 2011, Navios Acquisitions customers
representing 10% or more of total revenue were, Dalian Ocean Shipping Co., Blue light Chartering Inc and Jacob Tank Chartering GMBH &CO. KG. which accounted for 43.9%, 11.5% and 11.3%, respectively. For the year ended December 31, 2010,
Jacob Tank Chartering GMBH & CO. KG, SK Shipping Company Ltd, DOSCO, Formosa Petrochemical Corporation, Blue Light Chartering Inc and Navig8 Chemicals Shipping and Trading Co accounted for 42.5%, 18.6%, 12.9%, 12.9% and 10.9%, respectively,
of Navios Acquisitions revenue. No other customers accounted 10% or more of total revenue for any of the years presented.

Our revenues
are driven by the number of vessels in the fleet, the number of days during which the vessels operate and our charter hire rates, which, in turn, are affected by a number of factors, including:



| |  |  | the duration of the charters;
| | - |  | -----------------------------



| |  |  | the level of spot and long-term market rates at the time of charter;
| | - |  | --------------------------------------------------------------------



| |  |  | decisions relating to vessel acquisitions and disposals;
| | - |  | --------------------------------------------------------



| |  |  | the amount of time spent positioning vessels;
| | - |  | ---------------------------------------------



| |  |  | the amount of time that vessels spend undergoing repairs and upgrades in drydock;
| | - |  | ---------------------------------------------------------------------------------



| |  |  | the age, condition and specifications of the vessels; and
| | - |  | ---------------------------------------------------------



| |  |  | the aggregate level of supply and demand in the tanker shipping industry.
| | - |  | -------------------------------------------------------------------------

Time charters are available for varying periods, ranging from a single trip (spot charter) to long-term which may be any years. In general, a long-term time charter assures the vessel owner of a
consistent stream of revenue. Operating the vessel in the spot market affords the owner greater spot market opportunity, which may result in high rates when vessels are in high demand or low rates when vessel availability exceeds demand. We intend
to operate our vessels in a mix of short-term and long-term charter market. Vessel charter rates are affected by world economics, international events, weather conditions, strikes, governmental policies, supply and demand and many other factors that
might be beyond our control.



47



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We could lose a customer or the benefits of a charter if:



| |  |  | the customer fails to make charter payments because of its financial inability, disagreements with us or otherwise;
| | - |  | -------------------------------------------------------------------------------------------------------------------



| |  |  | the customer exercises certain rights to terminate the charter the vessel;
| | - |  | --------------------------------------------------------------------------

| |  |  | the customer terminates the charter because we fail to deliver the vessel within a fixed period of time, the vessel is lost or damaged beyond repair,
there are serious deficiencies in the vessel or prolonged periods of off-hire, or we default under the charter; or
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | a prolonged force majeure event affecting the customer, including damage to or destruction of relevant production facilities, war or political unrest
prevents us from performing services for that customer.
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

If we lose a charter, we may be unable to re-deploy the related
vessel on terms as favorable to us due to the long-term nature of most charters and the cyclical nature of the industry or we may be forced to charter the vessel on the spot market at then market rates which may be less favorable than the charter
that has been terminated. The loss of any of our customers, time charters or vessels, or a decline in payments under our charters, could have a material adverse effect on our business, results of operations and financial condition and our ability to
make cash distributions in the event we are unable to replace such customer, time charter or vessel.

Under some of our time charters, either
party may terminate the charter contract in the event of war in specified countries or in locations that would significantly disrupt the free trade of the vessel. Some of the time charters covering our vessels require us to return to the charterer,
upon the loss of the vessel, all advances paid by the charterer but not earned by us.

Vessels Operations

Under our charters, our vessel manager is generally responsible for commercial, technical, health and safety and other management services related to the
vessels operation, and the charterer is responsible for bunkering and substantially all of the vessel voyage costs, including canal tolls and port charges.

Pursuant to a Management Agreement dated May 28, 2010, Navios Tankers Management Inc. (the Manager), a subsidiary of Navios Holdings, provides for five years from the closing of the
Companys initial vessel acquisition, commercial and technical management services to Navios Acquisitions vessels for a daily fee of $6,000 per owned MR2 product tanker and chemical tanker vessel and $7,000 per owned LR1 product tanker
vessel and $10,000 per VLCC tanker vessel for the first two years. On May 4, 2012, Navios Acquisition amended its existing Management Agreement with the Manager, to fix the fees for ship management services of its owned fleet at current rates
for two additional years, through May 28, 2014. This daily fee covers all of the vessels operating expenses, other than certain fees and costs. During the remaining one year of the term of the Management Agreement, Navios Acquisition
expects it will reimburse Navios Holdings for all of the actual operating costs and expenses it incurs in connection with the management of its fleet. Actual operating costs and expenses will be determined in a manner consistent with how the initial
fixed fees were determined. Drydocking expenses are fixed for the first four years under these agreements for up to $0.3 million per LR1 and MR2 product tanker vessel and will be reimbursed at cost for VLCC vessels. Commencing as of March 30,
2012, Navios Acquisition can, upon request to the Manager, partially or fully defer the reimbursement of drydocking and other extraordinary fees and expenses under the Agreement to a later date, but not later than January 4, 2014, and if
reimbursed on a later date, such amounts will bear interest at a rate of 1% per annum over LIBOR. Commencing as of September 28, 2012, Navios Acquisition could, upon request, reimburse the Manager partially or fully, for any fixed
management fees outstanding for a period of not more than nine months under the Agreement at a later date, but not later than December 31, 2014, and if reimbursed on a later date, such amounts will bear interest at a rate of 1% per annum
over LIBOR.

Extraordinary costs and expenses include fees and costs resulting from:



| |  |  | time spent on insurance and salvage claims;
| | - |  | -------------------------------------------



| |  |  | time spent vetting and pre-vetting the vessels by any charterers in excess of 10 days per vessel per year;
| | - |  | ----------------------------------------------------------------------------------------------------------



| |  |  | the deductible of any insurance claims relating to the vessels or for any claims that are within such deductible range;
| | - |  | -----------------------------------------------------------------------------------------------------------------------



| |  |  | the significant increase in insurance premiums which are due to factors such as acts of God outside the control of the Manager;
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------



| |  |  | repairs, refurbishment or modifications, including those not covered by the guarantee of the shipbuilder or by the insurance covering the vessels,
resulting from maritime accidents, collisions, other accidental damage or unforeseen events (except to the extent that such accidents, collisions, damage or events are due to the fraud, gross negligence or willful misconduct of the Manager, its
employees or its agents, unless and to the extent otherwise covered by insurance);
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | expenses imposed due to any improvement, upgrade or modification to, structural changes with respect to the installation of new equipment aboard any
vessel that results from a change in, an introduction of new, or a change in the interpretation of, applicable laws, at the recommendation of the classification society for that vessel or otherwise;
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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| |  |  | costs associated with increases in crew employment expenses resulting from an introduction of new, or a change in the interpretation of, applicable
laws or resulting from the early termination of the charter of any vessel;
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | any taxes, dues or fines imposed on the vessels or the Manager due to the operation of the vessels;
| | - |  | ---------------------------------------------------------------------------------------------------



| |  |  | expenses incurred in connection with the sale or acquisition of a vessel such as inspections and technical assistance; and
| | - |  | --------------------------------------------------------------------------------------------------------------------------



| |  |  | any similar costs, liabilities and expenses that were not reasonably contemplated by us and the Manager as being encompassed by or a component of the
fixed daily fees at the time the fixed daily fees were determined.
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Payment of any extraordinary fees or expenses to the
Manager could significantly increase our vessel operating expenses and impact our results of operations.

During the remaining term of the
Management Agreement, we expect that we will reimburse the Manager for all of the actual operating costs and expenses it incurs in connection with the management of our fleet.

Administrative Services

On May 28, 2010, Navios Acquisition entered into an
administrative services agreement with Navios Holdings, expiring on May 28, 2015, pursuant to which a subsidiary of Navios Holdings provides certain administrative management services to Navios Acquisition which include: rent, bookkeeping,
audit and accounting services, legal and insurance services, administrative and clerical services, banking and financial services, advisory services, client and investor relations and other. Navios Holdings is reimbursed for reasonable costs and
expenses incurred in connection with the provision of these services.

A. Operating results

Trends and Factors Affecting Our Future Results of Operations

We believe the principal factors that will affect our future results of operations are the economic, regulatory, political and governmental conditions that affect the shipping industry generally and that
affect conditions in countries and markets in which our vessels engage in business. Other key factors that will be fundamental to our business, future financial condition and results of operations include:



| |  |  | the demand for seaborne transportation services;
| | - |  | ------------------------------------------------



| |  |  | the ability of Navios Holdings commercial and chartering operations to successfully employ our vessels at economically attractive rates,
particularly as our fleet expands and our charters expire;
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | the effective and efficient technical management of our vessels;
| | - |  | ----------------------------------------------------------------



| |  |  | Navios Holdings ability to satisfy technical, health, safety and compliance standards of major commodity traders; and
| | - |  | ----------------------------------------------------------------------------------------------------------------------



| |  |  | the strength of and growth in the number of our customer relationships, especially with major commodity traders.
| | - |  | ----------------------------------------------------------------------------------------------------------------

In addition to the factors discussed above, we believe certain specific factors will impact our combined and consolidated results of operations. These
factors include:



| |  |  | the charter hire earned by our vessels under our charters;
| | - |  | ----------------------------------------------------------



| |  |  | our access to capital required to acquire additional vessels and/or to implement our business strategy;
| | - |  | -------------------------------------------------------------------------------------------------------



| |  |  | our ability to sell vessels at prices we deem satisfactory;
| | - |  | -----------------------------------------------------------



| |  |  | our level of debt and the related interest expense and amortization of principal; and
| | - |  | -------------------------------------------------------------------------------------



| |  |  | the level of any dividend to our stockholders.
| | - |  | ----------------------------------------------



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Period over Period Comparisons

Year Ended December 31, 2012 Compared to the Year Ended December 31, 2011

The
following table presents consolidated revenue and expense information for the years ended December 31, 2012 and 2011. This information was derived from the audited consolidated financial statements of Navios Acquisition for the respective
periods.



|                                        |  |                                   |         |   |                                   |   |         |  
|--------------------------------------- |  | --------------------------------- | ------- | - | --------------------------------- | - | ------- | -
|(in thousands of U.S. dollars)          |  | For the
YearEndedDecember 31,2012 |         |   | For the
YearEndedDecember 31,2011 |  
|Revenue                                 |  | $                                 | 151,097 |   |                                   | $ | 121,925 |  
|Time charter expenses                   |  |                                   | (2,824  | ) |                                   |   | (3,499  | )
|Direct vessel expenses                  |  |                                   | (2,622  | ) |                                   |   | (633    | )
|Management fees                         |  |                                   | (47,043 | ) |                                   |   | (35,679 | )
|General and administrative expenses     |  |                                   | (3,853  | ) |                                   |   | (4,241  | )
|Write-off of deferred finance costs     |  |                                   |        |   |                                   |   | (935    | )
|Depreciation and amortization           |  |                                   | (49,644 | ) |                                   |   | (38,638 | )
|Interest income                         |  |                                   | 445     |   |                                   |   | 1,414   |  
|Interest expenses and finance cost, net |  |                                   | (49,432 | ) |                                   |   | (43,165 | )
|Other income/(expense), net             |  |                                   | 78      |   |                                   |   | (406    | )
|                                        |  |                                   |         |   |                                   |   |         |  
|Net loss                                |  | $                                 | (3,798  | ) |                                   | $ | (3,857  | )
|                                        |  |                                   |         |   |                                   |   |         |  

Set forth below are selected historical and statistical data for Navios Acquisition for each of the years ended
December 31, 2012 and 2011 that we believe may be useful in better understanding Navios Acquisitions financial position and results of operations.



|                                   |  |                            |  |   |                            |   |  |   |        |  
|---------------------------------- |  | -------------------------- |  | - | -------------------------- | - |  | - | ------ | -
|                                   |  | Year
EndedDecember 31,2012 |  |   | Year EndedDecember 31,2011 |  
|FLEET DATA                         |  |                            |  |   |                            |   |  |   |        |  
|Available days(1)                  |  |                            |  |   | 5,786                      |   |  |   | 4,053  |  
|Operating days(2)                  |  |                            |  |   | 5,751                      |   |  |   | 4,004  |  
|Fleet utilization(3)               |  | %                          |  |   | 99.4                       | % |  |   | 98.8   | %
|Vessels operating at period end    |  |                            |  |   | 19                         |   |  |   | 14     |  
|AVERAGE DAILY RESULTS              |  |                            |  |   |                            |   |  |   |        |  
|Time Charter Equivalent per day(4) |  |                            |  | $ | 25,625                     |   |  | $ | 29,218 |  



|(1) | Available days for the fleet are total calendar days the vessels were in Navios Acquisitions possession for the relevant period after
subtracting off-hire days associated with major repairs, drydocking or special surveys. The shipping industry uses available days to measure the number of days in a relevant period during which vessels should be capable of generating revenues.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | Operating days: Operating days are the number of available days in the relevant period less the aggregate number of days that the vessels are off-hire due
to any reason, including unforeseen circumstances. The shipping industry uses operating days to measure the aggregate number of days in a relevant period during which vessels actually generate revenues.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(3) | Fleet utilization:Fleet utilization is the percentage of time that Navios Acquisitions vessels were available for generating revenue, and is
determined by dividing the number of operating days during a relevant period by the number of available days during that period. The shipping industry uses fleet utilization to measure a companys efficiency in finding suitable employment for
its vessels.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(4) | Time Charter Equivalent:Time Charter Equivalent is defined as voyage and time charter revenues less voyage expenses during a relevant period
divided by the number of available days during the period.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

For the year ended December 31, 2012, Navios Acquisition had
5,786 available days, after it took delivery of the Shinyo Kieran in June 2011, the Bull and the Buddy in July 2011, the Nave Andromeda in November 2011, the Nave Estella in January 2012, the Nave Atria in July 2012, the Nave Cassiopeia in August
2012, the Nave Cetus in October 2012 and the Nave Aquila in November 2012. There were 4,053 available days in the comparative period in 2011.

Revenue: Revenue for the year ended December 31, 2012 increased by $29.2 million or 24.0% to $151.1 million, as compared to
$121.9 million for the same period in 2011. The increase was mainly attributable to the acquisition of the vessels mentioned above. As a result of the vessel acquisitions, available days of the fleet increased to 5,786 days for the year ended
December 31, 2012, as compared to 4,053 days for year ended December 31, 2011. TCE decreased to $25,625 for the year ended December 31, 2012, from $29,218 for the year ended December 31, 2011.

Time charter expenses: Time charter expenses for the year ended December 31, 2012 decreased by $0.7 million to $2.8 million, as
compared to $3.5 million for the year ended December 31, 2011. The decrease was attributable to a: (a) $0.4 million decrease in bunker costs; (b) $0.1 million decrease in port expenses; and (c) $0.6 million decrease in
miscellaneous voyage expenses, partially offset by a $0.4 million increase in broker commission costs. Time charter expenses are expensed over the period of the time charter.



50



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Direct vessel expenses: Direct vessel expenses, comprised of the amortization of dry dock and
special survey costs, of three VLCC vessels that were completed in August 2011, October 2011 and April 2012, respectively, and of two LR1 product tankers that were completed in May 2012 and June 2012, respectively, amounted to $2.6 million
for the year ended December 31, 2012. Direct vessel expenses for the comparative period in 2011 were $0.6 million and were related to dry dock and special survey costs of two VLCC vessels.

Management fees: Management fees for the year ended December 31, 2012 increased by $11.3 million to $47.0 million, as compared to
$35.7 million for the year ended December 31, 2011. The increase was attributable to the increase in the number of vessels operating under Navios Acquisitions fleet. Pursuant to the Management Agreement dated May 28, 2010, the
Manager, provides for five years from the closing of the vessels acquisition, commercial and technical management services to Navios Acquisitions vessels for a daily fee of $6,000 per owned MR2 product tanker and chemical tanker vessel,
$7,000 per owned LR1 product tanker vessel and $10,000, per owned VLCC vessel for the first two years. On May 4, 2012, Navios Acquisition amended its existing Management Agreement with the Manager, to fix the fees for ship management services
of its owned fleet at current rates for two additional years, through May 28, 2014. This daily fee covers all of the vessels operating expenses, other than certain extraordinary fees and costs. During the remaining term of the management
agreement, Navios Acquisition will reimburse the Manager for all of the actual operating costs and expenses it incurs in connection with the management of its fleet. Actual operating costs and expenses will be determined in a manner consistent with
how the initial fixed fees were determined. Drydocking expenses are fixed for the first four years under these agreements for up to $0.3 million per LR1 and MR2 product tanker vessel and will be reimbursed at cost for VLCC vessels.

General and administrative expenses: Total general and administrative expenses for the year ended December 31, 2012 decreased by $0.3
million or 7.1% to $3.9 million compared to $4.2 million for the year ended December 31, 2011. The decrease was mainly attributable to a: (a) $0.1 million decrease in travelling expenses; (b) $0.3 decrease in consulting
fees; (c) $0.5 million decrease in audit, professional and other fees partially offset by a $0.6 million increase in administrative expenses paid to the Manager due to the increased number of vessels in Navios Acquisitions fleet. On
May 28, 2010, Navios Acquisition entered into an administrative services agreement with Navios Holdings, expiring on May 28, 2015, pursuant to which a subsidiary of Navios Holdings provides certain administrative management services to
Navios Acquisition which include: rent, bookkeeping, audit and accounting services, legal and insurance services, administrative and clerical services, banking and financial services, advisory services, client and investor relations and other.
Navios Holdings is reimbursed for reasonable costs and expenses incurred in connection with the provision of these services. For the years ended December 31, 2012 and 2011, the expenses charged by Navios Holdings for administrative services
were $2.1 million and $1.5 million, respectively. The remaining balance of $1.8 million and $2.7 million of general and administrative expenses for the years ended December 31, 2012 and 2011, respectively, related to legal, consulting, travel
and professional fees including audit fees.

Write-off deferred financing costs:In connection with the cancellation of certain
committed credit in June 2011, the deferred finance fees in the amount of $0.9 million were written-off in the Statement of Operations.

Depreciation and amortization: Depreciation and amortization increased by $11.0 million to $49.6 million for the year ended
December 31, 2012 as compared to $38.6 million for the year ended December 31, 2011. The increase of $11.0 million was attributable to: (a) an increase in depreciation expense of $8.7 million due to the acquisitions of
the vessel the Nave Polaris in January 2011, the Shinyo Kieran in June 2011, the Buddy and the Bull in July 2011 , the Nave Andromeda in November 2011, the Nave Estella in January 2012, the Nave Atria in July 2012, the Nave Cassiopeia in August
2012, the Nave Cetus in October 2012 and the Nave Aquila in November 2012; and (b) an increase in amortization expense of $2.3 million due to the favorable and unfavorable lease terms that were recognized in relation to the acquisition of
the rights on the time charter-out contracts of the vessels. Depreciation of vessel is calculated using an estimated useful life of 25 years for the date the vessel was originally delivered from the shipyard. Intangible assets are amortized over the
contract periods, which range from 3.17 to 15.00 years.

Interest income: Interest income for year ended December 31, 2012
decreased by $1.0 million to $0.4 million compared to $1.4 million for the year ended December 31, 2011.

Interest expense and
finance cost, net:Interest expense and finance cost, net for the year ended December 31, 2012 increased by $6.2 million to $49.4 million, as compared to $43.2 million for the year ended December 31, 2011. The
increase was due to: (a) the increase in average outstanding loan balance to $486.2 million in the year ended December 31, 2012 from 327.2 million in the year ended December 31, 2011; and (b) the full effect of the
Additional Notes, which were issued on May 26, 2011. As of December 31, 2012 and 2011, the outstanding loan balance under Navios Acquisitions credit facilities was $1,029.1 million and $885.4 million, respectively, and the weighted
average interest rate as of December 31, 2012 and 2011 was 3.25% and 3.16%, respectively.



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##### Table of Contents

Other income/(expense), net: Other income/(expense), net increased to a $0.1 million income
for the year ended December 31, 2012 compared to $0.4 million expense for the same period in 2011. The increase of $0.5 million was mainly attributable to a: (a) $0.3 million decrease of claim reserves; and (b) $0.2 million increase
in miscellaneous income.

Year Ended December 31, 2011 Compared to the Year Ended December 31, 2010

The following table presents consolidated revenue and expense information for the years ended December 31, 2011 and 2010. This information was
derived from the audited consolidated financial statements of Navios Acquisition for the respective periods.



|                                                          |  |                            |         |   |                            |   |         |  
|--------------------------------------------------------- |  | -------------------------- | ------- | - | -------------------------- | - | ------- | -
|                                                          |  | Year
endedDecember 31,2011 |         |   | Year
endedDecember 31,2010 |  
|                                                          | 
|                                                          | 
|                                                          |  |                           
|Revenue                                                   |  | $                          | 121,925 |   |                            | $ | 33,568  |  
|Time charter expenses                                     |  |                            | (3,499  | ) |                            |   | (355    | )
|Direct vessel expenses                                    |  |                            | (633    | ) |                            |   |        |  
|Management fees                                           |  |                            | (35,679 | ) |                            |   | (9,752  | )
|General and administrative expenses                       |  |                            | (4,241  | ) |                            |   | (1,902  | )
|Share based compensation                                  |  |                            |        |   |                            |   | (2,140  | )
|Transaction costs                                         |  |                            |        |   |                            |   | (8,019  | )
|Depreciation and amortization                             |  |                            | (38,638 | ) |                            |   | (10,120 | )
|Prepayment penalties & write-off of deferred finance fees |  |                            | (935    | ) |                            |   | (5,441  | )
|Interest income                                           |  |                            | 1,414   |   |                            |   | 862     |  
|Interest expenses and finance cost, net                   |  |                            | (43,165 | ) |                            |   | (10,651 | )
|Other (expense)/income, net                               |  |                            | (406    | ) |                            |   | 404     |  
|                                                          |  |                            |         |   |                            |   |         |  
|Net loss                                                  |  | $                          | (3,857  | ) |                            | $ | (13,546 | )
|                                                          |  |                            |         |   |                            |   |         |  

Set forth below are selected historical and statistical data for Navios Acquisition for each of the years ended
December 31, 2011 and 2010 that we believe may be useful in better understanding Navios Acquisitions financial position and results of operations.



|                                   |  |                            |        |   |                            |   |        |  
|---------------------------------- |  | -------------------------- | ------ | - | -------------------------- | - | ------ | -
|                                   |  | Year endedDecember 31,2011 |        |   | Year endedDecember 31,2010 |  
|FLEET DATA                         |  |                            |        |   |                            |   |        |  
|Available days(1)                  |  |                            | 4,053  |   |                            |   | 1,104  |  
|Operating days(2)                  |  |                            | 4,004  |   |                            |   | 1,096  |  
|Fleet utilization(3)               |  |                            | 98.8   | % |                            |   | 99.3   | %
|Vessels operating at period end    |  |                            | 14     |   |                            |   | 9      |  
|AVERAGE DAILY RESULTS              |  |                            |        |   |                            |   |        |  
|Time Charter Equivalent per day(4) |  | $                          | 29,218 |   |                            | $ | 30,087 |  



|(1) | Available days: Available days is the total number of days a vessel is controlled by a company less the aggregate number of days that the vessel is
off-hire due to scheduled repairs or repairs under guarantee, vessel upgrades or special surveys. The shipping industry uses available days to measure the number of days in a period during which vessels should be capable of generating revenues.
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | Operating days: Operating days is the number of available days in a period less the aggregate number of days that the vessels are off-hire due to any
reason, including lack of demand or unforeseen circumstances. The shipping industry uses operating days to measure the aggregate number of days in a period during which vessels actually generate revenues.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(3) | Fleet utilization: Fleet utilization is obtained by dividing the number of operating days during a period by the number of available days during the
period. The shipping industry uses fleet utilization to measure a companys efficiency in finding suitable employment for its vessels and minimizing the amount of days that its vessels are off-hire for reasons other than scheduled repairs or
repairs under guarantee, vessel upgrades, special surveys or vessel positioning.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(4) | Time Charter Equivalent: Time Charter Equivalent is defined as voyage and time charter revenues less voyage expenses during a period divided by the number
of available days during the period. The TCE rate is a standard shipping industry performance measure used primarily to present the actual daily earnings generated by vessels on various types of charter contracts for the number of available days of
the fleet.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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For the year ended December 31, 2011, Navios Acquisition had 4,053 available days, after it took
delivery of the vessel Nave Cielo (ex. Colin Jacob) on June, 2010, Nave Ariadne (ex. Ariadne Jacob) on July 2010, seven VLCCs on September 10, 2010, of which the Shinyo Kieran was delivered in June 2011, the vessel Nave Cosmos on
October 2010, the Nave Polaris in January 2011, the Buddy and the Bull in July 2011 and the Nave Andromeda in November 2011. There were 1,104 available days in the comparative period in 2010.

Revenue: Revenue for the year ended December 31, 2011 increased by $88.3 million or 262.8% to $121.9 million, as compared to
$33.6 million for the year ended 2010. The increase was mainly attributable to the acquisitions of the Nave Cielo and the Nave Ariadne in July 2010, seven VLCCs in September 2010, of which the Shinyo Kieran was delivered in June 2011, the Nave
Cosmos in October 2010, the Nave Polaris in January 2011, the Buddy and the Bull in July 2011 and the Nave Andromeda in November 2011 and a $3,704 early termination compensation fee. As a result of the vessel acquisitions described above, available
days of the fleet increased to 4,053 days for the year ended December 31, 2011, as compared to 1,104 days for the year ended December 31, 2010. The TCE rate decreased to $29,218 for the year ended December 31, 2011, from
$30,087 for the year ended December 31, 2010.

Time Charter Expenses: Time charter expenses for the year ended
December 31, 2011 increased by $3.1 million to $3.5 million, as compared to $0.4 million for the year ended December 31, 2010. The increase was attributable to brokerage commissions and other miscellaneous expenses, due to the increased
number of vessels operating in Navios Acquisitions fleet. Time charter expenses are expensed over the period of the time charter.

Direct vessel expenses: Direct vessel expenses, comprised of the amortization of dry dock and special survey costs, of two VLCC vessels
that were completed in August 5, 2011 and October 3, 2011, respectively, amounted to $0.6 million for the year ended December 31, 2011. There were no direct vessel expenses for the comparative period in 2010.

Management Fees: Management fees for the year ended December 31, 2011 increased by $25.9 million to $35.7 million, as compared to $9.8
million for the year ended December 31, 2010. The increase was attributable to the increase in the number of vessels operating under Navios Acquisitions fleet. Pursuant to a Management Agreement dated May 28, 2010, a subsidiary of
Navios Holdings, provides for five years from the closing of the Product and Chemical Tanker Acquisition, commercial and technical management services to Navios Acquisitions vessels for a daily fee of $6,000 per owned MR2 product tanker and
chemical tanker vessel, $7,000 per owned LR1 product tanker vessel and $10,000 per VLCC vessel for the first two years with the fixed daily fees adjusted for the remainder of the term based on then-current market fees. This daily fee covers all of
the vessels operating expenses, other than certain fees and costs. During the remaining three years of the term of the Management Agreement, Navios Acquisition expects it will reimburse Navios Holdings for all of the actual operating costs and
expenses it incurs in connection with the management of its fleet. Actual operating costs and expenses will be determined in a manner consistent with how the initial fixed fees were determined. Drydocking expenses are fixed under this agreement for
up to $0.3 million per vessel chemical LR1 and MR2 product and are reimbursed at cost for VLCC vessels.

General and Administrative
Expenses: Total general and administrative fees for the year ended December 31, 2011 increased by $2.3 million or 121% to $4.2 million compared to $1.9 million for the year ended December 31, 2010. The increase was mainly
attributable to the increase in administrative expenses paid to the Manager due to the increased number of vessels in Navios Acquisitions fleet.

On May 28, 2010, Navios Acquisition entered into an administrative services agreement with Navios Holdings, expiring on May 28, 2015, pursuant to which a subsidiary of Navios Holdings provides
certain administrative management services to Navios Acquisition which include: rent, bookkeeping, audit and accounting services, legal and insurance services, administrative and clerical services, banking and financial services, advisory services,
client and investor relations and other. Navios Holdings is reimbursed for reasonable costs and expenses incurred in connection with the provision of these services. For the years ended December 31, 2011 and 2010, the expenses charged by Navios
Holdings for administrative services were $1.5 million and $0.4 million, respectively. The remaining balance of $2.7 million and $1.5 million of general and administrative expenses for the years ended December 31, 2011 and 2010, respectively,
related to legal and professional fees including audit fees.

Share-based compensation: On June 11, 2008, Navios Holdings
transferred 290,000 Sponsor Units to our officers and directors. Each Sponsor Unit consisted of one warrant and one share of common stock and they vested only upon a successful business combination. As such, on May 28, 2010, we recorded an
expense of $2.1 million representing the fair value of the units on that date with equal increase in our Additional Paid in Capital. There was no share-based compensation for the year ended December 31, 2011.



53



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##### Table of Contents

Transaction costs: On September 10, 2010, we completed the VLCC Acquisition and we
incurred certain expenses directly related to such acquisition that amounted to $8.0 million. From the $8.0 million, $2.4 million was related to various audit, legal and consulting fees and $5.6 million was related to the fair value
of 3,000 shares of preferred stock issued to an independent third party holder in connection with the payment of certain consultant and advisory fees. There were no transaction costs for the year ended December 31, 2011.

Depreciation and Amortization: Depreciation and amortization increased by $28.5 million to $38.6 million for the year ended
December 31, 2011 as compared to $10.1 million for the year ended December 31, 2010. The increase of $28.5 million was attributable to: (a) an increase in depreciation expense of $23.9 million due to the acquisitions of
the vessel Nave Cielo (ex. Colin Jacob) in June, 2010, Nave Ariadne (ex. Ariadne Jacob) in July 2010, seven VLCCs in September 2010, of which the Shinyo Kieran was delivered in June 2011, the vessel Nave Cosmos in October 2010, the Nave Polaris
in January 2011, the Buddy and the Bull in July 2011 and the Nave Andromeda in November 2011; and (b) an increase in amortization expense of $4.6 million due to the favorable and unfavorable lease terms that were recognized in relation to
the acquisition of the rights on the time charter-out contracts of the vessels. Depreciation of vessel is calculated using an estimated useful life of 25 years for the date the vessel was originally delivered from the shipyard. Intangible assets are
amortized over the contract periods, which range from 3.17 to 15.00 years.

Prepayment penalties and write-off deferred financing
costs: Prepayment penalties and write-off of deferred financing costs amounted to approximately $0.9 million for the year ended December 31, 2011 compared to $5.4 million for the year ended December 31, 2010.

For the year ended December 31, 2011, an amount of $0.9 million of deferred financing costs was written-off in relation to the cancellation of
certain committed credit.

For the year ended December 31, 2010, following the issuance of the Existing Notes and net proceeds raised of
$388.9 million, loan facilities, that previously secured the six VLCC vessels, were fully repaid, and as a result deferred finance costs related to these facilities of $2.9 million, were written off and prepayment fees of $2.5 million
were paid.

Interest Income: Interest income for year ended December 31, 2011 increased by $0.5 million to $1.4 million
compared to $0.9 million for the year ended December 31, 2010.

Interest expense and finance cost, net: Interest
expense and finance cost, net for the year ended December 31, 2011 increased by $32.5 million to $43.2 million, as compared to $10.7 million for the year ended December 31, 2010. The increase was due to: (a) the
increase in average outstanding loan balance to $327.2 million in the year ended December 31, 2011 from $185.7 million in the year ended December 31, 2010; (b) the full effect of the Existing Notes which were issued on
October 21, 2010; and (c) the effect of the Additional Notes, which were issued on May 26, 2011. As of December 31, 2011 and 2010, the outstanding loan balance under Navios Acquisitions credit facilities was $885.4 million
and $721.8 million, respectively, and the weighted average interest rate as of December 31, 2011 and 2010 was 3.16% and 3.27%, respectively.

Other (expense)/ income, net: Other (expense)/ income, net decreased to a $0.4 million expense for the year ended December 31, 2011 compared to $0.4 million income for the same period
in 2010. The decrease of $0.8 million was mainly attributable to: (a) $0.5 million of claim reserves; and (b) $0.3 million decrease in miscellaneous income.

B. Liquidity and Capital Resources and Uses

Our primary short-term liquidity needs
are to fund general working capital requirements, drydocking expenditures, deposits for vessels under construction, minimum cash balance maintenance as per our credit facility agreements and debt repayment, while our long-term liquidity needs
primarily relate to expansion and investment capital expenditures and other maintenance capital expenditures and debt repayment. Expansion capital expenditures are primarily for the purchase or construction of vessels to the extent the expenditures
increase the operating capacity of or revenue generated by our fleet, while maintenance capital expenditures primarily consist of drydocking expenditures and expenditures to replace vessels in order to maintain the operating capacity of or revenue
generated by our fleet. We anticipate that our primary sources of funds for our short-term liquidity needs will be cash flows from operations and bank borrowings which we believe that will be sufficient to meet our existing short-term liquidity
needs for at least the next 12 months. Generally, our long-term sources of funds will be from cash from operations, long-term bank borrowings and other debt or equity financings. We expect that we will rely upon external financing sources, including
bank borrowings, to fund acquisitions and expansion and investment capital expenditures. We cannot assure you that we will be able to secure adequate financing or obtaining additional funds on favorable terms, to meet our liquidity needs. Please
also refer to Item 3.D.-Risks Related to Our Indebtedness.



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Since 2010, Navios Acquisition had the following equity raisings:



| |  |  | On November 19, 2010, Navios Acquisition completed the public offering of 6,500,000 shares of common stock at $5.50 per share and raised gross
proceeds of $35.8 million. The net proceeds of this offering, including the underwriting discount of $1.8 million and excluding offering costs of $0.6 million were approximately $34.0 million.
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | In February 2013, Navios Acquisition completed two registered direct offerings of a total of 17,544,300 shares at $2.85 per share and raised gross
proceeds of $50.0 million in total. The net proceeds of the offerings including the underwriting discount of $2.0 million in total and excluding estimated offering costs of $0.6 million, were $48.0 million. On February 26, 2013, Navios
Acquisition completed the private placement of 17,702,491 shares of common stock at a price of $2.85 per share, to Navios Holdings and certain members of the management of Navios Acquisition, Navios Holdings and Navios Partners, raising gross
proceeds of $50.5 million. The net proceeds of this private placement, including the agents fees of $2.0 million were $48.5 million.
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Navios Acquisition finances its capital requirements with cash flows from operations, equity contributions from stockholders, bank loans and the issuance of the Existing Notes and Additional Notes. The
main uses of funds have been capital expenditures for the acquisition of new vessels, expenditures incurred in connection with ensuring that the owned vessels comply with international and regulatory standards, repayments of bank loans and payments
of dividends.

Our contracts for the construction of our vessels are cancellable in various cases among which are, the shipbuilders
inability to meet its obligations for delivery of the vessel until a set deadline and in accordance with its specifications, our inability to finance the purchase of the vessel, bankruptcy or other financial or liquidity problems of the shipbuilder
and our inability to obtain requisite permits or approvals.

As of December 31, 2012, the remaining contractual installments for our
tanker vessels to be delivered on various dates through October 2014, were $105.1 million of which $48.8 million will be financed through committed debt financing, $6.0 million through the issuance of Series D Preferred Stock and $50.3 million
through cash on hand.

Cash flows for the year ended December 31, 2012 compared to the year ended December 31, 2011:

The following table presents cash flow information for the years ended December 31, 2012 and 2011. This information was derived from
the audited consolidated statement of cash flows of Navios Acquisition for the respective periods.



|                                          |  |                            |          |   |                            |  |          |  
|----------------------------------------- |  | -------------------------- | -------- | - | -------------------------- |  | -------- | -
|(Expressed in thousands of U.S. dollars)  |  | Year EndedDecember 31,2012 |          |   | Year EndedDecember 31,2011 | 
|Net cash provided by operating activities |  | $                          | 81,877   |   |                            |  | 64,233   |  
|Net cash used in investing activities     |  |                            | (205,956 | ) |                            |  | (225,777 | )
|Net cash provided by financing activities |  |                            | 125,625  |   |                            |  | 141,484  |  
|                                          |  |                            |          |   |                            |  |          |  
|Change in cash and cash equivalents       |  | $                          | 1,546    |   |                            |  | (20,060  | )
|                                          |  |                            |          |   |                            |  |          |  

Cash provided by operating activities for the year ended December 31, 2012 as compared to the year ended
December 31, 2011:

Net cash provided by operating activities increased by $17.7 million to $81.9 million for the year
ended December 31, 2012 as compared to $64.2 million for the same period in 2011. The increase is analyzed as follows:

The net loss
for the year ended December 31, 2012 was $3.8 million compared to $3.9 million loss for the year ended December 31, 2011. In determining net cash provided by operating activities for the years ended December 31, 2012, net
loss was adjusted for the effect of depreciation and amortization of $49.6 million, $2.8 million for amortization and write-off of deferred finance cost, net and $2.6 million for the amortization of drydock and special survey costs. For
the period ended December 31, 2011, net income was also adjusted for the effects of certain non-cash items, including depreciation and amortization of $38.6 million, $3.2 million amortization and write-off of deferred financing cost,
net and $0.6 million for the amortization of drydock and special survey costs.

Amounts due to related parties increased by $41.9 million
from $43.6 million at December 31, 2011 to $85.5 million at December 31, 2012, as a result of a: (a) $33.6 million increase in management fees, accrued administrative expenses and other payables due to affiliated
companies; (b) $6.1 million non-cash increase in pre-building costs; and (c) $2.2 million increase in expenses incurred by the Manager in relation to drydock and special survey costs of one VLCC vessel and two LR1 product tanker vessels.
Please see disclosures contained under Item 7.B.Related Party Transactions.



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Payment for drydock and special survey cost incurred in the year ended December 31, 2012 was
$2.9 million and related to the drydock and special survey costs incurred for one VLCC and two LR1 tanker vessels of the fleet. Payment for drydock and special survey cost incurred in the year ended December 31, 2011 was $7.8 million
and related to the drydock and special survey costs incurred for two VLCC tanker vessels.

Accounts receivable decreased by $1.4 million from
$6.5 million for the year ended December 31, 2011, to $5.1 million for the year ended December 31, 2012 and were related to receivables from charterers.

Restricted cash from operating activities decreased by $0.3 million for the year ended December 31, 2012 and related to the cash held in retention accounts for the payment of interest under our
credit facilities.

Accounts payable increased by $0.3 million from $1.0 million for the year ended December 31, 2011 to
$1.3 million for the year ended December 31, 2012. This increase was attributable to the increase in brokers payable by $0.2 million and the increase in other creditors by $0.2 million partially offset by a decrease of $0.1 million
in legal and professional fees.

Prepaid expenses and other current assets increased by $2.2 million to $2.7 million for the year ended
December 31, 2012 from $0.5 million for the year ended December 31, 2011. The increase was mainly due to the amounts advanced to certain counterparties for working capital purposes as per the charters entered with them.

Other long term assets decreased by $0.4 million to $0.9 million for the year ended December 31, 2012 from $1.3 million for the year ended
December 31, 2011. On October 28, 2011, the charter contract of the Nave Ariadne (ex. Ariadne Jacob) and the Nave Cielo (ex. Colin Jacob) were terminated prior to their original expiration date in June 2013. Navios Acquisition entered into
certain settlement agreements with charterers that provided for an amount of approximately $5.0 million to compensate for the early termination of the charters and to cover outstanding receivables, out of which $1.5 million will be settled in
installments until June 2015, the long term portion being $0.9 million.

Accrued expenses decreased by $2.5 million to $13.0 million
for the year ended December 31, 2012, from $15.5 million on December 31, 2011. The decrease was attributable to a $4.2 million decrease in accrued other expenses partially offset by a $1.5 increase in accrued voyage expenses and a
$0.2 increase in accrued interest.

Deferred voyage revenue primarily relates to cash received from charterers prior to it being earned. These
amounts are recognized as revenue over the voyage or charter period. Deferred voyage revenue increased by $0.4 million to $3.7 million for the year ended December 31, 2012 from $3.3 million on December 31, 2011.

Long Term Liabilities decreased by $0.3 million to $0.2 million for the year ended December 31, 2012 from $0.5 million on December 31, 2011. Long
term liabilities are related to the long term portion of the straight line effect of revenue of the vessels acquired in July 2011.

Cash used in investing activities for the year ended December 31, 2012 as compared to the year ended December 31, 2011:

Net cash used in investing activities decreased by $19.9 million to $205.9 million at December 31, 2012 from $225.8 million at
December 31, 2011.

Net cash used in investing activities for the year ended December 31, 2012, resulted from: (a) $11.0
million paid for the acquisition of the Nave Estella in January 2012, $9.0 million paid for acquisition of the Nave Atria in July 2012, $ 27.3 million paid for the acquisition of the Nave Cassiopeia in August 2012, $27.5 million paid for the
acquisition of the Nave Cetus in October 2012 and $12.7 million paid for the acquisition of the Nave Aquila in November 2012; and (b) $142.1 million paid as a deposits for the acquisition of the vessels that will be delivered to Navios
Acquisition at various dates through October 2014. The $229.6 million was partially offset by a $19.4 million decrease in restricted cash and $4.3 million of non-cash items.

Net cash used in investing activities for the year ended December 31, 2011, resulted from: (a) $4.5 million paid for the acquisition of the Nave Polaris in January 2011, $29.3 million paid for
the acquisition of the Shinyo Kieran in June 2011, $37.3 million paid for the acquisition of the Buddy and $37.3 million paid for the acquisition of the Bull in July 2011 and $ 27.0 million paid for the acquisition of the Nave Andromeda in
November 2011; (b) $78.5 million paid as a deposits for the acquisition of the vessels that will be delivered to Navios Acquisition at various dates through October 2014; (c) $7.8 million paid for improvements in certain VLCC vessels;
and (d) $10.4 million of intangible assets and liabilities associated with the acquisition of two MR2 vessels in July 2011. The $232.1 million was partially offset by a $3.8 million decrease in restricted cash and $2.5 million of non-cash
items.



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Cash provided by financing activities for the year ended December 31, 2012 as compared to the year
ended December 31, 2011:

Net cash provided by financing activities decreased by $15.9 million to $125.6 million at
December 31, 2012 from $141.5 million at December 31, 2011.

Net cash provided by financing activities for the year ended
December 31, 2012 was $125.6 million. Net cash provided by financing activities resulted from a $162.8 million loan proceeds net of deferred finance fees and $5.0 million proceeds from related party loan, net of deferred finance fees. This
increase was partially offset by: (a) a $8.7 million increase in restricted cash; (b) $13.7 million for loan repayments; (c) a $10.0 million repayment of a loan from related party; and (d) dividends paid of
$9.8 million.

Net cash provided by financing activities for the year ended December 31, 2011 was $141.5 million. Net cash provided by
financing activities resulted from $252.1 million loan proceeds net of deferred finance fees and $33.2 million proceeds from related party loan, net of deferred finance fees. This increase was partially offset by:
(a) a $1.7 million increase in restricted cash; (b) $126.3 million for loan repayments; (c) a $6.0 million repayment of a loan from a related party; and (d) dividends paid of $9.8 million.

Cash flows for the year ended December 31, 2011 compared to the year ended December 31, 2010:

The following table presents cash flow information for the years ended December 31, 2011 and 2010. This information was derived from the audited
consolidated statement of cash flows of Navios Acquisition for the respective periods.



|                                          |  |                            |          |   |                            |   |          |  
|----------------------------------------- |  | -------------------------- | -------- | - | -------------------------- | - | -------- | -
|(Expressed in thousands of U.S. dollars)  |  | Year EndedDecember 31,2011 |          |   | Year EndedDecember 31,2010 |  
|Net cash provided by operating activities |  | $                          | 64,233   |   |                            | $ | 10,300   |  
|Net cash used in investing activities     |  |                            | (225,777 | ) |                            |   | (103,602 | )
|Net cash provided by financing activities |  |                            | 141,484  | ) |                            |   | 154,575  |  
|                                          |  |                            |          |   |                            |   |          |  
|Change in cash and cash equivalents.      |  | $                          | (20,060  | ) |                            | $ | 61,273   |  
|                                          |  |                            |          |   |                            |   |          |  

Cash provided by operating activities for the year ended December 31, 2011 as compared to the year ended
December 31, 2010:

Net cash provided by operating activities increased by $53.9 million to $64.2 million for the year
ended December 31, 2011 as compared to $10.3 million for the same period in 2010. The increase is analyzed as follows:

The net loss
for the year ended December 31, 2011 was $3.9 million compared to $13.5 million loss for the year ended December 31, 2010. In determining net cash provided by operating activities for the years ended December 31, 2011, net
loss was adjusted for the effect of depreciation and amortization of $38.6 million, $3.2 million for amortization and write-off of deferred finance cost net and $0.6 million for the amortization of drydock and special survey costs. For the
period ended December 31, 2010, net income was also adjusted for the effects of certain non-cash items, including depreciation and amortization of $10.1 million, $3.5 million amortization and write-off of deferred financing cost net,
$5.6 million for non-cash transaction costs and $2.1 million for share based compensation.

Amounts due to related parties increased
by $37.5 million from $6.1 million for the year ended December 31, 2010 to $43.6 million for the year ended December 31, 2011. The increase was due to: (a) administrative fees payable to the Manager of $0.9 million;
(b) managements fees payable to the Manager of $18.1 million; (c) $14.7 million costs related to vessel pre-building expenses, dry dockings and insurances; (d) $0.1 million related to accrued interest; and (e)$3.7 million
non-cash increase in pre-building costs.

Payments for dry dock and special survey costs incurred in the year ended December 31, 2011
were $7.8 million and related to the dry dock and special survey costs incurred for two of the VLCC tanker vessels of the fleet.

Accounts receivable increased by $2.0 million to $6.5 million for the year ended December 31, 2011, from $4.5 million for the year ended
December 31, 2010 and were related to receivables from charterers.

Restricted cash from operating activities decrease by
$0.5 million for the year ended December 31, 2011 and related to the cash held in retention account for the payment of interest under our credit facilities.

Accounts payable decreased by $2.4 million from $3.4 million for the year ended December 31, 2010 to $1.0 million for the year ended December 31, 2011. This decrease was
attributable to the decrease in legal and professional fees of $2.3 million and the $0.6 million decrease in other creditors which were partially offset by the $0.5 million increase in brokers commission payable.



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Prepaid expenses increased by $0.1 million to $0.5 million for the year ended December 31, 2011
from $0.4 million for the year ended December 31, 2010, due to a decrease in prepaid vessel operating expenses On November 4, 2011, with respect to the shares held in escrow for the VLCC Acquisition, a total of 1,160,963 shares of
common stock were released to the sellers and the remaining 217,159 were returned to Navios Acquisition in settlement of claims for breaches of representations and warranties attributable to the sellers. The returned shares were cancelled on
December 30, 2011. The value of the 217,159 shares that were returned was $1.2 million.

Accrued expenses increased by $6.3 million
to $15.5 million for the year ended December 31, 2011, from $9.2 million on December 31, 2010. The increase was attributable to a $1.2 million increase in accrued interest, $4.2 million increase in other accrued expenses due to
increase in accrued deferred finance fees incurred in relation to credit facilities entered to partially finance the acquisition of three MR2 vessels, $0.4 million increase in voyage expenses and $0.5 million increase due to the straight line effect
of revenue of the vessels acquired in July 2011.

Other long term assets increased by $1.3 million for the year ended December 31,
2011 and $0 million of the comparative period in 2010. On October 28, 2011, the charter contract of the Nave Ariadne (ex. Ariadne Jacob) and Nave Cielo (ex. Colin Jacob) were terminated prior to their original expiration in June 2013. Navios
Acquisition entered into certain settlement agreements with charterers that provide for an amount of approximately $5.0 million to compensate for the early termination of the charters and to cover outstanding receivables, out of which $2.0 million
will be settled in installments until June 2015.

Deferred voyage revenue primarily relates to cash received from charterers prior to it being
earned. These amounts are recognized as revenue over the voyage or charter period. Deferred voyage revenue increased by $0.5 million to $3.3 million for the year ended December 31, 2011 from $2.8 million on December 31, 2010.

Long Term Liabilities increased by $0.5 million. Long term liabilities are related to the long term portion of the straight line effect of
revenue of the vessels acquired in July 2011.

Cash used in investing activities for the year ended December 31, 2011 as compared
to the year ended December 31, 2010:

Net cash used in investing activities increased by $122.2 million to $225.8 million
at December 31, 2011 from $103.6 million at December 31, 2010 mainly as a result of fleet expansion.

Net cash used in
investing activities for the year ended December 31, 2011, resulted from: (a) $4.5 million paid for the acquisition of the Nave Polaris in January 2011, $29.3 million paid for the acquisition of the Shinyo Kieran in June 2011, $37.3
million paid for the acquisition of the Buddy and $37.3 million paid for the acquisition of the Bull in July 2011 and $ 27.0 million paid for the acquisition of the Nave Andromeda in November 2011; (b) $78.5 million paid as a deposits
for the acquisition of the vessels that will be delivered to Navios Acquisition at various dates through October 2014; (c) $7.8 million paid for improvements in certain VLCC vessels; and (d) $10.4 million of intangible assets and
liabilities associated with the acquisition of two MR2 vessels in July 2011. The $232.1 million was partially offset by a $3.8 million decrease in restricted cash and $2.5 million of non-cash items

For the year ended December 31, 2010, net cash used in investing activities increased as a result of: (a) a $76.4 million refund to Navios
Holdings, which made the first equity installment payment on the vessels acquired in Navios Acquisitions initial vessel acquisition; (b) $39.3 million paid for the acquisition of the Nave Cielo (ex. Colin Jacob) in June 2010, $39.3
million paid for the acquisition of the Nave Ariadne (ex. Ariadne Jacob) and $11.3 million paid for the acquisition of the Nave Cosmos in October 2010; (c) $102.0 million paid for the VLCC Acquisition, net of cash acquired through working
capital; and (d) $89.8 million paid as a deposits for the acquisition of the vessels that will be delivered to Navios Acquisition at various dates through December 2012. The increase was partially offset by the release of $251.5 million of
investments from the trust account and the release of $2.3 million from the restricted cash and $0.8 million of non-cash items.

Cash
provided by financing activities for the year ended December 31, 2011 as compared to the year ended December 31, 2010:

Net cash
provided by financing activities decreased by $13.1 million to $141.5 million at December 31, 2011 from $154.6 million at December 31, 2010.

Net cash provided by financing activities for the year ended December 31, 2011 was $141.5 million. Net cash provided by financing activities resulted from $252.1 million of loan proceeds net of
deferred finance fees and $33.2 million proceeds from related party loan, net of deferred finance fees. This increase was partially offset by: (a) a $1.7 million decrease in restricted cash; (b) $126.3 million for loan
repayments; (c) a $6.0 million repayment of a loan from a related party; and (d) dividends paid of $9.8 million.



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Net cash provided by financing activities for the year ended December 31, 2010 was $154.6 million. Net
cash provided by financing activities resulted from: (a) $556.7 million loan proceeds net of deferred finance fees; (b) $75.0 million from net proceeds from the warrant exercise program; (c) $39.6 million of proceeds
from a related party loan; and (d) $33.4 million of net proceeds from the equity offering of 6,500,000 shares that was completed on November 19, 2010. This increase was offset by: (a) $99.3 million paid to holders of
10,021,399 shares of our common stock who voted against the initial vessel acquisition and elected to redeem their shares; (b) $8.9 million disbursed to the underwriters of Navios Acquisitions initial public offering for deferred
fees; (c) $0.3 million decrease in restricted cash; (d) $412.3 million for loan repayments, of which, $410.5 million was associated with facilities acquired in the VLCC Acquisition; (e) $27.6 million repayment of a loan
from related party; and (f) $1.8 million costs related to the issuance of Series B convertible preferred stock.

Reconciliation of EBITDA to Net Cash from Operating Activities



|                                       |  |                                       |         |   |                                       |   |         |                                       |  |   |        |  
|-------------------------------------- |  | ------------------------------------- | ------- | - | ------------------------------------- | - | ------- | ------------------------------------- |  | - | ------ | -
|Expressed in thousands of U.S. dollars |  | Year
EndedDecember 31,2012(unaudited) |         |   | Year
EndedDecember 31,2011(unaudited) |   |         | Year
EndedDecember 31,2010(unaudited) | 
|Net Cash from Operating Activities     |  | $                                     | 81,877  |   |                                       | $ | 64,233  |                                       |  | $ | 10,300 |  
|Net increase in operating assets       |  |                                       | 3,030   |   |                                       |   | 12,972  |                                       |  |   | 1,579  |  
|Net increase in operating liabilities  |  |                                       | (33,619 | ) |                                       |   | (38,603 | )                                     |  |   | (4,090 | )
|Net interest cost                      |  |                                       | 48,987  |   |                                       |   | 41,751  |                                       |  |   | 9,789  |  
|Amortization of deferred finance cost  |  |                                       | (2,820  | ) |                                       |   | (2,253  | )                                     |  |   | (518   | )
|Write-off of deferred finance costs    |  |                                       |        |   |                                       |   | (935    | )                                     |  |   | (2,938 | )
|Share-based compensation               |  |                                       |        |   |                                       |   |        |                                       |  |   | (2,140 | )
|Non-cash transaction costs             |  |                                       |        |   |                                       |   |        |                                       |  |   | (5,619 | )
|                                       |  |                                       |         |   |                                       |   |         |                                       |  |   |        |  
|EBITDA
(1)                             |  | $                                     | 97,455  |   |                                       | $ | 77,165  |                                       |  | $ | 6,363  |  
|                                       |  |                                       |         |   |                                       |   |         |                                       |  |   |        |  



|                                          |  |                            |          |   |                            |   |          |                            |  |   |          |  
|----------------------------------------- |  | -------------------------- | -------- | - | -------------------------- | - | -------- | -------------------------- |  | - | -------- | -
|(1)                                       |  | Year endedDecember 31,2012 |          |   | Year endedDecember 31,2011 |   |          | Year endedDecember 31,2010 | 
|Net cash provided by operating activities |  | $                          | 81,877   |   |                            | $ | 64,233   |                            |  | $ | 10,300   |  
|Net cash used in investing activities     |  | $                          | (205,956 | ) |                            | $ | (225,777 | )                          |  | $ | (103,602 | )
|Net cash provided by financing activities |  | $                          | 125,625  |   |                            | $ | 141,484  |                            |  | $ | 154,575  |  

EBITDA represents loss plus interest expenses and finance cost plus depreciation and amortization and income taxes.

EBITDA is presented because Navios Acquisition believes that EBITDA is basis upon which liquidity can be assessed and present useful
information to investors regarding Navios Acquisitions ability to service and/or incur indebtedness, pay capital expenditures, meet working capital requirements and pay dividends. EBITDA is non-GAAP financial measure and should not
be considered a substitute for net income, cash flow from operating activities and other operations or cash flow statement data prepared in accordance with accounting principles generally accepted in the United States or as a measure of
profitability or liquidity.

While EBITDA is frequently used as a measure of operating results and the ability to meet debt service
requirements, the definition of EBITDA used here may not be comparable to that used by other companies due to differences in methods of calculation.

EBITDA for the year ended December 31, 2012, increased by $20.3 million to $97.5 million, as compared to $77.2 million for the same period in 2011. The increase in EBITDA was due to a:
(a) $29.2 million increase in revenue due to the acquisitions of the Shinyo Kieran in June 2011, the Bull and the Buddy in July 2011, the Nave Andromeda in November 2011, the Nave Estella in January 2012, the Nave Atria in July 2012, the Nave
Cassiopeia in August 2012, the Nave Cetus in October 2012 and the Nave Aquila in November 2012; (b) $0.9 million write-off of deferred financing costs incurred in 2011; (c) $0.3 million decrease in general and administrative expenses;
(d) $0.5 million increase in other income/ (expense), net; and (e) $0.7 million decrease in time charter expenses. The above $31.6 million increase was partially offset by an $11.3 million increase in management fees.



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EBITDA increased by $70.8 million to $77.2 million for the year ended December 31, 2011, as
compared to $6.4 million for the same period of 2010. The increase in EBITDA was due to: (a) a $88.3 million increase in revenue following the acquisitions of the Nave Cielo and the Nave Ariadne in July 2010, the VLCC Acquisition in
September 2010, of which the Shinyo Kieran was delivered in June 2011, the Nave Cosmos in October 2010, the Nave Polaris in January 2011, the Buddy and the Bull in July 2011 and the Nave Andromeda in November 2011; (b) $8.0 million of
transaction costs for the VLCC Acquisition incurred in 2010; (c) a $2.1 million of share based compensation incurred in 2010; and (d) a $5.4 million of prepayment fees and write-off of deferred financing costs incurred in 2010. The above
increase of $103.8 million was partially offset by a: (a) $25.9 million increase in management fees due to the increased number of vessels in Navios Acquisitions fleet; (b) $3.1 million increase in time charter expenses;
(c) $2.3 million increase in general and administrative expenses; (d) $0.8 million increase in other net income; and (e) a $0.9 million write-off of deferred financing costs incurred in 2011.

Long-Term Obligations and Credit Arrangements

8 5/8% First Priority Ship Mortgage Notes

On October 21, 2010, Navios
Acquisition and Navios Acquisition Finance completed the sale of the $400.0 million of Existing Notes. On May 26, 2011, Navios Acquisition and Navios Acquisition Finance completed the sale of the $105.0 million of Additional Notes. The Existing
Notes and the Additional Notes are secured by first priority ship mortgages on seven VLCC vessels owned by certain subsidiary guarantors.

The
Existing Notes and the Additional Notes are fully and unconditionally guaranteed on a joint and several basis by all of the Companys subsidiaries with the exception of Navios Acquisition Finance. The subsidiary guarantees are full and
unconditional, as that term is defined by Regulation S-X Rule 3-10, except for the fact that the indenture provides for an individual subsidiarys guarantee to be automatically released in certain customary circumstances, such as when a
subsidiary is sold or all assets are sold, the capital stock is sold, when the subsidiary is designated as an unrestricted subsidiary for purposes of the bond indenture upon liquidation or dissolution or upon legal or covenant defeasance
or satisfaction and discharge of the Existing Notes and the Additional Notes.

Navios Acquisition does not have any subsidiaries that are not
guarantors of the 8 5/8% Notes. In addition, the disclosures required by Rules 3-10(i)(9) and (10) are not applicable because there are no significant restrictions on (i) the ability of the parent company, any issuer (or co-issuer) or any
guarantor subsidiaries of the 8 5/8% Notes to obtain funds by dividend or loan from any of their subsidiaries or (ii) the ability of any subsidiaries to transfer funds to the issuer (or co-issuer) or any guarantor subsidiaries.

The Existing Notes and the Additional Notes contain covenants which, among other things, limit the incurrence of additional indebtedness, issuance of
certain preferred stock, the payment of dividends, redemption or repurchase of capital stock or making restricted payments and investments, creation of certain liens, transfer or sale of assets, entering into certain transactions with affiliates,
merging or consolidating or selling all or substantially all of Companys properties and assets and creation or designation of restricted subsidiaries.

Credit Facilities

Commerzbank AG, Alpha Bank A.E., and Credit Agricole Corporate
and Investment Bank: As a result of its initial vessel acquisition, Navios Acquisition assumed a loan agreement dated April 7, 2010, with Commerzbank AG, Alpha Bank A.E. and Credit Agricole Corporate and Investment Bank of up to
$150.0 million (divided in six equal tranches of $25.0 million each) to partially finance the construction of two chemical tankers and four product tankers. Each tranche of the facility is repayable in 12 equal semi-annual installments of
$0.75 million each with a final balloon payment of $16.75 million to be repaid on the last repayment date. The repayment of each tranche starts six months after the delivery date of the respective vessel which that tranche finances. It
bears interest at a rate of LIBOR plus 250 bps. The loan also requires compliance with certain financial covenants. As of December 31, 2012, $137.4 million was outstanding under this facility and $7.4 million remains to be drawn.

BNP Paribas SA Bank and DVB Bank S.E.: As a result of the initial vessel acquisition, Navios Acquisition assumed a loan agreement dated
April 8, 2010, of up to $75.0 million (divided in three equal tranches of $25.0 million each) for the purpose of part-financing the purchase price of three product tankers. Each of the tranche is repayable in 12 equal semi-annual
installments of $0.75 million each with a final balloon payment of $16.75 million to be repaid on the last repayment date. The repayment date of each tranche starts six months after the delivery date of the respective vessel which that tranche
finances. It bears interest at a rate of LIBOR plus 250 bps. The loan also requires compliance with certain financial covenants. As of December 31, 2012, $58.4 million was outstanding under this facility and $16.6 million remains to be drawn.



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DVB Bank S.E. and ABN AMRO Bank N.V.: On May 28, 2010, Navios Acquisition entered into a loan
agreement with DVB Bank S.E. and ABN AMRO BANK N.V. of up to $52.0 million (divided into two tranches of $26.0 million each) to partially finance the acquisition costs of two product tanker vessels. Each tranche of the facility is repayable in 24
equal quarterly installments of $0.45 million each with a final balloon payment of $15.2 million to be repaid on the last repayment date. The repayment of each tranche starts three months after the delivery date of the respective vessel. It bears
interest at a rate of LIBOR plus 275 bps. The loan also requires compliance with certain financial covenants. On December 29, 2011, Navios Acquisition prepaid $2.5 million in relation to an amendment to its credit facility. After the
prepayment, outstanding amount under each tranche is repayable in five quarterly installments of $0.2 each, 13 equal quarterly installments of $0.44 million each, with a final balloon payment of $15.2 million to be repaid on the last repayment date.
On December 31, 2012, Navios Acquisition prepaid $0.5 million in relation to an amendment to its credit facility. After the prepayment, outstanding amount under each tranche is repayable in two quarterly installments of $0.2 million each, 13
equal quarterly installments of $0.4 million each, with a final balloon payment of $15.2 million to be repaid on the last repayment date. As of December 31, 2012, the facility was fully drawn and the outstanding amount was $42.0 million.

Cyprus Popular Bank Public Co Ltd: In September 2010, Navios Acquisition (through four subsidiaries) entered into a $80.0 million
revolving credit facility with Cyprus Popular Bank Public Co Ltd to partially finance the acquisition and construction of vessels and for investment and working capital purposes. On September 7, 2012, the amount of the facility was reduced to
$32.4 million. Drawings under the facility are secured by assignments of construction contracts and guarantees, as well as security interests in related assets. The facility bears interest at a rate of LIBOR plus 275 bps. Pursuant to an agreement
dated December 31, 2012, the maturity of the facility was extended to match the delivery of the vessels. As of December 31, 2012, the outstanding amount under this facility was $32.4 million that was used to partially finance the
acquisition cost of two product tanker vessels.

EFG Eurobank Ergasias S.A.: On October 26, 2010, Navios Acquisition entered into
a loan agreement with Eurobank Ergasias S.A. of up to $52.2 million out of which $51.6 million has been drawn (divided into two tranches of $26.1 million and $25.5 million) to partially finance the acquisition costs of two LR1 product tanker
vessels. Each tranche of the facility is repayable in 32 equal quarterly installments of $0.35 million, each with a final balloon payment of $15.1 million and $14.7 million, to be repaid on the last repayment date. The repayment of each tranche
started three months after the delivery date of the respective vessel. The loan bears interest at a rate of LIBOR plus (i) plus 250 bps for the period prior to the delivery date in respect of the vessel being financed, and (ii) thereafter
275 bps. The loan also requires compliance with certain financial covenants. The facility was fully drawn and the outstanding amount as of December 31, 2012 was $49.2 million.

EFG Eurobank Ergasias S.A.: On December 6, 2010, Navios Acquisition entered into a loan agreement with Eurobank Ergasias S.A. of up to $52.0 million out of which $46.2 million has
been drawn (divided into two tranches of $23.1 million each) to partially finance the acquisition costs of two LR1 product tanker vessels. Each tranche of the facility is repayable in 32 equal quarterly installments of $0.3 million each with a final
balloon payment of $13.3 million, to be repaid on the last repayment date. The repayment of each tranche started three months after the delivery date of the respective vessel. It bears interest at a rate of LIBOR plus 300 bps. The loan also requires
compliance with certain financial covenants. The facility was fully drawn and the outstanding amount as of December 31, 2012 was $45.9 million.

ABN AMRO BANK N.V.: On July 8, 2011, Navios Acquisition entered into a loan agreement with ABN AMRO Bank N.V of up to $55.1 million (divided into two equal tranches) to partially finance the
purchase price of two MR2 product tanker vessels. The total amount of $54.8 million was drawn under this facility. Each tranche of the facility is repayable in 12 quarterly installments of $0.75 million each and 12 quarterly installments of $0.57
million each with a final balloon payment of $11.6 million to be repaid on the last repayment date. The repayment of each tranche started in October 2011 and it bears interest at a rate of LIBOR plus 325 bps. The loan also requires compliance
with certain financial covenants. As of December 31, 2012, $47.3 million was outstanding under this loan agreement ($23.65 million from each of the two tranches), and no further amounts are available to be drawn.

DVB Bank SE: On December 7, 2011, Navios Acquisition entered into a loan agreement with DVB Bank SE of up to $51.0 million (divided into
two tranches of $25.5 million each) to partially finance the purchase price of two LR1 product tanker vessels. Each tranche of the facility is repayable in 28 quarterly installments of $0.4 million each with a final balloon payment of $14.3
million to be repaid on the last repayment date. The repayment starts three months after the delivery of the respective vessel and it bears interest at a rate of LIBOR plus 270 bps per annum. The loan also requires compliance with certain financial
covenants. As of December 31, 2012, there were no outstanding amounts under this loan agreement and $51.0 million remained to be drawn.

NORDDEUTSCHE LANDESBANK GIROZENTRALE: On December 29, 2011, Navios Acquisition entered into a loan agreement with NORDDEUTSCHE
LANDESBANK GIROZENTRALE of up to $28.1 million to partially finance the purchase price of one MR2 product tanker vessel. The facility is repayable in 32 quarterly installments of $0.39 million each with a final balloon payment of $15.6 million
to be repaid on the last repayment date. The repayment starts three months



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after the delivery of the vessel and it bears interest at a rate of LIBOR plus: (a) up to but not including the Drawdown Date of, 175bps per annum; (b) thereafter until, but not
including, the tenth Repayment Date, 250 bps per annum; and (c) thereafter 300 bps per annum. The loan also requires compliance with certain financial covenants. As of December 31, 2012, $25.0 million was outstanding under this loan
agreement and $3.1 million remained to be drawn.

DVB Bank SE and Credit Agricole.: On December 29, 2011, Navios Acquisition
entered into a loan agreement with DVB Bank SE and Credit Agricole of up to $56.3 million (divided into two tranches of $28.1 million each) to partially finance the purchase price of two MR2 product tanker vessels. Each tranche of the
facility is repayable in 32 quarterly installments of $0.39 million each with a final balloon payment of $15.6 million to be repaid on the last repayment date. The repayment starts three months after the delivery of the respective vessel and it
bears interest at a rate of LIBOR plus: (a) up to but not including the Drawdown Date of, 175 bps per annum; (b) thereafter until, but not including, the tenth Repayment Date, 250 bps per annum; and (c) thereafter 300 bps per annum.
The loan also requires compliance with certain financial covenants. As of December 31, 2012, $49.9 million was outstanding under this loan agreement and $6.3 million remained to be drawn.

Navios Holdings Credit Facility: Navios Acquisition entered into a $40.0 million credit facility with Navios Holdings and paid $0.4 million
as arrangement fee. The $40.0 million facility has a margin of LIBOR plus 300 bps. Pursuant to an amendment in October 2010, the facility will be available for multiple drawings up to a limit of $40.0 million. Pursuant to an agreement
dated November 8, 2011, this facility was extended from April 2012 to December 2014. As of December 31, 2012, the outstanding amount under this facility was $35.0 million and $5.0 million remained to be drawn.

As of December 31, 2012, the total amount available to be drawn from all of our facilities was $89.4 million of which $84.4 million will be used to
finance the acquisition and construction of vessels and $5.0 million for investment and working capital purposes.

C. Research and
development, patents and licenses, etc.

Not applicable.

D. Trend information

Our results of operations depend primarily on the charter hire
rates that we are able to realize for our vessels, which depend on the demand and supply dynamics characterizing the tanker market at any given time. For other trends affecting our business please see other discussions in Item 5-Operating and
Financial Review and Prospects.

E. Off-Balance Sheet Arrangements

We have no off-balance sheet arrangements that have or are reasonably likely to have, a current or future material effect on our financial condition,
changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.

F.
Contractual Obligations and Contingencies

The following table summarizes our long-term contractual obligations as of December 31,
2012:





|                                  |  |                        |        |  |           |   |         |           |  |   |                  |  |  |       |         |  |  |   |           | 
|--------------------------------- |  | ---------------------- | ------ |  | --------- | - | ------- | --------- |  | - | ---------------- |  |  | ----- | ------- |  |  | - | --------- | 
|                                  |  | Payments due by period |       
|(In thousands of U.S. dollars)    |  | Less than1 year        |        |  | 1-3 years |   |         | 3-5 years |  |   | More than5 years |  |  | Total |        
|Long term debt obligations(1,2)   |  | $                      | 19,724 |  |           | $ | 41,003  |           |  | $ | 634,752          |  |  | $     | 297,014 |  |  | $ | 992,493   | 
|Loans due to related parties(3)   |  |                        |       |  |           |   | 35,000  |           |  |   |                 |  |  |       |        |  |  |   | 35,000    | 
|Due to related parties, long-term |  |                        |        |  |           |   | 57,701  |           |  |   |                  |  |  |       |         |  |  |   | 57,701    | 
|Vessel deposits(4)                |  |                        | 69,170 |  |           |   | 35,880  |           |  |   |                 |  |  |       |        |  |  |   | 105,050   | 
|                                  |  |                        |        |  |           |   |         |           |  |   |                  |  |  |       |         |  |  |   |           | 
|Total contractual obligations     |  | $                      | 88,894 |  |           | $ | 169,584 |           |  | $ | 634,752          |  |  | $     | 297,014 |  |  | $ | 1,190,244 | 
|                                  |  |                        |        |  |           |   |         |           |  |   |                  |  |  |       |         |  |  |   |           | 



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|1. | The amount identified does not include interest costs associated with the outstanding credit facility which is based on LIBOR, plus the costs of complying with any
applicable regulatory requirements and a margin ranging from 1.75% to 3.25% per annum.
|-- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|2. | The long-term debt contractual obligations includes in the amount shown for more than three and five years future principal payments of the drawn portion of credit
facilities associated with the financing of the construction of the LR1 vessel, the Nave Bellatrix, which was delivered to Navios Acquisitions fleet on January 24, 2013 and of the MR2 vessel, the Nave Rigel, which was delivered to Navios
Acquisitions fleet on February 14, 2013.
|-- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|3. | The amount relates to the credit facility with Navios Holdings. The amount identified does not include interest costs associated with the outstanding credit facility
which is based on LIBOR, and a margin of 3.00% per annum.
|-- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|4. | Future remaining contractual deposits of the eight MR2 product tanker vessels and the two LR1 product tanker vessels to be delivered on various dates through
October 2014.
|-- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Critical Accounting Policies

Our consolidated financial statements have been prepared in accordance with U.S. GAAP. The preparation of these financial statements requires us to make estimates in the application of our accounting
policies based on the best assumptions, judgments and opinions of management. Following is a discussion of the accounting policies that involve a higher degree of judgment and the methods of their application that affect the reported amount of
assets and liabilities, revenues and expenses and related disclosure of contingent assets and liabilities at the date of our financial statements. Actual results may differ from these estimates under different assumptions or conditions.

Critical accounting policies are those that reflect significant judgments or uncertainties, and potentially result in materially different results under
different assumptions and conditions. For a description of all of our significant accounting policies, see Note 2 to the Notes to Consolidated Financial Statements, included herein.

Fair Value of Vessels:As of December 31, 2012, Navios Acquisition owned and operated a fleet of 19 vessels, with an aggregate carrying value of $995.4 million, including the carrying
value of existing time charters on its fleet of vessels. On a vessel-by-vessel basis, as of December 31, 2012, the carrying value of 18 of Navios Acquisitions vessels (including the carrying value of the time charter, if any, on the
specified vessel) exceeds the estimated fair value of those same vessels (including the estimated fair value of the time charter, if any, on the specified vessel) by approximately $142.8 million in aggregate (the unrealized loss).

A vessel-by-vessel summary as of December 31, 2012, follows (with an * indicating those individual vessels whose carrying value exceeds its
estimated fair value, including the related time charter, if any):



|                 |  |                               |            |  |                   |   |         |                                         |  |   |       |  
|---------------- |  | ----------------------------- | ---------- |  | ----------------- | - | ------- | --------------------------------------- |  | - | ----- | -
|Vessel name      |  | Date ofAcquisition            |            |  | PurchasePrice (1) |   |         | CarryingValue as ofDecember 31,2012 (1) | 
|                 |  | (In millions of U.S. dollars) |           
|Nave Cielo       |  |                               | 6-29-2010  |  |                   | $ | 44.2    |                                         |  | $ | $39.6 | *
|Nave Ariadne     |  |                               | 7-2-2010   |  |                   | $ | 44.1    |                                         |  | $ | 39.5  | *
|Nave Cosmos      |  |                               | 7-27-2010  |  |                   | $ | 31.8    |                                         |  | $ | 29.2  | *
|Shinyo Navigator |  |                               | 9-10-2010  |  |                   | $ | 60.5    |                                         |  | $ | 48.2  | *
|Shinyo Kannika   |  |                               | 9-10-2010  |  |                   | $ | 81.3    |                                         |  | $ | 70.4  | *
|Shinyo Kieran    |  |                               | 6-8-2011   |  |                   | $ | 139.7   |                                         |  | $ | 131.0 | *
|Shinyo Ocean     |  |                               | 9-10-2010  |  |                   | $ | 81.7    |                                         |  | $ | 70.2  | *
|Shinyo Splendor  |  |                               | 9-10-2010  |  |                   | $ | 45.0    |                                         |  | $ | 35.0  | *
|C. Dream         |  |                               | 9-10-2010  |  |                   | $ | 62.2    |                                         |  | $ | 55.0  | *
|Shinyo Saowalak  |  |                               | 9-10-2010  |  |                   | $ | 137.6   |                                         |  | $ | 124.6 | *
|Nave Polaris     |  |                               | 1-27-2011  |  |                   | $ | 31.7    |                                         |  | $ | 29.5  | *
|Buddy            |  |                               | 7-12-2011  |  |                   | $ | 42.5    |                                         |  | $ | 38.0  | *
|Bull             |  |                               | 7-18-2011  |  |                   | $ | 42.4    |                                         |  | $ | 37.9  | *
|Nave Andromeda   |  |                               | 11-14-2011 |  |                   | $ | 44.3    |                                         |  | $ | 42.5  | *
|Nave Estella     |  |                               | 1-20-2012  |  |                   | $ | 44.6    |                                         |  | $ | 43.1  | *
|Nave Atria       |  |                               | 7-31-2012  |  |                   | $ | 37.6    |                                         |  | $ | 37.0  | *
|Nave Cassiopeia  |  |                               | 8-31-2012  |  |                   | $ | 43.8    |                                         |  | $ | 43.3  | *
|Nave Cetus       |  |                               | 10-31-2012 |  |                   | $ | 44.0    |                                         |  | $ | 43.7  | *
|Nave Aquila      |  |                               | 11-9-2012  |  |                   | $ | 37.8    |                                         |  | $ | 37.7  | *
|                 |  |                               |            |  |                   |   |         |                                         |  |   |       |  
|                 |  |                               |            |  |                   |   | 1,096.8 |                                         |  |   | 995.4 |  
|                 |  |                               |            |  |                   |   |         |                                         |  |   |       |  



|(1) | All amounts include related time charter, if any.
|--- | -------------------------------------------------



| | Although the aforementioned excess of carrying value over fair value represents an estimate of the loss that Navios Acquisition would sustain on a hypothetical
disposition of those vessels as of December 31, 2012, the recognition of the unrealized loss absent a disposition (i.e. as an impairment) would require, among other things, that a triggering event had occurred and that the undiscounted cash
flows attributable to the vessel are also less than the carrying value of the vessel (including the carrying value of the time charter, if any, on the specified vessel).
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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Use of Estimates: The preparation of consolidated financial statements in conformity with U.S.
GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities as of the dates of the financial statements and the reported amounts of
revenues and expenses during the reporting periods. On an on-going basis, management evaluates the estimates and judgments, including those related to uncompleted voyages, future drydock dates, the selection of useful lives for tangible assets,
expected future cash flows from long-lived assets to support impairment tests, provisions necessary for accounts receivables, provisions for legal disputes, and contingencies. Management bases its estimates and judgments on historical experience and
on various other factors that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources.
Actual results could differ from those estimates under different assumptions and/or conditions.

Vessels, Net: Vessels are
stated at historical cost, which consists of the contract price, delivery and acquisition expenses and capitalized interest costs while under construction. Vessels acquired in an asset acquisition or in a business combination are recorded at fair
value. Subsequent expenditures for major improvements and upgrading are capitalized, provided they appreciably extend the life, increase the earning capacity or improve the efficiency or safety of the vessels. Expenditures for routine maintenance
and repairs are expensed as incurred.

Depreciation is computed using the straight line method over the useful life of the vessels, after
considering the estimated residual value. Management estimates the residual values of our tanker vessels based on a scrap value of $285 per lightweight ton, as we believe these levels are common in the shipping industry. Management estimates the
useful life of our vessels to be 25 years from the vessels original construction. However, when regulations place limitations over the ability of a vessel to trade on a worldwide basis, its useful life is re-estimated to end at the date
such regulations become effective.

Impairment of long-lived Asset Group: Vessels, other fixed assets and other long lived
assets held and used by Navios Acquisition are reviewed periodically for potential impairment whenever events or changes in circumstances indicate that the carrying amount of a particular asset may not be fully recoverable. Navios Acquisitions
management evaluates the carrying amounts and periods over which long-lived assets are depreciated to determine if events or changes in circumstances have occurred that would require modification to their carrying values or useful lives. In
evaluating useful lives and carrying values of long-lived assets, certain indicators of potential impairment, are reviewed such as undiscounted projected operating cash flows, vessel sales and purchases, business plans and overall market conditions.

Undiscounted projected net operating cash flows are determined for each asset group (consisting of the individual vessel and the intangible
with respect to the time charter agreement to that vessel) and compared to the vessel carrying value and related carrying value of the intangible with respect to the time charter agreement attached to that vessel or the carrying value of deposits
for new buildings. Within the shipping industry, vessels are customarily bought and sold with a charter attached. The value of the charter may be favorable or unfavorable when comparing the charter rate to then current market rates. The loss
recognized either on impairment (or on disposition) will reflect the excess of carrying value over fair value (selling price) for the vessel individual asset group.

During the fourth quarter of fiscal 2012, management concluded that events occurred and circumstances had changed, which indicated the potential impairment of Navios Acquisitions long-lived assets
may exist. These indicators included continued deterioration in the spot market, and the related, impact of the current tanker sector has on managements expectation for future revenues. As a result, an impairment assessment of long-lived
assets was performed.

The Company determined undiscounted projected net operating cash flows for each vessel and deposits for buildings and
compared it to the vessels carrying value together with the carrying value of the related intangible. The significant factors



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and assumptions used in the undiscounted projected net operating cash flow analysis included: determining the projected net operating cash flows by considering the charter revenues from existing
time charters for the fixed fleet days (Companys remaining charter agreement rates) and an estimated daily time charter equivalent for the unfixed days (based on a combination of the Companys remaining charter agreement rates and the
10-year average historical one year time charter rates) over the remaining economic life of each vessel, net of brokerage and address commissions, excluding days of scheduled off-hires, management fees fixed until May 2014 and thereafter assuming an
annual increase of 3.0% and utilization rate of 98.6% based on the fleets historical performance.

In connection with its annual impairment
testing on its vessels as of December 31, 2012, the Company performs sensitivity analysis on the most sensitive and/or subjective assumptions that have the potential to affect the outcome of the test, principally the projected charter rate used
to forecast future cash flow for unfixed days. In that regard, there would continue to be no impairment required to be recognized on any of the Companys vessels when assuming a decline in the 10-year average (of the one-year charter rate for
similar vessels), which is the rate that the Company uses to forecast future cash flow for unfixed days, ranging from 31.6% to 89.6% (depending on the vessel).

For the deposits for new build vessels, the net cash flows also included the future cash out flows to make vessel ready for use, all remaining progress payments to shipyards and other pre-delivery
expenses (e.g. capitalized interest). Accordingly, no impairment charge was recorded.

The assessment concluded that step two of the
impairment analysis was not required and no impairment of vessels and the intangible assets existed as of December 31, 2012, as the undiscounted projected net operating cash flows exceeded the carrying value.

In the event that impairment would occur, the fair value of the related asset would be determined and a charge would be recorded to operations calculated
by comparing the assets carrying value to its fair value. Fair value is estimated primarily through the use of third-party valuations performed on an individual vessel basis.

Although management believes the underlying assumptions supporting this assessment are reasonable, if charter rate trends and the length of the current market downturn, vary significantly from our
forecasts, management may be required to perform step two of the impairment analysis in the future that could expose Navios Acquisition to material impairment charges in the future.

No impairment loss was recognized for any of the periods presented.

Revenue
Recognition: Revenue is recorded when services are rendered, under a signed charter agreement or other evidence of an arrangement, the price is fixed or determinable, and collection is reasonably assured. Revenue is generated from the voyage
charter and the time charter of vessels.

Voyage revenues for the transportation of cargo are recognized ratably over the estimated relative
transit time of each voyage. A voyage is deemed to commence when a vessel is available for loading and is deemed to end upon the completion of the discharge of the current cargo. Estimated losses on voyages are provided for in full at the time such
losses on voyages are provided for in full at the time such losses become evident. Under a voyage charter, a vessel is provided for the transportation of specific goods between specific ports in return for payment of an agreed upon freight per ton
of cargo.

Revenues from time chartering of vessels are accounted for as operating leases and are thus recognized on a straight-line basis as
the average revenue over the rental periods of such charter agreements, as service is performed. A time charter involves placing a vessel at the charterers disposal for a period of time during which the charterer uses the vessel in return for
the payment of a specified daily hire rate. Under time charters, operating costs such as for crews, maintenance and insurance are typically paid by the owner of the vessel.

Profit-sharing revenues are calculated at an agreed percentage of the excess of the charterers average daily income (calculated on a quarterly or half-yearly basis) over an agreed amount and
accounted for on an accrual basis based on provisional amounts and for those contracts that provisional accruals cannot be made due to the nature of the profit share elements, these are accounted for on the actual cash settlement.

Revenues are recorded net of address commissions. Address commissions represent a discount provided directly to the charterers based on a fixed
percentage of the agreed upon charter or freight rate. Since address commissions represent a discount (sales incentive) on services rendered by the Company and no identifiable benefit is received in exchange for the consideration provided to the
charterer, these commissions are presented as a reduction of revenue.



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Recent Accounting Pronouncements

Fair Value Disclosures

In January 2010, the Financial Accounting Standards Board
(FASB) issued amended standards requiring additional fair value disclosures. The amended standards require disclosures of transfers in and out of Levels 1 and 2 of the fair value hierarchy, as well as requiring gross basis disclosures
for purchases, sales, issuances and settlements within the Level 3 reconciliation. Additionally, the update clarifies the requirement to determine the level of disaggregation for fair value measurement disclosures and to disclose valuation
techniques and inputs used for both recurring and nonrecurring fair value measurements in either Level 2 or Level 3. Navios Acquisition adopted the new guidance in the first quarter of fiscal 2010, except for the disclosures related to purchases,
sales, issuance and settlements, which was effective for Navios Acquisition beginning in the first quarter of fiscal 2012. The adoption of the new standards did not have a significant impact on Navios Acquisitions consolidated financial
statements.

Item 6. Directors, Senior Management and Employees

A. Directors and Senior Management

Set forth below are the names, ages and positions of Navios Acquisitions directors, executive officers and key employees.



|                       |  |     |    |  |          |                                                        
|---------------------- |  | --- | -- |  | -------- | -------------------------------------------------------
|Name                   |  | Age |    |  | Position
|                       |  |    
|Angeliki Frangou       |  |     | 48 |  |          | Chairman, Chief Executive Officer and Director         
|Ted C. Petrone         |  |     | 58 |  |          | President and Director                                 
|Nikolaos Veraros, CFA  |  |     | 43 |  |          | Director                                               
|John Koilalous         |  |     | 82 |  |          | Director                                               
|Leonidas Korres        |  |     | 37 |  |          | Chief Financial Officer                                
|Brigitte Noury         |  |     | 66 |  |          | Director                                               
|Anna Kalathakis        |  |     | 43 |  |          | Director, Senior Vice President  Legal Risk Management
|George Galatis         |  |     | 50 |  |          | Director                                               
|Vasiliki Papaefthymiou |  |     | 44 |  |          | Secretary                                              

Angeliki Frangouhas been Navios Maritime Acquisition Corporation Chairman and Chief
Executive Officer since inception. Ms. Frangou is also Chairman and CEO of Navios Maritime Holdings Inc.  Navios Acquisitions sponsor  since August 2005. In addition, Ms. Frangou serves as the Chairman and Chief Executive
Officer of Navios Partners, an affiliated limited partnership trading on the New York Stock Exchange, since August 2007. Ms. Frangou is also the Chairman of the board of directors of Navios South American Logistics since inception in December
2007. Previously, Ms. Frangou was Chairman, Chief Executive Officer and President of International Shipping Enterprises Inc., which acquired Navios Holdings. During the period 1990 through August 2005, Ms. Frangou was the Chief Executive
Officer of Maritime Enterprises Management S.A., and its predecessor company, which specialized in the management of dry cargo vessels. Ms. Frangou is the Chairman of IRF European Finance Investments Ltd., listed on the SFM of the London Stock
Exchange. As of September 2012, Ms. Frangou is also serving as a Board member of Eurobank Ergasias S.A. (one of the largest commercial banks in Greece). During the period April 2004 to July 2005, Ms. Frangou served on the board of
directors of Emporiki Bank of Greece (then, the second largest retail bank in Greece). From June 2006 until September 2008, Ms. Frangou also served as Chairman of Proton Bank, based in Athens, Greece. Ms. Frangou is Member of the Board of
The United Kingdom Mutual Steam Ship Assurance Association (Bermuda) Limited and Vice Chairman of China Classification Society Mediterranean Committee and a member of the Hellenic and Black Sea Committee of Bureau Veritas as well as a member of
Greek Committee of Nippon Kaiji Kyokai. Ms. Frangou received a bachelors degree in mechanical engineering from Fairleigh Dickinson University (summa cum laude) and a masters degree in mechanical engineering from Columbia University.



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Ted C. Petronehas been our President and a member of our Board of Directors
since March 2008. He has also been a director of Navios Holdings since May 2007, having become President of Navios Corporation in September 2006. He heads Navios Holdings worldwide commercial operations. Mr. Petrone has
served in the maritime industry for 36 years, 33 of which he has spent with Navios Holdings. After joining Navios Holdings as an assistant vessel operator, Mr. Petrone worked there in various operational and commercial positions. For the
last 15 years, Mr. Petrone has been responsible for all the aspects of the daily commercial activity, encompassing the trading of tonnage, derivative hedge positions and cargoes. Mr. Petrone graduated from New York Maritime College at Fort
Schuyler with a B.S. in Maritime Transportation. He has also served aboard U.S. Navy (Military Sealift Command) tankers.

Nikolaos Veraros, CFA,has been a member of our Board of Directors since June 2008. Mr. Veraros is a senior
analyst at Investments & Finance Ltd., where he has worked since August 2001, and also from June 1997 to February 1999. From March 1999 to August 2001, Mr. Veraros worked as a senior equity analyst for National
Securities, S.A., a subsidiary of National Bank of Greece. He is a Chartered Financial Analyst (CFA), a Certified Market Maker for Derivatives in the Athens Stock Exchange, and a Certified Analyst from the Hellenic Capital Market Commission.
Mr. Veraros received his Bachelor of Science degree in Business Administration from the Athens University of Economics and Business (graduated as valedictorian) and his Master of Business Administration degree in Finance/Accounting from the
William E. Simon Graduate School of Business Administration at the University of Rochester.

John
Koilaloushas been a member of our Board of Directors since June 2008. Mr. Koilalous began his career in the shipping industry in the City of London in 1949, having worked for various firms both in London and Piraeus. He
entered the adjusting profession in 1969, having worked for Francis and Arnold for 18 years and then with Pegasus Adjusting Services Ltd., of which he was the founder and, until his retirement at the end of 2008, the Managing Director. He still
remains active in an advisory capacity on matters of marine insurance claims. Mr. Koilalous is also a member of our Audit Committee and is an independent director.

Leonidas Korreshas been our Chief Financial Officer since April 2010, and previously our Senior Vice President for Business Development since January 2010. Mr. Korres served
as the Special Secretary for Public Private Partnerships in the Ministry of Economy and Finance of the Hellenic Republic from October 2005 until November 2009. Prior to that, from April 2004 to October 2005, Mr. Korres
served as Special Financial Advisor to the Minister of Economy and Finance of the Hellenic Republic and as liquidator of the Organizational Committee for the Olympic Games Athens 2004 S.A. From 2001 to 2004, Mr. Korres worked as a Senior
Financial Advisor for KPMG Corporate Finance. From October 2007 until January 2010, Mr. Korres was a member of the board of directors of Navios Partners. From May 2003 to December 2006, Mr. Korres was Chairman of the
Center for Employment and Entrepreneurship, a non-profit Company. From June 2008 until February 2009, Mr. Korres served as a board member and audit committee member of Hellenic Telecommunications Organization S.A. (trading on the Athens
and New York Stock Exchanges). From June 2004 until November 2009, Mr. Korres served on the board of Hellenic Olympic Properties S.A., which was responsible for exploiting the Olympic venues. Mr. Korres earned his bachelors
degree in Economics from the Athens University of Economics and Business and his masters degree in Finance from the University of London.

Brigitte Noury has been a member of our Board of Directors since May 2010. Ms. Noury served from March 2002 until December 2009 as Director of Corporate & Investment Banking
Asset & Recovery Management  Europe for Societe Generale. She also served from June 1989 until February 2002 as Head of Shipping at Societe Generale. In addition, she served as Vice President  Shipping at
Banque Indosuez from 1987 to 1989. Before that Ms. Noury served as Financial Controller at Banque Internationale pour lAfrique Occidentale (later acquired by BNP Paribas). Ms. Noury received a Master of Economic Sciences degree and a
Diploma in Business Administration from the University of Dijon. Ms. Noury is also a member of our Audit Committee and Nominating Committee and is an independent director.

Anna Kalathakishas been a member of our board of directors and Senior Vice President  Legal Risk Management since May 2010. Ms. Kalathakis has been Chief Legal Risk Officer
from November 2012, and Senior Vice President  Legal Risk Management of Navios Maritime Holdings Inc. from December 2005 until October 2012. Before joining Navios Holdings, Ms. Kalathakis was the General Manager of the Greek office
of A Bilbrough & Co. Ltd. (Managers of the London Steam-Ship Owners Mutual Insurance Association Limited, the London P&I Club) and an Associate Director of the London P&I Club where she gained experience in the
handling of liability and contractual disputes in both the dry and tanker shipping sectors (including collisions, oil pollution incidents, groundings etc). She previously worked for a U.S. maritime law firm in New Orleans, having qualified as a
lawyer in Louisiana in 1995, and also served in a similar capacity for a London maritime law firm. She qualified as a solicitor in England and Wales in 1999 and was admitted to the Piraeus Bar, Greece, in 2003. She received a bachelors degree
International Relations from Georgetown University and holds a Masters of Business Administration degree from European University in Brussels and a Juris Doctor degree from Tulane Law School.

George Galatishas served as a member of our Board of Directors since July 2010. He is currently the Executive
Vice President  Product Development at Demo Pharmaceutical Industry having served as a Senior Vice President  Project



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Development since 1999. Mr Galatis also served as a Technical Manager in Pharmaceutical Industry Projects at Telos Consulting Ltd. of London from 1994 to 1999. Previously, Mr. Galatis served
as an engineer, technical manager and product manager at various shipping companies in the United States and the UK. Mr. Galatis is a mechanical engineer and holds a Bachelors Degree in Mechanical Engineering and Masters Degree
in Robotics from the University of Newcastle upon Tyne. Mr. Galatis is also a member of our Nominating Committee and is an independent director.

Vasiliki Papaefthymiouhas been appointed our Secretary since inception. Ms. Papaefthymiou has been Executive Vice President  Legal and a member of Navios Holdings board of
directors since August 25, 2005, and prior to that was a member of the board of directors of ISE. Ms. Papaefthymiou has served as General Counsel for Maritime Enterprises Management S.A. since October 2001, where she has advised the
company on shipping, corporate and finance legal matters. Ms. Papaefthymiou provided similar services as General Counsel to Franser Shipping from October 1991 to September 2001. Ms. Papaefthymiou received her undergraduate degree from
the Law School of the University of Athens and a masters degree in Maritime Law from Southampton University in the United Kingdom. Ms. Papaefthymiou is admitted to practice law before the Bar in Piraeus, Greece.

B. Compensation

Compensation

Our independent directors are entitled to receive $50,000 in cash per year, from the respective start of their service on our board of
directors. Ms. Frangou receives a fee of $150,000 per year for acting as a director and as our Chairman of the Board. No other executive officer has received any cash compensation for services rendered.

For the year ended December 31, 2012, aggregate annual compensation paid to our current non-management executive directors was $0.2 million; and
$0.15 million was paid to Ms. Frangou for acting as a director and as our Chairman of the Board. For the year ended December 31, 2011, aggregate annual compensation paid to our current non-management executive directors was $0.2 million;
and $0.15 million was paid to Ms. Frangou for acting as a director and as our Chairman of the Board.

C. Board Practices

Board Classes

Our board
of directors is divided into three classes with only one class of directors being elected in each year and each class serving a three-year term. The term of office of the first class of directors, consisting of John Koilalous, George Galatis and
Brigitte Noury, will expire at our 2015 annual meeting of stockholders, as their term was renewed for three years during our 2012 annual meeting. The term of office of the second class of directors, consisting of Ted C. Petrone and Nikolaos Veraros,
will expire at our 2013 annual meeting of stockholders. The term of office of the third class of directors, consisting of Angeliki Frangou and Anna Kalathakis, will expire at our 2014 annual meeting.

Director Independence

Our board of
directors has determined that Messrs. Veraros, Koilalous, Galatis and Ms. Noury are independent directors as defined in the New York Stock Exchange listing standards and Rule 10A-3 of the Exchange Act. We will always seek
to have a board of directors comprising of a majority of independent directors.

Board committees

Our board of directors has an audit committee and a nominating committee. Our board of directors has adopted a charter for the audit committee as well as
a code of conduct and ethics that governs the conduct of our directors and officers.

Audit committee

Our audit committee consists of Messrs. Veraros, Koilalous and Ms. Noury. Each member of our audit committee is financially literate under the
current listing standards of the New York Stock Exchange, and our board of directors has determined that Mr. Veraros qualifies as an audit committee financial expert, as such term is defined by SEC rules.



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The audit committee reviews the professional services and independence of our independent registered public
accounting firm and our accounts, procedures and internal controls. The audit committee also selects our independent registered public accounting firm, reviews and approves the scope of the annual audit, reviews and evaluates with the independent
public accounting firm our annual audit and annual consolidated financial statements, reviews with management the status of internal accounting controls, evaluates problem areas having a potential financial impact on us that may be brought to the
committees attention by management, the independent registered public accounting firm or the board of directors, and evaluates all of our public financial reporting documents.

Any expense reimbursements payable to members of our audit committee are reviewed and approved by our board of directors, with the interested director or directors abstaining from such review and
approval.

Nominating committee

A nominating committee of the board of directors has been established, which consists of Messrs. Veraros, Koilalous, Galatis, and Ms. Noury, each of whom is an independent director. The
nominating committee is responsible for overseeing the selection of persons to be nominated to serve on our board of directors. The nominating committee considers persons identified by its members, management, stockholders, investment bankers and
others.

Code of conduct and ethics

We have adopted a code of conduct and ethics applicable to our directors and officers in accordance with applicable federal securities laws and the rules of the New York Stock Exchange.

Conflicts of Interest

Stockholders and
potential investors should be aware of the following potential conflicts of interest:



| |  | None of our officers and directors is required to commit their full time to our affairs and, accordingly, they will have conflicts of interest in
allocating management time among various business activities, including those related to Navios Holdings and Navios Partners.
|- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | Each of our directors has, or may come to have other fiduciary obligations. Angeliki Frangou, our Chairman and Chief Executive Officer, is the Chairman
and Chief Executive Officer of Navios Holdings and Navios Partners. In addition, Ms. Frangou is the Chairman of the board of directors of IRF European Finance Investments, Ltd. Ted C. Petrone, our president and a member of our board of
directors, is the president of Navios Corporation, a subsidiary of Navios Holdings, and a director of Navios Holdings. Mr. Veraros is a senior analyst at Investments & Finance, Ltd., an investment banking firm specializing in the
shipping industry. Mr. Koilalous is the founder and managing director of Pegasus Adjusting Services, Ltd., an adjusting firm in the shipping industry. Ms. Kalathakis is Chief Legal Risk Officer of Navios Holdings.
|- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | We have entered a Management Agreement, expiring May 28, 2015, with a subsidiary of Navios Holdings, pursuant to which such subsidiary provides
certain commercial and technical ship management services for a fixed daily fee of $6,000 per owned MR2 product tanker and chemical tanker vessel, $7,000 per owned LR1 product tanker vessel and $10,000 per owned VLCC tanker vessel for the first four
years of the term of that agreement.
|- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | We entered into an Administrative Services Agreement with Navios Holdings, expiring on May 28, 2015, pursuant to which a subsidiary of Navios
Holdings provides certain administrative management services to Navios Acquisition which include: bookkeeping, audit and accounting services, legal and insurance services, administrative and clerical services, banking and financial services,
advisory services, client and investor relations and other. Navios Holdings is reimbursed for reasonable costs and expenses incurred in connection with the provision of these services.
|- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | We have not adopted a policy that expressly prohibits our directors, officers, security holders or affiliates from having a direct or indirect
pecuniary interest in any investment to be acquired or disposed of by us or in any transaction to which we are a party or have an interest. Nor do we have a policy that expressly prohibits any such persons from engaging for their own account in
business activities of the types conducted by us. Accordingly, such parties may have an interest in certain transactions in which we are involved, and may also compete with us.
|- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

We cannot assure you that any of the above mentioned conflicts will be resolved in our favor.

Navios Holdings has a significant ownership interest. As a result of Navios Holdings significant ownership stake in us and our common management, there are certain potential conflicts of interest,
including potential competition as to acquisition targets and, after an acquisition has been consummated, potential competition and business relationships with each other.



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All ongoing and future transactions between us and any of our officers and directors or their respective
affiliates, including Navios Holdings, will be on terms believed by us to be no less favorable than are available from unaffiliated third parties, and such transactions will require prior approval, in each instance, by a unanimous vote of our
disinterested independent directors or the members of our board who do not have an interest in the transaction.

Please see
Item 7.-Major Stockholders and Related Party Transactions.

Facilities

We do not own any real estate or other physical property. Our headquarters are located at 85 Akti Miaouli Street, Piraeus, Greece 185 38.

D. Employees

Employees of Navios
Holdings and its subsidiaries provide assistance to us and our operating subsidiaries pursuant to the management agreement and the administrative services agreement; therefore Navios Acquisition does not employ additional staff.

The Manager crews its vessels primarily with Greek, Filipino, Romanian, Russian and Ukranian officers and Filipino seamen. The Manager is
responsible for selecting its Greek officers. For other nationalities, officers and seamen are referred to us by local crewing agencies. Navios Acquisition requires that all of its seamen have the qualifications and licenses required to comply with
international regulations and shipping conventions.

Navios Holdings also provides on-shore advisory, operational and administrative support
to us pursuant to service agreements. Please see Item 7.-Major Stockholders and Related Party Transactions.

E. Share
Ownership

The following table sets forth certain information regarding beneficial ownership, based on 75,764,204 shares of common
stock outstanding as of March 19, 2013, of our common stock held by Navios Holdings, each of our officers and directors and by all of our directors and officers as a group. The information is not necessarily indicative of beneficial ownership
for any other purposes.

Unless otherwise indicated, we believe that all persons named in the table have sole voting and investment power with
respect to all shares of common stock beneficially owned by them.



|                                                |  |                              |            |     |                         |  |      |  
|----------------------------------------------- |  | ---------------------------- | ---------- | --- | ----------------------- |  | ---- | -
|Name and Address of Beneficial Owner (1)        |  | Amount ofBeneficialOwnership |            |     | PercentageofCommonStock | 
|Navios Maritime Holdings Inc.(2)                |  |                              | 35,875,851 | (2) |                         |  | 47.4 | %
|Angeliki Frangou(3)                             |  |                              | 1,902,628  |     |                         |  | 2.5  | %
|Ted C. Petrone                                  |  |                              |            | *   |                         |  |      | *
|Nikolaos Veraros                                |  |                              |            | *   |                         |  |      | *
|George Galatis                                  |  |                              |           |     |                         |  |      | *
|John Koilalous                                  |  |                              |            | *   |                         |  |      | *
|Birgitte Noury                                  |  |                              |           |     |                         |  |      | *
|Anna Kalathakis                                 |  |                              |           |     |                         |  |      | *
|Leonidas Korres                                 |  |                              |            | *   |                         |  |      | *
|All of our officers and directors as a group(3) |  |                              | 2,035,801  |     |                         |  | 2.7  | %



|* | less than one (1%) percent.
|- | ---------------------------

|(1) | Unless otherwise indicated, the business address of each of the individuals is c/o Navios Maritime Holdings Inc., 85 Akti Miaouli Street, Piraeus, Greece.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | Navios Holdings is a U.S. public company controlled by its board of directors, which consists of the following seven members: Angeliki Frangou (our Chairman and Chief
Executive Officer), Vasiliki Papaefthymiou, Ted C. Petrone (our president), Spyridon Magoulas, John Stratakis, Stathis Loizos and George Malanga.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(3) | Includes 1,502,628 shares held by Amadeus Maritime S.A. that may be deemed to be beneficially owned by Ms. Frangou.
|--- | -------------------------------------------------------------------------------------------------------------------



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Item 7. Major Stockholders and Related Party Transactions

A. Major Stockholders

The
following table sets forth the beneficial ownership of our common stock by each person we know to beneficially own more than 5% of our common stock based upon 75,764,204 shares of common stock outstanding as of March 19, 2013 and the amounts
and percentages as are contained in the public filings of such persons and based on knowledge of the Company. The number of shares of common stock beneficially owned by each person is determined under SEC rules and the information is not necessarily
indicative of beneficial ownership for any other purpose. Under SEC rules, a person beneficially owns any units as to which the person has or shares voting or investment power. In addition, a person beneficially owns any shares of common stock that
the person or entity has the right to acquire as of March 19, 2013 through the exercise of any right. All of the stockholders, including the stockholders listed in this table, are entitled to one vote per share of common stock held.



|                                 |  |                              |            |  |                         |  |      |  
|-------------------------------- |  | ---------------------------- | ---------- |  | ----------------------- |  | ---- | -
|Name of Beneficial Owner         |  | Amount ofBeneficialOwnership |            |  | PercentageofCommonStock | 
|Navios Maritime Holdings Inc.(1) |  |                              | 35,875,851 |  |                         |  | 47.4 | %
|A. Lawrence Caroll Trust(2)      |  |                              | 7,260,000  |  |                         |  | 9.6  | %



|(1) | The business address of the reporting person is 85 Akti Miaouli Street, Piraeus, Greece 185 38. The foregoing information was derived from a Schedule 13D/A filed
with the SEC on March 19, 2013.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | The business address of the reporting person is 415 LAmbiance Drive, 804 Longboat Key, FL 34228. The foregoing information was derived from a schedule 13G/A with
the SEC on January 29, 2013.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

B. Related Party Transactions

On May 28, 2010, Navios Acquisition consummated the vessel acquisition, which constituted its initial business combination. In connection with the
stockholder vote to approve the business combination, holders of 10,021,399 shares of common stock voted against the business combination and elected to redeem their shares in exchange for an aggregate of approximately $99.3 million, which
amount was disbursed from Navios Acquisitions investments held in trust account on May 28, 2010. In addition, on May 28, 2010, Navios Acquisition disbursed an aggregate of $8.9 million from the trust account to the underwriters
of its IPO for deferred fees. After disbursement of approximately $76.5 million to Navios Holdings to reimburse it for the first equity installment payment on the vessels of $38.8 million and other associated payments, the balance of the
trust account of $66.1 million was released to Navios Acquisition for general operating expenses. Following such transaction, Navios Acquisition commenced its operations as an operating company and was controlled by Navios Holdings and is
consolidated into its financial statements.

Navios Acquisition entered into a $40.0 million credit facility with Navios Holdings. The
$40.0 million facility has a margin of LIBOR plus 300 bps. Pursuant to an agreement dated November 8, 2011, the Navios Holdings credit facility was extended from April 2012 to December 2014. Pursuant to an amendment in October 2010,
the facility will be available for multiple drawings up to a limit of $40.0 million. As of December 31, 2011, the outstanding amount under this facility was $40.0 million and interest accrued under this facility was $0.1 million
and was included under amounts due to related parties. For the years ended December 31, 2012, 2011 and 2010, interest expense in relation to this facility amounted to $1.2 million, $0.7 million and $0.2 million, respectively, and was included
under interest expense and finance cost, net in the statement of operations. As of December 31, 2012, the outstanding amount under this facility was $35.0 million and accrued interest under this facility was below $0.1 million and was
included under amounts due to related parties.

Pursuant to an Exchange Agreement entered into March 30, 2011, Navios Holdings exchanged
7,676,000 shares of Navios Acquisitions common stock it held for 1,000 shares of Series C Convertible Preferred Stock of Navios Acquisition. Dividend paid to the Series C Convertible Preferred Stock was $1.5 million and $0.8 million
for the years ended December 31, 2012 and 2011, respectively.

On February 26, 2013, Navios Acquisition completed the private
placement of 17,702,491 shares of common stock at a price of $2.85 per share, to Navios Holdings and certain members of management of Navios Acquisition, Navios Holdings and Navios Partners, raising gross proceeds of $50.5 million. The net proceeds
of this private placement, including the agents fees of $2.0 million, were $48.5 million. On February 26, 2013, Navios Acquisition entered into a registration rights agreement with Navios Holdings and certain members of management of
Navios Acquisition, Navios Holdings and Navios Partners who purchased shares in the private placement, providing for standard piggy-back and demand registration rights with respect to the shares purchased in the private placement.



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The Management Agreement

We have entered into a five-year Management Agreement with the Manager, pursuant to which the Manager will provide certain commercial and technical ship management services to us. These services will be
provided in a commercially reasonable manner in accordance with customary ship management practice and under our direction. The Manager will provide these services to us directly but may subcontract for certain of these services with other entities,
including other Navios Holdings subsidiaries.

The commercial and technical management services will include:



| |  |  | the commercial and technical management of vessels: managing day-to-day vessel operations including negotiating charters and other employment
contracts for the vessels and monitoring payments thereunder, ensuring regulatory compliance, arranging for the vetting of vessels, procuring and arranging for port entrance and clearance, appointing counsel and negotiating the settlement of all
claims in connection with the operation of each vessel, appointing adjusters and surveyors and technical consultants as necessary, and providing technical support;
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | vessel maintenance and crewing: including the supervision of the maintenance and general efficiency of vessels and ensuring the vessels are in
seaworthy and good operating condition, arranging our hire of qualified officers and crew, arranging for all transportation, board and lodging of the crew, negotiating the settlement and payment of all wages; and
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | purchasing and insurance: purchasing stores, supplies and parts for vessels, arranging insurance for vessels (including marine hull and
machinery insurance, protection and indemnity insurance and war risk and oil pollution insurance).
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

The initial term of the
Management Agreement will expire May 28, 2015. Pursuant to the terms of the Management Agreement, we will pay the Manager a fixed daily fee of $6,000 per owned MR2 product tanker and chemical tanker vessel, $7,000 per owned LR1 product tanker
vessel and $10,000 per owned VLCC vessel, for the first two years of the term of that agreement, with the fixed daily fees adjusted for the remainder of the term based on then-current market fees. On May 4, 2012, Navios Acquisition amended its
existing Management Agreement with the Manager, to fix the fees for ship management services of its owned fleet at current rates for two additional years, through May 28, 2014.This fixed daily fee will cover all of our vessel operating
expenses, other than certain extraordinary fees and costs. During the remaining three years of the term of the Management Agreement, we expect that we will reimburse the Manager for all of the actual operating costs and expenses it incurs in
connection with the management of our fleet. Actual operating costs and expenses will be determined in a manner consistent with how the initial fees were determined. Drydocking expenses will be fixed under this agreement for up to $300,000 per
vessel and will be reimbursed at cost for VLCC vessels. Commencing as of March 30, 2012, Navios Acquisition can, upon request to the Manager, partially or fully defer the reimbursement of drydocking and other extraordinary fees and expenses
under the Agreement to a later date, but not later than January 4, 2014, and if reimbursed on a later date, such amounts will bear interest at a rate of 1% per annum over LIBOR. Commencing as of September 28, 2012, Navios
Acquisition could, upon request, reimburse the Manager partially or fully, for any fixed management fees outstanding for a period of not more than nine months under the Agreement at a later date, but not later than December 31, 2014, and if
reimbursed on a later date, such amounts will bear interest at a rate of 1% per annum over LIBOR. Total management fees for each of the year ended December 31, 2012, 2011 and 2010 amounted to $47.0 million, $35.7 million and $9.8 million,
respectively.

The Management Agreement may be terminated prior to the end of its initial term by us upon 120-days notice if there is a
change of control of the Manager or by the Manager upon 120-days notice if there is a change of control of Navios Acquisition. In addition, the Management Agreement may be terminated by us or by the Manager upon 120-days notice if:



| |  |  | the other party breaches the agreement;
| | - |  | ---------------------------------------



| |  |  | a receiver is appointed for all or substantially all of the property of the other party;
| | - |  | ----------------------------------------------------------------------------------------



| |  |  | an order is made to wind up the other party;
| | - |  | --------------------------------------------



| |  |  | a final judgment or order that materially and adversely affects the other partys ability to perform the Management Agreement is obtained or
entered and not vacated or discharged; or
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | the other party makes a general assignment for the benefit of its creditors, files a petition in bankruptcy or liquidation or commences any
reorganization proceedings.
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------

Furthermore, at any time after the first anniversary of the Management Agreement, the
Management Agreement may be terminated prior to the end of its initial term by us or by the Manager upon 365-days notice for any reason other than those described above.



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In addition to the fixed daily fees payable under the Management Agreement, the Management Agreement
provides that the Manager will be entitled to reasonable supplementary remuneration for extraordinary fees and costs resulting from:



| |  |  | time spent on insurance and salvage claims;
| | - |  | -------------------------------------------



| |  |  | time spent vetting and pre-vetting the vessels by any charterers in excess of 10 days per vessel per year;
| | - |  | ----------------------------------------------------------------------------------------------------------



| |  |  | the deductible of any insurance claims relating to the vessels or for any claims that are within such deductible range;
| | - |  | -----------------------------------------------------------------------------------------------------------------------



| |  |  | the significant increase in insurance premiums which are due to factors such as acts of God outside the control of the Manager;
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------



| |  |  | repairs, refurbishment or modifications, including those not covered by the guarantee of the shipbuilders or by the insurance covering the vessels,
resulting from maritime accidents, collisions, other accidental damage or unforeseen events (except to the extent that such accidents, collisions, damage or events are due to the fraud, gross negligence or willful misconduct of the Manager, its
employees or its agents, unless and to the extent otherwise covered by insurance);
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | expenses imposed due to any improvement, upgrade or modification to, structural changes with respect to the installation of new equipment aboard any
vessel that results from a change in, an introduction of new, or a change in the interpretation of, applicable laws, at the recommendation of the classification society for that vessel or otherwise;
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | costs associated with increases in crew employment expenses resulting from an introduction of new, or a change in the interpretation of, applicable
laws or resulting from the early termination of the charter of any vessel;
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | any taxes, dues or fines imposed on the vessels or the Manager due to the operation of the vessels;
| | - |  | ---------------------------------------------------------------------------------------------------



| |  |  | expenses incurred in connection with the sale or acquisition of a vessel such as inspections and technical assistance; and
| | - |  | --------------------------------------------------------------------------------------------------------------------------



| |  |  | any similar costs, liabilities and expenses that were not reasonably contemplated by us and the Manager as being encompassed by or a component of the
fixed daily fees at the time the fixed daily fees were determined.
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Under the Management Agreement, neither we nor the
Manager will be liable for failure to perform any of our or its obligations, respectively, under the Management Agreement by reason of any cause beyond our or its reasonable control.

In addition, the Manager will have no liability for any loss arising in the course of the performance of the commercial and technical management services under the Management Agreement unless and to the
extent that such loss is proved to have resulted solely from the fraud, gross negligence or willful misconduct of the Manager or its employees, in which case (except where such loss has resulted from the Managers intentional personal act or
omission and with knowledge that such loss would probably result) the Managers liability will be limited to $3.0 million for each incident or series of related incidents.

Further, under our Management Agreement, we have agreed to indemnify the Manager and its employees and agents against all actions that may be brought against them under the Management Agreement including,
without limitation, all actions brought under the environmental laws of any jurisdiction, or otherwise relating to pollution or the environment, and against and in respect of all costs and expenses they may suffer or incur due to defending or
settling such action; provided, however, that such indemnity excludes any or all losses which may be caused by or due to the fraud, gross negligence or willful misconduct of the Manager or its employees or agents, or any breach of the Management
Agreement by the Manager.

The Administrative Services Agreement

We have entered into an Administrative Services Agreement, expiring May 28, 2015, with the Manager, pursuant to which the Manager will provide certain administrative management services to us.

The Administrative Services Agreement may be terminated prior to the end of its term by us upon 120-days notice if there is a change of
control of the Manager or by the Manager upon 120-days notice if there is a change of control of us. In addition, the Administrative Services Agreement may be terminated by us or by the Manager upon 120-days notice if:



| |  |  | the other party breaches the agreement;
| | - |  | ---------------------------------------



| |  |  | a receiver is appointed for all or substantially all of the property of the other party;
| | - |  | ----------------------------------------------------------------------------------------



| |  |  | an order is made to wind up the other party;
| | - |  | --------------------------------------------



| |  |  | a final judgment or order that materially and adversely affects the other partys ability to perform the Administrative Services Agreement is
obtained or entered and not vacated or discharged; or
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | the other party makes a general assignment for the benefit of its creditors, files a petition in bankruptcy or liquidation or commences any
reorganization proceedings.
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------

Furthermore, at any time after the first anniversary of the Administrative Services Agreement,
the Administrative Services Agreement may be terminated by us or by the Manager upon 365-days notice for any reason other than those described above.



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The administrative services will include:



| |  |  | bookkeeping, audit and accounting services: assistance with the maintenance of our corporate books and records, assistance with the preparation
of our tax returns and arranging for the provision of audit and accounting services;
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | legal and insurance services: arranging for the provision of legal, insurance and other professional services and maintaining our existence and
good standing in necessary jurisdictions;
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | administrative and clerical services: providing office space, arranging meetings for our security holders, arranging the provision of IT
services, providing all administrative services required for subsequent debt and equity financings and attending to all other administrative matters necessary to ensure the professional management of our business;
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | banking and financial services: providing cash management including assistance with preparation of budgets, overseeing banking services and bank
accounts, arranging for the deposit of funds, negotiating loan and credit terms with lenders and monitoring and maintaining compliance therewith;
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | advisory services: assistance in complying with United States and other relevant securities laws;
| | - |  | -------------------------------------------------------------------------------------------------



| |  |  | client and investor relations: arranging for the provision of, advisory, clerical and investor relations services to assist and support us in
our communications with our security holders; and client and investor relations; and
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | integration of any acquired businesses.
| | - |  | ---------------------------------------

We will reimburse the Manager for reasonable costs and expenses incurred in connection with the provision of these services within 15 days after the Manager submits to us an invoice for such costs
and expenses, together with any supporting detail that may be reasonably required.

Under the Administrative Services Agreement, we have
agreed to indemnify the Manager and its employees against all actions which may be brought against them under the Administrative Services. Agreement including, without limitation, all actions brought under the environmental laws of any jurisdiction,
and against and in respect of all costs and expenses they may suffer or incur due to defending or settling such actions; provided, however, that such indemnity excludes any or all losses that may be caused by or due to the fraud, gross negligence or
willful misconduct of the Manager or its employees or agents. For the years ended December 31, 2012, 2011 and 2010 the administrative services rendered by the Manager amounted to $2.1 million, $1.5 million and $0.4 million, respectively.

Registration Rights

Pursuant to a registration rights agreement between us and our initial stockholders entered into in connection with the IPO, the holders of the sponsor
units (and the common stock and warrants comprising such units and the common stock issuable upon exercise of such warrants), the sponsor warrants (and the common stock issuable upon exercise of such warrants), the co-investment shares and any
shares of common stock purchased pursuant to the limit orders described above are entitled to three demand registration rights, piggy-back registration rights and short-form resale registration rights. We will bear the expenses incurred
in connection with any such registration statements other than underwriting discounts or commissions for shares not sold by us. In addition, we have registered the 1,677,759 shares of common stock issued in connection with the VLCC Acquisition. The
resale registration statement became effective on January 19, 2011.

In addition, in connection with the private placement of 17,702,491
shares, that was completed on February 26, 2013, we have granted registration rights to Navios Holdings and certain members of the management of Navios Acquisition, Navios Holdings and Navios Partners.

The Acquisition Omnibus Agreement

We
have entered an Acquisition Omnibus Agreement with Navios Holdings and Navios Partners. The following discussion describes certain provisions of the Acquisition Omnibus Agreement.

Noncompetition

Navios Holdings and Navios Partners agree not to acquire, charter-in
or own Liquid Shipment Vessels (as hereinafter defined). For purposes of the Acquisition Omnibus Agreement, Liquid Shipment Vessels means vessels intended primarily for the sea going shipment of liquid products, including chemical and
petroleum-based products, except for container vessels and vessels that will be employed primarily in operations in South America. This restriction will not prevent Navios Holdings or any of its controlled affiliates or Navios Partners (other than
us and our subsidiaries) from:



| | (1) | acquiring a Liquid Shipment Vessel(s) from us for fair market value;
| | --- | --------------------------------------------------------------------



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##### Table of Contents

| | (2) | acquiring a Liquid Shipment Vessel(s) as part of the acquisition of a controlling interest in a business or package of assets and owning those vessels; provided,
however, that:
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | a. | if less than a majority of the value of the total assets or business acquired is attributable to a Liquid Shipment Vessel(s) and related charters, as determined in good
faith by the board of directors of Navios Holdings or Navios Partners, as the case may be, Navios Holdings or Navios Partners, as the case may be, must offer to sell a Liquid Shipment Vessel(s) and related charters to us for their fair market value
plus any additional tax or other similar costs to Navios Holdings that would be required to transfer a Liquid Shipment Vessel(s) and related charters to us separately from the acquired business; and
| | -- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | b. | if a majority or more of the value of the total assets or business acquired is attributable to a Liquid Shipment Vessel(s) and related charters, as determined in good
faith by the board of directors of Navios Holdings or Navios Partners, as the case may be, Navios Holdings or Partners, as the case may be, shall notify us in writing, of the proposed acquisition. We shall, not later than the 15th calendar day
following receipt of such notice, notify Navios Holdings or Navios Partners, as the case may be, if we wish to acquire such a Liquid Shipment Vessel(s) and related charters forming part of the business or package of assets in cooperation and
simultaneously with Navios Holdings or Navios Partners, as the case may be, acquiring a Liquid Shipment Vessel(s) and related charters forming part of that business or package of assets. If we do not notify Navios Holdings of our intent to pursue
the acquisition within 15 calendar days, Navios Holdings may proceed with the acquisition as provided in (a) above.
| | -- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (3) | acquiring a non-controlling interest in any company, business or pool of assets;
| | --- | --------------------------------------------------------------------------------



| | (4) | acquiring or owning a Liquid Shipment Vessel(s) and related charter if we do not fulfill our obligation, under any existing or future written agreement, to purchase
such vessel in accordance with the terms of any such agreement;
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (5) | acquiring or owning a Liquid Shipment Vessel(s) subject to the offers to us described in paragraphs (3) and (4) above pending our determination whether to
accept such offers and pending the closing of any offers we accept;
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (6) | providing ship management services relating to any vessel whatsoever, including to a Liquid Shipment Vessel(s) owned by the controlled affiliates of Navios Holdings; or
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (7) | acquiring or owning a Liquid Shipment Vessel(s) if we have previously advised Navios Holdings or Navios Partners, as the case may be, that we consent to such
acquisition, or if we have been offered the opportunity to purchase such vessel pursuant to the Acquisition Omnibus Agreement and failed to do so.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

If Navios Holdings or Navios Partners, as the case may be, or any of their respective controlled affiliates (other than us or our subsidiaries) acquires or owns a Liquid Shipment Vessel(s) pursuant to any
of the exceptions described above, it may not subsequently expand that portion of its business other than pursuant to those exceptions.

In
addition, under the Acquisition Omnibus Agreement we have agreed, and will cause our subsidiaries to agree, not to acquire, own, operate or charter drybulk carriers (Drybulk Carriers). Pursuant to an agreement between them, Navios
Holdings and Navios Partners may be entitled to a priority over each other depending on the class and charter length of any Drybulk Carrier. This restriction will not:



| | (1) | prevent us or any of our subsidiaries from acquiring a Drybulk Carrier(s) and any related charters as part of the acquisition of a controlling interest in a business or
package of assets and owning and operating or chartering those vessels; provided, however, that:
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (a) | if less than a majority of the value of the total assets or business acquired is attributable to a Drybulk Carrier(s) and related charter(s), as determined in good
faith by us, we must offer to sell such Drybulk Carrier(s) and related charter to Navios Holdings or Navios Partners, as the case may be, for their fair market value plus any additional tax or other similar costs to us that would be required to
transfer the Drybulk Carrier(s) and related charter(s) to Navios Holdings or Navios Partners, as the case may be, separately from the acquired business; and
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (b) | if a majority or more of the value of the total assets or business acquired is attributable to a Drybulk Carrier(s) and related charter(s), as determined in good faith
by us, we shall notify Navios Holdings or Navios Partners, as the case may be, in writing of the proposed acquisition. Navios Holdings or Navios Partners, as the case may be, shall, not later than the 15th calendar day following receipt of such
notice, notify us if it wishes to acquire the Drybulk Carrier(s) forming part of the business or package of assets in cooperation and simultaneously with us acquiring the Non-Drybulk Carrier assets forming part of that business or package of assets.
If Navios Holdings and Navios Partners do not notify us of its intent to pursue the acquisition within 15 calendar days, we may proceed with the acquisition as provided in (a) above.
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (2) | prevent us or any of our subsidiaries from owning, operating or chartering a Drybulk Carrier(s) subject to the offer to Navios Holdings or Navios Partners described in
paragraph (1) above, pending its determination whether to accept such offer and pending the closing of any offer it accepts; or
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (3) | prevent us or any of our subsidiaries from acquiring, operating or chartering a Drybulk Carrier(s) if Navios Holdings and Navios Partners has previously advised us that
it consents to such acquisition, operation or charter, or if they have previously been offered the opportunity to purchase such Drybulk Carrier(s) and have declined to do so.
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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If we or any of our subsidiaries owns, operates and charters Drybulk Carriers pursuant to any of the
exceptions described above, neither we nor such subsidiary may subsequently expand that portion of our business other than pursuant to those exceptions.

Rights of First Offer

Under the Acquisition Omnibus Agreement, we and our
subsidiaries will grant to Navios Holdings and Navios Partners, as the case may be, a right of first offer on any proposed sale, transfer or other disposition of any of our Drybulk Carriers and related charters owned or acquired by us. Likewise,
Navios Holdings and Navios Partners will agree (and will cause its subsidiaries to agree) to grant a similar right of first offer to us for any Liquid Shipment Vessels it might own. These rights of first offer will not apply to a: (a) sale,
transfer or other disposition of vessels between any affiliated subsidiaries, or pursuant to the terms of any charter or other agreement with a counterparty; or (b) merger with or into, or sale of substantially all of the assets to, an
unaffiliated third party.

Prior to engaging in any negotiation regarding any vessel disposition with respect to a Liquid Shipment Vessel(s)
with a non-affiliated third party or any Drybulk Carrier(s) and related charter, we, Navios Holdings, or Navios Partners, as the case may be, will deliver a written notice to the other parties setting forth the material terms and conditions of the
proposed transaction. During the 15-day period after the delivery of such notice, we, Navios Holdings or Navios Partners, as the case may be, will negotiate in good faith to reach an agreement on the transaction. If we do not reach an agreement
within such 15-day period, we or Navios Holdings or Navios Partners, as the case may be, will be able within the next 180 calendar days to sell, transfer or dispose of the vessel to a third party (or to agree in writing to undertake such transaction
with a third party) on terms generally no less favorable to us or Navios Holdings, as the case may be, than those offered pursuant to the written notice.

Upon a change of control of Navios Partners, the noncompetition and the right of first offer provisions of the Acquisition Omnibus Agreement will terminate immediately as to Navios Partners, but shall
remain binding on us and Navios Holdings. Upon a change of control of Navios Holdings, the noncompetition and the right of first offer provisions of the Acquisition Omnibus Agreement shall terminate; provided, however, that in no event shall the
noncompetition and the rights of first refusal terminate upon a change of control of Navios Holdings prior to the fourth anniversary of the Acquisition Omnibus Agreement. Upon change of control of us, the noncompetition and the right of first offer
provisions of the Acquisition Omnibus Agreement will terminate immediately as to all parties of the Acquisition Omnibus Agreement.

C.
Interest of Experts and Counsel

Not Applicable.

Item 8. Financial Information

A. Consolidated
Statements and Other Financial Information

Consolidated Financial Statements: See Item 18.

Legal Proceedings

Although we may, from
time to time, be involved in litigation and claims arising out of our operations in the normal course of business, we are not at present party to any legal proceedings or aware of any proceedings against us, or contemplated to be brought against us,
that would have a material effect on our business, financial position, results of operations or liquidity. We maintain insurance policies with insurers in amounts and with coverage and deductibles as our board of directors believes are reasonable
and prudent. We expect that these claims would be covered by insurance, subject to customary deductibles. Those claims, even if lacking merit, could result in the expenditure of significant financial and managerial resources.

Dividend Policy

At the present time,
Navios Acquisition intends to retain most of its available earnings generated by operations for the development and growth of the business. The continued declaration and payment of any dividend remains subject to the discretion of the Board of
Directors, and will depend on, among other things, Navios Acquisitions cash requirements as measured by market opportunities and conditions. In addition, the terms and provisions of our current secured credit facilities and our indenture limit
our ability to pay dividends in excess of certain amounts or if certain covenants are not met. (See also Long Term Debt Obligations and Credit Arrangements.)



76



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On February 13, 2012, the Board of Directors declared a quarterly cash dividend in respect of the
fourth quarter of 2011 of $0.05 per common share of common stock. A dividend in the aggregate amount of $2.4 million was paid on April 5, 2012 out of which $2.0 million was paid to the stockholders of record as of March 22, 2012 and $0.4
million was paid to the holder of 1,000 shares of the Series C preferred stock which is Navios Holdings (see note 17 of the financial statements included herein).

On May 4, 2012, the Board of Directors declared a quarterly cash dividend in respect of the first quarter of 2012 of $0.05 per share of common stock. A dividend in the aggregate amount of $2.4
million was paid on July 3, 2012 out of which $2.0 million was paid to the stockholders of record as of June 20, 2012 and $0.4 million was paid to the holder of 1,000 shares of the Series C preferred stock which is Navios Holdings
(see note 17 of the financial statements included herein).

On August 13, 2012, the Board of Directors declared a quarterly cash dividend
in respect of the second quarter of 2012 of $0.05 per share of common stock. A dividend in the aggregate amount of $2.4 million was paid on October 3, 2012 out of which $2.0 million was paid to the stockholders of record as of
September 19, 2012 and $0.4 was paid to the holder of 1,000 shares of the Series C preferred stock which is Navios Holdings (see note 17 of the financial statements included herein).

On November 9, 2012, the Board of Directors declared a quarterly cash dividend in respect of the third quarter of 2012 of $0.05 per share of common
stock. A dividend in the aggregate amount of $2.4 million was paid on January 4, 2013 out of which $2.0 million was paid to the stockholders of record as of December 19, 2012 and $0.4 million was paid to the holder of 1,000 shares of the
Series C preferred stock which is Navios Holdings (see note 17 of the financial statements included herein).

As of December 31,
2012, Navios Acquisition paid a dividend of $0.1 million to the holders of the 540 shares of Series B preferred stock.

On
February 7, 2013, the Board of Directors declared a quarterly cash dividend in respect of the fourth quarter of 2012 of $0.05 per common share payable on April 4, 2013 to stockholders of record as of March 19, 2013.

B. Significant Changes

Not Applicable.

Item 9. Listing Details

Our listing of securities are traded on the New York Stock Exchange and comprised of units under the symbol NNA.U, of common stock and warrants under the symbols NNA and
NNA.WS, respectively.

The following table sets forth the high and low closing sales prices of Navios Acquisitions units,
common stock and warrants on the New York Stock Exchange.



|                                        |  |                  |       |  |                         |   |      |                     |  |   |      |  |  |      |      |  |     |   |      |  |  |   |      | 
|--------------------------------------- |  | ---------------- | ----- |  | ----------------------- | - | ---- | ------------------- |  | - | ---- |  |  | ---- | ---- |  | --- | - | ---- |  |  | - | ---- | 
|                                        |  | Price RangeUnits |       |  | Price RangeCommon Stock |   |      | Price RangeWarrants | 
|                                        |  | High             |       |  | Low                     |   |      | High                |  |   | Low  |  |  | High |      |  | Low |  
|Year Ended:                             |  |                  |       |  |                         |   |      |                     |  |   |      |  |  |      |      |  |     |   |      |  |  |   |      | 
|December 31, 2012                       |  | $                | 3.75  |  |                         | $ | 2.70 |                     |  | $ | 3.66 |  |  | $    | 2.11 |  |     | $ | 0.19 |  |  | $ | 0.05 | 
|December 31, 2011                       |  | $                | 5.54  |  |                         | $ | 2.70 |                     |  | $ | 4.55 |  |  | $    | 2.51 |  |     | $ | 0.80 |  |  | $ | 0.15 | 
|December 31, 2010                       |  | $                | 11.54 |  |                         | $ | 4.96 |                     |  | $ | 9.95 |  |  | $    | 3.84 |  |     | $ | 1.58 |  |  | $ | 0.45 | 
|December 31, 2009                       |  | $                | 10.55 |  |                         | $ | 8.61 |                     |  | $ | 9.90 |  |  | $    | 8.57 |  |     | $ | 0.81 |  |  | $ | 0.16 | 
|December 31, 2008(1),(2)                |  | $                | 10.20 |  |                         | $ | 8.40 |                     |  | $ | 9.40 |  |  | $    | 8.08 |  |     | $ | 1.05 |  |  | $ | 0.14 | 
|Quarter Ended:                          |  |                  |       |  |                         |   |      |                     |  |   |      |  |  |      |      |  |     |   |      |  |  |   |      | 
|March 31, 2013 (through March 20, 2013) |  | $                | 3.40  |  |                         | $ | 2.83 |                     |  | $ | 3.39 |  |  | $    | 2.45 |  |     | $ | 0.09 |  |  | $ | 0.03 | 
|December 31, 2012                       |  | $                | 3.13  |  |                         | $ | 2.83 |                     |  | $ | 3.05 |  |  | $    | 2.11 |  |     | $ | 0.17 |  |  | $ | 0.06 | 
|September 30, 2012                      |  | $                | 3.13  |  |                         | $ | 2.70 |                     |  | $ | 3.08 |  |  | $    | 2.30 |  |     | $ | 0.19 |  |  | $ | 0.07 | 
|June 30, 2012                           |  | $                | 3.49  |  |                         | $ | 2.71 |                     |  | $ | 3.31 |  |  | $    | 2.26 |  |     | $ | 0.17 |  |  | $ | 0.05 | 
|                                        |  |                  |       |  |                         |  
|March 31, 2012                          |  | $                | 3.75  |  |                         | $ | 2.70 |                     |  | $ | 3.66 |  |  | $    | 2.68 |  |     | $ | 0.19 |  |  | $ | 0.19 | 
|December 31, 2011                       |  | $                | 3.55  |  |                         | $ | 2.70 |                     |  | $ | 3.50 |  |  | $    | 2.51 |  |     | $ | 0.22 |  |  | $ | 0.18 | 
|September 30, 2011                      |  | $                | 4.15  |  |                         | $ | 3.40 |                     |  | $ | 4.05 |  |  | $    | 3.03 |  |     | $ | 0.42 |  |  | $ | 0.15 | 
|June 30, 2011                           |  | $                | 5.54  |  |                         | $ | 4.15 |                     |  | $ | 4.13 |  |  | $    | 3.52 |  |     | $ | 0.62 |  |  | $ | 0.42 | 
|March 31, 2011                          |  | $                | 4.96  |  |                         | $ | 4.96 |                     |  | $ | 4.55 |  |  | $    | 3.92 |  |     | $ | 0.80 |  |  | $ | 0.43 | 
|Month Ended:                            |  |                  |       |  |                         |   |      |                     |  |   |      |  |  |      |      |  |     |   |      |  |  |   |      | 
|March 31, 2013 (through March 20, 2013) |  | $                | 3.40  |  |                         | $ | 3.12 |                     |  | $ | 3.39 |  |  | $    | 2.99 |  |     | $ | 0.08 |  |  | $ | 0.06 | 
|February 28, 2013                       |  | $                | 3.12  |  |                         | $ | 2.89 |                     |  | $ | 3.30 |  |  | $    | 2.67 |  |     | $ | 0.08 |  |  | $ | 0.04 | 
|January 31, 2013                        |  | $                | 2.85  |  |                         | $ | 2.83 |                     |  | $ | 2.78 |  |  | $    | 2.45 |  |     | $ | 0.09 |  |  | $ | 0.06 | 
|December 31, 2012                       |  | $                | 2.90  |  |                         | $ | 2.83 |                     |  | $ | 2.50 |  |  | $    | 2.11 |  |     | $ | 0.15 |  |  | $ | 0.06 | 
|November 30, 2012                       |  | $                | 3.10  |  |                         | $ | 2.90 |                     |  | $ | 2.96 |  |  | $    | 2.52 |  |     | $ | 0.15 |  |  | $ | 0.15 | 
|October 31, 2012                        |  | $                | 3.10  |  |                         | $ | 2.95 |                     |  | $ | 3.05 |  |  | $    | 2.62 |  |     | $ | 0.17 |  |  | $ | 0.13 | 
|September 30, 2012                      |  | $                | 3.13  |  |                         | $ | 2.85 |                     |  | $ | 3.04 |  |  | $    | 2.60 |  |     | $ | 0.16 |  |  | $ | 0.12 | 



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|(1) | Period beginning July 1, 2008.
|--- | ------------------------------

|(2) | The Company completed its initial vessel acquisition on May 28, 2010. Prior to such date, the Company was not an operating company and, accordingly, prices prior
to such date may not be meaningful.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Item 10. Additional Information

A. Share Capital

Not applicable.

B. Memorandum and Articles of Association

Please refer to the filings on Form 6-K (file number 001-34104) filed with the Securities and Exchange Commission: Exhibit 99.9 of Form 6-K filed on June 4, 2010, Exhibit 3.1 of Form 6-K filed on
February 10, 2011, Exhibit 1.1 of Form 6-K filed on September 21, 2010, Exhibit 1.1 of Form 6-K filed on November 9, 2010, and Exhibit 1.1 to Form 6-K filed on April 12, 2011, which the Company hereby incorporates by reference.

C. Material Contracts

The following is a summary of each material contract, other than material contracts entered into in the ordinary course of business, to which we or any of
our subsidiaries is a party, for the two years immediately preceding the date of this Annual Report, each of which is included in the list of exhibits in Item 19.



| |  | Indenture, dated October 21, 2010, among Navios Acquisition, Navios Acquisition Finance, the guarantors party thereto and Wells Fargo Bank,
National Association (Wells Fargo), as trustee and collateral trustee (the Indenture). Please read Item 5. Operating and Financial Review and Prospects for a summary of certain contract terms.
|- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | First Supplemental Indenture, dated November 9, 2010, among Navios Acquisition, Navios Acquisition Finance, the guarantors party thereto and Wells
Fargo, which was entered into in order to add the entities identified in such First Supplemental Indenture as guarantors to the Indenture.
|- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | Second Supplemental Indenture, dated May 20, 2011, among Navios Acquisition, Navios Acquisition Finance, the guarantors party thereto and Wells
Fargo, which was entered into in order to add the entity identified in such Second Supplemental Indenture as a guarantor to the Indenture.
|- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | Third Supplemental Indenture, dated May 26, 2011, among Navios Acquisition, Navios Acquisition Finance, the guarantors party thereto and Wells
Fargo, to ratify and confirm the Indenture following the issuance of the Additional Notes. Please read Item 5. Operating and Financial Review and Prospects for a summary of certain terms relating to the Additional Notes.
|- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | Fourth Supplemental Indenture dated July 1, 2011, among Navios Acquisition, Navios Acquisition Finance, the guarantors party thereto and Wells
Fargo, which was entered into in order to add the entities identified in such Fourth Supplemental Indenture as guarantors to the Indenture.
|- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | Fifth Supplemental Indenture dated December 15, 2011, among Navios Acquisition, Navios Acquisition Finance, the guarantors party thereto and Wells
Fargo, which was entered into in order to add the entities identified in such Fifth Supplemental Indenture as guarantors to the Indenture.
|- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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| |  | Repurchase Plan, dated April 8, 2010, among Navios Acquisition, Navios Holdings, Amadeus Maritime S.A. (Amadeus) and J.P. Morgan
Securities Inc. (J.P. Morgan) whereby Navios Holdings and Angeliki Frangou agreed to acquire through J.P. Morgan or a third party, $60.0 million of Navios Acquisitions common stock in open market purchases or privately negotiated
purchases. This agreement terminated upon the consummation of the vessel acquisition.
|- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | Amendment to Buyback Agreement and Assumption Agreement, dated April 8, 2010, among Navios Acquisition, Navios Holdings, Amadeus, J.P. Morgan and
Deutsche Bank Securities Inc., which, among other things, substituted Navios Holdings for certain of the parties under the original agreement. This agreement terminated upon the consummation of the vessel acquisition.
|- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | Amendment to Co-Investment Share Subscription Agreement and Assumption Agreement, dated April 8, 2010, among Navios Acquisition, Navios Holdings
and Amadeus, which, among other things, substituted Navios Holdings for certain of the parties under the original agreement. This agreement terminated upon the consummation of the vessel acquisition.
|- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | Acquisition Agreement, dated April 8, 2010, between Navios Acquisition and Navios Holdings. Please read Item 5. Operating and Financial
Review and Prospects for a summary of certain contract terms.
|- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | Management Agreement, dated May 28, 2010, between Navios Acquisition and Navios Ship Management Inc. Please read Item 7. Major
Stockholders and Related Party Transactions for a summary of certain contract terms.
|- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | Amendment to the Management Agreement dated May 4, 2012. Please read Item 7. Major Stockholders and Related Party Transactions for a
summary of certain contract terms.
|- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | Administrative Services Agreement, dated May 28, 2010, between Navios Acquisition and Navios Ship Management Inc. Please read Item 7.
Major Stockholders and Related Party Transactions for a summary of certain contract terms.
|- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | Acquisition Omnibus Agreement dated May 28, 2010 among Navios Acquisition, Navios Holdings and Navios Partners. Please read Item 7.
Major Shareholders and Related Party Transactions for a summary of certain contract terms.
|- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | Registration Rights Agreement, dated May 26, 2011, among Navios Acquisition, Navios Acquisition Finance and Merrill Lynch, Pierce,
Fenner & Smith Incorporated, acting as representative for the initial purchasers named therein. Please read Item 7. Major Stockholders and Related Party Transactions for a summary of certain contract terms.
|- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | Securities Purchase Agreement, dated July 18, 2010, between Navios Acquisition and Vanship Holdings Limited, entered into in connection with the
VLCC Acquisition.
|- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | Credit Agreement, dated April 7, 2010, among certain vessel-owning subsidiaries and Deutsche Schiffsbank AG, Alpha Bank A.E. and Credit Agricole
Corporate and Investment Bank. Please read Item 5. Operating and Financial Review and Prospects for a summary of certain contract terms.
|- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | Credit Agreement, dated April 8, 2010, among certain vessel-owning subsidiaries and DVB Bank S.E. and Fortis Bank. Please read Item 5.
Operating and Financial Review and Prospects for a summary of certain contract terms.
|- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | Revolving Credit Facility for $80.0 revolving credit facility, dated September 2010, among certain vessel-owning subsidiaries and Cyprus Popular Bank
Co Ltd. Please read Item 5. Operating and Financial Review and Prospects for a summary of certain contract terms.
|- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | Facility Agreement for $52.0 million term loan facility, dated May 28, 2010, among certain vessel-owning subsidiaries and DVB Bank S.E. and ABN
AMRO BANK N.V. Please read Item 5. Operating and Financial Review and Prospects for a summary of certain contract terms.
|- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | First Supplemental Agreement, dated December 20, 2011, to Facility Agreement dated May 28, 2010, for $52 million term loan facility, which
amends certain terms of the Facility Agreement, including providing for additional definitions relating to new charters, amending provisions relating to prepayments upon termination of charters within a certain period of time and associated
adjustments to the repayment installments and providing for mandatory prepayment of a minimal amount, and an associated adjustment to a future installment payment, in the event the initial charter period is not extended by July 2012.
|- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | Facility Agreement for $52.2 million term loan facility, dated October 26, 2010, between Navios Acquisition and Eurobank Ergasias S.A. Please read
Item 5. Operating and Financial Review and Prospects for a summary of certain contract terms.
|- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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| |  | Facility Agreement for $52.0 million term loan facility, dated December 6, 2010, between Navios Acquisition and Eurobank Ergasias S.A. Please read
Item 5. Operating and Financial Review and Prospects for a summary of certain contract terms.
|- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | Facility Agreement for $55.1 million term loan facility, dated July 8, 2011, between Navios Acquisition and ABN AMRO Bank N.V. Please read
Item 5. Operating and Financial Review and Prospects for a summary of certain contract terms.
|- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | Facility Agreement for $51.0 million term loan facility, dated December 7, 2011. between Navios Acquisition and DVB Bank S.E. Please read
Item 5. Operating and Financial Review and Prospects for a summary of certain contract terms.
|- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | Facility Agreement for up to $28.125 million term loan facility, dated December 29, 2011, between Navios Acquisition and NORDDEUTSCHE LANDESBANK
GIROZENTRALE. Please read Item 5. Operating and Financial Review and Prospects for a summary of certain contract terms.
|- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | Facility Agreement for $56.250 million term loan facility, dated December 29, 2011, among Navios Acquisition, DVB Bank SE and Emporiki Bank of
Greece S.A. Please read Item 5. Operating and Financial Review and Prospects for a summary of certain contract terms.
|- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | Loan Agreement for $40.0 million, dated September 7, 2010, between Navios Acquisition and Navios Holdings (the Loan Agreement). Please
read Item 7. Major Shareholders and Related Party Transactions for a summary of certain contract terms.
|- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | Letter Agreement Nr. 1 to the Loan Agreement, dated as of October 21, 2010, which provided that the loan would be a revolving facility.
|- |  | ---------------------------------------------------------------------------------------------------------------------------------------



| |  | Letter Agreement Nr. 2 to the Loan Agreement, dated November 8, 2011, pursuant to which Navios Holdings agreed to extend the maturity date from
April 1, 2012 to December 31, 2014.
|- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | Securities Purchase Agreement, dated February 26, 2013, between Navios Acquisition and Navios Holdings for the purchase by Navios Holdings of
17,544,300 shares of common stock of Navios Acquisition for $2.85 per share in a private placement that was completed on February 26, 2013.
|- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | Form of Co-Investment Share Purchase Agreement, which was entered into by Navios Acquisition and certain members of the management of Navios
Acquisition, Navios Holdings and Navios Partners for the purchase of an aggregate of 158,191 shares of common stock of Navios Acquisition for $2.85 per share in a private placement that was completed on February 26, 2013.
|- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | Registration Rights Agreement, dated February 26, 2013, between Navios Acquisition and Navios Holdings and the management investors party thereto.
Please read Item 7. Major Stockholders and Related Party Transactions for a summary of certain contract terms.
|- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

D. Exchange controls

Under the
laws of the of the Marshall Islands, Cayman Islands, Hong Kong and the British Virgin Islands, the countries of incorporation of the Company and its subsidiaries, there are currently no restrictions on the export or import of capital, including
foreign exchange controls, or restrictions that affect the remittance of dividends, interest or other payments to non-resident holders of our common stock.

E. Taxation of Holders

MATERIAL INCOME TAX CONSIDERATIONS

Marshall Islands Tax Considerations

We are incorporated in the Marshall Islands. Under current Marshall Islands law, we are not subject to tax on income or capital gains, and no Marshall Islands withholding tax will be imposed upon payments
of dividends by us to our stockholders.



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Material U.S. Federal Income Tax Consequences

The following discussion addresses the material U.S. federal income tax consequences relating to the purchase, ownership and disposition of shares of our
common stock by beneficial owners of such shares. This discussion is based on current provisions of the Internal Revenue Code of 1986, as amended (the Code), treasury regulations promulgated under the Code (Treasury
Regulations), Internal Revenue Service (IRS) rulings and pronouncements, and judicial decisions now in effect, all of which are subject to change at any time by legislative, judicial or administrative action. Any such changes may
be applied retroactively. No rulings from the IRS have been or will be sought with respect to the U.S. federal income tax consequences discussed below. The discussion below is not in any way binding on the IRS or the courts nor does it in any way
constitute an assurance that the U.S. federal income tax consequences discussed herein will be accepted by the IRS or the courts.

The U.S.
federal income tax consequences to a beneficial owner of shares of our common stock may vary depending upon such beneficial owners particular situation or status. This discussion is limited to beneficial owners of shares of our common stock
who hold such shares as capital assets, and it does not address aspects of U.S. federal income taxation that may be relevant to such beneficial owners that are subject to special treatment under U.S. federal income tax laws, including but not
limited to: dealers in securities; banks and other financial institutions; insurance companies; tax-exempt organizations, plans or accounts; persons holding shares of our common stock as part of a hedge, straddle or other
risk reduction transaction; persons holding shares of our common stock through partnerships, trusts or other entities; beneficial owners of shares of our common stock that own 10% or more (by vote or value) of our outstanding capital stock; U.S.
Holders (as defined below) whose functional currency is not the U.S. dollar; and controlled foreign corporations or passive foreign investment companies, as those terms are defined in the Code. In addition, this discussion does not consider the
effects of any applicable foreign, state, local or other tax laws, or estate or gift tax considerations, or the alternative minimum tax.

For
purposes of this discussion, a U.S. Holder is a beneficial owner of shares of our common stock that is, for U.S. federal income tax purposes: a citizen or resident of the United States; a corporation (or other entity that is classified
as a corporation for U.S. federal income tax purposes) created or organized in or under the laws of the United States or any state thereof (including the District of Columbia); an estate the income of which is subject to U.S. federal income tax
regardless of its source; or a trust, if a court within the United States can exercise primary supervision over its administration, and one or more United States persons (as defined in the Code) have the authority to control all of the
substantial decisions of that trust (or the trust was in existence on August 20, 1996, was treated as a domestic trust on August 19, 1996 and validly elected to continue to be treated as a domestic trust).

For purposes of this discussion, a beneficial owner of shares of our common stock (other than a partnership or an entity or arrangement treated as a
partnership for U.S. federal income tax purposes) that is not a U.S. Holder is a Non-U.S. Holder.

If a partnership or other
entity or arrangement classified as a partnership for U.S. federal income tax purposes holds shares of our common stock, the tax treatment of its partners generally will depend upon the status of the partner, the activities of the partnership and
certain determinations made at the partner level. If you are a partner in a partnership holding shares of our common stock, you should consult your own tax advisor regarding the tax consequences to you of the partnerships ownership of shares
of our common stock.

We urge beneficial owners of shares of our common stock to consult their own tax advisers as to the particular tax
considerations applicable to them relating to the purchase, ownership and disposition of shares of our common stock, including the applicability of U.S. federal, state and local tax laws and non-U.S. tax laws.

U.S. Federal Income Taxation of Navios Acquisition

Navios Acquisition is a foreign company that is treated as a corporation for U.S. federal income tax purposes and it neither has made, nor intends to make, an election to be treated as other than a
corporation for U.S. federal income tax purposes. Consequently, among other things, U.S. Holders will not directly be subject to U.S. federal income tax on their shares of our income, but rather will be subject to U.S. federal income tax on
distributions received from us and dispositions of shares of our common stock as described below.

Taxation of Operating Income: In General

Unless exempt from U.S. federal income taxation under the rules discussed below, a foreign corporation is subject to United States federal
income taxation in respect of any income that is derived from the use of vessels, from the hiring or leasing of vessels for use on a time, voyage or bareboat charter basis, from the participation in a pool, partnership, strategic alliance, joint
operating agreement, code sharing arrangements or other joint venture it directly or indirectly owns or participates in that generates such income, or from the performance of services directly related to those uses, which we refer to as
shipping income. to the extent that the shipping income is derived from sources within the United States. For these purposes, 50% of shipping income that is attributable to transportation that begins or ends, but that does not both begin
and end, in the United States constitutes income from sources within the United States, which we refer to as U.S.-source shipping income.



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Shipping income attributable to transportation that both begins and ends in the United States is considered
to be 100% from sources within the United States. Navios Acquisition is not permitted by law to engage in transportation that produces income which is considered to be 100% from sources within the United States.

Shipping income attributable to transportation exclusively between non-U.S. ports will be considered to be 100% derived from sources outside the United
States. Shipping income derived from sources outside the United States will not be subject to any United States federal income tax. In the absence of exemption from tax under Section 883 of the Code, Navios Acquisitions gross U.S.-source
shipping income would be subject to a 4% tax imposed without allowance for deductions as described below.

Exemption of Operating Income
From U.S. Federal Income Taxation

In general, the exemption from U.S. federal income taxation under Section 883 of the Code provides
that if a non-U.S. corporation satisfies the requirements of Section 883 of the Code and the Treasury Regulations thereunder, it will not be subject to the net basis and branch profits taxes or the 4% gross basis tax (each as described below)
on its U.S.-source shipping income.

Under Section 883 of the Code, we will be exempt from U.S. federal income taxation on our
U.S.-source shipping income if:

1. we and each of our vessel-owning subsidiaries are organized in a foreign country (country of
organization) that grants an equivalent exemption to corporations organized in the United States; and

2. either:



| |  |  | more than 50% of the value of our stock is owned, directly or indirectly, for at least half the number of days during the taxable year by
(i) individuals who are residents of our country of organization or of another foreign country that grants an equivalent exemption to corporations organized in the United States, (ii) non-U.S. corporations that meet
the Publicly Traded Test discussed below and are organized in a foreign country that grants an equivalent exemption to corporations organized in the United States or (iii) certain other qualified persons described in the
applicable regulations, which we refer to as the 50% Ownership Test, or
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | our stock is primarily and regularly traded on an established securities market in our country of organization, in another country that
grants an equivalent exemption to U.S. corporations, or in the United States, which we refer to as the Publicly-Traded Test.
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Currently, the jurisdiction where we are incorporated, as well as the jurisdictions where our vessel-owning subsidiaries are incorporated, namely, the Republic of the Marshall Islands, the Cayman Islands,
Hong Kong and the British Virgin Islands, grant an equivalent exemption to U.S. corporations. Therefore, at present, we will be exempt from U.S. federal income taxation with respect to our U.S.-source shipping income if we satisfy either
the 50% Ownership Test or the Publicly-Traded Test. Our ability to satisfy the 50% Ownership Test and Publicly-Traded Test is discussed below.

The Treasury Regulations provide, in pertinent part, that stock of a foreign corporation will be considered to be primarily traded on an
established securities market if the number of shares of each class of stock that are traded during any taxable year on all established securities markets in that country exceeds the number of shares in each such class that are traded during that
year on established securities markets in any other single country. Our common stock is primarily traded on the New York Stock Exchange.

Under the Treasury Regulations, our stock is considered to be regularly traded on an established securities market if one or more classes of our stock representing more than 50% of our
outstanding shares, by total combined voting power of all classes of stock entitled to vote and total value, is listed on the market during the taxable year, which we refer to as the listing threshold. Since our common stock, which represents more
than 50% of our outstanding shares by vote and value, is listed on the New York Stock Exchange, we currently satisfy the listing requirement.

It is further required that with respect to each class of stock relied upon to meet the listing threshold (i) such class of the stock is traded on
the market, other than de minimis quantities, on at least 60 days during the taxable year or 1/6 of the days in a short taxable year; and (ii) the aggregate number of shares of such class of stock traded on such market during the taxable
year is at least 10% of the average number of shares of such class of stock outstanding during such year or as appropriately adjusted in the case of a short taxable year. We currently satisfy the trading frequency and trading volume tests. Even if
this were not the case, the regulations provide that the trading frequency and trading volume tests will be deemed satisfied by a class of stock if such class of stock is traded during the taxable year on an established market in the United States
and such class of stock is regularly quoted by dealers making a market in such stock, which condition our common stock meets.



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Notwithstanding the foregoing, the Treasury Regulations provide, in pertinent part, that our common stock
will not be considered to be regularly traded on an established securities market for any taxable year in which 50% or more of the vote and value of the outstanding shares of our common stock are owned, actually or constructively under
specified stock attribution rules, on more than half the days during the taxable year by persons who each own 5% or more of the vote and value of our common stock, which we refer to as the 5% Override Rule.

For purposes of being able to determine the persons who owns 5% or more of our common stock, or 5% Stockholders, the Treasury Regulations
permit us to rely on Schedule 13G and Schedule 13D filings with the SEC to identify persons who have a 5% or more beneficial interest in our common stock. The Treasury Regulations further provide that an investment company that is
registered under the Investment Company Act will not be treated as a 5% Stockholder for such purposes.

If our 5% Stockholders did own more
than 50% of our common stock, then we would be subject to the 5% Override Rule unless we were able to establish that among the closely-held group of 5% Stockholders, there are sufficient 5% Stockholders that are qualified stockholders for purposes
of Section 883 to preclude non-qualified 5% Stockholders in the closely-held group from owning 50% or more of the total value of each class of our stock for more than half the number of days during the taxable year. In order to establish this,
sufficient 5% Stockholders that are qualified stockholders would have to comply with certain documentation and certification requirements designed to substantiate their identity as qualified stockholders. These requirements are onerous and there is
no guarantee that we would be able to satisfy them in all cases.

Currently, Navios Holdings (a Marshall Islands corporation) owns
approximately 47.4% of our common stock. Navios Holdings has represented to us that it presently meets the Publicly Traded Test and has agreed to comply with the documentation and certification requirements described above. Accordingly, we
anticipate that we will not be subject to the 5% Override Rule. However, there can be no assurance that Navios Holdings will continue to meet the Publicly Traded Test or continue to be able to comply with the documentation and certification
requirements described above. Consequently, there can be no assurance that we will not be subject to the 5% Override Rule in the future.

Taxation in Absence of Exemption

To the
extent the benefits of Section 883 are unavailable, our U.S.-source shipping income, to the extent not considered to be effectively connected with the conduct of a U.S. trade or business, as described below, would be subject to a 4%
tax imposed by Section 887 of the Code on a gross basis, without the benefit of deductions.

Since under the sourcing rules described
above, no more than 50% of our shipping income would be treated as being derived from U.S. sources, the maximum effective rate of U.S. federal income tax on our shipping income would never exceed 2% of our gross income under the 4% gross basis tax
regime.

To the extent the benefits of the Section 883 exemption are unavailable and our U.S.-source shipping income is considered to be
effectively connected with the conduct of a U.S. trade or business, as described below, any such effectively connected U.S.-source shipping income, net of applicable deductions, would be subject to the U.S. federal corporate
income tax currently imposed at rates of up to 35%. In addition, we may be subject to the 30% branch profits taxes on any earnings and profits effectively connected with the conduct of such trade or business, as determined after
allowance for certain adjustments, and on certain interest paid or deemed paid attributable to the conduct of our U.S. trade or business.

Our
U.S.-source shipping income would be considered effectively connected with the conduct of a U.S. trade or business only if:



| |  |  | we have, or are considered to have, a fixed place of business in the United States involved in the earning of shipping income; and
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------



| |  |  | substantially all of our U.S.-source shipping income is attributable to regularly scheduled transportation, such as the operation of a vessel that
follows a published schedule with repeated sailings at regular intervals between the same points for voyages that begin or end in the United States.
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

We do not intend to have, or permit circumstances that would result in having any vessel operating to the United States on a regularly scheduled basis. Based on the foregoing and on the expected mode of
our shipping operations and other activities, we believe that none of our U.S.-source shipping income will be effectively connected with the conduct of a U.S. trade or business.

United States Taxation of Gain on Sale of Vessels

Regardless of whether we will qualify
for exemption under Section 883, we should not be subject to U.S. federal income taxation with respect to gain realized on a sale of a vessel, provided that we did not depreciate the vessel for U.S. federal income tax purposes. If we took
depreciation deductions with respect to the vessel for U.S. federal income tax purposes



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(which would be the case if the vessel had produced effectively connected income), upon the sale of such vessel, a portion of any gain realized on the sale would be sourced to the U.S. in
proportion to the depreciation deductions taken in the U.S. compared to the total depreciation of the vessel.

United States Federal Income
Taxation of U.S. Holders

Distributions

Subject to the discussion of the rules applicable to a passive foreign investment company (PFIC) below, any distributions made by us with respect to our common stock to a U.S. Holder will
constitute dividends, which will be taxable as ordinary income, to the extent of our current or accumulated earnings and profits, as determined under U.S. federal income tax principles. Distributions in excess of our current and accumulated earnings
and profits will be treated first as a nontaxable return of capital to the extent of the U.S. Holders tax basis in our common stock on a dollar-for-dollar basis and thereafter as capital gain, which will be either long-term or short-term
capital gain depending upon whether the U.S. Holder held the common shares for more than one year. Because Navios Acquisition is not a U.S. corporation, U.S. Holders that are corporations will not be entitled to claim a dividends received deduction
with respect to any distributions they receive from us. Dividends paid with respect to Navios Acquisitions common stock will be treated as foreign source income and generally will be passive category income for purposes of
computing allowable foreign tax credits for U.S. foreign tax credit purposes.

Dividends received by a non-corporate U.S. Holder are taxed at
ordinary income tax rates (currently, a maximum 39.6%) unless such dividends constitute qualified dividend income. Qualified dividend income generally includes a dividend paid by a foreign corporation if (i) the stock
with respect to which such dividend was paid is readily tradable on an established securities market in the U.S., (ii) the foreign corporation is not a PFIC for the taxable year during which the dividend is paid and the immediately preceding
taxable year (which we do not believe we have been for 2012, or will be for subsequent years, as discussed below), (iii) the non-corporate U.S. Holder has owned the stock for more than 60 days during the 121-day period beginning 60 days before
the date on which the stock become ex-dividend (and has not entered into certain risk limiting transactions with respect to such stock), and (iv) the non-corporate U.S. Holder is not under an obligation to make related payments with respect to
positions in substantially similar or related property. Qualified dividend income is subject to the long-term capital gain tax rate, which is currently a maximum of 20%. In addition, a 3.8% tax may apply to certain investment income. See
 Medicare Tax  below. Because the common stock of Navios Acquisition is traded on the NYSE, dividends paid during 2013 to U.S. Holders that are U.S. citizens or individual residents should generally be qualified dividend income
subject to the long-term capital gains tax rate.

Special rules may apply to any amounts received in respect of our common stock that are
treated as extraordinary dividends. In general, an extraordinary dividend is a dividend with respect to a share of common stock that is equal to or in excess of 10.0% of a U.S. Holders adjusted tax basis (or fair market value upon
the U.S. Holders election) in such share. In addition, extraordinary dividends include dividends received within a one year period that, in the aggregate, equal or exceed 20.0% of a U.S. Holders adjusted tax basis (or fair market value).
If we pay an extraordinary dividend on our common stock that is treated as qualified dividend income, then any loss recognized by an individual U.S. Holder from the sale or exchange of such common stock will be treated as
long-term capital loss to the extent of the amount of such dividend.

Sale, Exchange or Other Disposition of Common Stock

Subject to the discussion of PFICs below, a U.S. Holder generally will recognize capital gain or loss upon a sale, exchange or other disposition of a
share of our common stock in an amount equal to the difference between the amount realized by the U.S. Holder from such sale, exchange or other disposition and the U.S. Holders adjusted tax basis in such stock. The U.S. Holders initial
tax basis in a share of our common stock generally will be the U.S. Holders purchase price for the share and that tax basis will be reduced (but not below zero) by the amount of any distributions on our common stock that are treated as
non-taxable returns of capital (as discussed under Distributions above). Such gain or loss will be treated as long-term capital gain or loss if the U.S. Holders holding period is greater than one year at the time of the sale,
exchange or other disposition. Such capital gain or loss will generally be treated as U.S.-source income or loss, as applicable, for U.S. foreign tax credit purposes.

A corporate U.S. Holders capital gains, long-term and short-term, are taxed at ordinary income tax rates. If a corporate U.S. Holder recognizes a loss upon the disposition of our common stock, the
U.S. Holder is limited to using the loss to offset other capital gain. If a corporate U.S. Holder has no other capital gain in the tax year of the loss, it may carry the capital loss back three years and forward five years.

As described above, long-term capital gains of non-corporate U.S. Holders are subject to the current favorable tax rate of 20%. In addition, a 3.8% tax
may apply to certain investment income.See  Medicare Tax  below. A non-corporate U.S.



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Holder may deduct a capital loss resulting from a disposition of our common stock to the extent of capital gains plus up to $3,000 ($1,500 for married individuals filing separate tax returns) and
may carry forward long-term capital losses indefinitely.

Passive Foreign Investment Company Status and Significant Tax Consequences

In general, we will be treated as a PFIC with respect to a U.S. Holder if, for any taxable year in which such holder held our common
stock, either:



| |  |  | at least 75% of our gross income for such taxable year consists of passive income (e.g., dividends, interest, capital gains and rents derived other
than in the active conduct of a rental business); or
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | at least 50% of the average value of the assets held by us during such taxable year produce, or are held for the production of, passive income.
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------

For purposes of determining whether we are a PFIC, we will be treated as earning and owning our proportionate share of the
income and assets, respectively, of any subsidiary corporation in which we own at least 25% of the value of the subsidiarys stock. Income earned, or deemed earned, by us in connection with the performance of services will not constitute
passive income. By contrast, rental income will constitute passive income unless we are treated as deriving our rental income in the active conduct of a trade or business under applicable rules.

Based on our current and projected methods of operations, and an opinion of counsel, we believe that we were not a PFIC for the 2012 and 2011 taxable
years (we were treated as a PFIC for the 2008 and 2009 taxable years), and we do not believe that we will be a PFIC for 2013 and subsequent taxable years. For post-2010 taxable years, our U.S. counsel, Thompson Hine LLP, is of the opinion that
(1) the income we receive from the time chartering activities and assets engaged in generating such income should not be treated as passive income or assets, respectively, and (2) so long as our income from time charters exceeds 25.0% of
our gross income for each taxable year after our 2010 taxable year and the value of our vessels contracted under time charters exceeds 50.0% of the average value of our assets for each taxable year after our 2010 taxable year, we should not be a
PFIC for any taxable year after our 2010 taxable year. This opinion is based on representations and projections provided to our counsel by us regarding our assets, income and charters, and its validity is conditioned on the accuracy of such
representations and projections.

Our counsels opinion is based principally on their conclusion that, for purposes of determining
whether we are a PFIC, the gross income we derive (or are deemed to derive from any subsidiary in which we own at least 25% by value of the subsidiarys stock) from time chartering activities should constitute services income, rather than
rental income. Correspondingly, such income should not constitute passive income, and the assets that we own and operate (or that we are deemed to own and operate through any subsidiary in which we own at least 25% by value of the subsidiarys
stock) in connection with the production of such income, in particular, the vessels we own (or we are deemed to own) that are subject to time charters, should not constitute passive assets for purposes of determining whether we are or have been a
PFIC. We expect that all of the vessels in our fleet will be engaged in time chartering activities and intend to treat our income from those activities as non-passive income, and the vessels engaged in those activities as non-passive assets, for
PFIC purposes.

Our counsel has advised us that there is a significant amount of legal authority consisting of the Code, legislative history,
IRS pronouncements and rulings supporting our position that the income from our time chartering activities constitutes services income (rather than rental income). There is, however, no direct legal authority under the PFIC rules addressing whether
income from time chartering activities is services income or rental income. Moreover, in a case not interpreting the PFIC rules, Tidewater Inc. v. United States, 565 F.3d 299 (5th Cir. 2009), the Fifth Circuit held that the vessel time charters at
issue generated predominantly rental income rather than services income. However, the IRS stated in an Action on Decision (AOD 2010-001) that it disagrees with, and will not acquiesce to, the way that the rental versus services framework was applied
to the facts in the Tidewater decision, and in its discussion stated that the time charters at issue in Tidewater would be treated as producing services income for PFIC purposes. The IRSs AOD, however, is an administrative action that cannot
be relied upon or otherwise cited as precedent by taxpayers.

The opinion of our counsel is not binding on the IRS or any court. Thus, while
we have received an opinion of our counsel in support of our position, there is a possibility that the IRS or a court could disagree with this position and the opinion of our counsel. In addition, although we intend to conduct our affairs in a
manner to avoid being classified as a PFIC with respect to any taxable year, we cannot assure you that the nature of our operations will not change in the future.

As discussed more fully below, if we were to be treated as a PFIC for any taxable year in which a U.S. Holder owned our common stock, the U.S. Holder would be subject to different taxation rules depending
on whether the U.S. Holder makes an election to treat us as a Qualified Electing Fund, which we refer to as a QEF election. (As previously discussed, we were not a PFIC for the 2011 and 2012 taxable years and we do not
believe that we will be treated as a PFIC for 2013 and



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subsequent taxable years.) As an alternative to making a QEF election, the U.S. Holder should be able to make a mark-to-market election with respect to our common stock, as discussed
below. In addition, if we were treated as a PFIC for any taxable year in which a U.S. Holder owned our common stock, the U.S. Holder would be required to file IRS Form 8621 for each year in which the U.S. Holder (i) recognizes gain on the
actual or deemed disposition of our common stock, (ii) receives certain actual or deemed distributions from us or (iii) makes any of certain reportable elections (including a QEF election or a mark-to-market election). The U.S. Holder also
would be required to file an annual report, with respect to each taxable year beginning on or after March 18, 2010, containing such information as the IRS may require in the revised IRS Form 8621. Until the IRS releases the revised IRS Form
8621, this additional reporting requirement is suspended (although a U.S. Holder that is currently otherwise required to file IRS Form 8621 ( e.g., upon an actual or deemed disposition of PFIC stock) must continue to file the current IRS Form 8621).
However, following the release of the revised IRS Form 8621, U.S. Holders for which the filing of IRS Form 8621 has been suspended for a taxable year will be required to attach IRS Form 8621 for each suspended taxable year to their next income tax
or information return required to be filed with the IRS. In the event a U.S. Holder does not file IRS Form 8621, the statute of limitations on the assessment and collection of U.S. federal income taxes of such U.S. Holder for the related tax year
may not close before the date which is three years after the date on which such report is filed.

It should also be noted that, if we were
treated as a PFIC for any taxable year in which a U.S. Holder owned our common stock and any of our non-U.S. subsidiaries were also a PFIC, the U.S. Holder would be treated as owning a proportionate amount (by value) of the shares of the lower-tier
PFIC for purposes of the application of these rules.

Taxation of U.S. Holders Making a Timely QEF Election

If we were to be treated as a PFIC for any taxable year and a U.S. Holder makes a timely QEF election (any such U.S. Holder, an Electing
Holder), the Electing Holder must report for U.S. federal income tax purposes its pro rata share of our ordinary earnings and net capital gain, if any, for our taxable year that ends with or within the Electing Holders taxable year,
regardless of whether or not the Electing Holder received any distributions from us in that year. Such income inclusions would not be eligible for the preferential tax rates applicable to qualified dividend income. The Electing
Holders adjusted tax basis in our common stock will be increased to reflect taxed but undistributed earnings and profits. Distributions to the Electing Holder of our earnings and profits that were previously taxed will result in a
corresponding reduction in the Electing Holders adjusted tax basis in our common stock and will not be taxed again once distributed. The Electing Holder would not, however, be entitled to a deduction for its pro rata share of any losses that
we incur with respect to any year. An Electing Holder generally will recognize capital gain or loss on the sale, exchange or other disposition of our common stock.

Even if a U.S. Holder makes a QEF election for one of our taxable years, if we were a PFIC for a prior taxable year during which the U.S. Holder owned our common stock and for which the U.S. Holder did
not make a timely QEF election, the U.S. Holder would also be subject to the more adverse rules described below under  Taxation of U.S. Holders Not Making a Timely QEF or Mark-to-Market Election. However, under certain circumstances, a
U.S. Holder may be permitted to make a retroactive QEF election with respect to us for any open taxable years in the U.S. Holders holding period for our common stock in which we are treated as a PFIC. Additionally, to the extent that any of
our subsidiaries is a PFIC, a U.S. Holders QEF election with respect to us would not be effective with respect to the U.S. Holders deemed ownership of the stock of such subsidiary and a separate QEF election with respect to such
subsidiary would be required.

A U.S. Holder makes a QEF election with respect to any year that we are a PFIC by filing IRS Form 8621 with the
U.S. Holders U.S. federal income tax return. If, contrary to our expectations, we were to determine that we are treated as a PFIC for any taxable year, we would notify all U.S. Holders and would provide all necessary information to any U.S.
Holder that requests such information in order to make the QEF election described above with respect to us and the relevant subsidiaries. A QEF election would not apply to any taxable year for which we are not a PFIC, but would remain in effect with
respect to any subsequent taxable year for which we are a PFIC, unless the IRS consents to the revocation of the election.

Taxation of
U.S. Holders Making a Mark-to-Market Election

If we were to be treated as a PFIC for any taxable year and, as we anticipate,
our common stock were treated as marketable stock, then, as an alternative to making a QEF election, a U.S. Holder would be allowed to make a mark-to-market election with respect to our common stock, provided the U.S. Holder
completes and files IRS Form 8621 in accordance with the relevant instructions and related Treasury Regulations. If that election is made, the U.S. Holder generally would include as ordinary income in each taxable year the excess, if any, of the
fair market value of the U.S. Holders common stock at the end of the taxable year over the holders adjusted tax basis in the common stock. The U.S. Holder also would be permitted an ordinary loss in respect of the excess, if any, of the
U.S. Holders adjusted tax basis in the common stock over the fair market value thereof at the end of the taxable year, but only to the extent of the net amount previously included in income as a result of the mark-to-market election. A U.S.
Holders tax basis in the U.S. Holders common stock would be adjusted to reflect any such income or loss recognized. Gain recognized on the sale, exchange or other disposition of our common stock



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would be treated as ordinary income, and any loss recognized on the sale, exchange or other disposition of the common stock would be treated as ordinary loss to the extent that such loss does not
exceed the net mark-to-market gains previously included in income by the U.S. Holder. A mark-to-market election would not apply to our common stock owned by a U.S. Holder in any taxable year during which we are not a PFIC, but would remain in effect
with respect to any subsequent taxable year for which we are a PFIC, unless our common stock is no longer treated as marketable stock or the IRS consents to the revocation of the election.

Even if a U.S. Holder makes a mark-to-market election for one of our taxable years, if we were a PFIC for a prior taxable year during which
the U.S. Holder owned our common stock and for which the U.S. Holder did not make a timely mark-to-market election, the U.S. Holder would also be subject to the more adverse rules described below under Taxation of U.S. Holders Not Making a
Timely QEF or Mark-to-Market Election. Additionally, to the extent that any of our subsidiaries is a PFIC, a mark-to-market election with respect to our common stock would not apply to the U.S. Holders deemed ownership of
the stock of such subsidiary.

Taxation of U.S. Holders Not Making a Timely QEF or Mark-to-Market Election

If we were to be treated as a PFIC for any taxable year, a U.S. Holder who does not make either a timely QEF election or a timely
mark-to-market election for that year (i.e., the taxable year in which the U.S. Holders holding period commences), whom we refer to as a Non-Electing Holder, would be subject to special rules resulting in increased tax
liability with respect to (1) any excess distribution (i.e., the portion of any distributions received by the Non-Electing Holder on our common stock in a taxable year in excess of 125.0% of the average annual distributions received by the
Non-Electing Holder in the three preceding taxable years, or, if shorter, the Non-Electing Holders holding period for the common stock), and (2) any gain realized on the sale, exchange or other disposition of our common stock. Under these
special rules:



| |  |  | the excess distribution and any gain would be allocated ratably over the Non-Electing Holders aggregate holding period for the common stock;
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | the amount allocated to the current taxable year and any year prior to the year we were first treated as a PFIC with respect to the Non-Electing Holder
would be taxed as ordinary income; and
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | the amount allocated to each of the other taxable years would be subject to tax at the highest rate of tax in effect for the applicable class of
taxpayer for that year, and an interest charge for the deemed deferral benefit would be imposed with respect to the resulting tax attributable to each such other taxable year.
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Moreover, (i) any dividends received by a non-corporate U.S. Holder in a year in which we are a PFIC (or in which we were a PFIC in the preceding
year) will not be treated as qualified dividend income and will be subject to tax at rates applicable to ordinary income and (ii) if a Non-Electing Holder who is an individual dies while owning our common stock, such holders
successor generally would not receive a step-up in tax basis with respect to such stock. Additionally, to the extent that any of our subsidiaries is a PFIC, the foregoing consequences would apply to the U.S. Holders deemed receipt of any
excess distribution on, or gain deemed realized on the disposition of, the stock of such subsidiary deemed owned by the U.S. Holder.

If we
are treated as a PFIC for any taxable year during the holding period of a U.S. Holder, unless the U.S. Holder makes a timely QEF election, or a timely mark-to-market election, for the first taxable year in which the U.S. Holder holds our
common stock and in which we are a PFIC, we will continue to be treated as a PFIC for all succeeding years during which the U.S. Holder owns our common stock even if we are not a PFIC for such years. U.S. Holders are encouraged to consult their tax
advisers with respect to any available elections that may be applicable in such a situation. In this regard, while it is our position and our U.S. counsels position that we should not be a PFIC for 2011 or 2012 and we believe that we will not
be a PFIC for subsequent taxable years, there is no assurance that these positions are correct. In addition, U.S. Holders should consult their tax advisers regarding the IRS information reporting and filing obligations that may arise as a result of
the ownership of shares in a PFIC.

Medicare Tax

A U.S. Holder that is an individual or estate, or a trust that does not fall into a special class of trusts that is exempt from such tax, will generally be subject to a 3.8% tax on the lesser of
(i) the U.S. Holders net investment income for a taxable year and (ii) the excess of the U.S. Holders modified adjusted gross income for such taxable year over $200,000 ($250,000 in the case of joint filers). For
these purposes, net investment income will generally include dividends paid with respect to our common stock and net gain attributable to the disposition of our common stock (in each case, unless such common stock is held in connection
with certain trades or businesses), but will be reduced by any deductions properly allocable to such income or net gain.



87



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United States Federal Income Taxation of Non-U.S. Holders

Distributions

A Non-U.S. Holder
generally will not be subject to U.S. federal income tax or withholding tax on distributions received with respect to our common stock if the Non-U.S. Holder is not engaged in a U.S. trade or business. If the Non-U.S. Holder is engaged in a U.S.
trade or business, our distributions will be subject to U.S. federal income tax to the extent they constitute income effectively connected with the Non-U.S. Holders U.S. trade or business (and a corporate Non-U.S. Holder may also be subject to
U.S. federal branch profits tax). However, distributions paid to a Non-U.S. Holder who is engaged in a trade or business may be exempt from taxation under an income tax treaty if the income arising from the distribution is not attributable to a U.S.
permanent establishment maintained by the Non-U.S. Holder.

Sale, Exchange or other Disposition of Common Stock

In general, a Non-U.S. Holder will not be subject to U.S. federal income tax or withholding tax on any gain resulting from the disposition of our common
stock provided the Non-U.S. Holder is not engaged in a U.S. trade or business. A Non-U.S. Holder that is engaged in a U.S. trade or business will be subject to U.S. federal income tax in the event the gain from the disposition of our common stock is
effectively connected with the conduct of such U.S. trade or business (provided, in the case of a Non-U.S. Holder entitled to the benefits of an income tax treaty with the United States, such gain also is attributable to a U.S. permanent
establishment). However, even if not engaged in a U.S. trade or business, individual Non-U.S. Holders may be subject to tax on gain resulting from the disposition of our common stock if they are present in the United States for 183 days or more
during the taxable year of the disposition and meet certain other requirements.

Certain Information Reporting Requirements

Individual U.S. Holders (and to the extent specified in applicable Treasury Regulations, certain individual Non-U.S. Holders and certain U.S. Holders that
are entities) that hold specified foreign financial assets, including our common stock, whose aggregate value exceeds $75,000 at any time during the taxable year or $50,000 on the last day of the taxable year (or such higher amounts as
prescribed by applicable Treasury Regulations) are required to file a report on IRS Form 8938 with information relating to the assets for each such taxable year. Specified foreign financial assets would include, among other things, our common stock,
unless such common stock is held in an account maintained by a U.S. financial institution (as defined). Substantial penalties apply to any failure to timely file IRS Form 8938, unless the failure is shown to be due to reasonable cause
and not due to willful neglect. Additionally, in the event an individual U.S. Holder (and to the extent specified in applicable Treasury Regulations, an individual Non-U.S. Holder or a U.S. entity) that is required to file IRS Form 8938 does not
file such form, the statute of limitations on the assessment and collection of U.S. federal income taxes of such holder for the related tax year may not close until three years after the date that the required information is filed. U.S. Holders
(including U.S. entities) and Non-U.S. Holders should consult their own tax advisors regarding their reporting obligations under this legislation.

U.S. Backup Withholding Tax and Related Information Reporting Requirements

In general,
dividend payments and payments of proceeds from the disposition of our common stock made to a non-corporate U.S. Holder may be subject to information reporting requirements. Such payments may also be subject to backup withholding tax (currently at a
rate of 28%) if you are a non-corporate U.S. Holder and you:



| |  |  | fail to provide an accurate taxpayer identification number;
| | - |  | -----------------------------------------------------------



| |  |  | are notified by the IRS that you are subject to backup withholding because you have previously failed to report all interest or dividends required to
be shown on your federal income tax returns; or
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | fail to comply with applicable certification requirements.
| | - |  | ----------------------------------------------------------

Non-U.S. Holders may be required to establish their exemption from information reporting and backup withholding by certifying their status on an applicable IRS Form W-8.

Backup withholding tax is not an additional tax. Rather, you generally may obtain a credit of any amounts withheld against your liability for U.S.
federal income tax (and obtain a refund of any amounts withheld in excess of such liability) by timely filing a U.S. federal income tax return with the IRS.

F. Dividends and paying agents

Not applicable.

G. Statements by experts

Not
applicable.



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H. Documents on display

We file reports and other information with the SEC. These materials, including this Annual Report and the accompanying exhibits, may be inspected and copied at the public facilities maintained by the SEC
at 100 F Street, N.E., Washington, D.C. 20549, or from the SECs website http://www.sec.gov. You may obtain information on the operation of the public reference room by calling 1 (800) SEC-0330 and you may obtain copies at prescribed
rates.

I. Subsidiary information

Not applicable.

Item 11. Quantitative and Qualitative
Disclosures about Market Risks

Foreign Exchange Risk

Our functional and reporting currency is the U.S. dollar. We engage in worldwide commerce with a variety of entities. Although our operations may expose us to certain levels of foreign currency risk, our
transactions are predominantly U.S. dollar denominated. Transactions in currencies other than U.S. dollar are translated at the exchange rate in effect at the date of each transaction. Differences in exchange rates during the period between the date
a transaction denominated in a foreign currency is consummated and the date on which it is either settled or translated, are recognized. Expenses incurred in foreign currencies against which the U.S. Dollar falls in value can increase thereby
decreasing our income or vice versa if the U.S. dollar increases in value. For example, during the year ended December 31, 2012, the value of U.S. dollar increased by approximately 2.0% as compared to the Euro.

Interest Rate Risk

As of
December 31, 2012, Navios Acquisition had a total of $1,021.1 million in short term and long-term indebtness. The debt is U.S. dollar-denominated. Borrowings under our credit facilities bear interest at rates based on a premium over U.S.$ LIBOR
except for the interest rate on the Notes which is fixed. Therefore, we are exposed to the risk that our interest expense may increase if interest rates rise. For the year ended December 31, 2012, 2011 and 2010 we paid interest on our
outstanding debt at a weighted average interest rate of 3.25%, 3.16% and 3.27%, respectively. A 1% increase in LIBOR would have increased our interest expense for the year ended December 31, 2012, 2011 and 2010 by $4.9 million,
$3.3 million and $1.7 million, respectively.

Concentration of Credit Risk

Financial instruments, which potentially subject us to significant concentrations of credit risk, consist principally of trade accounts receivable. We
closely monitor our exposure to customers for credit risk. We have policies in place to ensure that we trade with customers with an appropriate credit history. For the year ended December 31, 2010, Jacob Tank Chartering GMBH & CO. KG,
SK Shipping Company Ltd, DOSCO, Formosa Petrochemical Corporation, Blue Light Chartering Inc and Navig8 Chemicals Shipping and Trading Co accounted for 42.5%, 18.6%, 12.9%, 12.9% and 10.9%, respectively, of Navios Acquisitions revenue. For the
year ended December 31, 2011, we had three charter counterparties, the most significant of which were DOSCO, KG, Blue Light Chartering Inc. and Jacob Tank Chartering GMBH & Co. and which counterparties accounted for approximately
43.9%, 11.5% and 11.3%, respectively, of our total revenue. For the year ended December 31, 2012, Navios Acquisitions customers representing 10% or more of total revenue were Dalian Ocean Shipping Co., and STX Panocean Co LTD, which
accounted for 43.3% and 10.7%, respectively.

Cash and Cash Equivalent

Cash deposits and cash equivalents in excess of amounts covered by government-provided insurance are exposed to loss in the event of non-performance by financial institutions. The Company does maintain
cash deposits and equivalents in excess of government-provided insurance limits. The Company also minimizes exposure to credit risk by dealing with a diversified group of major financial institutions.

Inflation

Inflation has had a minimal
impact on vessel operating expenses and general and administrative expenses. Our management does not consider inflation to be a significant risk to direct expenses in the current and foreseeable economic environment.

Item 12. Description of Securities Other than Equity Securities

Not applicable.



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PART II

Item 13. Defaults, Dividend Arrearages and Delinquencies

None.

Item 14. Material Modifications to the Rights of Shareholders and Use of Proceeds

None.

Item 15. Controls and Procedures

A. Disclosure Controls and Procedures

The management of Navios Acquisition, with
the participation of the Chief Executive Officer and Chief Financial Officer, conducted an evaluation, pursuant to Rule 13a-15 promulgated under the Securities Act of 1934, as amended (the Exchange Act), of the effectiveness of our
disclosure controls and procedures as of December 31, 2012. Based on this evaluation, the Chief Executive Officer and Chief Financial Officer concluded that the disclosure controls and procedures were effective as of December 31, 2012.

Disclosure controls and procedures means controls and other procedures that are 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 SECs rules and forms and that such information required to be disclosed by us in the
reports that we file or submit under the Exchange Act is accumulated and communicated to our management, including our principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely
decisions regarding required disclosures.

B. Managements annual report on internal control over financial reporting

The management of Navios Acquisition is responsible for establishing and maintaining adequate internal control over financial
reporting as defined in Rule 13a-15(f) or 15d-15(f) of the Exchange Act. Navios Acquisitions internal control system was designed 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 in the United States (GAAP).

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any
evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Navios Acquisitions management assessed the effectiveness of Navios Acquisitions internal control over financial reporting as of
December 31, 2012. In making this assessment, it used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control  Integrated Framework. Based on its assessment,
management concluded that, as of December 31, 2012, Navios Acquisitions internal control over financial reporting is effective based on those criteria.

Navios Acquisitions independent registered public accounting firm has issued an attestation report on Navios Acquisitions internal control over financial reporting.

C. Attestation report of the registered public accounting firm

Navios Acquisitions independent registered public accounting firm has issued an audit report on Navios Acquisitions internal control over financial reporting. This report appears on
Page F-2 of the consolidated financial statements.

D. Changes in internal control over financial reporting

There have been no changes in internal controls over financial reporting (identified in connection with managements evaluation of such internal
controls over financial reporting) that occurred during the year covered by this Annual Report that have materially affected, or are reasonably likely to materially affect, Navios Acquisitions internal controls over financial reporting.

Item 16A. Audit Committee Financial Expert

Our audit committee consists of three independent directors, Messrs. Veraros and Koilalous, and Ms. Noury. Each member of our audit committee is financially literate under the current listing
standards of the New York Stock Exchange, and our board of directors has determined that Mr. Veraros qualifies as an audit committee financial expert, as such term is defined by the SEC. Mr. Veraros is independent under
applicable NYSE and SEC standards.



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Item 16B. Code of Ethics

We have adopted a code of conduct and ethics applicable to our directors and officers in accordance with applicable federal securities laws and the rules
of the New York Stock Exchange. The code is available for review on our website at http://www.navios-acquisition.com.

Item 16C. Principal Accountant Fees and Services

Audit Fees

Our principal accountants for the fiscal years 2012 and 2011 were PricewaterhouseCoopers S.A. The audit fees for the audit of each of the years ended
December 31, 2012 and 2011 were $0.2 million and $0.4 million, respectively.

Audit-Related Fees

There were no audit-related fees billed in 2012 and 2011.

Tax Fees

There were no tax fees billed in 2012 and 2011.

Other Fees

There were no other
fees billed in 2012 and 2011.

Audit Committee

The Audit Committee is responsible for the appointment, replacement, compensation, evaluation and oversight of the work of the independent auditors. As part of this responsibility, the audit committee
pre-approves the audit and non-audit services performed by the independent auditors in order to assure that they do not impair the auditors independence from Navios Acquisition. The Audit Committee has adopted a policy which sets forth the
procedures and the conditions pursuant to which services proposed to be performed by the independent auditors may be pre-approved.

The Audit
Committee separately pre-approved all engagements and fees paid to our principal accountants in 2012 and 2011.

Item 16D. Exemptions from the Listing Standards for Audit Committees

Not applicable.

Item 16E. Purchases of Equity Securities by the Issuer and Affiliated Purchasers

None.

Item 16F. Change in Registrants Certifying Accountant

Not applicable.

Item 16G. Corporate Governance

Pursuant to an exception for foreign private issuers, we are not required to comply with the corporate governance practices followed by U.S. companies under the New York Stock Exchange listing standards.
However, we have voluntarily adopted all of the New York Stock Exchange required practices, except we do not have (i) a compensation committee consisting of independent directors or (ii) a compensation committee charter specifying the
purpose and responsibilities of the compensation committee. Instead, all compensation decisions are currently made by a majority of our independent board members.



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Item 16H. Mine Safety Disclosures

Not applicable.

Item 17. Financial Statements

See Item 18.

Item 18. Financial Statements

See index to Financial Statements on page F-1.

Item 19. Exhibits



|            |  |                                                                                                                                                                                                                                                                                                           
|----------- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit No. |  | Description                                                                                                                                                                                                                                                                                               
|            | 
|1.1         |  | Amended and Restated Articles of Incorporation (Previously filed as an exhibit to a Report on Form 6-K filed on June 4, 2010 and hereby incorporated by
reference.)                                                                                                                                       
|            | 
|1.2         |  | Articles of Amendment to the Amended and Restated Articles of Incorporation (Previously filed as an exhibit to a Report on Form 6-K filed on February 10, 2011, and hereby
incorporated by reference.)                                                                                                    
|            | 
|1.3         |  | By-laws (Previously filed as an exhibit to the Navios Acquisition Registration Statement on Form F-1, as amended (File No 333-151707) and hereby incorporated by
reference.)                                                                                                                              
|            | 
|2.1         |  | Specimen Unit Certificate (Previously filed as an exhibit to the Navios Acquisition Registration Statement on Form F-1, as amended (File No 333-151707) and hereby incorporated
by reference.)                                                                                                            
|            | 
|2.2         |  | Specimen Common Stock Certificate (Previously filed as an exhibit to the Navios Acquisition Registration Statement on Form F-1, as amended (File No 333-151707) and hereby
incorporated by reference.)                                                                                                    
|            | 
|2.3         |  | Specimen Warrant Certificate (Previously filed as an exhibit to the Navios Acquisition Registration Statement on Form F-1, as amended (File No 333-151707) and hereby
incorporated by reference.)                                                                                                         
|            | 
|2.4         |  | Form of Amendment to Warrant Agreement between Continental Stock Transfer & Trust Company and Navios Acquisition (Previously filed as an exhibit to a Report on Form 6-K
filed on July 29, 2010, and hereby incorporated by reference.)                                                                   
|            | 
|2.5         |  | Certificate of Designation of the Series A Convertible Preferred Stock, as filed with the Registrar of Companies of the Republic of the Marshall Islands on September 16,
2010 (Previously filed as an exhibit to a Report on Form 6-K filed on September 21, 2010, and hereby incorporated by reference.)
|            | 
|2.6         |  | Indenture dated October 21, 2010 (Previously filed as an exhibit to a Report on Form 6-K filed on October 26, 2010, and hereby incorporated by
reference.)                                                                                                                                                
|            | 
|2.7         |  | Certificate of Designation of the Series B Convertible Preferred Stock, as filed with the Registrar of Companies of the Republic of the Marshall Islands on October 29,
2010 (Previously filed as an exhibit to a Report on Form 6-K filed on November 9, 2010, and hereby incorporated by reference.)    
|            | 
|2.8         |  | First Supplemental Indenture dated November 9, 2010 (Previously filed as an exhibit to a Report on Form 6-K filed on December 22, 2010, and hereby incorporated by
reference.)                                                                                                                            
|            | 
|2.9         |  | Certificate of Designation of the Series C Convertible Preferred Stock, as filed with the Registrar of Companies of the Republic of the Marshall Islands on March 29, 2011
(Previously filed as an exhibit to a Report on Form 6-K filed on April 12, 2011, and hereby incorporated by reference.)        



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|     |  |                                                                                                                                                                                                                                                                                                       
|---- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|2.10 |  | Second Supplemental Indenture dated May 20, 2011 (Previously filed as an exhibit to a Report on Form 6-K filed on May 27, 2011, and hereby incorporated by
reference.)                                                                                                                                
|     | 
|2.11 |  | Third Supplemental Indenture dated May 26, 2011 (Previously filed as an exhibit to a Report on Form 6-K filed on May 27, 2011, and hereby incorporated by
reference.)                                                                                                                                 
|     | 
|2.12 |  | Fourth Supplemental Indenture dated July 1, 2011 (Previously filed as an exhibit to a Report on Form 6-K filed on July 22, 2011, and hereby incorporated by
reference.)                                                                                                                               
|     | 
|2.13 |  | Fifth Supplemental Indenture dated December 15, 2011 (Previously filed as an exhibit to a Report on Form 6-K filed on January 12, 2012, and hereby incorporated by
reference.)                                                                                                                        
|     | 
|2.14 |  | Certificate of Designation of the Series D Convertible Preferred Stock, as filed with the Registrar of Companies of the Republic of the Marshall Islands on August 24, 2012
(Previously filed as an exhibit to a Report on Form 6-K filed on November 16, 2012, and hereby incorporated by reference.)
|     | 
|4.1  |  | Form of Right of First Refusal Agreement among Navios Acquisition, Navios Holdings and Navios Partners (Previously filed as an exhibit to the Navios Acquisition Registration
Statement on Form F-1, as amended (File No 333-151707) and hereby incorporated by reference.)                           
|     | 
|4.2  |  | Repurchase Plan dated April 8, 2010 (Previously filed as an exhibit to a Report on Form 6-K filed on April 12, 2010, and hereby incorporated by
reference.)                                                                                                                                           
|     | 
|4.3  |  | Amendment to Buyback Agreement dated April 8, 2010 (Previously filed as an exhibit to a Report on Form 6-K filed on April 12, 2010, and hereby incorporated by
reference.)                                                                                                                            
|     | 
|4.4  |  | Amended Co-Investment Shares Subscription Agreement dated April 8, 2010 (Previously filed as an exhibit to a Report on Form 6-K filed on June 4, 2010, and hereby
incorporated by reference.)                                                                                                         
|     | 
|4.5  |  | Acquisition Agreement, dated April 8, 2010 between Navios Acquisition and Navios Holdings (Previously filed as an exhibit to a Report on Form 6-K filed on June 4,
2010, and hereby incorporated by reference.)                                                                                       
|     | 
|4.6  |  | Management Agreement dated May 28, 2010 between Navios Acquisition and Navios Ship Management Inc. (Previously filed as an exhibit to a Report on Form 6-K filed on
June 4, 2010, and hereby incorporated by reference.)                                                                              
|     | 
|4.7  |  | Administrative Services Agreement dated May 28, 2010 between Navios Acquisition and Navios Ship Management Inc. (Previously filed as an exhibit to a Report on Form 6-K
filed on June 4, 2010, and hereby incorporated by reference.)                                                                 
|     | 
|4.8  |  | Acquisition Omnibus Agreement dated May 28, 2010 among Navios Acquisition, Navios Holdings and Navios Partners (Previously filed as an exhibit to a Report on Form 6-K
filed on June 4, 2010, and hereby incorporated by reference.)                                                                  
|     | 
|4.9  |  | Securities Purchase Agreement dated July 18, 2010 between Navios Acquisition and Vanship Holdings Limited (Previously filed as an exhibit to a Report on Form 6-K filed on
July 26, 2010, and hereby incorporated by reference.)                                                                      
|     | 
|4.10 |  | Credit Agreement, dated April 7, 2010, among certain vessel-owning subsidiaries and Deutsche Schiffsbank AG, Alpha Bank A.E. and Credit Agricole Corporate and Investment Bank
(Previously filed as an exhibit to a Report on Form 6-K filed on June 4, 2010, and hereby incorporated by reference.)  
|     | 
|4.11 |  | Credit Agreement, dated April 8, 2010, among certain vessel-owning subsidiaries and DVB Bank SE and Fortis Bank (Previously filed as an exhibit to a Report on Form 6-K
filed on June 4, 2010, and hereby incorporated by reference.)                                                                 
|     | 
|4.12 |  | Form of Revolving Credit Facility with Cyprus Popular Bank Co Ltd (Previously filed as an exhibit to a Report on Form 6-K filed on June 4, 2010, and hereby incorporated by
reference.)                                                                                                               
|     | 
|4.13 |  | Facility Agreement for $52 million term loan facility, dated May 28, 2010 Previously filed as an exhibit to a Report on Form 6-K filed on June 4, 2010, and hereby
incorporated by reference.)                                                                                                        



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|     |  |                                                                                                                                                                                                                                                                                                            
|---- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|4.14 |  | Facility Agreement for $52.2 million term loan facility, dated October 26, 2010 (Previously filed as an exhibit to a Report on Form 6-K filed on November 9, 2010, and
hereby incorporated by reference.)                                                                                                  
|     | 
|4.15 |  | Facility Agreement for $52 million term loan facility, dated December 6, 2010 (Previously filed as an exhibit to a Report on Form 6-K filed on January 12, 2012, and hereby
incorporated by reference.)                                                                                                    
|     | 
|4.16 |  | Registration Rights Agreement dated May 26, 2011 (Previously filed as an exhibit to a Report on Form 6-K filed on May 27, 2011, and hereby incorporated by
reference.)                                                                                                                                     
|     | 
|4.17 |  | Loan Agreement for $40.0 million with Navios Maritime Holdings Inc., dated September 7, 2010 (Previously filed as an exhibit to a Report on Form 6-K filed on May 27, 2011,
and hereby incorporated by reference.)                                                                                         
|     | 
|4.18 |  | Letter Agreement Nr. 1 to Loan Agreement, dated as of October 21, 2010 (Previously filed as an exhibit to a Report on Form 6-K filed on May 27, 2011, and hereby
incorporated by reference.)                                                                                                               
|     | 
|4.19 |  | Facility Agreement for $55.1 million term loan facility, dated July 8, 2011 (Previously filed as an exhibit to a Report on Form 6-K filed on July 21, 2011, and hereby
incorporated by reference.)                                                                                                         
|     | 
|4.20 |  | Letter Agreement Nr. 2 to Loan Agreement, dated November 8, 2011 (Previously filed as an exhibit to a Report on Form 6-K filed on November 15, 2011, and hereby incorporated by
reference.)                                                                                                                
|     | 
|4.21 |  | Facility Agreement for $51 million term loan facility, dated December 7, 2011 (Previously filed as an exhibit to a Report on Form 6-K filed on December 14, 2011, and hereby
incorporated by reference.)                                                                                                   
|     | 
|4.22 |  | First Supplemental Agreement dated December 20, 2011, to Facility Agreement dated May 28, 2010, for $52 million term loan facility (Previously filed as an exhibit to a Report on
Form 6-K filed on January 12, 2012, and hereby incorporated by reference.)                                               
|     | 
|4.23 |  | Facility Agreement for up to $28.125 million term loan facility, dated December 29, 2011 (Previously filed as an exhibit to a Report on Form 6-K filed on February 22, 2012, and
hereby incorporated by reference.)                                                                                        
|     | 
|4.24 |  | Facility Agreement for $56.250 million term loan facility, dated December 29, 2011 (Previously filed as an exhibit to a Report on Form 6-K filed on February 22, 2012, and
hereby incorporated by reference.)                                                                                              
|     | 
|4.25 |  | Amendment to the Management Agreement dated May 4, 2012 (Previously filed as an exhibit to a Report on Form 6-K filed on May 15, 2012, and hereby incorporated by
reference.)                                                                                                                              
|     | 
|4.26 |  | Securities Purchase Agreement, dated February 26, 2013, between Navios Maritime Acquisition Corporation and Navios Maritime Holdings Inc. (Previously filed as an exhibit to a Report
on Form 6-K filed on March 4, 2013, and hereby incorporated by reference.)                                           
|     | 
|4.27 |  | Form of Co-Investment Share Purchase Agreement (Previously filed as an exhibit to a Report on Form 6-K filed on March 4, 2013, and hereby incorporated by
reference.)                                                                                                                                      
|     | 
|4.28 |  | Registration Rights Agreement, dated February 26, 2013, between Navios Maritime Acquisition Corporation and Navios Maritime Holdings Inc. and the management investors party thereto
(Previously filed as an exhibit to a Report on Form 6-K filed on March 4, 2013, and hereby incorporated by reference.)
|     | 
|8.1  |  | List of subsidiaries.*                                                                                                                                                                                                                                                                                     
|     | 
|12.1 |  | Certification by principal executive officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. *                                                                                                                                                                                                  
|     | 
|12.2 |  | Certification by principal financial officer pursuant to section 302 of the Sarbanes-Oxley Act of 2002. *                                                                                                                                                                                                  
|     | 
|13.1 |  | Certification by principal executive officer and principal financial officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002+                                                                                                                                                                    
|     | 
|15.1 |  | Consent of PricewaterhouseCoopers S.A.*                                                                                                                                                                                                                                                                    



|* | Filed herewith.
|- | ---------------

|+ | Furnished herewith.
|- | -------------------



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Signatures

Navios Maritime Acquisition Corporation hereby certifies that it meets all of the requirements for filing on Form 20-F and that it has duly caused and authorized the undersigned to sign this Annual Report
on its behalf.



|     |  |                                        
|---- |  | ---------------------------------------
|     |  | Navios Maritime Acquisition Corporation
|     | 
|     |  | /s/ Angeliki Frangou                   
|     | 
|By:  |  | Angeliki Frangou                       
|Its: |  | Chairman and Chief Executive Officer   

Date: March 25, 2013



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NAVIOS MARITIME ACQUISITION CORPORATION



|                                                                                                          |  |  |     | 
|--------------------------------------------------------------------------------------------------------- |  |  | --- | 
|REPORT OF PRICEWATERHOUSECOOPERS S.A. INDEPENDENT REGISTERED PUBLIC ACCOUNTING
FIRM                       |  |  | F-1 | 
|CONSOLIDATED BALANCE SHEETS AT DECEMBER 31, 2012 AND 2011                                                 |  |  | F-2 | 
|CONSOLIDATED STATEMENTS OF OPERATIONS FOR EACH OF THE YEARS ENDED DECEMBER 31, 2012, 2011 AND 2010        |  |  | F-3 | 
|CONSOLIDATED STATEMENTS OF CASH FLOWS FOR EACH OF THE YEARS ENDED DECEMBER 31, 2012, 2011 AND 2010        |  |  | F-4 | 
|CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY FOR EACH OF THE YEARS ENDED DECEMBER 31, 2012, 2011 AND 2010 |  |  | F-6 | 
|NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS                                                            |  |  | F-7 | 



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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Shareholders and Board of Directors of

Navios Maritime Acquisition Corporation:

In our opinion, the accompanying consolidated
balance sheets and the related consolidated statements of operations, changes in equity, and cash flows present fairly, in all material respects, the financial position of Navios Maritime Acquisition Corporation and its subsidiaries (the
Company) at December 31, 2012 and 2011, and the results of their operations and their cash flows for each of the three years in the period ended December 31, 2012 in conformity with accounting principles generally accepted in
the United States of America. Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2012, based on criteria established in Internal Control - Integrated
Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The Companys management is responsible for these financial statements, for maintaining effective internal control over financial reporting and for
its assessment of the effectiveness of internal control over financial reporting, included in Managements annual report on internal control over financial reporting, appearing in Item 15(b) of the Companys 2012 Annual
Report on Form 20-F. Our responsibility is to express opinions on these financial statements and on the Companys internal control over financial reporting based on our integrated audits. We conducted our audits in accordance with the
standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement and
whether effective internal control over financial reporting was maintained in all material respects. Our audits of the financial statements included examining, on a test basis, evidence supporting the amounts and disclosures in the financial
statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. Our audit of internal control over financial reporting included obtaining an
understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also
included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions.

A companys internal control over financial reporting is a process designed 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. A companys internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that,
in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in
accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (iii) provide reasonable assurance
regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the companys assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject
to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

/s/ PricewaterhouseCoopers S.A.

Athens, Greece

March 25, 2013



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##### Table of Contents

NAVIOS MARITIME ACQUISITION CORPORATION

CONSOLIDATED BALANCE SHEETS

(Expressed in thousands of U.S. Dollars except share data)



|                                                                                                                                                        |  |       |    |  |                  |   |           |                  |  |   |           |  
|------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ----- | -- |  | ---------------- | - | --------- | ---------------- |  | - | --------- | -
|                                                                                                                                                        |  | Notes |    |  | December 31,2012 |   |           | December 31,2011 | 
|                                                                                                                                                        |  |       |   
|ASSETS                                                                                                                                                  |  |       |    |  |                  |   |           |                  |  |   |           |  
|Current assets                                                                                                                                          |  |       |    |  |                  |   |           |                  |  |   |           |  
|Cash and cash equivalents                                                                                                                               |  |       | 5  |  |                  | $ | 42,846    |                  |  | $ | 41,300    |  
|Restricted cash, short term portion                                                                                                                     |  |       | 5  |  |                  |   | 21,163    |                  |  |   | 30,640    |  
|Accounts receivable, net                                                                                                                                |  |       | 6  |  |                  |   | 5,103     |                  |  |   | 6,478     |  
|Prepaid expenses and other current assets                                                                                                               |  |       |    |  |                  |   | 2,683     |                  |  |   | 489       |  
|                                                                                                                                                        |  |       |    |  |                  |   |           |                  |  |   |           |  
|Total current assets                                                                                                                                    |  |       |    |  |                  |   | 71,795    |                  |  |   | 78,907    |  
|                                                                                                                                                        |  |       |    |  |                  |   |           |                  |  |   |           |  
|                                                                                                                                                        |  |       |   
|Vessels, net                                                                                                                                            |  |       | 7  |  |                  |   | 940,738   |                  |  |   | 774,624   |  
|Deposits for vessels acquisitions                                                                                                                       |  |       | 7  |  |                  |   | 276,142   |                  |  |   | 245,567   |  
|Deferred finance costs, net                                                                                                                             |  |       | 8  |  |                  |   | 20,727    |                  |  |   | 24,819    |  
|Goodwill                                                                                                                                                |  |       | 10 |  |                  |   | 1,579     |                  |  |   | 1,579     |  
|Intangible assets-other than goodwill                                                                                                                   |  |       | 9  |  |                  |   | 51,233    |                  |  |   | 59,879    |  
|Restricted cash, long-term portion                                                                                                                      |  |       | 5  |  |                  |   |          |                  |  |   | 1,574     |  
|Other long-term assets                                                                                                                                  |  |       | 6  |  |                  |   | 897       |                  |  |   | 1,310     |  
|Deferred dry dock and special survey costs, net                                                                                                         |  |       |    |  |                  |   | 7,533     |                  |  |   | 7,210     |  
|                                                                                                                                                        |  |       |    |  |                  |   |           |                  |  |   |           |  
|Total non-current assets                                                                                                                                |  |       |    |  |                  |   | 1,298,849 |                  |  |   | 1,116,562 |  
|                                                                                                                                                        |  |       |    |  |                  |   |           |                  |  |   |           |  
|                                                                                                                                                        |  |       |   
|Total assets                                                                                                                                            |  |       |    |  |                  | $ | 1,370,644 |                  |  | $ | 1,195,469 |  
|                                                                                                                                                        |  |       |    |  |                  |   |           |                  |  |   |           |  
|                                                                                                                                                        |  |       |   
|LIABILITIES AND STOCKHOLDERS EQUITY                                                                                                                    |  |       |    |  |                  |   |           |                  |  |   |           |  
|Current liabilities                                                                                                                                     |  |       |    |  |                  |   |           |                  |  |   |           |  
|Accounts payable                                                                                                                                        |  |       | 11 |  |                  | $ | 1,277     |                  |  | $ | 1,021     |  
|Dividend payable                                                                                                                                        |  |       | 12 |  |                  |   | 2,410     |                  |  |   | 2,421     |  
|Accrued expenses                                                                                                                                        |  |       | 13 |  |                  |   | 12,951    |                  |  |   | 15,492    |  
|Due to related parties, short term                                                                                                                      |  |       | 17 |  |                  |   | 27,815    |                  |  |   | 43,616    |  
|Deferred revenue                                                                                                                                        |  |       |    |  |                  |   | 3,651     |                  |  |   | 3,251     |  
|Current portion of long-term debt                                                                                                                       |  |       | 14 |  |                  |   | 19,724    |                  |  |   | 11,928    |  
|                                                                                                                                                        |  |       |    |  |                  |   |           |                  |  |   |           |  
|Total current liabilities                                                                                                                               |  |       |    |  |                  |   | 67,828    |                  |  |   | 77,729    |  
|                                                                                                                                                        |  |       |    |  |                  |   |           |                  |  |   |           |  
|                                                                                                                                                        |  |       |   
|Long-term debt, net of current portion and premium                                                                                                      |  |       | 14 |  |                  |   | 974,362   |                  |  |   | 833,483   |  
|Loans due to related party                                                                                                                              |  |       | 17 |  |                  |   | 35,000    |                  |  |   | 40,000    |  
|Due to related parties, long term                                                                                                                       |  |       | 17 |  |                  |   | 57,701    |                  |  |   |          |  
|Other long-term liabilities                                                                                                                             |  |       |    |  |                  |   | 204       |                  |  |   | 480       |  
|Unfavorable lease terms                                                                                                                                 |  |       | 9  |  |                  |   | 4,245     |                  |  |   | 4,928     |  
|                                                                                                                                                        |  |       |    |  |                  |   |           |                  |  |   |           |  
|Total non-current liabilities                                                                                                                           |  |       |    |  |                  |   | 1,071,512 |                  |  |   | 878,891   |  
|                                                                                                                                                        |  |       |    |  |                  |   |           |                  |  |   |           |  
|                                                                                                                                                        |  |       |   
|Total liabilities                                                                                                                                       |  |       |    |  |                  |   | 1,139,340 |                  |  |   | 956,620   |  
|                                                                                                                                                        |  |       |    |  |                  |   |           |                  |  |   |           |  
|                                                                                                                                                        |  |       |   
|Commitments and contingencies                                                                                                                           |  |       | 18 |  |                  |   |          |                  |  |   |          |  
|Series D Convertible Preferred stock 600 shares issued and outstanding with $6,000 redemption amount                                                    |  |       | 19 |  |                  |   | 6,000     |                  |  |   |          |  
|                                                                                                                                                        |  |       |   
|Stockholders equity                                                                                                                                    |  |       |    |  |                  |   |           |                  |  |   |           |  
|Preferred stock, $0.0001 par value; 10,000,000 shares authorized; 4,540 issued and outstanding as of each of December 31, 2012 and December 31, 2011    |  |       | 19 |  |                  |   |          |                  |  |   |          |  
|Common stock, $0.0001 par value; 250,000,000 shares authorized; 40,517,413 issued and outstanding as of each of December 31, 2012 and December 31, 2011 |  |       | 19 |  |                  |   | 4         |                  |  |   | 4         |  
|Additional paid-in capital                                                                                                                              |  |       | 19 |  |                  |   | 246,102   |                  |  |   | 255,849   |  
|Accumulated Deficit                                                                                                                                     |  |       |    |  |                  |   | (20,802   | )                |  |   | (17, 004  | )
|                                                                                                                                                        |  |       |    |  |                  |   |           |                  |  |   |           |  
|Total stockholders equity                                                                                                                              |  |       |    |  |                  |   | 225,304   |                  |  |   | 238, 849  |  
|                                                                                                                                                        |  |       |    |  |                  |   |           |                  |  |   |           |  
|                                                                                                                                                        |  |       |   
|Total liabilities and stockholders equity                                                                                                              |  |       |    |  |                  | $ | 1,370,644 |                  |  | $ | 1,195,469 |  
|                                                                                                                                                        |  |       |    |  |                  |   |           |                  |  |   |           |  

See notes to consolidated financial statements



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##### Table of Contents

NAVIOS MARITIME ACQUISITION CORPORATION

CONSOLIDATED STATEMENTS OF OPERATIONS

(Expressed in thousands of U.S. dollars- except share and per share data)



|                                                                           |  |       |     |  |                            |   |            |                            |  |   |                            |   |  |   |            |  
|-------------------------------------------------------------------------- |  | ----- | --- |  | -------------------------- | - | ---------- | -------------------------- |  | - | -------------------------- | - |  | - | ---------- | -
|                                                                           |  | Notes |     |  | Year endedDecember 31,2012 |   |            | Year endedDecember 31,2011 |  |   | Year endedDecember 31,2010 |  
|Revenue                                                                    |  |       |     |  |                            | $ | 151,097    |                            |  | $ | 121,925                    |   |  | $ | 33,568     |  
|Time charter expenses                                                      |  |       |     |  |                            |   | (2,824     | )                          |  |   | (3,499                     | ) |  |   | (355       | )
|Direct vessel expenses                                                     |  |       |     |  |                            |   | (2,622     | )                          |  |   | (633                       | ) |  |   |           |  
|Management fees                                                            |  |       | 17  |  |                            |   | (47,043    | )                          |  |   | (35,679                    | ) |  |   | (9,752     | )
|General and administrative expenses                                        |  |       | 17  |  |                            |   | (3,853     | )                          |  |   | (4,241                     | ) |  |   | (1,902     | )
|Share based compensation                                                   |  |       |     |  |                            |   |           |                            |  |   |                           |   |  |   | (2,140     | )
|Transaction costs                                                          |  |       | 4   |  |                            |   |           |                            |  |   |                           |   |  |   | (8,019     | )
|Depreciation and amortization                                              |  |       | 7,9 |  |                            |   | (49,644    | )                          |  |   | (38,638                    | ) |  |   | (10,120    | )
|Prepayment penalties & write-off of deferred finance fees                  |  |       | 8   |  |                            |   |           |                            |  |   | (935                       | ) |  |   | (5,441     | )
|Interest income                                                            |  |       |     |  |                            |   | 445        |                            |  |   | 1,414                      |   |  |   | 862        |  
|Interest expenses and finance cost, net                                    |  |       | 14  |  |                            |   | (49,432    | )                          |  |   | (43,165                    | ) |  |   | (10,651    | )
|Other income/(expense), net                                                |  |       |     |  |                            |   | 78         |                            |  |   | (406                       | ) |  |   | 404        |  
|                                                                           |  |       |     |  |                            |   |            |                            |  |   |                            |   |  |   |            |  
|Net loss                                                                   |  |       |     |  |                            | $ | (3,798     | )                          |  | $ | (3,857                     | ) |  | $ | (13,546    | )
|                                                                           |  |       |     |  |                            |   |            |                            |  |   |                            |   |  |   |            |  
|                                                                           |  |       |     | 
|Incremental fair value of securities offered to induce warrants exercise   |  |       |     |  |                            |   |           |                            |  |   |                           |   |  |   | (647       | )
|Dividend declared on preferred shares Series B                             |  |       |     |  |                            |   | (108       | )                          |  |   | (108                       | ) |  |   |           |  
|Undistributed loss attributable to Series C participating preferred shares |  |       |     |  |                            |   | 622        |                            |  |   | 587                        |   |  |   |           |  
|                                                                           |  |       |     |  |                            |   |            |                            |  |   |                            |   |  |   |            |  
|Net loss attributable to common stockholders                               |  |       | 21  |  |                            | $ | (3,284     | )                          |  | $ | (3,378                     | ) |  | $ | (14,193    | )
|                                                                           |  |       |     |  |                            |   |            |                            |  |   |                            |   |  |   |            |  
|                                                                           |  |       |     | 
|Net loss per share, basic                                                  |  |       | 21  |  |                            | $ | (0.08      | )                          |  | $ | (0.08                      | ) |  | $ | (0.43      | )
|                                                                           |  |       |     |  |                            |   |            |                            |  |   |                            |   |  |   |            |  
|                                                                           |  |       |     | 
|Weighted average number of shares, basic                                   |  |       |     |  |                            |   | 40,517,413 |                            |  |   | 41,409,433                 |   |  |   | 32,677,318 |  
|                                                                           |  |       |     |  |                            |   |            |                            |  |   |                            |   |  |   |            |  
|                                                                           |  |       |     | 
|Net loss per share, diluted                                                |  |       | 21  |  |                            | $ | (0.08      | )                          |  | $ | (0.08                      | ) |  | $ | (0.43      | )
|                                                                           |  |       |     |  |                            |   |            |                            |  |   |                            |   |  |   |            |  
|                                                                           |  |       |     | 
|Weighted average number of shares, diluted                                 |  |       |     |  |                            |   | 40,517,413 |                            |  |   | 41,409,433                 |   |  |   | 32,677,318 |  
|                                                                           |  |       |     |  |                            |   |            |                            |  |   |                            |   |  |   |            |  

See notes to consolidated financial statements



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##### Table of Contents

NAVIOS MARITIME ACQUISITION CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Expressed in thousands of U.S. dollars)



|                                                                                |  |       |      |  |                            |   |          |                            |  |   |                            |   |  |   |          |  
|------------------------------------------------------------------------------- |  | ----- | ---- |  | -------------------------- | - | -------- | -------------------------- |  | - | -------------------------- | - |  | - | -------- | -
|                                                                                |  | Notes |      |  | Year endedDecember 31,2012 |   |          | Year endedDecember 31,2011 |  |   | Year endedDecember 31,2010 |  
|Operating Activities                                                            |  |       |      |  |                            |   |          |                            |  |   |                            |   |  |   |          |  
|Net loss                                                                        |  |       |      |  |                            | $ | (3,798   | )                          |  | $ | (3,857                     | ) |  | $ | (13,546  | )
|Adjustments to reconcile net loss to net cash provided by operating activities: |  |       |      |  |                            |   |          |                            |  |   |                            |   |  |   |          |  
|Depreciation and amortization                                                   |  |       | 7,9  |  |                            |   | 49,644   |                            |  |   | 38,638                     |   |  |   | 10,120   |  
|Amortization and write-off of deferred finance cost, net                        |  |       | 8    |  |                            |   | 2,820    |                            |  |   | 3,188                      |   |  |   | 3,456    |  
|Amortization of dry dock and special survey costs                               |  |       |      |  |                            |   | 2,622    |                            |  |   | 633                        |   |  |   |         |  
|Non-cash transaction costs                                                      |  |       | 19   |  |                            |   |         |                            |  |   |                           |   |  |   | 5,619    |  
|Share based compensation                                                        |  |       | 17   |  |                            |   |         |                            |  |   |                           |   |  |   | 2,140    |  
|Changes in operating assets and liabilities:                                    |  |       |      |  |                            |   |          |                            |  |   |                            |   |  |   |          |  
|(Increase)/decrease in prepaid expenses and other current assets                |  |       |      |  |                            |   | (2,194   | )                          |  |   | (1,369                     | ) |  |   | 3,188    |  
|Decrease/(increase) in accounts receivable                                      |  |       |      |  |                            |   | 1,375    |                            |  |   | (1,999                     | ) |  |   | (4,479   | )
|Decrease/(increase) in restricted cash                                          |  |       |      |  |                            |   | 320      |                            |  |   | (451                       | ) |  |   | (288     | )
|Decrease/(increase) in other long term assets                                   |  |       |      |  |                            |   | 413      |                            |  |   | (1,310                     | ) |  |   |         |  
|Increase/(decrease) in accounts payable                                         |  |       |      |  |                            |   | 256      |                            |  |   | (2,433                     | ) |  |   | 3,398    |  
|(Decrease)/increase in accrued expenses                                         |  |       |      |  |                            |   | (2,541   | )                          |  |   | 6,273                      |   |  |   | (4,022   | )
|Payments for dry dock and special survey costs                                  |  |       |      |  |                            |   | (2,944   | )                          |  |   | (7,843                     | ) |  |   |         |  
|Increase in due to related parties                                              |  |       |      |  |                            |   | 35,780   |                            |  |   | 33,797                     |   |  |   | 4,390    |  
|Increase in deferred revenue                                                    |  |       |      |  |                            |   | 400      |                            |  |   | 486                        |   |  |   | 324      |  
|(Decrease)/increase in other long term liabilities                              |  |       |      |  |                            |   | (276     | )                          |  |   | 480                        |   |  |   |         |  
|                                                                                |  |       |      |  |                            |   |          |                            |  |   |                            |   |  |   |          |  
|Net cash provided by operating activities                                       |  |       |      |  |                            | $ | 81,877   |                            |  | $ | 64,233                     |   |  | $ | 10,300   |  
|                                                                                |  |       |      |  |                            |   |          |                            |  |   |                            |   |  |   |          |  
|                                                                                |  |       |      | 
|Investing Activities                                                            |  |       |      |  |                            |   |          |                            |  |   |                            |   |  |   |          |  
|Cash paid for assets acquired, net of cash assumed                              |  |       | 3    |  |                            |   |         |                            |  |   |                           |   |  |   | (76,428  | )
|Cash paid for business acquisition, net of cash assumed                         |  |       | 4    |  |                            |   |         |                            |  |   |                           |   |  |   | (102,038 | )
|Acquisition of vessels                                                          |  |       | 7    |  |                            |   | (83,253  | )                          |  |   | (140,704                   | ) |  |   | (89,121  | )
|Deposits for vessel acquisitions                                                |  |       | 7    |  |                            |   | (142,119 | )                          |  |   | (78,495                    | ) |  |   | (89,843  | )
|Decrease in restricted cash                                                     |  |       |      |  |                            |   | 19,416   |                            |  |   | 3,769                      |   |  |   | 2,335    |  
|Acquisition of intangible assets other than goodwill                            |  |       | 7    |  |                            |   |         |                            |  |   | (10,347                    | ) |  |   |         |  
|Release from trust account                                                      |  |       |      |  |                            |   |         |                            |  |   |                           |   |  |   | 251,493  |  
|                                                                                |  |       |      |  |                            |   |          |                            |  |   |                            |   |  |   |          |  
|Net cash used in investing activities                                           |  |       |      |  |                            | $ | (205,956 | )                          |  | $ | (225,777                   | ) |  | $ | (103,602 | )
|                                                                                |  |       |      |  |                            |   |          |                            |  |   |                            |   |  |   |          |  
|                                                                                |  |       |      | 
|Financing Activities                                                            |  |       |      |  |                            |   |          |                            |  |   |                            |   |  |   |          |  
|Loan proceeds, net of deferred finance costs and net of premium                 |  |       | 8,14 |  |                            |   | 162,813  |                            |  |   | 252,075                    |   |  |   | 556,671  |  
|Loan proceeds from related party, net of deferred finance cost                  |  |       |      |  |                            |   | 5,000    |                            |  |   | 33,209                     |   |  |   | 39,600   |  
|Deferred underwriters fee                                                      |  |       | 3    |  |                            |   |         |                            |  |   |                           |   |  |   | (8,855   | )
|Loan repayment to related party                                                 |  |       |      |  |                            |   | (10,000  | )                          |  |   | (6,000                     | ) |  |   | (27,609  | )
|Loan repayments                                                                 |  |       | 14   |  |                            |   | (13,744  | )                          |  |   | (126,277                   | ) |  |   | (412,245 | )
|Net proceeds from warrant exercise                                              |  |       | 19   |  |                            |   |         |                            |  |   |                           |   |  |   | 74,978   |  
|Conversion of common stock into cash, upon redemption of common stock           |  |       | 3    |  |                            |   |         |                            |  |   |                           |   |  |   | (99,312  | )
|Dividend paid                                                                   |  |       | 12   |  |                            |   | (9,759   | )                          |  |   | (9,790                     | ) |  |   |         |  
|Increase in restricted cash                                                     |  |       |      |  |                            |   | (8,685   | )                          |  |   | (1,733                     | ) |  |   | (250     | )
|Net proceeds from equity offering                                               |  |       | 19   |  |                            |   |         |                            |  |   |                           |   |  |   | 33,402   |  
|Issuance costs for preferred shares                                             |  |       | 19   |  |                            |   |         |                            |  |   |                           |   |  |   | (1,805   | )
|                                                                                |  |       |      |  |                            |   |          |                            |  |   |                            |   |  |   |          |  
|Net cash provided by financing activities                                       |  |       |      |  |                            | $ | 125,625  |                            |  | $ | 141,484                    |   |  | $ | 154,575  |  
|                                                                                |  |       |      |  |                            |   |          |                            |  |   |                            |   |  |   |          |  
|                                                                                |  |       |      | 
|Net increase/(decrease) in cash and cash equivalents                            |  |       |      |  |                            |   | 1,546    |                            |  |   | (20,060                    | ) |  |   | 61,273   |  
|Cash and cash equivalents, beginning of year                                    |  |       |      |  |                            |   | 41,300   |                            |  |   | 61,360                     |   |  |   | 87       |  
|                                                                                |  |       |      |  |                            |   |          |                            |  |   |                            |   |  |   |          |  
|Cash and cash equivalents, end of year                                          |  |       |      |  |                            | $ | 42,846   |                            |  | $ | 41,300                     |   |  | $ | 61,360   |  
|                                                                                |  |       |      |  |                            |   |          |                            |  |   |                            |   |  |   |          |  



F-4



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##### Table of Contents

|                                                                                |  |  |  |   |        |  |  |   |        |  |  |   |          |  
|------------------------------------------------------------------------------- |  |  |  | - | ------ |  |  | - | ------ |  |  | - | -------- | -
|Supplemental disclosures of cash flow information                               |  |  |  |   |        |  |  |   |        |  |  |   |          |  
|Cash interest paid, net of capitalized interest                                 |  |  |  | $ | 47,102 |  |  | $ | 40,672 |  |  | $ | 2,933    |  
|Non  cash investing activities                                                 |  |  |  |   |        |  |  |   |        |  |  |   |          |  
|Common stock issued for VLCC acquisition                                        |  |  |  |   |       |  |  | $ |       |  |  | $ | 10,745   |  
|Preferred stock issued for VLCC transaction costs                               |  |  |  |   |       |  |  | $ |       |  |  | $ | 5,619    |  
|Preferred stock issued for vessel deposits                                      |  |  |  |   |       |  |  | $ |       |  |  | $ | 1,649    |  
|Capitalized financing costs                                                     |  |  |  |   | 879    |  |  | $ | 766    |  |  | $ | 320      |  
|Due to related parties                                                          |  |  |  |   |       |  |  | $ |       |  |  | $ | 480      |  
|Release from escrow                                                             |  |  |  |   |       |  |  | $ | 1,232  |  |  | $ |         |  
|Non-cash financing activities                                                   |  |  |  |   |        |  |  |   |        |  |  |   |          |  
|Dividends payable                                                               |  |  |  |   | 2,410  |  |  | $ | 2,421  |  |  | $ | 2,421    |  
|Acquisition of vessels                                                          |  |  |  |   | 4,313  |  |  | $ | 2,488  |  |  | $ | 789      |  
|Deposits for vessel acquisition                                                 |  |  |  |   | 1,848  |  |  | $ | 1,210  |  |  | $ | 390      |  
|Issuance of Series D Convertible Preferred Stock issued for vessel acquisitions |  |  |  |   | 6,000  |  |  | $ |       |  |  | $ |         |  
|                                                                                |  |  |  |  
|Initial acquisition of 13 vessels (see note 3)                                  |  |  |  |   |        |  |  |   |        |  |  |   |          |  
|Restricted cash                                                                 |  |  |  | $ |       |  |  | $ |       |  |  | $ | 35,596   |  
|Deposits for vessel acquisitions                                                |  |  |  |   |       |  |  |   |       |  |  |   | 174,411  |  
|Purchase options                                                                |  |  |  |   |       |  |  |   |       |  |  |   | 3,158    |  
|Debt assumed                                                                    |  |  |  |   |       |  |  |   |       |  |  |   | (132,987 | )
|Long term liabilities                                                           |  |  |  |   |       |  |  |   |       |  |  |   | (3,158   | )
|Accrued expenses                                                                |  |  |  |   |       |  |  |   |       |  |  |   | (112     | )
|                                                                                |  |  |  |   |        |  |  |   |        |  |  |   |          |  
|Total                                                                           |  |  |  | $ |       |  |  | $ |       |  |  | $ | 76,908   |  
|                                                                                |  |  |  |   |        |  |  |   |        |  |  |   |          |  
|                                                                                |  |  |  |  
|Cash paid, net of cash received of $57                                          |  |  |  |   |       |  |  |   |       |  |  |   | 76,428   |  
|Payable to Navios Holdings                                                      |  |  |  |   |       |  |  |   |       |  |  |   | 480      |  
|                                                                                |  |  |  |   |        |  |  |   |        |  |  |   |          |  
|Total                                                                           |  |  |  | $ |       |  |  | $ |       |  |  | $ | 76,908   |  
|                                                                                |  |  |  |   |        |  |  |   |        |  |  |   |          |  
|                                                                                |  |  |  |  
|VLCC Acquisition (see note 4)                                                   |  |  |  |   |        |  |  |   |        |  |  |   |          |  
|Purchase price:                                                                 |  |  |  |   |        |  |  |   |        |  |  |   |          |  
|Cash consideration                                                              |  |  |  | $ |       |  |  | $ |       |  |  | $ | 134,270  |  
|Equity issuance                                                                 |  |  |  |   |       |  |  |   |       |  |  |   | 9,513    |  
|                                                                                |  |  |  |   |        |  |  |   |        |  |  |   |          |  
|Total purchase price                                                            |  |  |  | $ |       |  |  | $ |       |  |  | $ | 143,783  |  
|                                                                                |  |  |  |   |        |  |  |   |        |  |  |   |          |  
|                                                                                |  |  |  |  
|Fair value of assets and liabilities acquired:                                  |  |  |  |   |        |  |  |   |        |  |  |   |          |  
|Vessels                                                                         |  |  |  | $ |       |  |  | $ |       |  |  | $ | 419,500  |  
|Deposits for vessel acquisition                                                 |  |  |  |   |       |  |  |   |       |  |  |   | 62,575   |  
|Favorable lease terms                                                           |  |  |  |   |       |  |  |   |       |  |  |   | 57,070   |  
|Current Assets including cash of $32,232                                        |  |  |  |   |       |  |  |   |       |  |  |   | 35,716   |  
|Current liabilities                                                             |  |  |  |   |       |  |  |   |       |  |  |   | (16,387  | )
|Long-term debt assumed (including current portion)                              |  |  |  |   |       |  |  |   |       |  |  |   | (410,451 | )
|Unfavorable lease terms                                                         |  |  |  |   |       |  |  |   |       |  |  |   | (5,819   | )
|                                                                                |  |  |  |   |        |  |  |   |        |  |  |   |          |  
|Fair Value of net assets acquired                                               |  |  |  | $ |       |  |  | $ |       |  |  | $ | 142,204  |  
|                                                                                |  |  |  |   |        |  |  |   |        |  |  |   |          |  
|                                                                                |  |  |  |  
|Goodwill                                                                        |  |  |  | $ |       |  |  | $ |       |  |  | $ | 1,579    |  
|                                                                                |  |  |  |   |        |  |  |   |        |  |  |   |          |  

See notes to consolidated financial statements



F-5



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##### Table of Contents

NAVIOS MARITIME ACQUISITION CORPORATION

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

(Expressed in thousands of U.S. dollars, except share data)



|                                                           |  |      |    |  |                         |  |       |              |  |   |                             |  |  |        |             |   |                          |   |    |                                       |  |   |                          |   |  |   |         |   |  |   |         |  
|---------------------------------------------------------- |  | ---- | -- |  | ----------------------- |  | ----- | ------------ |  | - | --------------------------- |  |  | ------ | ----------- | - | ------------------------ | - | -- | ------------------------------------- |  | - | ------------------------ | - |  | - | ------- | - |  | - | ------- | -
|                                                           |  |      |    |  | Preferred Stock         |  |       | Common Stock |  |   |                             |  |  |        |             |   |                          |  
|                                                           |  | Note |    |  | NumberofPreferredShares |  |       | Amount       |  |   | Number ofCommonUnits/Shares |  |  | Amount |             |   | AdditionalPaid-inCapital |   |    | (Accumulateddeficit)/Retainedearnings |  |   | TotalStockholdersEquity |  
|Balance, December 31, 2009                                 |  |      |    |  |                         |  |      |              |  | $ |                            |  |  |        | 31,625,000  |   |                          | $ | 3  |                                       |  | $ | 141,588                  |   |  | $ | 399     |   |  | $ | 141,990 |  
|                                                           |  |      |    |  |                         |  |       |              |  |   |                             |  |  |        |             |   |                          |   |    |                                       |  |   |                          |   |  |   |         |   |  |   |         |  
|                                                           |  |      |    |  |                         |  |       |             
|Common stock redeemed                                      |  |      |    |  |                         |  |      |              |  |   |                            |  |  |        | (10,021,399 | ) |                          |   | (1 | )                                     |  |   |                         |   |  |   |        |   |  |   | (1      | )
|Common stock not redeemed                                  |  |      |    |  |                         |  |      |              |  |   |                            |  |  |        |            |   |                          |   |   |                                       |  |   | 978                      |   |  |   |        |   |  |   | 978     |  
|Directors compensation (290,000 units)                     |  |      |    |  |                         |  |      |              |  |   |                            |  |  |        |            |   |                          |   |   |                                       |  |   | 2,140                    |   |  |   |        |   |  |   | 2,140   |  
|Shares Issued from Warrant Tender Program, net             |  |      |    |  |                         |  |      |              |  |   |                            |  |  |        | 18,412,053  |   |                          |   | 2  |                                       |  |   | 74,976                   |   |  |   |        |   |  |   | 74,978  |  
|Shares issued in business acquisition                      |  |      | 4  |  |                         |  |      |              |  |   |                            |  |  |        | 1,894,918   |   |                          |   |   |                                       |  |   | 10,745                   |   |  |   |        |   |  |   | 10,745  |  
|Preferred Shares issued, net of expenses                   |  |      | 19 |  |                         |  | 3,540 |              |  |   |                            |  |  |        |            |   |                          |   |   |                                       |  |   | 5,463                    |   |  |   |        |   |  |   | 5,463   |  
|Equity offering, net of offering expenses                  |  |      | 19 |  |                         |  |      |              |  |   |                            |  |  |        | 6,500,000   |   |                          |   | 1  |                                       |  |   | 33,401                   |   |  |   |        |   |  |   | 33,402  |  
|Dividend declared/paid                                     |  |      |    |  |                         |  |      |              |  |   |                            |  |  |        |            |   |                          |   |   |                                       |  |   | (2,421                   | ) |  |   |        |   |  |   | (2,421  | )
|Net loss                                                   |  |      |    |  |                         |  |      |              |  |   |                            |  |  |        |            |   |                          |   |   |                                       |  |   |                         |   |  |   | (13,546 | ) |  |   | (13,546 | )
|                                                           |  |      |    |  |                         |  |       |              |  |   |                             |  |  |        |             |   |                          |   |    |                                       |  |   |                          |   |  |   |         |   |  |   |         |  
|Balance, December 31, 2010                                 |  |      |    |  |                         |  | 3,540 |              |  | $ |                            |  |  |        | 48,410,572  |   |                          | $ | 5  |                                       |  | $ | 266,870                  |   |  | $ | (13,147 | ) |  | $ | 253,728 |  
|                                                           |  |      |    |  |                         |  |       |              |  |   |                             |  |  |        |             |   |                          |   |    |                                       |  |   |                          |   |  |   |         |   |  |   |         |  
|Common stock exchanged for 1,000 Series C Preferred Shares |  |      | 19 |  |                         |  | 1,000 |              |  |   |                            |  |  |        | (7,676,000  | ) |                          |   | (1 | )                                     |  |   | 1                        |   |  |   |        |   |  |   |        |  
|Shares reimbursed from escrow in settlement of claim       |  |      | 4  |  |                         |  |      |              |  |   |                            |  |  |        | (217,159    | ) |                          |   |   |                                       |  |   | (1,232                   | ) |  |   |        |   |  |   | (1,232  | )
|Dividend declared/paid                                     |  |      |    |  |                         |  |      |              |  |   |                            |  |  |        |            |   |                          |   |   |                                       |  |   | (9,790                   | ) |  |   |        |   |  |   | (9,790  | )
|Net loss                                                   |  |      |    |  |                         |  |      |              |  |   |                            |  |  |        |            |   |                          |   |   |                                       |  |   |                         |   |  |   | (3,857  | ) |  |   | (3,857  | )
|                                                           |  |      |    |  |                         |  |       |              |  |   |                             |  |  |        |             |   |                          |   |    |                                       |  |   |                          |   |  |   |         |   |  |   |         |  
|Balance, December 31, 2011                                 |  |      |    |  |                         |  | 4,540 |              |  | $ |                            |  |  |        | 40,517,413  |   |                          | $ | 4  |                                       |  | $ | 255,849                  |   |  | $ | (17,004 | ) |  | $ | 238,849 |  
|                                                           |  |      |    |  |                         |  |       |              |  |   |                             |  |  |        |             |   |                          |   |    |                                       |  |   |                          |   |  |   |         |   |  |   |         |  
|                                                           |  |      |    |  |                         |  |       |             
|Dividends paid/declared                                    |  |      | 12 |  |                         |  |      |              |  |   |                            |  |  |        |            |   |                          |   |   |                                       |  |   | (9,747                   | ) |  |   |        |   |  |   | (9,747  | )
|Net loss                                                   |  |      |    |  |                         |  |      |              |  |   |                            |  |  |        |            |   |                          |   |   |                                       |  |   |                         |   |  |   | (3,798  | ) |  |   | (3,798  | )
|                                                           |  |      |    |  |                         |  |       |              |  |   |                             |  |  |        |             |   |                          |   |    |                                       |  |   |                          |   |  |   |         |   |  |   |         |  
|Balance, December 31, 2012                                 |  |      |    |  |                         |  | 4,540 |              |  | $ |                            |  |  |        | 40,517,413  |   |                          | $ | 4  |                                       |  | $ | 246,102                  |   |  | $ | (20,802 | ) |  | $ | 225,304 |  
|                                                           |  |      |    |  |                         |  |       |              |  |   |                             |  |  |        |             |   |                          |   |    |                                       |  |   |                          |   |  |   |         |   |  |   |         |  

See notes to consolidated financial statements



F-6



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##### Table of Contents

NAVIOS MARITIME ACQUISITION CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Expressed in thousands of U.S. Dollars except share and per share data)

NOTE 1: DESCRIPTION
OF ORGANIZATION AND BUSINESS OPERATIONS

Navios Maritime Acquisition Corporation (Navios Acquisition or the
Company) (NYSE: NNA) owns a large fleet of modern crude oil, refined petroleum product and chemical tankers providing world-wide marine transportation services. The Companys strategy is to charter its vessels to international oil
companies, refiners and large vessel operators under long, medium and short-term charters. The Company is committed to providing quality transportation services and developing and maintaining long-term relationships with its customers. The
operations of Navios Acquisition are managed by Navios Tankers Management Inc. (the Manager), a subsidiary of Navios Maritime Holdings Inc. (Navios Holdings) from its head offices in Piraeus, Greece.

Navios Acquisition was incorporated in the Republic of Marshall Islands on March 14, 2008. On July 1, 2008, Navios Acquisition completed its
initial public offering, or its IPO. On May 28, 2010, Navios Acquisition consummated the vessel acquisition, which constituted its initial business combination (see note 3). Following such transaction, Navios Acquisition commenced its
operations as an operating company and was controlled by Navios Holdings.

On March 30, 2011, Navios Holdings exchanged 7,676,000 shares
of Navios Acquisitions common stock it held for 1,000 shares of Series C Convertible Preferred Stock of Navios Acquisition pursuant to an Exchange Agreement entered into on March 30, 2011, between Navios Acquisition and Navios
Holdings. Following this exchange, Navios Holdings currently has 45% of the voting power and 53.7% of the economic interest in Navios Acquisition.

As of December 31, 2012, Navios Acquisition had outstanding: 40,517,413 shares of common stock, 4,540 shares of preferred stock and 600 shares of convertible preferred stock, 6,037,994 public
warrants. Included in the number of shares and warrants are 12,752 units (one unit consists of one share of common stock and one warrant).

NOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

(a) Basis of presentation: The accompanying consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States of America
(GAAP).

Navios Acquisition has revised its consolidated statement of cash flows for the years ended December 31, 2011 and 2010 to
appropriately reflect certain amounts related to acquisitions of vessels and deposits of vessel acquisitions during 2011 and 2010 that were not paid as at December 31, 2011 and 2010. This revision resulted in a total of $3,739 and $1,179
decrease in net cash used in investing activities for the year ended December 31, 2011 and 2010 respectively and a corresponding decrease in the change in due to related parties resulting in a decrease in net cash provided by operating
activities. The Company also revised the supplemental disclosure of noncash acquisition of vessels and deposits for vessel acquisition by an increase of $2,529 and $1,210 respectively for 2011 and an increase of $789 and $390 respectively for 2010.
The Company determined that such revisions are not material to consolidated financial statements.

There was no impact on previously reported
total cash and cash equivalents, consolidated balance sheets or consolidated statements of operations.

(b) Principles of
consolidation: The accompanying consolidated financial statements include the accounts of Navios Acquisition, a Marshall Islands corporation, and its majority owned subsidiaries. All significant intercompany balances and transactions have
been eliminated in the consolidated statements.

The Company also consolidates entities that are determined to be variable interest entities
as defined in the accounting guidance, if it determines that it is the primary beneficiary. A variable interest entity is defined as a legal entity where either (a) equity interest holders as a group lack the characteristics of a controlling
financial interest, including decision making ability and an interest in the entitys residual risks and rewards, or (b) the equity holders have not provided sufficient equity investment to permit the entity to finance its activities
without additional subordinated financial support, or (c) the voting rights of some investors are not proportional to their obligations to absorb the expected losses of the entity, their rights to receive the expected residual returns of the
entity, or both and substantially all of the entitys activities either involve or are conducted on behalf of an investor that has disproportionately few voting rights.

(c) Subsidiaries: Subsidiaries are those entities in which the Company has an interest of more than one half of the voting rights and/or otherwise has power to govern the financial and
operating policies. The acquisition method of accounting is used to account for the acquisition of subsidiaries if deemed to be a business combination. The cost of an acquisition is measured as the fair value of the assets given up, shares issued or
liabilities undertaken at the date of acquisition. The excess of the cost of acquisition over the fair value of the net assets acquired and liabilities assumed is recorded as goodwill.



F-7



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##### Table of Contents

NAVIOS MARITIME ACQUISITION CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Expressed in thousands of U.S. Dollars except share and per share data)



As of December 31, 2012, Navios Acquisitions subsidiaries included in these consolidated financial
statements are:



|                                        |  |                       |               |                    |      |                         |      |              |      |              
|--------------------------------------- |  | --------------------- | ------------- | ------------------ | ---- | ----------------------- | ---- | ------------ | ---- | -------------
|Navios Maritime Acquisition Corporation |  | Nature                |               | Country of         |      | Statement of operations
|and Subsidiaries:                       |  |                       | Incorporation |                    | 2012 |                         | 2011 |              | 2010
|Company Name                            |  |                       |               |                    |      |                         |      |              |      |              
|Aegean Sea Maritime Holdings Inc.       |  | Sub-Holding Company   |               | Marshall Is.       |      | 1/1 - 12/31             |      | 1/1 - 12/31  |      | 5/28 - 12/31 
|Amorgos Shipping Corporation            |  | Vessel Owning Company |               | Marshall Is.       |      | 1/1 - 12/31             |      | 1/1 - 12/31  |      | 5/28 - 12/31 
|Andros Shipping Corporation             |  | Vessel Owning Company |               | Marshall Is.       |      | 1/1 - 12/31             |      | 1/1 - 12/31  |      | 5/28 - 12/31 
|Antikithira Shipping Corporation        |  | Vessel Owning Company |               | Marshall Is.       |      | 1/1 - 12/31             |      | 6/7 - 12/31  |      |             
|Antiparos Shipping Corporation          |  | Vessel Owning Company |               | Marshall Is.       |      | 1/1 - 12/31             |      | 1/1 - 12/31  |      | 5/28 - 12/31 
|Amindra Shipping Co.                    |  | Sub-Holding Company   |               | Marshall Is.       |      | 1/1 - 12/31             |      | 4/28 - 12/31 |      |             
|Crete Shipping Corporation              |  | Vessel Owning Company |               | Marshall Is.       |      | 1/1 - 12/31             |      | 1/1 - 12/31  |      | 5/28 -12/31  
|Folegandros Shipping Corporation        |  | Vessel Owning Company |               | Marshall Is.       |      | 1/1 - 12/31             |      | 1/1 - 12/31  |      | 10/26 - 12/31
|Ikaria Shipping Corporation             |  | Vessel Owning Company |               | Marshall Is.       |      | 1/1 - 12/31             |      | 1/1 - 12/31  |      | 5/28 - 12/31 
|Ios Shipping Corporation                |  | Vessel Owning Company |               | Cayman Is.         |      | 1/1 - 12/31             |      | 1/1 - 12/31  |      | 5/28 - 12/31 
|Kithira Shipping Corporation            |  | Vessel Owning Company |               | Marshall Is.       |      | 1/1 - 12/31             |      | 6/7 - 12/31  |      |             
|Kos Shipping Corporation(1)             |  | Vessel Owning Company |               | Marshall Is.       |      | 1/1 - 12/31             |      | 1/1 - 12/31  |      | 5/28 - 12/31 
|Mytilene Shipping Corporation(1)        |  | Vessel Owning Company |               | Marshall Is.       |      | 1/1 - 12/31             |      | 1/1 - 12/31  |      | 5/28 - 12/31 
|Navios Maritime Acquisition Corporation |  | Holding Company       |               | Marshall Is.       |      | 1/1 - 12/31             |      | 1/1 - 12/31  |      | 1/1 - 12/31  
|Navios Acquisition Finance (U.S.) Inc.  |  | Co-Issuer             |               | Delaware           |      | 1/1 - 12/31             |      | 1/1 - 12/31  |      | 10/05 - 12/31
|Rhodes Shipping Corporation             |  | Vessel Owning Company |               | Marshall Is.       |      | 1/1 - 12/31             |      | 1/1 - 12/31  |      | 5/28 - 12/31 
|Serifos Shipping Corporation            |  | Vessel Owning Company |               | Marshall Is.       |      | 1/1 - 12/31             |      | 1/1 - 12/31  |      | 10/26 - 12/31
|Shinyo Dream Limited                    |  | Vessel Owning Company |               | Hong Kong          |      | 1/1 - 12/31             |      | 1/1 - 12/31  |      | 9/10 - 12/31 
|Shinyo Kannika Limited                  |  | Vessel Owning Company |               | Hong Kong          |      | 1/1 - 12/31             |      | 1/1 - 12/31  |      | 9/10 - 12/31 
|Shinyo Kieran Limited                   |  | Vessel Owning Company |               | British Virgin Is. |      | 1/1 - 12/31             |      | 1/1 - 12/31  |      | 9/10 - 12/31 
|Shinyo Loyalty Limited                  |  | Vessel Owning Company |               | Hong Kong          |      | 1/1 - 12/31             |      | 1/1 - 12/31  |      | 9/10 - 12/31 
|Shinyo Navigator Limited                |  | Vessel Owning Company |               | Hong Kong          |      | 1/1 - 12/31             |      | 1/1 - 12/31  |      | 9/10 - 12/31 
|Shinyo Ocean Limited                    |  | Vessel Owning Company |               | Hong Kong          |      | 1/1 - 12/31             |      | 1/1 - 12/31  |      | 9/10 - 12/31 
|Shinyo Saowalak Limited                 |  | Vessel Owning Company |               | British Virgin Is. |      | 1/1 - 12/31             |      | 1/1 - 12/31  |      | 9/10 - 12/31 
|Sifnos Shipping Corporation(1)          |  | Vessel Owning Company |               | Marshall Is.       |      | 1/1 - 12/31             |      | 1/1 - 12/31  |      | 5/28 - 12/31 
|Skiathos Shipping Corporation(1)        |  | Vessel Owning Company |               | Marshall Is.       |      | 1/1 - 12/31             |      | 1/1 - 12/31  |      | 5/28 - 12/31 
|Skopelos Shipping Corporation           |  | Vessel Owning Company |               | Cayman Is.         |      | 1/1 - 12/31             |      | 1/1 - 12/31  |      | 5/28 - 12/31 
|Syros Shipping Corporation(1)           |  | Vessel Owning Company |               | Marshall Is.       |      | 1/1 - 12/31             |      | 1/1 - 12/31  |      | 5/28 - 12/31 
|Thera Shipping Corporation(1)           |  | Vessel Owning Company |               | Marshall Is.       |      | 1/1 - 12/31             |      | 1/1 - 12/31  |      | 5/28 - 12/31 
|Tinos Shipping Corporation(1)           |  | Vessel Owning Company |               | Marshall Is.       |      | 1/1 - 12/31             |      | 1/1 - 12/31  |      | 5/28 - 12/31 
|Oinousses Shipping Corporation(1)       |  | Vessel Owning Company |               | Marshall Is.       |      | 1/1 - 12/31             |      | 10/5 - 12/31 |      |             
|Psara Shipping Corporation(1)           |  | Vessel Owning Company |               | Marshall Is.       |      | 1/1 - 12/31             |      | 10/5 - 12/31 |      |             
|Antipsara Shipping Corporation(1)       |  | Vessel Owning Company |               | Marshall Is.       |      | 1/1 - 12/31             |      | 10/5 - 12/31 |      |             



|(1) | Each company has the rights over a shipbuilding contract of a tanker vessel.
|--- | ----------------------------------------------------------------------------

(d) Use of estimates: The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported
amounts of assets and liabilities and the disclosure of contingent assets and liabilities as of the dates of the financial statements and the reported amounts of revenues and expenses during the reporting periods. On an on-going basis, management
evaluates the estimates and judgments, including those related to uncompleted voyages, future drydock dates, the selection of useful lives for tangible assets, expected future cash flows from long-lived assets to support impairment tests, provisions
necessary for accounts receivables, provisions for legal disputes and contingencies. Management bases its estimates and judgments on historical experience and on various other factors that are believed to be reasonable under the circumstances, the
results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results could differ from those estimates under different assumptions and/or
conditions.

(e) Cash and Cash equivalents: Cash and cash equivalents consist of cash on hand, deposits held on call with
banks, and other short-term liquid investments with original maturities of three months or less.

(f) Restricted Cash:
Restricted cash consists of cash totaling $10,075 and $29,491 as of December 31, 2012 and 2011, respectively, restricted to pay future installments for vessel deposits in accordance with Navios Acquisitions new build program. Also in
restricted cash is an amount of $11,088 for 2012 and $2,723 for 2011 held in retention account in order to service debt, interest payments and pledged cash, as required by certain of Navios Acquisitions credit facilities.

(g) Accounts Receivable, net: The amount shown as accounts receivable, net at each balance sheet date includes receivables from
charterers for hire, freight and demurrage billings, net of a provision for doubtful accounts. At each balance sheet date, all potentially uncollectible accounts are assessed individually for purposes of determining the appropriate provision for
doubtful accounts.

(h) Vessels, net: Vessels are stated at historical cost, which consists of the contract price, delivery
and acquisition expenses and capitalized interest costs while under construction. Vessels acquired in an asset acquisition or in a business combination are recorded at fair value. Subsequent expenditures for major improvements and upgrading are
capitalized, provided they appreciably extend the life, increase the earning capacity or improve the efficiency or safety of the vessels. Expenditures for routine maintenance and repairs are expensed as incurred.



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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Expressed in thousands of U.S. Dollars except share and per share data)



Depreciation is computed using the straight line method over the useful life of the vessels, after
considering the estimated residual value. Management estimates the residual values of its tanker vessels based on a scrap value of $285 per lightweight ton, as it believes this level is reasonable and common in the shipping industry. Management
estimates the useful life of our vessels to be 25 years from the vessels original construction. However, when regulations place limitations over the ability of a vessel to trade on a worldwide basis, its useful life is re-estimated to end
at the date such regulations become effective.

(i) Deposits for vessels acquisitions: This represents amounts paid by the
Company in accordance with the terms of the purchase agreements for the construction of long-lived fixed assets. Interest costs incurred during the construction (until the asset is substantially complete and ready for its intended use) are
capitalized. Capitalized interest included in deposits for the acquisition of vessels amounted to $14,240 and $11,449 for the year, ended December 31, 2012 and 2011, respectively.

(j) Impairment of long-lived assets: Vessels, other fixed assets and other long lived assets held and used by Navios Acquisition are reviewed periodically for potential impairment whenever
events or changes in circumstances indicate that the carrying amount of a particular asset may not be fully recoverable. Navios Acquisitions management evaluates the carrying amounts and periods over which long-lived assets are depreciated to
determine if events or changes in circumstances have occurred that would require modification to their carrying values or useful lives. In evaluating useful lives and carrying values of long-lived assets, certain indicators of potential impairment,
are reviewed such as undiscounted projected operating cash flows, vessel sales and purchases, business plans and overall market conditions.

Undiscounted projected net operating cash flows are determined for each asset group (consisting of the individual vessel and the intangible with respect
to the time charter agreement to that vessel) and compared to the vessel carrying value and related carrying value of the intangible with respect to the time charter agreement attached to that vessel or the carrying value of deposits for new
buildings. Within the shipping industry, vessels are customarily bought and sold with a charter attached. The value of the charter may be favorable or unfavorable when comparing the charter rate to then current market rates. The loss recognized
either on impairment (or on disposition) will reflect the excess of carrying value over fair value (selling price) for the vessel individual asset group.

During the fourth quarter of fiscal 2012, management concluded that events occurred and circumstances had changed, which indicated the potential impairment of Navios Acquisitions long-lived assets
may exist. These indicators included continued deterioration in the spot market, and the related, impact of the current tanker sector has on managements expectation for future revenues. As a result, an impairment assessment of long-lived
assets or identified asset groups was performed.

The Company determined undiscounted projected net operating cash flows for each vessel and
deposits for new buildings and compared it to the vessels carrying value together with the carrying value of the related intangible. The significant factors and assumptions used in the undiscounted projected net operating cash flow analysis
included: determining the projected net operating cash flows by considering the charter revenues from existing time charters for the fixed fleet days (Companys remaining charter agreement rates) and an estimated daily time charter equivalent
for the unfixed days (based on the 10-year average historical one year time charter rates) over the remaining economic life of each vessel, net of brokerage and address commissions, excluding days of scheduled off-hires, management fees fixed until
May 2014 and thereafter assuming an annual increase of 3.0% and utilization rate of 98.6% based on the fleets historical performance.

For the
deposits for new build vessels, the net cash flows also included the future cash out flows to make the vessels ready for use, all remaining progress payments to shipyards and other pre-delivery expenses (e.g. capitalized interest). The assessment
concluded that step two of the impairment analysis was not required and no impairment of vessels, deposits for vessel acquisitions and related intangible assets existed as of December 31, 2012, as the undiscounted projected net operating cash
flows exceeded the carrying value.

In the event that impairment would occur, the fair value of the related asset would be determined and a
charge would be recorded to operations calculated by comparing the assets carrying value to its fair value. Fair value is estimated primarily through the use of third-party valuations performed on an individual vessel basis.

Although management believes the underlying assumptions supporting this assessment are reasonable, if charter rate trends and the length of the current
market downturn vary significantly from our forecasts, management may be required to perform step two of the impairment analysis in the future that could expose Navios Acquisition to material impairment charges in the future.

No impairment loss was recognized for any of the periods presented.

(k) Deferred Financing Costs: Deferred financing costs include fees, commissions and legal expenses associated with obtaining loan facilities. These costs are amortized over the life of
the related debt using the effective interest rate method, and are included in interest expense. Amortization of deferred financing cost and write-offs for each of the years ended December 31, 2012, 2011 and 2010 were $2,820, $3,188 and $3,456,
respectively.

(l) Goodwill: Goodwill acquired in a business combination is not to be amortized. Goodwill is tested for
impairment at the reporting unit level at least annually and written down with a charge to operations if the carrying amount exceeds the estimated implied fair value.

The Company will evaluate impairment of goodwill using a two-step process. First, the aggregate fair value of the reporting unit is compared to its carrying amount, including goodwill. The Company
determines the fair value of the reporting unit based on a combination of discounted cash flow analysis and an industry market multiple.



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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Expressed in thousands of U.S. Dollars except share and per share data)



If the fair value exceeds the carrying amount, no impairment exists. If the carrying amount of the
reporting unit exceeds the fair value, then the Company must perform the second step in order to determine the implied fair value of the reporting units goodwill and compare it with its carrying amount. The implied fair value of goodwill is
determined by allocating the fair value of the reporting unit to all the assets and liabilities of that unit, as if the unit had been acquired in a business combination and the fair value of the unit was the purchase price. If the carrying amount of
the goodwill exceeds the implied fair value, then goodwill impairment is recognized by writing the goodwill down to its implied fair value.

Navios Acquisition has one reporting unit. No impairment loss was recognized for any of the periods presented.

(m) Intangibles other than goodwill: Navios Acquisitions intangible assets and liabilities consist of favorable lease terms
and unfavorable lease terms. When intangible assets or liabilities associated with the acquisition of a vessel are identified, they are recorded at fair value. Fair value is determined by reference to market data and the discounted amount of
expected future cash flows. Where charter rates are higher than market charter rates, an asset is recorded, being the difference between the acquired charter rate and the market charter rate for an equivalent vessel. Where charter rates are less
than market charter rates, a liability is recorded, being the difference between the assumed charter rate and the market charter rate for an equivalent vessel. The determination of the fair value of acquired assets and assumed liabilities requires
us to make significant assumptions and estimates of many variables including market charter rates, expected future charter rates, the level of utilization of its vessels and its weighted average cost of capital. The use of different assumptions
could result in a material change in the fair value of these items, which could have a material impact on Navios Acquisitions financial position and results of operations.

The amortizable value of favorable and unfavorable leases is amortized over the remaining life of the lease term and the amortization expense is included in the statement of operations in the depreciation
and amortization line item. The amortizable value of favorable leases would be considered impaired if their fair market values could not be recovered from the future undiscounted cash flows associated with the asset. Vessel purchase options that
have not been exercised, which are included in favorable lease terms, are not amortized and would be considered impaired if the carrying value of an option, when added to the option price of the vessel, exceeded the fair value of the vessel. If the
purchase option is exercised the portion of this asset will be capitalized as part of the cost of the vessel and will be depreciated over the remaining useful life of the vessel.

Management, after considering various indicators performed impairment tests on asset groups which included intangible assets as described in paragraph (j) above. As of December 31, 2012 and
2011, there was no impairment of intangible assets.

(n) Preferred shares Series D: On each of August 31, 2012 and
October 31, 2012 Navios Acquisition issued 300 shares (600 in the aggregate) of its authorized Series D Preferred Stock (nominal and fair value $6,000) to a shipyard, in partial settlement of the purchase price of the two newbuild LR1 product
tankers, the Nave Cassiopeia and the Nave Cetus. The preferred stock contains a 6% per annum dividend payable quarterly, starting one year after delivery of each vessel. The Series D Preferred Stock will mandatorily convert into shares of
common stock 30 months after the issuance, at a price per share of common stock equal to $10.00. The holder of the preferred stock shall have the right to convert the shares of preferred stock into common stock prior to the scheduled maturity date
at a price of $7.00 per share of common stock. The preferred stock does not have any voting rights. Navios Acquisition is obligated to redeem the Series D Preferred Stock (or converted common shares), at the holders option exercisable
beginning 18 months after the issuance, at par payable at up to 12 equal quarterly installments. The Series D Preferred Stock is classified outside of permanent equity as Series D Convertible Preferred Stock as these shares are
contractually redeemable for cash at the option of the holder.

(o) Deferred Drydock and Special Survey Costs: Navios
Acquisitions vessels are subject to regularly scheduled drydocking and special surveys which are carried out every 30 or 60 months to coincide with the renewal of the related certificates issued by the classification societies, unless a
further extension is obtained in rare cases and under certain conditions. The costs of drydocking and special surveys is deferred and amortized over the above periods or to the next drydocking or special survey date if such has been determined.
Unamortized drydocking or special survey costs of vessels sold are written off to income in the year the vessel is sold.

Costs capitalized as
part of the drydocking or special survey consist principally of the actual costs incurred at the yard, spare parts, paints, lubricants and services incurred solely during the drydocking or special survey period. For each of the years ended
December 31, 2012, 2011 and 2010, the amortization expense was $2,622, $633 and $0, respectively. Accumulated amortization as of December 31, 2012 and 2011 amounted to$ 3,255 and $633, respectively.

(p) Foreign currency translation: Navios Acquisitions functional and reporting currency is the U.S. dollar. Navios Acquisition
engages in worldwide commerce with a variety of entities. Although, its operations may expose it to certain levels of foreign currency risk, its transactions are predominantly U.S. dollar denominated. Additionally, Navios Acquisitions wholly
owned vessel subsidiaries transacted a nominal amount of their operations in Euros; however, all of the subsidiaries primary cash flows are U.S. dollar-denominated. Transactions in currencies other than the functional currency are translated
at the exchange rate in effect at the date of each transaction. Differences in exchange rates during the period between the date a transaction denominated in a foreign currency is consummated and the date on which it is either settled or translated,
are recognized in the statement of operations.

(q) Provisions: Navios Acquisition, in the ordinary course of its business,
is subject to various claims, suits and complaints. Management, in consultation with internal and external advisors, will provide for a contingent loss in the financial statements if the



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NAVIOS MARITIME ACQUISITION CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Expressed in thousands of U.S. Dollars except share and per share data)



contingency had been incurred at the date of the financial statements and the amount of the loss was probable and can be reasonably estimated. If Navios Acquisition has determined that the
reasonable estimate of the loss is a range and there is no best estimate within the range, Navios Acquisition will provide the lower amount of the range. Navios Acquisition, through the Management Agreement with the Manager, participates in
Protection and Indemnity (P&I) insurance coverage plans provided by mutual insurance societies known as P&I clubs. Services such as the ones described above are provided by the Manager under the management agreement dated May 28, 2010,
and included as part of the daily fee of $6.0 for each MR2 Product tanker and chemical tanker vessel, $7.0 per owned LR1 product tanker vessel and $10.0 per owned VLCC vessel.

(r) Segment Reporting: Navios Acquisition reports financial information and evaluates its operations by charter revenues and not by the length of ship employment for its customers.
Navios Acquisition does not use discrete financial information to evaluate operating results for each type of charter. Management does not identify expenses, profitability or other financial information by charter type. As a result, management
reviews operating results solely by revenue per day and operating results of the fleet and thus Navios Acquisition has determined that it operates under one reportable segment.

(s) Revenue and Expense Recognition:

Revenue Recognition:
Revenue is recorded when services are rendered, under a signed charter agreement or other evidence of an arrangement, the price is fixed or determinable, and collection is reasonably assured. Revenue is generated from the voyage charter and the time
charter of vessels.

Voyage revenues for the transportation of cargo are recognized ratably over the estimated relative transit time of each
voyage. Voyage expenses are recognized as incurred. A voyage is deemed to commence when a vessel is available for loading and is deemed to end upon the completion of the discharge of the current cargo. Estimated losses on voyages are provided for in
full at the time such losses become evident. Under a voyage charter, a vessel is provided for the transportation of specific goods between specific ports in return for payment of an agreed upon freight per ton of cargo.

Revenues from time chartering of vessels are accounted for as operating leases and are thus recognized on a straight-line basis as the average revenue
over the rental periods of such charter agreements, as service is performed. A time charter involves placing a vessel at the charterers disposal for a period of time during which the charterer uses the vessel in return for the payment of a
specified daily hire rate. Under time charters, operating costs such as for crews, maintenance and insurance are typically paid by the owner of the vessel.

Profit-sharing revenues are calculated at an agreed percentage of the excess of the charterers average daily income (calculated on a quarterly or half-yearly basis) over an agreed amount and
accounted for on an accrual basis based on provisional amounts and for those contracts that provisional accruals cannot be made due to the nature of the profit share elements, these are accounted for on the actual cash settlement.

Revenues are recorded net of address commissions. Address commissions represent a discount provided directly to the charterers based on a fixed
percentage of the agreed upon charter or freight rate. Since address commissions represent a discount (sales incentive) on services rendered by the Company and no identifiable benefit is received in exchange for the consideration provided to the
charterer, these commissions are presented as a reduction of revenue.

Time Charter and Voyage Expenses: Time charter and voyage
expenses comprise all expenses related to each particular voyage, including time charter hire paid and bunkers, port charges, canal tolls, cargo handling, agency fees and brokerage commissions. Time charter expenses are expensed over the period of
the time charter and voyage expenses are recognized as incurred.

Direct Vessel Expense: Direct vessel expenses are provided to
Navios Acquisition by the Manager through the management agreement discussed in the paragraph below. Direct vessel expenses consist of all expenses relating to the operation of vessels, including crewing, repairs and maintenance, insurance, stores
and lubricants and miscellaneous expenses such as communications and amortization of drydock and special survey costs.

Management
fees: Pursuant to a Management Agreement dated May 28, 2010, the Manager provides, for five years from the closing of the Companys initial vessel acquisition, commercial and technical management services to Navios
Acquisitions vessels for a daily fee of $6.0 per owned MR2 product tanker and chemical tanker vessel, $7.0 per owned LR1 product tanker vessel, and $10.0 per owned VLCC vessel for the first two years. On May 4, 2012, Navios Acquisition
amended its existing Management Agreement with the Manager, to fix the fees for ship management services of its owned fleet at current rates for two additional years, through May 28, 2014. This daily fee covers all of the vessels
operating expenses, other than certain extraordinary fees and costs. During the remaining one year of the term of the Management Agreement, Navios Acquisition expects it will reimburse Navios Holdings for all of the actual operating costs and
expenses it incurs in connection with the management of its fleet. Actual operating costs and expenses will be determined in a manner consistent with how the initial fixed fees were determined. Drydocking expenses are fixed under this agreement for
up to $300 per vessel, for chemical tanker, MR2 and LR1 product tankers, and will be reimbursed at cost for VLCC vessels. Commencing as of March 30, 2012, Navios Acquisition can, upon request to the Manager, partially or fully defer the
reimbursement of drydocking and other extraordinary fees and expenses under the Agreement to a later date, but not later than January 4, 2014, and if reimbursed on a later date, such amounts will bear interest at a rate of 1% per
annum over LIBOR. Commencing as of September 28, 2012, Navios Acquisition could, upon request, reimburse the Manager partially or fully, for any fixed management fees outstanding for a period of not more than nine months under the Agreement at
a later date, but not later than December 31, 2014, and if reimbursed on a later date, such amounts will bear interest at a rate of 1% per annum over LIBOR.



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NAVIOS MARITIME ACQUISITION CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Expressed in thousands of U.S. Dollars except share and per share data)



General and administrative expenses: On May 28, 2010, Navios Acquisition entered into
an administrative services agreement with Navios Holdings, expiring on May 28, 2015, pursuant to which a subsidiary of Navios Holdings provides certain administrative management services to Navios Acquisition which include: rent, bookkeeping,
audit and accounting services, legal and insurance services, administrative and clerical services, banking and financial services, advisory services, client and investor relations and other. Navios Holdings is reimbursed for reasonable costs and
expenses incurred in connection with the provision of these services.

Deferred Revenue: Deferred revenue primarily relates to
cash received from charterers prior to it being earned. These amounts are recognized as revenue over the voyage or charter period.

Prepaid Expense: Prepaid expenses relate primarily to cash paid in advance for expenses associated with voyages. These amounts are
recognized as expense over the voyage or charter period.

(t) Financial Instruments: Financial instruments carried on the
balance sheet include trade receivables and payables, other receivables and other liabilities and long-term debt. The particular recognition methods applicable to each class of financial instrument are disclosed in the applicable significant policy
description of each item, or included below as applicable.

Financial risk management: Navios Acquisitions activities
expose it to a variety of financial risks including fluctuations in future freight rates, time charter hire rates, and fuel prices, credit and interest rate risk. Risk management is carried out under policies approved by executive management.
Guidelines are established for overall risk management, as well as specific areas of operations.

Credit risk: Navios
Acquisition closely monitors its exposure to customers and counterparties for credit risk. Navios Acquisition has entered into the Management Agreement with the Manager, pursuant to which the Manager agreed to provide commercial and technical
management services to Navios Acquisition. When negotiating on behalf of Navios Acquisition various employment contracts, the Manager has policies in place to ensure that it trades with customers and counterparties with an appropriate credit
history.

For the year ended December 31, 2012, Navios Acquisitions customers representing 10% or more of total revenue were Dalian
Ocean Shipping Co., and STX Panocean Co LTD, which accounted for 43.3% and 10.7%, respectively. For the year ended December 31, 2011, Navios Acquisitions customers representing 10% or more of total revenue were, Dalian Ocean Shipping Co.,
Blue light Chartering Inc and Jacob Tank Chartering GMBH &CO. KG., which accounted for 43.9%, 11.5% and 11.3%, respectively. For the year ended December 31, 2010, Jacob Tank Chartering GMBH & CO. KG, SK Shipping Company Ltd, DOSCO,
Formosa Petrochemical Corporation, Blue Light Chartering Inc and Navig8 Chemicals Shipping and Trading Co. accounted for 42.5%, 18.6%, 12.9%, 12.9% and 10.9%, respectively, of Navios Acquisitions revenue. No other customers accounted for 10%
or more of total revenue for any of the years presented.

Foreign exchange risk: Foreign currency transactions are translated
into the measurement currency rates prevailing at the dates of transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation of monetary assets and liabilities denominated in foreign
currencies are recognized in the consolidated statement of operations.

(u) (Loss)/ Earnings per Share: Basic (loss)/
earnings per share is computed by dividing net (loss)/income attributable to Navios Acquisitions common shareholders by the weighted average number of common shares outstanding during the periods presented. Diluted earnings per share reflect
the potential dilution that would occur if securities or other contracts to issue common stock were exercised. Dilution has been computed by the treasury stock method whereby all of the Companys dilutive securities (the warrants and preferred
shares) are assumed to be exercised and the proceeds used to repurchase shares of common stock at the weighted average market price of the Companys common stock during the relevant periods. Convertible shares are included in the diluted
earnings/ (loss) per share, based on the weighted average number of convertible shares assumed to be outstanding during the period. The incremental shares (the difference between the number of shares assumed issued and the number of shares assumed
purchased) shall be included in the denominator of the diluted earnings per share computation.

Net loss for both of the years ended
December 31, 2012 and 2011 were adjusted for the purpose of the earnings per share calculation, for the dividends on the Series B Convertible Preferred Stock and further adjusted for the undistributed net loss allocated to the Series C
Convertible Preferred Stock. Net Loss for the year ended December 31, 2010 was adjusted for the purposes of earnings per share calculation, to reflect the inducement of the Warrant Exercise Program discussed in Note 19.

(v) Dividends: Dividends are recorded in the Companys financial statements in the period in which they are declared.

(w) Recent Accounting Pronouncements:

Fair Value Disclosures

In January 2010, the Financial Accounting Standards Board
(FASB) issued amended standards requiring additional fair value disclosures. The amended standards require disclosures of transfers in and out of Levels 1 and 2 of the fair value hierarchy, as well as requiring gross basis disclosures
for purchases, sales, issuances and settlements within the Level 3 reconciliation. Additionally, the update clarifies the requirement to determine the level of disaggregation for fair value measurement disclosures and to disclose



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NAVIOS MARITIME ACQUISITION CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Expressed in thousands of U.S. Dollars except share and per share data)



valuation techniques and inputs used for both recurring and nonrecurring fair value measurements in either Level 2 or Level 3. Navios Acquisition adopted the new guidance in the first quarter of
fiscal 2010, except for the disclosures related to purchases, sales, issuance and settlements, which was effective for Navios Acquisition beginning in the first quarter of fiscal 2012. The adoption of the new standards did not have a significant
impact on Navios Acquisitions consolidated financial statements.

NOTE 3: INITIAL VESSEL ACQUISITION

On May 25, 2010, after its special meeting of stockholders, Navios Acquisition announced the approval of (a) the acquisition
from Navios Holdings of 13 vessels (11 product tankers and two chemical tankers) for an aggregate purchase price of $457,659, of which $128,659 was to be paid from existing cash and the $329,000 balance with existing and new debt financing pursuant
to the terms and conditions of the Acquisition Agreement by and between Navios Acquisition and Navios Holdings and (b) certain amendments to Navios Acquisitions amended and restated articles of incorporation.

On May 28, 2010, Navios Acquisition consummated the acquisition of vessels, which constituted its initial business combination. In connection with
the stockholder vote to approve the acquisition of vessels, holders of 10,021,399 shares of our common stock voted against the business combination and elected to redeem their shares in exchange for an aggregate of approximately $99,312 which amount
was disbursed from our investments in trust account on May 28, 2010. In addition, on May 28, 2010, Navios Acquisition disbursed an aggregate of $8,855 from the trust account to the underwriters of its IPO for deferred fees. After
disbursement of approximately $76,485 to Navios Holdings to reimburse it for the first equity installment payment on the vessels of $38,763 and other associated payments, the balance of the trust account of $66,118 was released to the Company for
general operating expenses.

Following the consummation of the transactions described in the Acquisition Agreement, Navios Holdings was
released from all debt and equity commitments for the above vessels and Navios Acquisition reimbursed Navios Holdings for vessel installments made prior to the stockholders meeting under the purchase contracts for the vessels, plus all
associated payments previously made by Navios Holdings amounting to $76,485.

The initial acquisition was treated as an asset acquisition and
the following table summarizes the consideration paid and fair values of assets and liabilities assumed on May 28, 2010.



|                                       |  |   |          |  
|-------------------------------------- |  | - | -------- | -
|Initial Acquisition of 13 vessels      |  |   |          |  
|Restricted Cash                        |  | $ | 35,596   |  
|Deposits for vessel acquisitions       |  |   | 174,411  |  
|Purchase options                       |  |   | 3,158    |  
|Debt assumed                           |  |   | (132,987 | )
|Long-term liabilities                  |  |   | (3,158   | )
|Accrued expenses                       |  |   | (112     | )
|                                       |  |   |          |  
|Total                                  |  | $ | 76,908   |  
|                                       |  |   |          |  
|                                       | 
|Cash paid, net of cash received of $57 |  | $ | 76,428   |  
|Payable to Navios Holdings             |  |   | 480      |  
|                                       |  |   |          |  
|Total                                  |  | $ | 76,908   |  
|                                       |  |   |          |  

NOTE 4: VLCC ACQUISITION

On September 10, 2010, Navios Acquisition consummated the VLCC Acquisition for $134,270 of cash and the issuance of 1,894,918
shares of common stock having a fair value of $10,745 (of which 1,378,122 shares were deposited into one-year escrow to provide for indemnity and other claims). The 1,894,918 shares were valued using the opening price of the stock on the date of the
acquisition of $5.67.

Transaction costs amounted to $8,019 and have been fully expensed. Transaction costs include $5,619, which is the fair
value of the 3,000 preferred shares, issued to a third party on September 17, 2010, as a compensation for consulting services (see note 19).

On November 4, 2011 a total of 1,160,963 shares of common stock were released to the sellers and the remaining 217,159 were returned to Navios Acquisition in settlement of claims relating to
representations and warranties attributable to the sellers. The returned shares were cancelled on December 30, 2011.

The VLCC
Acquisition contributed revenues of $26,592 and net loss of ($8,838) to Navios Acquisition for the year ended December 31, 2010.



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NAVIOS MARITIME ACQUISITION CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Expressed in thousands of U.S. Dollars except share and per share data)



The VLCC Acquisition was treated as a business combination and the following table summarizes the
consideration paid and the fair value of assets and liabilities assumed on September 10, 2010 and as further adjusted for the release of the escrow shares:

VLCC Acquisition



|                                                   |  |   |          |  
|-------------------------------------------------- |  | - | -------- | -
|Purchase price:                                    |  |   |          |  
|Cash consideration                                 |  | $ | 134,270  |  
|Equity issuance                                    |  |   | 9,513    |  
|                                                   |  |   |          |  
|Total purchase price                               |  |   | 143,783  |  
|                                                   | 
|Fair value of assets and liabilities acquired:     |  |   |          |  
|Vessels                                            |  |   | 419,500  |  
|Deposits for vessel acquisition                    |  |   | 62,575   |  
|Favorable lease terms                              |  |   | 57,070   |  
|Current assets including cash of $32,232           |  |   | 35,716   |  
|Current liabilities                                |  |   | (16,387  | )
|Long-term debt assumed (including current portion) |  |   | (410,451 | )
|Unfavorable lease terms                            |  |   | (5,819   | )
|                                                   |  |   |          |  
|Fair value of net assets acquired                  |  |   | 142,204  |  
|                                                   |  |   |          |  
|                                                   | 
|Goodwill                                           |  | $ | 1,579    |  
|                                                   |  |   |          |  

The acquired intangible assets and liabilities, listed below, as determined at the acquisition date and where applicable,
are amortized under the straight line method over the periods indicated below:



|                        |  |                                    |      |  |                      |   |        |  
|----------------------- |  | ---------------------------------- | ---- |  | -------------------- | - | ------ | -
|                        |  | Weightedaverageamortization(years) |      |  | Amortizationper year |  
|Favorable lease terms   |  |                                    | 12.5 |  |                      | $ | (4,566 | )
|Unfavorable lease terms |  |                                    | 8.5  |  |                      |   | 683    |  

The following is a summary of the acquired identifiable intangible assets:



|                        |  |             |        |  
|----------------------- |  | ----------- | ------ | -
|                        |  | GrossAmount |       
|Description             |  |             |        |  
|Favorable lease terms   |  | $           | 57,070 |  
|Unfavorable lease terms |  |             | (5,819 | )
|                        |  |             |        |  
|Total                   |  | $           | 51,251 |  
|                        |  |             |        |  

NOTE 5: CASH AND CASH EQUIVALENTS

Cash and cash equivalents consist of the following:



|                                |  |                  |        |  |                  |   |        | 
|------------------------------- |  | ---------------- | ------ |  | ---------------- | - | ------ | 
|                                |  | December 31,2012 |        |  | December 31,2011 |  
|Cash on hand and at banks       |  | $                | 6,348  |  |                  | $ | 8,333  | 
|Short-term deposits             |  |                  | 36,498 |  |                  |   | 32,967 | 
|                                |  |                  |        |  |                  |   |        | 
|Total cash and cash equivalents |  | $                | 42,846 |  |                  | $ | 41,300 | 
|                                |  |                  |        |  |                  |   |        | 

Restricted cash consists of cash totaling $10,075 and $29,491 as of December 31, 2012 and 2011, respectively,
restricted to pay future installments for vessel deposits in accordance with Navios Acquisitions new build program. Also in restricted cash is an amount of $11,088 for 2012 and $2,723 for 2011 held in retention account in order to service
debt, interest payments and pledged accounts, as required by certain of Navios Acquisitions credit facilities.

Cash deposits and cash
equivalents in excess of amounts covered by government-provided insurance are exposed to loss in the event of non-performance by financial institutions. The Company does maintain cash deposits and equivalents in excess of government-provided
insurance limits. The Company also minimizes exposure to credit risk by dealing with a diversified group of major financial institutions.



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##### Table of Contents

NAVIOS MARITIME ACQUISITION CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Expressed in thousands of U.S. Dollars except share and per share data)



NOTE 6: ACCOUNTS RECEIVABLE, NET

Accounts receivable consist of the following:



|                                      |  |                  |       |  |                  |   |       | 
|------------------------------------- |  | ---------------- | ----- |  | ---------------- | - | ----- | 
|                                      |  | December 31,2012 |       |  | December 31,2011 |  
|Accounts receivable                   |  | $                | 5,103 |  |                  | $ | 6,478 | 
|Less: Provision for doubtful accounts |  |                  |      |  |                  |   |      | 
|                                      |  |                  |       |  |                  |   |       | 
|Accounts receivable, net              |  | $                | 5,103 |  |                  | $ | 6,478 | 
|                                      |  |                  |       |  |                  |   |       | 

Financial instruments that potentially subject Navios Acquisition to concentrations of credit risk are accounts
receivable. Navios Acquisition does not believe its exposure to credit risk is likely to have a material adverse effect on its financial position, results of operations or cash flows.

On October 28, 2011, the charter contract of the Nave Ariadne (ex Ariadne Jacob) and the Nave Cielo (ex Colin Jacob) were terminated prior to their original expiration in June 2013. Navios
Acquisition entered into certain settlement agreements with charterers that provided for an amount of $4,909 to compensate for the early termination of the charters and to cover any outstanding receivables. The amount $3,704 was recognized as
compensation for early termination and was recorded in revenue. Of the total compensation for early termination, the amount of $500 was received on December 19, 2012, the amount of $487 classified under accounts receivable, net, will be settled
during 2013 and the amount of $897, classified under long term assets, will be settled in installments until June 2015.

NOTE 7: VESSELS, NET



|                             |  |      |           |  |                         |   |         |               |  |   |         | 
|---------------------------- |  | ---- | --------- |  | ----------------------- | - | ------- | ------------- |  | - | ------- | 
|                             |  | Cost |           |  | AccumulatedDepreciation |   |         | Net BookValue | 
|Vessels                      |  |      |           |  |                         |   |         |               |  |   |         | 
|Balance at December 31, 2010 |  | $    | 538,751   |  |                         | $ | (9,092  | )             |  | $ | 529,659 | 
|Additions                    |  |      | 277,985   |  |                         |   | (33,020 | )             |  |   | 244,965 | 
|                             |  |      |           |  |                         |   |         |               |  |   |         | 
|Balance at December 31, 2011 |  | $    | 816,736   |  |                         | $ | (42,112 | )             |  | $ | 774,624 | 
|Additions                    |  |      | 207,795   |  |                         |   | (41,681 | )             |  |   | 166,114 | 
|                             |  |      |           |  |                         |   |         |               |  |   |         | 
|Balance at December 31, 2012 |  | $    | 1,024,531 |  |                         | $ | (83,793 | )             |  | $ | 940,738 | 
|                             |  |      |           |  |                         |   |         |               |  |   |         | 

On January 20, 2012, Navios Acquisition took delivery of the Nave Estella, a 75,000 dwt South Koreanbuilt LR1
product tanker, for a total cost of $44,643. Cash paid was $11,023 and $33,620 was transferred from vessel deposits.

On July 31, 2012,
Navios Acquisition took delivery of the Nave Atria, a 49,992 dwt South Koreanbuilt MR2 product tanker, for a total cost of $37,583. Cash paid was $8,997 and $28,586 was transferred from vessel deposits.

On August 31, 2012, Navios Acquisition took delivery of the Nave Cassiopeia, a 74,711 dwt South Koreanbuilt LR1 product tanker, for a total
cost of $43,827. Cash paid was $27,315, $3,000 shares of Series D Preferred Stock were issued and $13,512 was transferred from vessel deposits.

On October 30, 2012, Navios Acquisition took delivery of the Nave Cetus, a 74,581 dwt South Koreanbuilt LR1 product tanker, for a total cost
of $44,018. Cash paid was $27,545, $3,000 shares of Series D Preferred Stock were issued and $13,473 was transferred from vessel deposits.

On
November 9, 2012, Navios Acquisition took delivery of the Nave Aquila, a 49,991 dwt South Koreanbuilt MR2 product tanker, for a total cost of $37,765. Cash paid was $12,686 and $25,079 was transferred from vessel deposits.

On January 27, 2011, Navios Acquisition took delivery of the Nave Polaris, a 25,145 dwt South Koreanbuilt chemical tanker, for a total cost of
$31,774. Cash paid was $4,533 and $27,241 was transferred from vessel deposits.

On June 8, 2011, Navios Acquisition took delivery of a
297,066 dwt VLCC, the Shinyo Kieran, from a Chinese shipyard, for a total cost of $119,443. Cash paid was $29,298 and $90,145 was transferred from vessel deposits.

On July 12, 2011, Navios Acquisition took delivery of the Bull, a 2009built MR2 product tanker vessel of 50,542 dwt, for a total cost of $42,430 that was paid with cash. Favorable lease terms
recognized through this transaction amounted to $5,128 and the balance of $37,302 was classified under vessels, net.

On July 18, 2011,
Navios Acquisition took delivery of the Buddy, a 2009built MR2 product tanker vessel of 50,470 dwt for a total cost of $42,490 that was paid with cash. Favorable lease terms recognized through this transaction amounted to $5,219 and the
balance of $37,271 was classified under vessels, net.

On November 14, 2011, Navios Acquisition took delivery of the Nave Andromeda, a
75,000 dwt LR1 South Koreanbuilt product tanker, for a total cost of $44,319. Cash paid was $26,953 and $17,366 was transferred from vessel deposits.



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##### Table of Contents

NAVIOS MARITIME ACQUISITION CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Expressed in thousands of U.S. Dollars except share and per share data)



Improvements for vessels for the year ended December 31, 2012 amounted to $0 and $7,834 for 2011.

Deposits for vessel acquisition represent deposits for vessels to be delivered in the future. As of December 31, 2012, Navios
Acquisition vessel deposits amounted to $276,142 out of which $204,014 was financed through loans and the balance from existing cash. For the year ended December 31 2012, additions to deposits for vessels acquisitions comprising of cash
payments and capitalized interest were $142,119, which was offset by $114,270, transferred to vessels, net. As of December 31, 2011, Navios Acquisition vessel deposits amounted to $245,567 out of which $167,152 was financed through loans, $825
was financed through the issuance of preferred shares (see note 19) and the balance from existing cash. For the year ended December 31, 2011, $134,752 was transferred to vessels.

For the year ended December 31, 2012 and 2011, capitalized interest amounted to $14,240 and $11,450, respectively.

NOTE 8: DEFERRED FINANCE COSTS

Deferred finance costs consisted of the following:



|                                 |  |                |        |  
|-------------------------------- |  | -------------- | ------ | -
|                                 |  | FinancingCosts |       
|Balance at December 31, 2010     |  | $              | 18,178 |  
|                                 |  |                |        |  
|Additions                        |  |                | 10,929 |  
|Capitalized into vessel deposits |  |                | (766   | )
|Amortization                     |  |                | (2,587 | )
|Deferred charges written-off     |  |                | (935   | )
|                                 |  |                |        |  
|Balance at December 31, 2011     |  | $              | 24,819 |  
|                                 |  |                |        |  
|Additions                        |  |                | 42     |  
|Amortization                     |  |                | (3,255 | )
|Capitalized into vessel deposits |  |                | (879   | )
|                                 |  |                |        |  
|Balance at December 31, 2012     |  | $              | 20,727 |  
|                                 |  |                |        |  

In 2011, an amount of $935 of deferred financing costs was written-off in relation to the cancellation of certain
committed credit. In addition, the amortization income of the bond premium was $435 for 2012, $334 for 2011 and $0 for 2010.

NOTE 9: INTANGIBLE ASSETS OTHER THAN GOODWILL

Intangible assets as of December 31, 2012 and 2011 consist of the following:



|                        |  |                 |        |   |                         |   |         |                               |  |   |        |  
|----------------------- |  | --------------- | ------ | - | ----------------------- | - | ------- | ----------------------------- |  | - | ------ | -
|                        |  | AcquisitionCost |        |   | AccumulatedAmortization |   |         | Net BookValueDecember 31,2012 | 
|Favorable lease terms   |  | $               | 67,417 |   |                         | $ | (16,184 | )                             |  | $ | 51,233 |  
|Unfavorable lease terms |  |                 | (5,819 | ) |                         |   | 1,574   |                               |  |   | (4,245 | )
|                        |  |                 |        |   |                         |   |         |                               |  |   |        |  
|Total                   |  | $               | 61,598 |   |                         | $ | (14,610 | )                             |  | $ | 46,988 |  
|                        |  |                 |        |   |                         |   |         |                               |  |   |        |  



|                        |  |                 |        |   |                         |   |        |                           |  |   |                               |   |  |   |        |  
|----------------------- |  | --------------- | ------ | - | ----------------------- | - | ------ | ------------------------- |  | - | ----------------------------- | - |  | - | ------ | -
|                        |  | AcquisitionCost |        |   | AccumulatedAmortization |   |        | Transferto VesselDeposits |  |   | Net BookValueDecember 31,2011 |  
|Purchase options        |  | $               | 3,158  |   |                         | $ |       |                           |  | $ | (3,158                        | ) |  | $ |       |  
|Favorable lease terms   |  |                 | 67,417 |   |                         |   | (7,538 | )                         |  |   |                              |   |  |   | 59,879 |  
|                        |  |                 |        |   |                         |   |        |                           |  |   |                               |   |  |   |        |  
|Total Intangible assets |  |                 | 70,575 |   |                         |   | (7,538 | )                         |  |   | (3,158                        | ) |  |   | 59,879 |  
|                        |  |                 |        |   |                         |   |        |                           |  |   |                               |   |  |   |        |  
|                        |  |                 |        |  
|Unfavorable lease terms |  |                 | (5,819 | ) |                         |   | 891    |                           |  |   |                              |   |  |   | (4,928 | )
|                        |  |                 |        |   |                         |   |        |                           |  |   |                               |   |  |   |        |  
|Total                   |  | $               | 64,756 |   |                         | $ | (6,647 | )                         |  | $ | (3,158                        | ) |  | $ | 54,951 |  
|                        |  |                 |        |   |                         |   |        |                           |  |   |                               |   |  |   |        |  



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##### Table of Contents

NAVIOS MARITIME ACQUISITION CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Expressed in thousands of U.S. Dollars except share and per share data)



Amortization (expense)/income of favorable and unfavorable lease terms for the years ended
December 31, 2012, 2011 and 2010 are presented in the following table:



|                                    |  |                  |        |   |                  |   |        |                  |  |   |        |  
|----------------------------------- |  | ---------------- | ------ | - | ---------------- | - | ------ | ---------------- |  | - | ------ | -
|                                    |  | December 31,2012 |        |   | December 31,2011 |   |        | December 31,2010 | 
|Unfavorable lease terms charter-out |  | $                | 683    |   |                  | $ | 683    |                  |  | $ | 208    |  
|Favorable lease terms charter-out   |  |                  | (8,646 | ) |                  |   | (6,302 | )                |  |   | (1,236 | )
|                                    |  |                  |        |   |                  |   |        |                  |  |   |        |  
|Total                               |  | $                | (7,963 | ) |                  | $ | (5,619 | )                |  | $ | (1,028 | )
|                                    |  |                  |        |   |                  |   |        |                  |  |   |        |  

The aggregate amortizations of acquired intangibles will be as follows:



|                        |  |               |        |   |         |   |        |           |  |   |          |   |  |          |        |   |            |   |        |       |  |   |         |   |  |   |         |  
|----------------------- |  | ------------- | ------ | - | ------- | - | ------ | --------- |  | - | -------- | - |  | -------- | ------ | - | ---------- | - | ------ | ----- |  | - | ------- | - |  | - | ------- | -
|Description             |  | WithinOneYear |        |   | YearTwo |   |        | YearThree |  |   | YearFour |   |  | YearFive |        |   | Thereafter |   |        | Total | 
|Favorable lease terms   |  | $             | (8,646 | ) |         | $ | (7,551 | )         |  | $ | (4,959   | ) |  | $        | (4,913 | ) |            | $ | (2,846 | )     |  | $ | (22,318 | ) |  | $ | (51,233 | )
|Unfavorable lease terms |  |               | 683    |   |         |   | 683    |           |  |   | 683      |   |  |          | 684    |   |            |   | 684    |       |  |   | 828     |   |  |   | 4,245   |  
|                        |  |               |        |   |         |   |        |           |  |   |          |   |  |          |        |   |            |   |        |       |  |   |         |   |  |   |         |  
|                        |  | $             | (7,963 | ) |         | $ | (6,868 | )         |  | $ | (4,276   | ) |  | $        | (4,229 | ) |            | $ | (2,162 | )     |  | $ | (21,490 | ) |  | $ | (46,988 | )
|                        |  |               |        |   |         |   |        |           |  |   |          |   |  |          |        |   |            |   |        |       |  |   |         |   |  |   |         |  

NOTE 10: GOODWILL

Goodwill as of December 31, 2012, 2011 and 2010 consist of the following:



|                          |  |   |       | 
|------------------------- |  | - | ----- | 
|Balance December 31, 2010 |  | $ | 1,579 | 
|                          |  |   |       | 
|Balance December 31, 2011 |  | $ | 1,579 | 
|                          |  |   |       | 
|Balance December 31, 2012 |  | $ | 1,579 | 
|                          |  |   |       | 

NOTE 11: ACCOUNTS PAYABLE

Accounts payable as of December 31, 2012 and 2011 consist of the following:



|                            |  |                  |       |  |                  |   |       | 
|--------------------------- |  | ---------------- | ----- |  | ---------------- | - | ----- | 
|                            |  | December 31,2012 |       |  | December 31,2011 |  
|Creditors                   |  | $                | 226   |  |                  | $ | 51    | 
|Brokers                     |  |                  | 820   |  |                  |   | 614   | 
|Professional and legal fees |  |                  | 231   |  |                  |   | 356   | 
|                            |  |                  |       |  |                  |   |       | 
|Total accounts payable      |  | $                | 1,277 |  |                  | $ | 1,021 | 
|                            |  |                  |       |  |                  |   |       | 

NOTE 12: DIVIDEND PAYABLE

On November 7, 2011, the Board of Directors of Navios Acquisition declared a quarterly cash dividend for the third quarter of 2011
of $0.05 per share of common stock. A dividend in the aggregate amount of $2,421 was paid on January 5, 2012 out of which $2,037 was paid to the stock holders of record as of December 15, 2011 and $384 was paid to the holders of 1,000
shares of the Series C preferred stock (which is Navios Holdingssee related party transactions note 17).

On February 13,
2012, the Board of Directors declared a quarterly cash dividend in respect of the fourth quarter of 2011 of $0.05 per common share of common stock. A dividend in the aggregate amount of $2,410 was paid on April 5, 2012 out of which $2,026 was
paid to the stock holders of record as of March 22, 2012 and $384 was paid to the holder of 1,000 shares of the Series C preferred stock which is Navios Holdings (see related party transactions note 17).

On May 4, 2012, the Board of Directors declared a quarterly cash dividend in respect of the first quarter of 2012 of $0.05 per share of common
stock. A dividend in the aggregate amount of $2,410 was paid on July 3, 2012 out of which $2,026 was paid to the stock holders of record as of June 20, 2012 and $384 was paid to the holder of 1,000 shares of the Series C preferred
stock which is Navios Holdings (see related party transactions note 17).

On August 13, 2012, the Board of Directors declared a quarterly
cash dividend in respect of the second quarter of 2012 of $0.05 per share of common stock. A dividend in the aggregate amount of $2,410 was paid on October 3, 2012 out of which $2,026 was paid to the stock holders of record as of
September 19, 2012 and $384 was paid to the holder of 1,000 shares of the Series C preferred stock which is Navios Holdings (see related party transactions note 17).



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##### Table of Contents

NAVIOS MARITIME ACQUISITION CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Expressed in thousands of U.S. Dollars except share and per share data)



On November 9, 2012, the Board of Directors declared a quarterly cash dividend in respect of the
third quarter of 2012 of $0.05 per share of common stock. A dividend in the aggregate amount of $2,410 was paid on January 4, 2013 out of which $2,026 was paid to the stock holders of record as of December 19, 2012 and $384 was paid to the
holder of 1,000 shares of the Series C preferred stock which is Navios Holdings (see related party transactions note 17).

As of
December 31, 2012, Navios Acquisition paid a dividend of $108 to the holders of the 540 shares of Series B preferred stock.

NOTE 13: ACCRUED EXPENSES

Accrued expenses as of December 31, 2012 and 2011 consist of the following:



|                                    |  |                  |        |  |                  |   |        | 
|----------------------------------- |  | ---------------- | ------ |  | ---------------- | - | ------ | 
|                                    |  | December 31,2012 |        |  | December 31,2011 |  
|Accrued voyage expenses             |  | $                | 2,811  |  |                  | $ | 1,262  | 
|Accrued loan interest               |  |                  | 9,184  |  |                  |   | 9,067  | 
|Accrued legal and professional fees |  |                  | 956    |  |                  |   | 5,163  | 
|                                    |  |                  |        |  |                  |   |        | 
|Total accrued expenses              |  | $                | 12,951 |  |                  | $ | 15,492 | 
|                                    |  |                  |        |  |                  |   |        | 

NOTE 14: BORROWINGS



|                                                                          |  |                  |         |   |                  |   |         |  
|------------------------------------------------------------------------- |  | ---------------- | ------- | - | ---------------- | - | ------- | -
|                                                                          |  | December 31,2012 |         |   | December 31,2011 |  
|Commerzbank, Alpha Bank AE, Credit Agricole Corporate and Investment Bank |  | $                | 137,383 |   |                  | $ | 115,827 |  
|BNP Paribas S.A. and DVB Bank SE                                          |  |                  | 58,361  |   |                  |   | 36,175  |  
|DVB Bank SE and ABN AMRO Bank N.V.                                        |  |                  | 42,034  |   |                  |   | 44,121  |  
|Cyprus Popular Bank Public Co Ltd                                         |  |                  | 32,400  |   |                  |   | 24,300  |  
|Eurobank Ergasias S.A. $52.2 million                                      |  |                  | 49,209  |   |                  |   | 46,500  |  
|Eurobank Ergasias S.A. $52.0 million                                      |  |                  | 45,894  |   |                  |   | 18,200  |  
|ABN AMRO Bank N.V                                                         |  |                  | 47,298  |   |                  |   | 53,260  |  
|Norddeutsche Landesbank Girozentrale                                      |  |                  | 24,971  |   |                  |   |        |  
|DVB Bank SE and Credit Agricole Corporate and Investment Bank             |  |                  | 49,943  |   |                  |   |        |  
|Ship Mortgage Notes                                                       |  |                  | 505,000 |   |                  |   | 505,000 |  
|                                                                          |  |                  |         |   |                  |   |         |  
|Total borrowing                                                           |  |                  | 992,493 |   |                  |   | 843,383 |  
|Less: current portion                                                     |  |                  | (19,724 | ) |                  |   | (11,928 | )
|Add: bond premium                                                         |  |                  | 1,593   |   |                  |   | 2,028   |  
|                                                                          |  |                  |         |   |                  |   |         |  
|Total long-term borrowings                                                |  | $                | 974,362 |   |                  | $ | 833,483 |  
|                                                                          |  |                  |         |   |                  |   |         |  

Long-Term Debt Obligations and Credit Arrangements

Senior Notes

Ship Mortgage Notes: In October 2010, Navios Acquisition issued
$400,000 of 8 5/8% First Priority Ship Mortgage Notes (the Existing Notes) due on November 1, 2017. The Existing Notes are senior obligations of Navios Acquisition and are secured by first priority ship mortgages on seven VLCC
vessels owned by certain subsidiary guarantors and certain other associated property and contract rights. The guarantees of the Companys subsidiaries that own mortgage vessels are senior secured guarantees and the guarantees of the
Companys subsidiaries that do not own mortgage vessels are senior unsecured guarantees. Navios Acquisition may redeem the Existing Notes in whole or in part, at its option, at any time (1) before November 1, 2013 at a redemption
price equal to 100% of the principal amount plus a make whole price which is based on a formula calculated using a discount rate of treasury bonds plus 50 bps and (2) on or after November 1, 2013, at a fixed price of 104.313%, which price
declines ratably until it reaches par. In addition, any time before November 1, 2013, Navios Acquisition may redeem up to 35% of the aggregate principal amount of the Existing Notes with the net proceeds of an equity offering at 108.625% of the
principal amount of the Existing Notes, plus accrued and unpaid interest, if any, so long as at least 65% of the originally issued aggregate principal amount of the Existing Notes remains outstanding after such redemption. Furthermore, upon
occurrence of certain change of control events, the holders of the Existing Notes may require Navios Acquisition to repurchase some or all of the Existing Notes at 101% of their face amount, plus accrued and unpaid interest to the repurchase date.
Pursuant to a registration rights agreement, Navios Acquisition filed a registration statement enabling the holders of the Existing Notes to exchange the privately placed notes with publicly



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##### Table of Contents

NAVIOS MARITIME ACQUISITION CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Expressed in thousands of U.S. Dollars except share and per share data)



registered notes with identical terms, which registration statement went effective on January 31, 2011. On February 2, 2011, the Navios Acquisition commenced the exchange offer which
terminated on March 2, 2011. As a result of such exchange offer, 100% of the outstanding Existing Notes were exchanged. The Existing Notes contain covenants which, among other things, limit the incurrence of additional indebtedness, issuance of
certain preferred stock, the payment of dividends, redemption or repurchase of capital stock or making restricted payments and investments, creation of certain liens, transfer or sale of assets, entering into certain transactions with affiliates,
merging or consolidating or selling all or substantially all of Navios Acquisitions properties and assets and creation or designation of restricted subsidiaries.

On May 26, 2011, Navios Acquisition and Navios Acquisition Finance (US) Inc., its wholly owned finance subsidiary (Navios Acquisition Finance), completed the sale of $105,000 of 8
5/8% first priority ship mortgage notes due 2017 (the Additional Notes) at 102.25% plus accrued interest from May 1, 2011.

The Additional Notes are identical to the $400,000 of Existing Notes. The Existing Notes and the Additional Notes are fully and unconditionally
guaranteed on a joint and several bases by all of Navios Acquisitions subsidiaries with the exception of Navios Acquisition Finance (a co-issuer of the ship mortgage notes). The subsidiary guarantees are full and unconditional as that term is
defined by Regulation S-X Rule 3-10, except for the fact that the indenture provides for an individual subsidiarys guarantee to be automatically released in certain customary circumstances, such as when a subsidiary is sold or all assets are
sold, the capital stock is sold, when the subsidiary is designated as an unrestricted subsidiary for the purposes of the bond indenture, upon liquidation or dissolution or upon legal or covenant defeasance or satisfaction and discharge
of the Existing Notes and the Additional Notes. A Registration Statement for the exchange of Additional Notes was filed on July 28, 2011 and was declared effective on August 22, 2011. On August 24, 2011 Navios Acquisition commenced
the exchange offer which terminated on September 23, 2011. As a result of such exchange offer, 100% of the outstanding Additional Notes were exchanged.

The Additional Notes and the Existing Notes are treated as a single class for all purposes under the indenture including, without limitation, waivers, amendments, redemptions and other offers to purchase
and the Additional Notes rank evenly with the Existing Notes. Following the consummation of the exchange offer for the Additional Notes on September 23, 2011, the Additional Notes and the Existing Notes have the same CUSIP number.

Amortization of the bond premium for the each of the years ended December 31, 2012, 2011 and 2010 amounted to $435, $334 and $0, respectively.

Credit Facilities

Commerzbank AG, Alpha Bank A.E., and Credit Agricole Corporate and Investment Bank: As a result of the initial business combination, Navios
Acquisition assumed a loan agreement dated April 7, 2010, with Commerzbank AG, Alpha Bank A.E. and Credit Agricole Corporate and Investment Bank of up to $150,000 (divided in six equal tranches of $25,000 each) to partially finance the
construction of two chemical tankers and four product tankers. Each tranche of the facility is repayable in 12 equal semi-annual installments of $750 each with a final balloon payment of $16,750 to be repaid on the last repayment date. The repayment
of each tranche starts six months after the delivery date of the respective vessel which that tranche finances. It bears interest at a rate of LIBOR plus 250 bps. The loan also requires compliance with certain financial covenants. As of
December 31, 2012, $137,383 was outstanding under this facility and $7,367 remained to be drawn.

BNP Paribas SA Bank and DVB Bank
S.E.: As a result of the initial business combination, Navios Acquisition assumed a loan agreement dated April 8, 2010, of up to $75,000 (divided in three equal tranches of $25,000 each) for the purpose of part-financing the purchase price
of three product tankers. Each of the tranche is repayable in 12 equal semi-annual installments of $750 each with a final balloon payment of $16,750 to be repaid on the last repayment date. The repayment date of each tranche starts six months after
the delivery date of the respective vessel which that tranche finances. It bears interest at a rate of LIBOR plus 250 bps. The loan also requires compliance with certain financial covenants. As of December 31, 2012, $58,361 was outstanding and
$16,639 remains to be drawn under this facility.

DVB Bank S.E. and ABN AMRO Bank N.V.: On May 28, 2010, Navios Acquisition
entered into a loan agreement with DVB Bank S.E. and ABN AMRO BANK N.V. of up to $52,000 (divided into two tranches of $26,000 each) to partially finance the acquisition costs of two product tanker vessels. Each tranche of the facility is repayable
in 24 equal quarterly installments of $448 each with a final balloon payment of $15,241 to be repaid on the last repayment date. The repayment of each tranche starts three months after the delivery date of the respective vessel. It bears interest at
a rate of LIBOR plus 275 bps. The loan also requires compliance with certain financial covenants. On December 29, 2011, Navios Acquisition prepaid $2,500 in relation to an amendment to its credit facility. After the prepayment, outstanding
amount under each tranche is repayable in five quarterly installments of $198 each, 13 equal quarterly installments of $448 each, with a final balloon payment of $15,241 to be repaid on the last repayment date. On December 31, 2012, Navios
Acquisition prepaid $500 in relation to an amendment to its credit facility. After the prepayment, outstanding amount under each tranche is repayable in two quarterly installments of $198 each, 13 equal quarterly installments of $448 each, with a
final balloon payment of $15,241 to be repaid on the last repayment date. As of December 31, 2012, the facility was fully drawn and the outstanding amount was $42,034.

Cyprus Popular Bank Public Co Ltd: Cyprus Popular Bank Public Co Ltd: In September 2010, Navios Acquisition (through four subsidiaries) entered into a $80,000 revolving credit facility with
Cyprus Popular Bank Public Co Ltd to partially finance the acquisition and construction of vessels and for investment and working capital purposes. On September 7, 2012, the amount of the



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##### Table of Contents

NAVIOS MARITIME ACQUISITION CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Expressed in thousands of U.S. Dollars except share and per share data)



facility was reduced to $32,400. Drawings under the facility are secured by assignments of construction contracts and guarantees, as well as security interests in related assets. The facility
bears interest at a rate of LIBOR plus 275 bps. Pursuant to an agreement dated December 31, 2012, the maturity of the facility was extended to match the delivery of the vessels. As of December 31, 2012, the outstanding amount under this
facility was $32,400 that was used to partially finance the acquisition cost of two product tanker vessels.

EFG Eurobank Ergasias
S.A.: On October 26, 2010, Navios Acquisition entered into a loan agreement with Eurobank Ergasias S.A. of up to $52,200 out of which $51,600 has been drawn (divided into two tranches of $26,100 and $25,500) to partially finance the
acquisition costs of two LR1 product tanker vessels. Each tranche of the facility is repayable in 32 equal quarterly installments of $345 and $337 respectively, with a final balloon payment of $15,060 and $14,716, to be repaid on the last repayment
date. The repayment of each tranche started three months after the delivery date of the respective vessel. The loan bears interest at a rate of LIBOR plus (i) plus 250 bps for the period prior to the delivery date in respect of the vessel being
financed, and (ii) thereafter 275 bps. The loan also requires compliance with certain financial covenants. The facility was fully drawn and the outstanding amount as of December 31, 2012 was $49,209.

EFG Eurobank Ergasias S.A.: On December 6, 2010, Navios Acquisition entered into a loan agreement with Eurobank Ergasias S.A. of
up to $52,000 out of which $46,200 has been drawn (divided into two tranches of $23,100 each) to partially finance the acquisition costs of two LR1 product tanker vessels. Each tranche of the facility is repayable in 32 equal quarterly installments
of $306 each with a final balloon payment of $13,308, to be repaid on the last repayment date. The repayment of each tranche started three months after the delivery date of the respective vessel. It bears interest at a rate of LIBOR plus 300 bps.
The loan also requires compliance with certain financial covenants. The facility was fully drawn and the outstanding amount as of December 31, 2012 was $45,894.

ABN AMRO BANK N.V.: On July 8, 2011, Navios Acquisition entered into a loan agreement with ABN AMRO Bank N.V of up to $55,100 (divided into two equal tranches) to partially finance the
purchase price of two MR2 product tanker vessels. The total amount of $54,750 was drawn under this facility. Each tranche of the facility is repayable in 12 quarterly installments of $745 each and 12 quarterly installments of $571 each with a final
balloon payment of $11,576 to be repaid on the last repayment date. The repayment of each tranche started in October 2011 and it bears interest at a rate of LIBOR plus 325 bps. The loan also requires compliance with certain financial covenants.
As of December 31, 2012, $47,298 was outstanding under this loan agreement ($23,649 from each of the two tranches) and no further amounts are available to be drawn.

DVB Bank SE: On December 7, 2011, Navios Acquisition entered into a loan agreement with DVB Bank SE of up to $51,000 (divided into two tranches of $25,500 each) to partially finance
the purchase price of two LR1 product tanker vessels. Each tranche of the facility is repayable in 28 quarterly installments of $400 each with a final balloon payment of $14,300 to be repaid on the last repayment date. The repayment starts three
months after the delivery of the respective vessel and it bears interest at a rate of LIBOR plus 270 bps per annum. The loan also requires compliance with certain financial covenants. As of December 31, 2012, no amounts were outstanding under
this loan agreement and $51,000 remained undrawn.

NORDDEUTSCHE LANDESBANK GIROZENTRALE: On December 29, 2011, Navios Acquisition
entered into a loan agreement with NORDDEUTSCHE LANDESBANK GIROZENTRALE of up to $28,125 to partially finance the purchase price of one MR2 product tanker vessel. The facility is repayable in 32 quarterly installments of $391 each with a
final balloon payment of $15,625 to be repaid on the last repayment date. The repayment starts three months after the delivery of the vessel and it bears interest at a rate of LIBOR plus: (a) up to but not including the Drawdown Date of,
175bps per annum; (b) thereafter until, but not including, the tenth Repayment Date, 250 bps per annum; and (c) thereafter 300 bps per annum. The loan also requires compliance with certain financial covenants. As of December 31,
2012, $24,971 was drawn and outstanding under this loan agreement and $3,154 remained to be drawn.

DVB Bank SE and Credit Agricole
Corporate and Investment Bank: On December 29, 2011, Navios Acquisition entered into a loan agreement with DVB Bank SE and Credit Agricole Corporate and Investment Bank of up to $56,250 (divided into two tranches of $28,125
each) to partially finance the purchase price of two MR2 product tanker vessels. Each tranche of the facility is repayable in 32 quarterly installments of $391 each with a final balloon payment of $15,625 to be repaid on the last repayment
date. The repayment starts three months after the delivery of the respective vessel and it bears interest at a rate of LIBOR plus: (a) up to but not including the Drawdown Date of, 175 bps per annum; (b) thereafter until, but not
including, the tenth Repayment Date, 250 bps per annum; and (c) thereafter 300 bps per annum. The loan also requires compliance with certain financial covenants. As of December 31, 2012, $49,943 was drawn and outstanding under this loan
agreement and $6,307 remained to be drawn.

The Navios Holdings Credit Facility:Navios Acquisition entered into a $40,000 credit
facility with Navios Holdings and paid $400 as an arrangement fee. The $40,000 facility has a margin of LIBOR plus 300 bps and pursuant to an agreement dated November 8, 2011, the Navios Holdings credit facility was extended to December
2014. Pursuant to an amendment in October 2010, the facility will be available for multiple drawings up to a limit of $40,000. As of December 31, 2012 the outstanding amount under this facility was $35,000 and $5,000 remained to be drawn.

As of December 31, 2012, the total amount available to be drawn from all our facilities was $89,467.



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##### Table of Contents

NAVIOS MARITIME ACQUISITION CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Expressed in thousands of U.S. Dollars except share and per share data)



The weighted average balance outstanding of our loan facilities for the year ended December 31,
2012 was $486,247 and the weighted average interest rate was 3.25%. The weighted average balance outstanding of our loan facilities (excluding the Existing Notes and the Additional Notes) for the year ended December 31, 2011 was $327,174 and
the weighted average interest rate was 3.16%.

The loan facilities include, among other things, compliance with certain financial covenants:
(i) minimum liquidity higher of $40,000 or $1,000 per vessel, including vessels under construction; (ii) net worth ranging from $50,000 to $75,000 up to January 2013, up to $135,000 thereafter; and (iii) total liabilities divided by
total assets, adjusted for market values to be lower than 75%, as of January 1, 2013 and thereafter.

As of December 31, 2012, the
Company was in compliance with its covenants.

Amounts drawn under the facilities are secured by first preferred mortgages on Navios
Acquisitions vessels and other collateral and are guaranteed by each vessel-owning subsidiary. The credit facilities contain a number of restrictive covenants that prohibit or limit Navios Acquisition from, among other things: incurring
or guaranteeing indebtedness; entering into affiliate transactions; changing the flag, class, management or ownership of Navios Acquisitions vessels; changing the commercial and technical management of Navios Acquisitions vessels;
selling Navios Acquisitions vessels; and subordinating the obligations under each credit facility to any general and administrative costs relating to the vessels, including the fixed daily fee payable under the management agreement. The credit
facilities also require Navios Acquisition to comply with the ISM Code and ISPS Code and to maintain valid safety management certificates and documents of compliance at all times. The credit facilities also require compliance with a number of
financial covenants of Navios Acquisition, including net worth, debt coverage ratios, and minimum liquidity. It is an event of default under the credit facilities if such covenants are not complied with.

Guarantees

The Companys
Ship Mortgage Notes (consisting of the Existing Notes and the Additional Notes) are fully and unconditionally guaranteed on a joint and several basis by all of the Companys subsidiaries with the exception of Navios Acquisition Finance (a
co-issuer of the ship mortgage notes). The guarantees of our subsidiaries that own mortgaged vessels are senior secured guarantees and the guarantees of our subsidiaries that do not own mortgaged vessels are senior unsecured guarantees. All
subsidiaries, including Navios Acquisition Finance are 100% owned. The Navios Acquisition does not have any independent assets or operations. Navios Acquisition does not have any subsidiaries that are not guarantors of the 8 5/8% Notes. In addition,
the disclosures required by Rules 3-10(i)(9) and (10) are not applicable because there are no significant restrictions on (i) the ability of the parent company, any issuer (or co-issuer) or any guarantor subsidiaries of the 8 5/8% Notes to
obtain funds by dividend or loan from any of their subsidiaries or (ii) the ability of any subsidiaries to transfer funds to the issuer (or co-issuer) or any guarantor subsidiaries.

The maturity table below reflects the principal payments of all Notes and credit facilities outstanding as of December 31, 2012 for the next five years and thereafter are based on the repayment
schedule of the respective loan facilities (as described above) and the outstanding amount due under the senior Notes. The maturity table below includes in the amount shown for 2017 and thereafter future principal payments of the drawn portion of
credit facilities associated with the financing of the construction of vessels scheduled to be delivered on various dates throughout 2014.



|                                 |  |                  |         | 
|-------------------------------- |  | ---------------- | ------- | 
|                                 |  | December 31,2012 |        
|Long-Term Debt Obligations:      |  |                  |         | 
|Year                             |  |                  |         | 
|December 31, 2013                |  | $                | 19,724  | 
|December 31, 2014                |  |                  | 20,376  | 
|December 31, 2015                |  |                  | 20,627  | 
|December 31, 2016                |  |                  | 66,976  | 
|December 31, 2017                |  |                  | 567,776 | 
|December 31, 2018 and thereafter |  |                  | 297,014 | 
|                                 |  |                  |         | 
|Total                            |  | $                | 992,493 | 
|                                 |  |                  |         | 

NOTE 15: FAIR VALUE OF FINANCIAL INSTRUMENTS

Fair Value of Financial Instruments

The following methods and assumptions were used to estimate the fair value of each class of financial instrument:

Cash and cash equivalents: The carrying amounts reported in the consolidated balance sheets for interest bearing deposits approximate their fair value because of the short maturity of these
investments.

Restricted Cash: The carrying amounts reported in the consolidated balance sheets for interest bearing deposits
approximate their fair value because of the short maturity of these investments.

Accounts receivable: Carrying amounts are
considered to approximate fair value due to the short-term nature of these accounts receivables and no significant changes in interest rates. All amounts that are assumed to be uncollectible are written off and/or reserved.



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NAVIOS MARITIME ACQUISITION CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Expressed in thousands of U.S. Dollars except share and per share data)



Accounts payable: The carrying amount of accounts payable reported in the balance sheet
approximates its fair value due to the short-term nature of these accounts payable and no significant changes in interest rates.

Other
long term borrowings: The carrying amount of the floating rate loans approximates its fair value.

Ship Mortgage Notes:
The fair value of the Notes, which has a fixed rate, was determined based on quoted market prices, as indicated in the table below.

Loans due to related party: The carrying amount of the floating rate loans approximates its fair value.



|                                   |  |                   |         |  |                   |   |         |           |  |   |            |  |  |   |         | 
|---------------------------------- |  | ----------------- | ------- |  | ----------------- | - | ------- | --------- |  | - | ---------- |  |  | - | ------- | 
|                                   |  | December 31, 2012 |         |  | December 31, 2011 |  
|                                   |  | BookValue         |         |  | Fair Value        |   |         | BookValue |  |   | Fair Value | 
|Cash and cash equivalents          |  | $                 | 42,846  |  |                   | $ | 42,846  |           |  | $ | 41,300     |  |  | $ | 41,300  | 
|Restricted cash                    |  | $                 | 21,163  |  |                   | $ | 21,163  |           |  | $ | 32,214     |  |  | $ | 32,214  | 
|Accounts receivable, net           |  | $                 | 5,103   |  |                   | $ | 5,103   |           |  | $ | 6,478      |  |  | $ | 6,478   | 
|Accounts payable                   |  | $                 | 1,277   |  |                   | $ | 1,277   |           |  | $ | 1,021      |  |  | $ | 1,021   | 
|Ship mortgage notes and premium    |  | $                 | 506,593 |  |                   | $ | 482,275 |           |  | $ | 507,028    |  |  | $ | 385,088 | 
|Other Long-term debt               |  | $                 | 487,493 |  |                   | $ | 487,493 |           |  | $ | 338,383    |  |  | $ | 338,383 | 
|Loans due to related party         |  | $                 | 35,000  |  |                   | $ | 35,000  |           |  | $ | 40,000     |  |  | $ | 40,000  | 
|Due to related parties, short term |  | $                 | 27,815  |  |                   | $ | 27,815  |           |  | $ | 43,616     |  |  | $ | 43,616  | 
|Due to related parties, long term  |  | $                 | 57,701  |  |                   | $ | 57,701  |           |  | $ |           |  |  | $ |        | 

Fair Value Measurements

The estimated fair value of our financial instruments that are not measured at fair value on a recurring basis, categorized based upon the fair value hierarchy, are as follows:

Level I: Inputs are unadjusted, quoted prices for identical assets or liabilities in active markets that we have the ability to access. Valuation of
these items does not entail a significant amount of judgment.

Level II: Inputs other than quoted prices included in Level I that are
observable for the asset or liability through corroboration with market data at the measurement date.

Level III: Inputs that are
unobservable. The Company did not use any Level 3 inputs as of December 31, 2012.



|                                     |  |                                                    |         |  |         |   |         |          |  |   |           |     |  |   |   | 
|------------------------------------ |  | -------------------------------------------------- | ------- |  | ------- | - | ------- | -------- |  | - | --------- | --- |  | - | - | 
|                                     |  | Fair Value Measurements at December 31, 2012 Using |        
|                                     |  | Total                                              |         |  | Level I |   |         | Level II |  |   | Level III |    
|Cash and cash equivalents            |  | $                                                  | 42,846  |  |         | $ | 42,846  |          |  | $ |          |     |  | $ |  | 
|Restricted cash                      |  | $                                                  | 21,163  |  |         | $ | 21,163  |          |  | $ |          |     |  | $ |  | 
|Ship mortgage notes and premium      |  | $                                                  | 482,275 |  |         | $ | 482,275 |          |  | $ |          |     |  | $ |  | 
|Other Long-term debt(1)              |  | $                                                  | 487,493 |  |         | $ |        |          |  | $ | 487,493   | (1) |  | $ |  | 
|Loans due to related party(1)        |  | $                                                  | 35,000  |  |         | $ |        |          |  | $ | 35,000    | (1) |  | $ |  | 
|Due to related parties, long term(1) |  | $                                                  | 57,701  |  |         | $ |        |          |  | $ | 57,701    | (1) |  | $ |  | 



|(1) | The fair value of the Companys other long term debt, loans due to related party and due to related parties, long term is estimated based on currently available
debt with similar contract terms, interest rate and remaining maturities as well as taking into account our creditworthiness.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

NOTE 16: LEASES

Chartered-out:

The future minimum contractual lease income (charter-out rates is presented net of commissions), including revenue for vessels expected to deliver in 2013
for which a charter party has been concluded, is as follows:



|                                                |  |        |         | 
|----------------------------------------------- |  | ------ | ------- | 
|                                                |  | Amount |        
|2013                                            |  | $      | 179,419 | 
|2014                                            |  |        | 141,980 | 
|2015                                            |  |        | 111,461 | 
|2016                                            |  |        | 91,835  | 
|2017                                            |  |        | 48,174  | 
|Thereafter                                      |  |        | 292,437 | 
|                                                |  |        |         | 
|Total minimum lease revenue, net of commissions |  | $      | 865,306 | 
|                                                |  |        |         | 



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##### Table of Contents

NAVIOS MARITIME ACQUISITION CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Expressed in thousands of U.S. Dollars except share and per share data)



Revenues from time charters are not generally received when a vessel is off-hire, including time
required for scheduled maintenance of the vessel.

NOTE 17: TRANSACTIONS WITH RELATED PARTIES

Pursuant to an Exchange Agreement entered into on March 30, 2011, Navios Holdings exchanged 7,676,000 shares of Navios
Acquisitions common stock it held for 1,000 shares of Series C Convertible Preferred Stock of Navios Acquisition (see note 19). As of December 31, 2012, dividends paid to Navios Holdings amounted to $1,536 and dividends payable
amounted to $384. As of December 31, 2011, dividends paid to Navios Holdings amounted to $768 and dividends payable amounted to $384.

The Navios Holdings Credit Facility:Navios Acquisition entered into a $40,000 credit facility with Navios Holdings. The $40,000 facility has a
margin of LIBOR plus 300 bps and a pursuant to an amendment dated November 8, 2011, the maturity of the facility was extended to December 2014. Pursuant to an amendment in October 2010, the facility will be available for multiple
drawings up to a limit of $40,000. As of December 31, 2012 and 2011, the outstanding amount under this facility was $35,000 and $40,000, respectively, and was included under loans due to related parties. For the years ended December 31,
2012, 2011 and 2010, interest expense in relation to this facility amounted to $1,164, $710 and $236, respectively, and was included under interest expense and finance cost, net in the statement of operations. Accrued interest as of
December 31, 2012 and 2011 was $1 and $62, respectively.

Management fees:Pursuant to a Management Agreement dated May 28,
2010, Navios Tankers Management Inc. (the Manager), a subsidiary of Navios Holdings, provides for five years from the closing of the Companys initial vessel acquisition, commercial and technical management services to Navios
Acquisitions vessels for a daily fee of $6 per owned MR2 product tanker and chemical tanker vessel and $7 per owned LR1 product tanker vessel and $10 per VLCC tanker vessel for the first two years. On May 4, 2012, Navios Acquisition
amended its existing Management Agreement with the Manager, to fix the fees for ship management services of its owned fleet at current rates for two additional years, through May 28, 2014. This daily fee covers all of the vessels
operating expenses, other than certain fees and costs. During the remaining one year of the term of the Management Agreement, Navios Acquisition expects it will reimburse Navios Holdings for all of the actual operating costs and expenses it incurs
in connection with the management of its fleet. Actual operating costs and expenses will be determined in a manner consistent with how the initial fixed fees were determined. Drydocking expenses are fixed for the first four years under these
agreements for up to $300 per LR1 and MR2 product tanker vessel and will be reimbursed at cost for VLCC vessels. Commencing as of March 30, 2012, Navios Acquisition can, upon request to the Manager, partially or fully defer the reimbursement of
drydocking and other extraordinary fees and expenses under the Agreement to a later date, but not later than January 4, 2014, and if reimbursed on a later date, such amounts will bear interest at a rate of 1% per annum over LIBOR.
Commencing as of September 28, 2012, Navios Acquisition could, upon request, reimburse the Manager partially or fully, for any fixed management fees outstanding for a period of not more than nine months under the Agreement at a later date, but
not later than December 31, 2014, and if reimbursed on a later date, such amounts will bear interest at a rate of 1% per annum over LIBOR. Total management fees for each of the year ended December 31, 2012, 2011 and 2010 amounted to
$47,043, $35,679 and $9,752, respectively.

General and administrative expenses:On May 28, 2010, Navios Acquisition entered into
an administrative services agreement with the Manager, expiring on May 28, 2015, pursuant to which a subsidiary of Navios Holdings provides certain administrative management services to Navios Acquisition which include: bookkeeping, audit and
accounting services, legal and insurance services, administrative and clerical services, banking and financial services, advisory services, client and investor relations and other. The Manager is reimbursed for reasonable costs and expenses incurred
in connection with the provision of these services. For the years ended December 31, 2012, 2011 and 2010 the administrative services rendered by the Manager amounted to $2,110, $1,527 and $407, respectively.

Balance due to related parties:Amounts due to related parties as of December 31, 2012 and 2011, was $85,516 and $43,616, respectively, of
which the current account payable to Navios Holdings and its subsidiaries was $27,815 and $43,616, respectively, and the long term payable was $57,701 and $0, respectively. The balance mainly consisted of management fees administrative fees,
drydocking costs and other expenses.

Omnibus agreement: Navios Acquisition entered into an omnibus agreement (the Acquisition
Omnibus Agreement) with Navios Holdings and Navios Maritime Partners L.P. (Navios Partners) in connection with the closing of Navios Acquisitions vessel acquisition, pursuant to which, among other things, Navios Holdings and
Navios Partners agreed not to acquire, charter-in or own liquid shipment vessels, except for container vessels and vessels that are primarily employed in operations in South America without the consent of an independent committee of Navios
Acquisition. In addition, Navios Acquisition, under the Acquisition Omnibus Agreement, agreed to cause its subsidiaries not to acquire, own, operate or charter drybulk carriers under specific exceptions. Under the Acquisition Omnibus Agreement,
Navios Acquisition and its subsidiaries grant to Navios Holdings and Navios Partners, a right of first offer on any proposed sale, transfer or other disposition of any of its drybulk carriers and related charters owned or acquired by Navios
Acquisition. Likewise, Navios Holdings and Navios Partners agreed to grant a similar right of first offer to Navios Acquisition for any liquid shipment vessels they might own. These rights of first offer will not apply to a (a) sale, transfer
or other disposition of vessels between any affiliated subsidiaries, or pursuant to the existing terms of any charter or other agreement with a counterparty, or (b) merger with or into, or sale of substantially all of the assets to, an
unaffiliated third party.



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##### Table of Contents

NAVIOS MARITIME ACQUISITION CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Expressed in thousands of U.S. Dollars except share and per share data)



NOTE 18  COMMITMENTS AND CONTINGENCIES

As of December 31, 2012, Navios Acquisition committed for future remaining contractual deposits for the vessels to be delivered on
various dates through October 2014.

The Company is involved in various disputes and arbitration proceedings arising in the ordinary course of
business. Provisions have been recognized in the financial statements for all such proceedings where the Company believes that a liability may be probable, and for which the amounts are reasonably estimable, based upon facts known at the date of the
financial statements were prepared. In the opinion of the management, the ultimate disposition of these matters individually and in aggregate will not materially affect the Companys financial position, results of operations or liquidity.

The future minimum commitments by period as of December 31, 2012, of Navios Acquisition under its ship building contracts, are as
follows:



|                  |  |        |         | 
|----------------- |  | ------ | ------- | 
|                  |  | Amount |        
|December 31, 2013 |  | $      | 69,170  | 
|December 31, 2014 |  |        | 35,880  | 
|                  |  |        |         | 
|Total             |  | $      | 105,050 | 
|                  |  |        |         | 

NOTE 19: PREFERRED AND COMMON STOCK

Preferred Stock

The
Company is authorized to issue 10,000,000 shares of $0.0001 par value preferred stock with such designations, voting and other rights and preferences as may be determined from time to time by the Board of Directors.

On March 30, 2011, pursuant to an Exchange Agreement Navios Holdings exchanged 7,676,000 shares of Navios Acquisitions common stock it held
for 1,000 non-voting Series C Convertible Preferred Stock of Navios Acquisition. Each holder of shares of Series C Convertible Preferred Stock shall be entitled at their option at any time, after March 31, 2013 to convert all or any
the outstanding shares of Series C Convertible Preferred Stock into a number of fully paid and non-assessable shares of Common Stock determined by multiplying each share of Series C Convertible Preferred Stock to be converted by 7,676,
subject to certain limitations. Upon the declaration of a common stock dividend, the holders of the Series C Convertible Preferred Stock are entitled to receive dividends on the Series C Convertible Preferred Stock in an amount equal to
the amount that would have been received in the number of shares of Common Stock into which the Shares of Series C Convertible Preferred Stock held by each holder thereof could be converted. The shares of Series C Preferred Stock were
recorded at fair value of the common stock exchanged which totaled $30,474, using the common stock price on March 30, 2011 of $3.97. The impact of the exchange (other than the par value of the common and preferred stock) was recorded net in
Additional-Paid-In-Capital. No fees were incurred in connection with the above issuance. For the purpose of calculating loss per share this preferred stock is treated as in-substance common stock and is allocated losses and considered in the
diluted calculation.

On September 17, 2010, Navios Acquisition issued 3,000 shares of the Companys authorized Series A
Convertible Preferred Stock (fair value of $5,619) to an independent third party as a consideration for certain consulting and advisory fees related to the VLCC acquisition. The Company valued these shares on and accounted for these shares as issued
and outstanding from September 17, 2010 since all services had been provided. The $5,619 has been recorded in the accompanying financial statements as transaction costs. Under the terms of the consulting agreement, the preferred stock will be
distributed in tranches of 300 shares every six months commencing on June 30, 2011 and ending on December 15, 2015. Accordingly, the shares of Series A Preferred Stock and the shares of common stock underlying them, will only be
eligible for transfer upon distribution to the holder. The preferred stock has no voting rights, is only convertible into shares of common stock and does not participate in dividends until such time as the shares are converted into common stock. The
holder of the preferred stock also has the right to convert their shares to common stock subject to certain terms and conditions at any time after distribution at a conversion price of $35.00 per share of common stock. Any shares of preferred stock
remaining outstanding on December 31, 2015 shall automatically convert into shares of common stock at a conversion price of $25.00 per share of common stock. The fair market value on September 17, 2010, was determined using a binomial
valuation model. The model used takes into account the credit spread of the Company, the volatility of its stock, as well as the price of its stock at the issuance date.

On October 29, 2010, Navios Acquisition issued 540 shares of the Companys authorized Series B Convertible Preferred Stock (fair value $1,649) to the seller of the two newbuild LR1 product
tankers the Company recently acquired and were included in the vessel cost. The preferred stock contains a 2% per annum dividend payable quarterly starting on January 1, 2011 and upon declaration by the Companys Board commences
payment on March 31, 2011. The Series B Convertible Preferred Stock, plus any accrued but unpaid dividends, will mandatorily convert into shares of common stock as follows: 30% of the outstanding amount will convert on June 30, 2015
and the remaining outstanding amounts will convert on June 30, 2020 at a price per share of common stock not less than $25.00. The holder of the preferred stock shall have the right to convert the shares of preferred stock into common stock
prior to the scheduled maturity dates at



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##### Table of Contents

NAVIOS MARITIME ACQUISITION CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Expressed in thousands of U.S. Dollars except share and per share data)



a price of $35.00 per share of common stock. The preferred stock does not have any voting rights. The fair value on October 29, 2010, was determined using a binomial valuation model. The
model used takes into account the credit spread of the Company, the volatility of its stock, as well as the price of its stock at the issuance date.

As of each of December 31, 2012 and 2011, 4,540 shares of preferred stock were issued and outstanding. As of December 31, 2012, 600 shares of convertible preferred stock were outstanding. Fees
incurred in 2010 connection with the issuance of the above shares of preferred stock amounted to $1,805.

Redeemable Convertible Preferred
Stock

On each of August 31, 2012, and October 31, 2012, Navios Acquisition issued in total 300 shares (600 in the aggregate) of
its authorized Series D Convertible Preferred Stock (nominal and fair value $6,000) (Series D Preferred Stock) to a shipyard, in partial settlement of two newbuild LR1 product tankers, the Nave Cassiopeia and the Nave Cetus. The Series D
Preferred Stock contains a 6% per annum dividend payable quarterly, starting one year after delivery of each vessel. The Series D Preferred Stock will mandatorily convert into shares of common stock 30 months after issuance at a price per share
of common stock equal to $10.00. The holder of the Series D Preferred Stock shall have the right to convert the shares of Series D Preferred Stock into common stock prior to the scheduled maturity dates at a price of $7.00 per share of common stock.
The Series D Preferred Stock does not have any voting rights. Navios Acquisition is obligated to redeem the Series D Preferred Stock (or converted common shares), at holders option exercisable beginning on 18 months after issuance, at par
payable at up to 12 equal quarterly installments.

The fair value was determined using a combination of Black Scholes model and discounted
projected cash flows for the conversion option and put, respectively. The model used takes into account the credit spread of Navios Acquisition, the volatility of its stock, as well as the price of its stock at the issuance date. The convertible
preferred stock is classified as temporary equity (i.e., apart from permanent equity) as a result of the redemption feature upon exercise of the put option granted to the holder of the preferred stock.

Redeemable Convertible Preferred and Common Stock is presented in the following table:



|                                                  |  |                         |     |  |              |   |       |                       |  |  |             |   |  |   |         |  
|------------------------------------------------- |  | ----------------------- | --- |  | ------------ | - | ----- | --------------------- |  |  | ----------- | - |  | - | ------- | -
|                                                  |  | Preferred Stock         |     |  | Common Stock |  
|                                                  |  | Numberofpreferredshares |     |  | Amount       |   |       | Number ofcommonshares |  |  | Amount      |  
|Balance January 1, 2010                           |  |                         |    |  |              |   |      |                       |  |  | 10,119,999  |   |  | $ | 100,289 |  
|                                                  |  |                         |     |  |              |   |       |                       |  |  |             |   |  |   |         |  
|                                                  |  |                         |     | 
|Common stock redeemed                             |  |                         |    |  |              | $ |      |                       |  |  | (10,021,399 | ) |  |   | (99,312 | )
|Common stock not redeemed                         |  |                         |     |  |              |   |       |                       |  |  | (98,600     | ) |  |   | (977    | )
|                                                  |  |                         |     |  |              |   |       |                       |  |  |             |   |  |   |         |  
|Balance December 31, 2010                         |  |                         |    |  |              |   |      |                       |  |  |            |   |  |   |        |  
|                                                  |  |                         |     |  |              |   |       |                       |  |  |             |   |  |   |         |  
|                                                  |  |                         |    |  |              | $ |      |                       |  |  |            |   |  | $ |        |  
|                                                  |  |                         |     |  |              |   |       |                       |  |  |             |   |  |   |         |  
|Balance December 31, 2011                         |  |                         |    |  |              |   |      |                       |  |  |            |   |  |   |        |  
|                                                  |  |                         |     |  |              |   |       |                       |  |  |             |   |  |   |         |  
|Issuance of preferred stock subject to redemption |  |                         | 600 |  |              |   | 6,000 |                       |  |  |             |   |  |   |         |  
|                                                  |  |                         |     |  |              |   |       |                       |  |  |             |   |  |   |         |  
|Balance December 31, 2012                         |  |                         | 600 |  |              | $ | 6,000 |                       |  |  |            |   |  | $ |        |  
|                                                  |  |                         |     |  |              |   |       |                       |  |  |             |   |  |   |         |  

Common Stock

On November 19, 2010, the Company completed the public offering of 6,500,000 shares of common stock at $5.50 per share and raised gross proceeds of $35,750. The net proceeds of this offering,
including the underwriting discount of $1,787 and excluding offering costs of $561 were $33,963.

Pursuant to an Exchange Agreement entered
into on March 30, 2011, Navios Holdings exchanged 7,676,000 shares of Navios Acquisitions common stock it held for 1,000 non-voting shares of Series C Convertible Preferred Stock of Navios Acquisition.

The Company is authorized to issue 250,000,000 shares of $0.0001 par value common stock.



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##### Table of Contents

NAVIOS MARITIME ACQUISITION CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Expressed in thousands of U.S. Dollars except share and per share data)



Warrant Exercise Program

On September 2, 2010, Navios Acquisition completed its Warrant Exercise Program (the Warrant Exercise Program). Under the Warrant Exercise Program, holders of public warrants had the
opportunity to exercise the public warrants on enhanced Terms through August 27, 2010.

The Warrant Exercise Program was coupled with a
consent solicitation accelerating the ability of Navios Holdings and its officers and directors to exercise certain private warrants on the same terms available to the public warrants during the Warrant Exercise Program.

As a result of the above:



| |  |  | 19,246,056 public warrants (76.13% of the public warrants then outstanding) were exercised on a cashless basis at an exchange rate of 4.25 public
warrants for one share of common stock;
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | $78,342 of gross cash proceeds were raised from the exercise of 15,950 of the public warrants by payment of $5.65 cash exercise price, and 13,850,000
private warrants owned by Navios Holdings and Angeliki Frangou, Navios Acquisitions Chairman and Chief Executive Officer; Total expenses associated with the Warrant Exercise Program were $3,364.
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | a portion of the private warrants exercised were held by officers and directors of Navios Acquisition, 15,000 and 75,000 were exercised on a cash basis
and cashless basis, respectively; and
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | 18,412,053 new shares of common stock were issued.
| | - |  | --------------------------------------------------

On September 2, 2010, Navios Acquisition completed its Warrant Exercise Program under which holder of its publicly traded and privately held warrants had the opportunity to exercise their warrants on
enhanced terms as described above. As a result of the Warrant Exercise Program and subsequent warrant exercises, as of December 31, 2010, the Company had outstanding 6,037,994 publicly traded warrants which were classified as equity, since they
cannot be cash settled. The fair value of the warrants after the inducement offer were compared to the fair value prior to the inducement, which resulted in incremental fair value of $647 transferred to shareholders who exercised on a cashless
basis. This incremental fair value has been reflected in the net loss per share calculation for the year ended December 31, 2010.

As of
December 31, 2012 there were 6,037,994 public warrants outstanding. Included in the number of shares and warrants are 12,752 units (one unit consists of one share of common stock and one warrant).

NOTE 20: SEGMENT INFORMATION

Navios Acquisition reports financial information and evaluates its operations by charter revenues. Navios Acquisition does not use
discrete financial information to evaluate operating results for each type of charter. As a result, management reviews operating results solely by revenue per day and operating results of the fleet and thus Navios Acquisition has determined that it
operates under one reportable segment.

The following table sets out operating revenue by geographic region for Navios Acquisitions
reportable segment. Revenue is allocated on the basis of the geographic region in which the customer is located. Tanker vessels operate worldwide. Revenues from specific geographic region which contribute over 10% of total revenue are disclosed
separately.

Revenue by Geographic Region

Vessels operate on a worldwide basis and are not restricted to specific locations. Accordingly, it is not possible to allocate the assets of these operations to specific countries.



|              |  |                            |         |  |                            |   |         |                            |  |   |        | 
|------------- |  | -------------------------- | ------- |  | -------------------------- | - | ------- | -------------------------- |  | - | ------ | 
|              |  | Year EndedDecember 31,2012 |         |  | Year EndedDecember 31,2011 |   |         | Year EndedDecember 31,2010 | 
|Asia          |  | $                          | 131,263 |  |                            | $ | 105,952 |                            |  | $ | 27,311 | 
|Europe        |  |                            | 16,881  |  |                            |   | 15,282  |                            |  |   | 6,257  | 
|United States |  |                            | 2,953   |  |                            |   | 691     |                            |  |   |       | 
|              |  |                            |         |  |                            |   |         |                            |  |   |        | 
|Total Revenue |  | $                          | 151,097 |  |                            | $ | 121,925 |                            |  | $ | 33,568 | 
|              |  |                            |         |  |                            |   |         |                            |  |   |        | 

NOTE 21: LOSS PER COMMON SHARE

Loss per share is calculated by dividing net loss available to common stockholders by the average number of shares of common stock of
Navios Acquisition outstanding during the period.

Net loss for the year ended December 31, 2012 and 2011 was adjusted for the purposes
of earnings per share calculation, for the dividends on Series B Preferred Shares and for the undistributed loss that is attributable to Series C preferred stock.



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##### Table of Contents

NAVIOS MARITIME ACQUISITION CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Expressed in thousands of U.S. Dollars except share and per share data)



The average number of shares of common stock of Navios Acquisition for the year ended December 31,
2011 excludes the 1,378,122 contingently returnable shares of common stock issued on September 10, 2010 for the VLCC Acquisition which were deposited into a one year escrow to provide for indemnity and other claims (see note 4) until
November 4, 2011 when 1,160,963 of these shares were released to the sellers and 217,159 were returned to Navios Acquisition in settlement of claims relating to representations and warranties attributable to the sellers of the VLCC Acquisition
and were cancelled on December 30, 2011.

Net Loss for the year ended December 31, 2010 is adjusted for the purposes of earnings per
share calculation, to reflect the inducement of the Warrant Exercise Program discussed in Note 19. The inducement resulted to the adjustment in the income available to common stockholders, for the earnings per share calculation, by $647, which
represents the incremental value that was given to the warrant holders in order to exercise their warrants. The average number of shares of common stock of Navios Acquisition for the year ended December 31, 2010 excludes the 1,378,122
contingently returnable shares of common stock issued on September 10, 2010 for the VLCC Acquisition which were deposited into a one year escrow to provide for indemnity and other claims (see Note 4).

For the years ended December 31, 2012, 2011 and 2010 potential common shares and shares kept in escrow have an anti-dilutive effect (i.e. those that
increase income per share or decrease loss per share) and are therefore excluded from the calculation of diluted loss per share.



|                                                                              |  |                            |            |   |                            |   |            |                            |  |   |            |  
|----------------------------------------------------------------------------- |  | -------------------------- | ---------- | - | -------------------------- | - | ---------- | -------------------------- |  | - | ---------- | -
|                                                                              |  | Year endedDecember 31,2012 |            |   | Year endedDecember 31,2011 |   |            | Year endedDecember 31,2010 | 
|Numerator:                                                                    |  |                            |            |   |                            |   |            |                            |  |   |            |  
|Net Loss                                                                      |  | $                          | (3,798     | ) |                            | $ | (3,857     | )                          |  | $ | (13,546    | )
|Incremental fair value of securities offered to induce warrants exercise      |  |                            |           |   |                            |   |           |                            |  |   | (647       | )
|Dividend declared on preferred shares Series B                                |  |                            | (108       | ) |                            |   | (108       | )                          |  |   |           |  
|Undistributed loss attributable to Series C participating preferred shares    |  |                            | 622        |   |                            |   | 587        |                            |  |   |           |  
|                                                                              |  |                            |            |   |                            |   |            |                            |  |   |            |  
|Loss attributable to common stockholders                                      |  | $                          | (3,284     | ) |                            | $ | (3,378     | )                          |  | $ | (14,193    | )
|                                                                              |  |                            |            |   |                            |   |            |                            |  |   |            |  
|                                                                              |  |                            |           
|Denominator:                                                                  |  |                            |            |   |                            |   |            |                            |  |   |            |  
|Denominator for basic net loss per share  weighted average shares            |  |                            | 40,517,413 |   |                            |   | 41,409,433 |                            |  |   | 32,677,318 |  
|                                                                              |  |                            |            |   |                            |   |            |                            |  |   |            |  
|                                                                              |  |                            |           
|Denominator for diluted net loss per share  adjusted weighted average shares |  |                            | 40,517,413 |   |                            |   | 41,409,433 |                            |  |   | 32,677,318 |  
|                                                                              |  |                            |            |   |                            |   |            |                            |  |   |            |  
|                                                                              |  |                            |           
|Basic net loss per share                                                      |  | $                          | (0.08      | ) |                            | $ | (0.08      | )                          |  | $ | (0.43      | )
|                                                                              |  |                            |           
|Diluted net loss per share                                                    |  | $                          | (0.08      | ) |                            | $ | (0.08      | )                          |  | $ | (0.43      | )
|                                                                              |  |                            |            |   |                            |   |            |                            |  |   |            |  

NOTE 22: INCOME TAXES

Marshall Islands, Cayman Islands, British Virgin Islands, and Hong Kong, do not impose a tax on international shipping
income. Under the laws of Marshall Islands, of the companies incorporation and vessels registration, the companies are subject to registration and tonnage taxes which have been included in the daily management fee.

As of January 1, 2013, foreign flagged vessels that are managed by Greek or foreign ship management companies in Greece are subject
to Greek tonnage tax. The payment of tonnage tax exhausts the tax liability of the foreign ship owning company against any tax, duty, charge or contribution payable on income from the exploitation of the foreign flagged vessel.

Pursuant to Section 883 of the Internal Revenue Code of the United States (the Code), U.S. source income from the
international operation of ships is generally exempt from U.S. income tax if the company operating the ships meets certain incorporation and ownership requirements. Among other things, in order to qualify for this exemption, the company operating
the ships must be incorporated in a country, which grants an equivalent exemption from income taxes to U.S. corporations. All the Navios Acquisitions ship-operating subsidiaries satisfy these initial criteria. In addition, these companies must
meet an ownership test. Subject to proposed regulations becoming finalized in their current form, the management of Navios Acquisition believes by virtue of a special rule applicable to situations where the ship operating companies are beneficially
owned by a publicly traded company like Navios Acquisition, the second criterion can also be satisfied based on the trading volume and ownership of the Companys shares, but no assurance can be given that this will remain so in the future. Due
to the exemption under Section 883 of the Code, Delaware would not impose a tax on the Company or its subsidiaries international shipping income.



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##### Table of Contents

NAVIOS MARITIME ACQUISITION CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Expressed in thousands of U.S. Dollars except share and per share data)



NOTE 23: SUBSEQUENT EVENTS

In February 2013, Navios Acquisition completed multiple offerings, including registered direct offerings, of a total of 35,246,791
shares of its common stock, at a price of $2.85 per share representing gross proceeds of $100,453. The offerings were conducted as follows:



| |  |  | The first registered direct offering of 7,719,300 shares of common stock was completed on February 21, 2013, raising $22,000 of gross proceeds.
The net proceeds of this offering, including the agents fees of $880 and excluding estimated offering costs of approximately $320, were $21,120.
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | The second registered direct offering of 9,825,000 shares of common stock was completed on February 26, 2013, raising $28,001 of gross proceeds.
The net proceeds of this offering, including the agents fees of $1,120 and excluding estimated offering costs of approximately $320, were $26,881.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | In addition, Navios Holdings and certain members of management of Navios Acquisition, Navios Holdings and Navios Partners purchased an aggregate of
17,702,491 shares of common stock in a private placement that was completed on February 26, 2013, raising $50,452 of gross proceeds. The net proceeds of this private placement, including the agents fees of $2,018, were $48,434.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

On February 13, 2013, Navios Acquisition took delivery of the Nave Rigel, a new building LR1 product tanker vessel of
74,673 dwt, from a South Korean shipyard. Nave Rigel has been chartered out to a high quality counterparty for one year at a rate of $12 net per day plus 50% profit sharing based on a formula. The charterer has been granted an option for an
additional six months at the same rate. Navios Acquisition issued 300 shares of its authorized Series D Preferred Stock to the shipyard, in partial settlement of the purchase price.

On February 07, 2013, the Board of Directors declared a quarterly cash dividend in respect of the fourth quarter of 2012 of $0.05 per common share payable on April 4, 2013 to stockholders of
record as of March 19, 2013. The declaration and payment of any further dividends remains subject to the discretion of the Board and will depend on, among other things, Navios Acquisitions cash requirements as measured by market
opportunities and restrictions under its credit agreements and other debt obligations and such other factors as the Board may deem advisable.

On January 24, 2013, Navios Acquisition took delivery of the Nave Bellatrix, a 49,999 dwt MR2 product tanker vessel, from a South Korean shipyard.
The vessel is chartered out to a high quality counterparty for three years at a rate of $13 net per day plus 50% profit sharing. The charterer will receive the first $1 of profits above the base rate and the owner will receive next $1 of profits.
Thereafter, all profits will be split equally to each party. The charterer has been granted an option for an additional year at a rate of $15 net per day plus 50% profit sharing.



F-28