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, 2006

                                       OR

[_]            TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934
                   For the transition period from ____ to ____

                                       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: N/A

                        Commission file number 0001322587

                        ARIES MARITIME TRANSPORT LIMITED
--------------------------------------------------------------------------------
             (Exact name of Registrant as specified in its charter)

                                     BERMUDA
--------------------------------------------------------------------------------
                 (Jurisdiction of incorporation or organization)

                        Aries Maritime Transport Limited

                  18 Zerva Nap., Glyfada, Athens 166 75, Greece
--------------------------------------------------------------------------------
                    (Address of principal executive offices)

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

                     Common Stock par value $0.01 per share

--------------------------------------------------------------------------------

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.

     28,416,877 shares of Common Stock, par value $0.01 per share.

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|

Note- Checking the box above will not relieve any registrant required to file
reports pursuant to Section 13 of 15(d) of the Securities Exchange Act of 1934
for their obligations under those Sections.

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.

                                 Yes |X| No |_|

Indicate by check mark whether 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 |X|   Non-accelerated filer |_|

Indicate by check mark which financial statement item the registrant has elected
to follow.

                            Item 17 |_| Item 18 |X|

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|
<PAGE>

                                TABLE OF CONTENTS

                                                                            Page


ITEM 1.    Identity Of Directors, Senior Management And Advisers...............1

ITEM 2.    Offer Statistics And Expected Timetable.............................1

ITEM 3.    Key Information.....................................................1

ITEM 4.    Information On The Company.........................................16

ITEM 4A.   Unresolved Staff Comments..........................................30

ITEM 5.    Operating And Financial Review And Prospects.......................30

ITEM 6.    Directors, Senior Management And Employees.........................49

ITEM 7.    Major Shareholders And Related Party Transactions..................52

ITEM 8.    Financial Information..............................................55

ITEM 9.    The Offer And Listing..............................................56

ITEM 10.   Additional Information.............................................56

ITEM 11.   Quantitative And Qualitative Disclosures About Market Risk.........66

ITEM 12.   Description Of Securities Other Than Equity Securities.............66

ITEM 13.   Defaults, Dividend Arrearages And Delinquencies....................67

ITEM 14.   Material Modifications To The Rights Of Security Holders And
           Use Of Proceeds....................................................67

ITEM 15.   Controls And Procedures............................................67

ITEM 16A.  Audit Committee Financial Expert...................................68

ITEM 16B.   Code Of Ethics....................................................68

ITEM 16C.  Principal Accountant Fees And Services.............................68

ITEM 16D.  Exemptions From The Listing Standards For Audit Committees.........68

ITEM 16E.  Purchases Of Equity Securities By The Issuer And Affiliated
           Purchases..........................................................69

ITEM 17.   Financial Statements...............................................69

ITEM 18.   Financial Statements...............................................69

ITEM 19.   Exhibits...........................................................70
<PAGE>

            CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

     This report includes assumptions, expectations, projections, intentions and
beliefs about future events. These statements are intended as "forward-looking
statements." We caution that assumptions, expectations, projections, intentions
and beliefs about future events may and often do vary from actual results and
the differences can be material. All statements in this document that are not
statements of historical fact are forward-looking statements. Forward-looking
statements include, but are not limited to, such matters as future operating or
financial results; statements about planned, pending or recent acquisitions,
business strategy, future dividend payments and expected capital spending or
operating expenses, including drydocking and insurance costs; statements about
trends in the container vessel and products tanker shipping markets, including
charter rates and factors affecting supply and demand; our ability to obtain
additional financing; expectations regarding the availability of vessel
acquisitions; completion of repairs, length of offhire, availability of charters
and anticipated developments with respect to any pending litigation. The
forward-looking statements in this press release are based upon various
assumptions, many of which are based, in turn, upon further assumptions,
including without limitation, management's examination of historical operating
trends, data contained in our records and other data available from third
parties. Although Aries Maritime Transport Limited believes that these
assumptions were reasonable when made, because these assumptions are inherently
subject to significant uncertainties and contingencies which are difficult or
impossible to predict and are beyond our control, Aries Maritime Transport
Limited cannot assure you that it will achieve or accomplish these expectations,
beliefs or projections described in the forward looking statements contained in
this press release. Important factors that, in our view, could cause actual
results to differ materially from those discussed in the forward-looking
statements include the strength of world economies and currencies, general
market conditions, including changes in charter rates and vessel values, failure
of a seller to deliver one or more vessels, failure of a buyer to accept
delivery of a vessel, inability to procure acquisition financing, default by one
or more charterers of our ships, our ability to complete documentation of
agreements in principle, changes in demand for oil and oil products, the effect
of changes in OPEC's petroleum production levels, worldwide oil consumption and
storage, changes in demand that may affect attitudes of time charterers,
scheduled and unscheduled drydocking, additional time spent in completing
repairs, changes in Aries Maritime Transport Limited's voyage and operating
expenses, including bunker prices, dry-docking and insurance costs, changes in
governmental rules and regulations or actions taken by regulatory authorities,
potential liability from pending or future litigation, domestic and
international political conditions, potential disruption of shipping routes due
to accidents, international hostilities and political events or acts by
terrorists and other factors discussed in Aries Maritime Transport Limited's
filings with the U.S. Securities and Exchange Commission from time to time. When
used in this document, the words "anticipate" "estimate" "project" "forecast"
"plan" "potential" "will" "may" "should" and "expect" reflect forward-looking
statements.
<PAGE>

                                     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

     Unless the context otherwise requires, as used in this report, the terms
"Company" "we" "us" "the Group" and "our" refer to Aries Maritime Transport
Limited and all of its subsidiaries, and "Aries Maritime Transport Limited"
refers only to Aries Maritime Transport Limited and not to its subsidiaries. We
use the term deadweight, or dwt, in describing the size of vessels. Dwt,
expressed in metric tons each of which is equivalent to 1,000 kilograms, refers
to the maximum weight of cargo and supplies that a vessel can carry. We use the
term TEU, or TEUs, in describing the size of vessels carrying containers. The
size of one TEU is equivalent to 20 feet by 8 feet by 8 feet 6 inches (that is,
5.9 metres by 2.35 metres by 2.39 metres).
<PAGE>

A. Selected Financial Data

     The following table sets forth our selected consolidated and combined
financial and other data. The selected consolidated and combined financial and
other data may not be indicative of the results we would have achieved had we
operated as a public company for the entire period presented or of our future
results. This information should be read in conjunction with "Item 5 --
Operating And Financial Review And Prospects" and our historical consolidated
and predecessor combined carve-out financial statements and related notes. In
accordance with standard shipping industry practice, we did not obtain from the
sellers historical operating data for the vessels that we acquired, as that data
was not material to our decision to purchase the vessels. Accordingly, we have
not included any historical financial data relating to the results of operations
of our vessels for any period before we acquired them. Please see the discussion
in "Item 5 -- Operating And Financial Review And Prospects -- Lack of Historical
Operating Data for Vessels Before their Acquisition."

     Subsequent to the year ended December 31, 2006, the Company declared
dividends of $0.07 per share in respect of the fourth quarter of 2006. The
dividend was paid on March 30, 2007 to stockholders on record as of March 19,
2007.

<TABLE>
<CAPTION>
                             From inception,
                            March 7, 2003, to      Year ended          Year ended          Year ended
                            December 31, 2003   December 31, 2004   December 31, 2005   December 31, 2006
                            -----------------   -----------------   -----------------   -----------------

                               (Dollars in thousands except per share data)
<S>                             <C>                <C>                 <C>                 <C>
Income Statement Data
  (for period ending)

Revenue from voyages                 7,316             48,269              75,905              94,199

Gain on disposal of
  vessels                               --             14,724                  --                  --

Commissions                           (150)            (1,189)             (1,323)             (1,403)

Voyage expenses                        (24)              (312)               (224)             (4,076)

Vessel operating
  expenses                          (2,660)           (12,460)            (17,842)            (27,091)

General & administrative
  expenses                             (34)               (75)             (1,649)             (4,226)

Depreciation                        (1,721)           (12,724)            (19,446)            (29,431)

Amortization of
  drydocking and
  special survey
  expenses                            (271)            (1,552)             (1,958)             (3,568)

Management fees                       (199)              (893)             (1,511)             (1,999)

Net operating income                 2,257             33,788              31,952              22,405

Interest expense                    (1,539)            (8,616)            (18,793)            (19,135)

Interest received                        5                 58                 672                 931

Other income (expenses),
  net                                    6                 76                 (10)               (214)

Change in fair value of
   derivatives                        (215)               (33)                950              (1,788)

Net income                             514             25,273              14,771               2,199

Earnings per share
  (basic and diluted)                 0.03               1.56                0.64                0.08

Weighted average number
  of shares
  (basic and diluted)           16,176,877         16,176,877          23,118,466          28,416,877

Balance Sheet Data (at
  period end)

Cash and cash equivalents              667              5,334              19,248              11,612

Restricted cash                        109              4,803                  10               3,242

Total current assets                   890             12,371              22,438              22,430

Total assets                        45,534            245,725             377,898             458,040

Total current liabilities            4,177             34,666              21,356              29,622

Current portion of
  long-term debt                     2,667             21,910                  --                  --

Long-term debt, net of
  current portion                   37,743            185,050             183,820             284,800

Total liabilities                   45,020            229,072             222,217             325,452

Total stockholders'
  equity                               514             16,653             155,681             132,588

Other Financial Data (for
  period ending)

Net cash provided by
  operating activities               4,426             21,899              36,974              24,215

Net cash used in
  investing activities             (41,612)          (161,773)           (114,001)           (101,815)

Net cash provided by
  financing activities              37,853            144,541              90,941              69,964

Net increase (decrease)
  in cash and cash
  equivalents                          667              4,667              13,914              (7,636)

Fleet Data (at period
  end)

Number of products
  tankers owned                          2                  7                   8                  10

Number of container
  vessels owned                         --                  3                   5                   5
</TABLE>

<TABLE>
<CAPTION>
                                       Period from
                                       inception,
                                         March 7,
(All amounts in thousands of U.S.     2003, through    Year ended     Year ended     Year ended
dollars, unless otherwise stated)     December 31,    December 31,   December 31,   December 31,
                                          2003            2004           2005           2006
<S>                                      <C>             <C>            <C>            <C>
ADJUSTED EBITDA(1)

NET INCOME                                 514           25,273         14,771          2,199
plus Net interest expense                1,534            8,558         18,121         18,204
plus Depreciation and Amortization       1,992            5,221         12,112         21,326
Plus/(minus) Change in fair value
of derivatives                             215               33           (950)         1,788
ADJUSTED EBITDA                          4,255           39,085         44,054         43,517
</TABLE>

                                 ADJUSTED EBITDA

     (1) We consider Adjusted EBITDA to represent the aggregate of net income,
net interest expense, depreciation, amortization and change in the fair value of
derivatives. The Company's management uses Adjusted EBITDA as a performance
measure. The Company believes that Adjusted EBITDA is useful to investors,
because the shipping industry is capital intensive and may involve significant
financing costs. Adjusted EBITDA is not a measure recognized by GAAP and should
not be considered as an alternative to net income, operating income or any other
indicator of a Company's operating performance required by GAAP. The Company's
definition of Adjusted EBITDA may not be the same as that used by other
companies in the shipping or other industries.

B.   Capitalization and Indebtedness

     Not Applicable.

C.   Reasons for the Offer and Use of Proceeds

     Not Applicable.
<PAGE>

D.   Risk Factors

     The following risks relate principally to the industry in which we operate
and our business in general. Other risks relate to the securities market and
ownership of our common stock. If any of the circumstances or events described
below actually arises or occurs, our business, results of operations, cash
flows, financial condition and ability to pay dividends could be materially
adversely affected. In any such case, the market price of our common shares
could decline, and you may lose all or part of your investment.

Industry Specific Risk Factors

Charter rates for products tankers and container vessels may decrease in the
future, which may adversely affect our earnings.

     If the shipping industry, which has been highly cyclical, is depressed in
the future when our charters expire or at a time when we may want to sell a
vessel, our earnings and available cash flow may be adversely affected. Two of
our period charters are scheduled to expire during 2007. Our ability to
re-charter our vessels on the expiration or termination of our current charters,
the charter rates payable under any replacement charters and vessel values will
depend upon, among other things, economic conditions in the products tanker and
container vessel markets at that time, changes in the supply and demand for
vessel capacity and changes in the supply and demand for oil and oil products
and container transportation. We have period charters expiring on one container
vessel and one products tanker during 2007. You should read the information
contained in the table of vessel information under "Item 4 - Information on the
Company - Business Overview - Our Fleet". The period charter expiration dates
for all our vessels are detailed in that table under `Charter Expiration',
except for one products tanker which is currently employed in the spot market.

Factors beyond our control may adversely affect the demand for and value of our
vessels.

     The factors affecting the supply and demand for products tankers and
container vessels are outside of our control, and the nature, timing and degree
of changes in industry conditions are unpredictable.

     The factors that influence the demand for vessel capacity include:

     o    demand for oil and oil products;

     o    changes in oil production and refining capacity;

     o    the globalization of manufacturing;

     o    global and regional economic and political conditions;

     o    developments in international trade;

     o    changes in seaborne and other transportation patterns, including
          changes in the distances over which cargoes are transported;

     o    environmental and other regulatory developments;

     o    currency exchange rates; and

     o    weather.

     The factors that influence the supply of vessel capacity include:

     o    the number of newbuilding deliveries;

     o    the scrapping rate of older vessels;

     o    the number of vessels that are out-of-service; and

     o    port or canal congestion.

     If the number of new ships delivered exceeds the number of vessels being
scrapped and lost, vessel capacity will increase. If the supply of vessel
capacity increases but the demand for vessel capacity does not increase
correspondingly, charter rates and vessel values could materially decline.

The value of our vessels may fluctuate, adversely affecting our liquidity and
causing us to breach the terms of our new credit facility.

     Vessel values can fluctuate substantially over time due to a number of
different factors, including:

     o    general economic and market conditions affecting the shipping
          industry;

     o    competition from other shipping companies;

     o    the types and sizes of available vessels;

     o    the availability of other modes of transportation;

     o    increases in the supply of vessel capacity;

     o    the cost of newbuildings;

     o    prevailing charter rates; and

     o    the cost of retrofitting or modifying second-hand vessels, as a result
          of charterer requirements, technological advances in vessel design or
          equipment, changes in applicable environmental or other regulations or
          standards, or otherwise.

     In addition, as vessels grow older, they generally decline in value. Due to
the cyclical nature of the products tanker and container vessel markets, if for
any reason we sell vessels at a time when prices have fallen, we could incur a
loss and our business, results of operations, cash flows, financial condition
and ability to pay dividends could be adversely affected.

The market value of our vessels may decline, which could lead to a default under
our new credit facility and the loss of our vessels.

     If the market value of our fleet declines, we may not be in compliance with
certain provisions of our new credit facility and we may not be able to
refinance our debt or obtain additional financing. If we are unable to pledge
additional collateral, our lenders could accelerate our debt and foreclose on
our fleet. For instance, if the market value of our fleet declines below 140% of
the aggregate outstanding principal balance of our borrowings under our new
credit facility, we will not be in compliance with certain provisions of our new
credit facility and, as a result, we will not be able to pay dividends and may
not be able to refinance our debt or obtain additional financing.

     We pay interest under our new credit facility at a rate of LIBOR plus a
margin which ranges from 1.125% to 1.5% to reflect the ratio of our total
liabilities divided by our total assets, adjusting the book value of our fleet
to its market value ranging from less than 50% to equal to or greater than 65%.
If the market value of our vessels declines, we may pay a higher margin under
the terms of our new credit facility. You should read "Item 5 - Operating and
Financial Review and Prospects - Liquidity and Capital Resources - Indebtedness"
for additional information concerning our new credit facility.

We are subject to complex laws and regulations, including environmental
regulations that can adversely affect the cost, manner or feasibility of doing
business.

     Our operations are subject to numerous laws and regulations in the form of
international conventions and treaties, national, state and local laws and
national and international regulations in force in the jurisdictions in which
our vessels operate or are registered, which can significantly affect the
ownership and operation of our vessels. These requirements include, but are not
limited to, the U.S. Oil Pollution Act of 1990, or OPA, the International
Convention on Civil Liability for Oil Pollution Damage of 1969, the
International Convention for the Prevention of Pollution from Ships, the IMO
International Convention for the Prevention of Marine Pollution of 1973, the IMO
International Convention for the Safety of Life at Sea of 1974, the
International Convention on Load Lines of 1966 and the U.S. Marine
Transportation Security Act of 2002. Compliance with such laws, regulations and
standards, where applicable, may require installation of costly equipment or
operational changes and may affect the resale value or useful lives of our
vessels. We may also incur additional costs in order to comply with other
existing and future regulatory obligations, including, but not limited to, costs
relating to air emissions, the management of ballast waters, maintenance and
inspection, elimination of tin-based paint, development and implementation of
emergency procedures and insurance coverage or other financial assurance of our
ability to address pollution incidents. These costs could have a material
adverse effect on our business, results of operations, cash flows, financial
condition and our ability to pay dividends.

     A failure to comply with applicable laws and regulations may result in
administrative and civil penalties, criminal sanctions or the suspension or
termination of our operations. Some environmental laws often impose strict
liability for remediation of spills and releases of oil and hazardous
substances, which could subject us to liability without regard to whether we
were negligent or at fault. Under OPA, for example, owners, operators and
bareboat charterers are jointly and severally strictly liable for the discharge
of oil within the 200-mile exclusive economic zone around the United States. An
oil spill could result in significant liability, including fines, penalties,
criminal liability and remediation costs for natural resource damages under
other federal, state and local laws, as well as third-party damages. We are
required to satisfy insurance and financial responsibility requirements for
potential oil (including marine fuel) spills and other pollution incidents.
Although we have arranged insurance to cover certain environmental risks, there
can be no assurance that such insurance will be sufficient to cover all such
risks or that any claims will not have a material adverse effect on our
business, results of operations, cash flows, financial condition and our ability
to pay dividends.

The shipping industry has inherent operational risks that could negatively
impact our results of operations.

     Our vessels and their cargoes are at risk of being damaged or lost because
of events such as marine disasters, bad weather, mechanical failures, human
error, war, terrorism, piracy and other circumstances or events. All these
hazards can result in death or injury to persons, loss of revenues or property,
environmental damage, higher insurance rates, damage to our customer
relationships, delay or rerouting.

     If our vessels suffer damage, they may need to be repaired at a drydocking
facility. The costs of drydock repairs are unpredictable and can be substantial.
We may have to pay drydocking costs that our insurance does not cover in full.
The loss of earnings while these vessels are being repaired and repositioned, as
well as the actual cost of these repairs, would decrease our earnings. If one of
our vessels were involved in an accident with the potential risk of
environmental contamination, it could have a material adverse effect on our
business, results of operations, cash flows, financial condition and ability to
pay dividends.

Our insurance may not be adequate to cover our losses.

     We carry insurance to protect us against most of the accident-related risks
involved in the conduct of our business, including marine hull and machinery
insurance, protection and indemnity insurance, which includes pollution risks,
crew insurance, war risk insurance and off-hire insurance. However, we may not
be adequately insured to cover losses from our operational risks, which could
have a material adverse effect on us. Additionally, our insurers may refuse to
pay particular claims and our insurance may be voidable by the insurers if we
take, or fail to take, certain action, such as failing to maintain certification
of our vessels with applicable maritime regulatory organizations. Any
significant uninsured or under-insured loss or liability could have a material
adverse effect on our business, results of operations, cash flows and financial
condition and our ability to pay dividends. In addition, we may not be able to
obtain adequate insurance coverage at reasonable rates in the future during
adverse insurance market conditions.

Because we obtain some of our insurance through protection and indemnity
associations, we may also be subject to calls in amounts based not only on our
own claim records, but also the claim records of other members of the protection
and indemnity associations.

     We may be subject to calls in amounts based not only on our claim records
but also the claim records of other members of the protection and indemnity
associations through which we receive insurance coverage for tort liability,
including pollution-related liability. Our payment of these calls could result
in significant expense to us, which could have a material adverse effect on our
business, results of operations, cash flows, financial condition and ability to
pay dividends.

Labor interruptions could disrupt our business.

     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 flows, financial condition and ability to pay
dividends.

Maritime claimants could arrest our vessels, which could interrupt our cash
flow.

     Crew members, suppliers of goods and services to a vessel, shippers of
cargo and other parties may be entitled to a maritime lien against that vessel
for unsatisfied debts, claims or damages. In many jurisdictions, a maritime lien
holder may enforce its lien by arresting a vessel through foreclosure
proceedings. The arrest or attachment of one or more of our vessels could
interrupt our cash flow and require us to pay a significant amount of money to
have the arrest lifted. In addition, in some jurisdictions, such as South
Africa, under the " sister ship" theory of liability, a claimant may arrest both
the vessel that is subject to the claimant's maritime lien and any " associated"
vessel, which is any vessel owned or controlled by the same owner. Claimants
could try to assert "sister ship" liability against one vessel in our fleet for
claims relating to another vessel in our fleet.

Increased inspection procedures, tighter import and export controls and new
security regulations could increase costs and cause disruption of our container
shipping business.

     International container shipping is subject to security and customs
inspection and related procedures in countries of origin, destination and
trans-shipment points. These security procedures can result in cargo seizure,
delays in the loading, offloading, trans-shipment, or delivery of containers and
the levying of customs duties, fines or other penalties against exporters or
importers and, in some cases, carriers.

     Since the events of September 11, 2001, U.S. authorities have more than
doubled container inspection rates to approximately 5% of all imported
containers. Government investment in non-intrusive container scanning technology
has grown, and there is interest in electronic monitoring technology, including
so-called "e-seals" and "smart" containers that would enable remote, centralized
monitoring of containers during shipment to identify tampering with or opening
of the containers, along with potentially measuring other characteristics such
as temperature, air pressure, motion, chemicals, biological agents and
radiation.

     It is unclear what changes, if any, to the existing security procedures
will ultimately be proposed or implemented, or how any such changes will affect
the container shipping industry. These changes have the potential to impose
additional financial and legal obligations on carriers and, in certain cases, to
render the shipment of certain types of goods by container uneconomical or
impractical. These additional costs could reduce the volume of goods shipped in
containers, resulting in a decreased demand for container vessels. In addition,
it is unclear what financial costs any new security procedures might create for
container vessel owners, or whether carrier companies may seek to pass on
certain of the costs associated with any new security procedures to vessel
owners. Any additional costs or a decrease in container volumes could have an
adverse impact on our business, results of operations, cash flows, financial
condition and ability to pay dividends.

Governments could requisition our vessels during a period of war or emergency
without adequate compensation.

     A government could requisition or seize our vessels. Under requisition for
title, a government takes control of a vessel and becomes its owner. Under
requisition for hire, a government takes control of a vessel and effectively
becomes its charterer at dictated charter rates. Generally, requisitions occur
during periods of war or emergency. Although we would be entitled to
compensation in the event of a requisition, the amount and timing of payment
would be uncertain.

Terrorist attacks and international hostilities can affect the shipping
industry, which could adversely affect our business.

     Terrorist attacks like those of September 11, 2001 or war or international
hostilities, including those currently underway in Iraq and the Middle East,
could adversely affect the world economy, the availability of and demand for
crude oil and petroleum products and the charter rates in the products tanker
and container vessel markets. Terrorist attacks, such as the attack on the M/T
Limburg in October 2002, could also adversely affect our operations and directly
impact our vessels or our charterers. Our business, results of operations, cash
flows, financial condition and ability to pay dividends may be adversely
affected by changing economic, political and government conditions in the
countries and regions where our vessels are employed or registered. Moreover, we
operate in a sector of the economy that is likely to be adversely impacted by
the effects of political instability, terrorist or other attacks, war or
international hostilities.

Company Specific Risk Factors

We cannot assure you that we will pay dividends.

     We will make dividend payments to our shareholders only if our board of
directors, acting in its sole discretion, determines that such payments would be
in our best interest and in compliance with relevant legal and contractual
requirements. The principal business factors that our board of directors expects
to consider when determining the timing and amount of dividend payments will be
our earnings, financial condition and cash requirements at the time. Currently,
the principal contractual and legal restrictions on our ability to make dividend
payments are those contained in our new credit facility agreement, which we
refer to as our credit agreement, and those created by Bermuda law.

     Our new credit facility prohibits us from paying a dividend if an event of
default under the new credit facility is continuing or would result from the
payment of the dividend. Our new credit facility further requires us to maintain
specified financial ratios and minimum liquidity and working capital amounts.
Our obligations pursuant to these and other terms of our new credit facility
could prevent us from making dividend payments under certain circumstances.

     Under Bermuda law, we may not declare or pay dividends if there are
reasonable grounds for believing that (1) we are, or would after the payment be,
unable to pay our liabilities as they become due or (2) the realizable value of
our assets would thereby be less than the sum of our liabilities, our issued
share capital (the total par value of all outstanding shares) and share premium
accounts (the aggregate amount paid for the subscription for our shares in
excess of the aggregate par value of such shares). Consequently, events beyond
our control, such as a reduction in the realizable value of our assets, could
cause us to be unable to make dividend payments.

     We may incur other expenses or liabilities that would reduce or eliminate
the cash available for distribution as dividends. We may also enter into new
agreements or new legal provisions may be adopted that will restrict our ability
to pay dividends. As a result, we cannot assure you that dividends will be paid
with the frequency set forth in this Annual Report or at all.

Our historical financial and operating data may not be representative of our
future results because we have a limited operating history as a stand-alone
entity or as a publicly traded company.

     Our historical financial and operating data may not be representative of
our future results because we have a limited operating history as a stand-alone
entity or as a publicly traded company. Our combined financial statements
included in this document have been carved out of the consolidated financial
statements of Aries Energy Corporation, or Aries Energy, a private company which
owned and operated two products tankers during the period from March 2003 to
December 31, 2003, seven products tankers and five container vessels during the
year ended December 31, 2004 and eight product tankers and five container
vessels during the year ended December 31, 2005. Consistent with shipping
industry practice, we have not obtained, nor do we present in this document,
historical operating data for our vessels prior to their acquisition. Although
our results of operations, cash flows and financial condition reflected in our
combined financial statements include all expenses allocable to our business,
due to factors such as the additional administrative and financial obligations
associated with operating as a publicly traded company, they may not be
indicative of the results of operations that we would have achieved had we
operated as a public entity for all periods presented or of future results that
we may achieve as a publicly traded company with our current holding company
structure.

We depend upon four significant charterers for the majority of our revenues. The
loss of one or more of these charterers could adversely affect our financial
performance.

     We have historically derived a significant part of our revenue from a small
number of charterers. During 2006, 65% of our revenue was derived from four
charterers, Trafigura Beheer B.V., Deiulemar Compagnia di Navigazione S.p.A, CMA
CGM S.A. and PDVSA. If we were to lose any of these charterers, or if any of
these charterers significantly reduced its use of our services or was unable to
make charter payments to us, our results of operations, cash flows and financial
condition would be adversely affected.

Our charterers may terminate or default on their charters, which could adversely
affect our results of operations and cash flow.

     Our charters may terminate earlier than the dates indicated in the section
"Our Fleet" in "Item 4 -- Information on the Company." The terms of our charters
vary as to which events or occurrences will cause a charter to terminate or give
the charterer the option to terminate the charter, but these generally include a
total or constructive total loss of the related vessel, the requisition for hire
of the related vessel or the failure of the related vessel to meet specified
performance criteria. In addition, the ability of each of our charterers 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 a specific shipping market sector, 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 and our ability to pay dividends.

     We cannot predict whether our charterers will, upon the expiration of their
charters, recharter our vessels on favorable terms or at all. If our charterers
decide not to re-charter our vessels, we may not be able to recharter them on
terms similar to the terms of 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 recharter all of our vessels, our business, results of operations, cash flows
and financial condition may be adversely affected and the amounts available, if
any, to pay dividends to our shareholders may be significantly reduced or
eliminated.

Servicing our debt will substantially limit our funds available for other
purposes, such as vessel acquisitions and the payment of dividends.

     We intend to finance future vessel acquisitions through borrowings under
our new credit facility. A large part of our cash from operations may be
required to pay principal and interest on that debt. Our debt service payments
will reduce our funds available for other purposes, including those that may be
in the best interests of our shareholders. We cannot assure you that our future
cash flows will be adequate to fund future vessel acquisitions or to pay
dividends.

Our new credit facility imposes significant operating and financial
restrictions.

Our new credit facility requires us to adhere to certain financial covenants as
of the end of each fiscal quarter, including the following:

o    our shareholders' equity as a percentage of our total assets, adjusting the
     book value of our fleet to its market value, must be no less than 35%;

o    free cash and cash equivalents plus the undrawn element of the $5 million
     portion of the new credit facility available for general corporate
     purposes, must be no less than 5% of interest bearing debt;

o    our current liabilities, excluding deferred revenue and derivative
     financial instruments, may not exceed our current assets, excluding
     derivative financial instruments;

o    the ratio of EBITDA (earnings before interest, taxes, depreciation and
     amortization) to interest expense must be no less than 3.00 to 1.00 on a
     trailing four quarter basis. Primarily due to vessel out-of-service time
     during the year ended December 31, 2006, the interest coverage ratio
     financial covenant contained in the new credit facility would not be met
     and the lender agreed to lower the ratio for this financial covenant. This
     ratio was lowered to 2.50 to 1.00 for the three month period ended December
     31, 2006, and three month periods ending March 31, 2007 and June 30, 2007.
     For subsequent three month periods the lower ratio will not apply and the
     ratio reverts back to 3.00 to 1.00, which the Company believes it will
     meet. With effect from January 3, 2007 and until the lower ratio under this
     covenant no longer applies, the Company will pay an increased margin of
     1.75%; and

o    the aggregate fair market value of our vessels must be no less than 140% of
     the aggregate outstanding loans under the credit facility.

In addition, Magnus Carriers is required to maintain a credit balance in an
account opened with the lender of at least $1 million. The new credit facility
also requires our two principal beneficial equity holders to maintain a
beneficial ownership interest in our company of no less than 10% each.

Our new credit facility prevents us from declaring dividends if any event of
default, as defined in the new credit facility, occurs or would result from such
declaration. Each of the following will be an event of default under the new
credit facility:

o    the failure to pay principal, interest, fees, expenses or other amounts
     when due;

o    breach of certain financial covenants, including those which require Magnus
     Carriers Corporation ("Magnus Carriers") to maintain a minimum cash
     balance;

o    the failure of any representation or warranty to be materially correct;

o    the occurrence of a material adverse change (as defined in the credit
     agreement);

o    the failure of the security documents or guarantees to be effective;

o    judgments against us or any of our subsidiaries in excess of certain
     amounts;

o    bankruptcy or insolvency events; and

o    the failure of our principal beneficial equity holders to maintain their
     investment in us.

Events beyond our control, including changes in the economic and business
conditions in the shipping markets in which we operate, may affect our ability
to comply with these covenants. We cannot assure you that we will meet these
ratios or satisfy these covenants or that our lenders will waive any failure to
do so. A breach of any of the covenants in, or our inability to maintain the
required financial ratios under, our new credit facility would prevent us from
borrowing additional money under the new credit facility and could result in a
default under the new credit facility. If a default occurs under our new credit
facility, the lenders could elect to declare the outstanding debt, together with
accrued interest and other fees, to be immediately due and payable and proceed
against the collateral securing that debt, which could constitute all or
substantially all of our assets.

Our ability to obtain additional debt financing may depend on the performance of
our then existing charters and the creditworthiness of our charterers.

     The actual or perceived credit quality of our charterers, and any defaults
by them, may materially affect our ability to obtain the additional capital
resources that we will require to purchase additional vessels or may
significantly increase our costs of obtaining that capital. Our inability to
obtain additional financing or our ability to obtain additional financing at
higher than anticipated costs may materially and adversely affect our business,
results of operations, cash flows and financial condition and our ability to pay
dividends.

We will depend on Magnus Carriers, a private company, or other management
companies to manage and charter our fleet.

     We have contracted the commercial and technical management of all the
vessels in our fleet (with the exception of the Chinook, Stena Compass and Stena
Compassion), including crewing, maintenance and repairs to the management
company, Magnus Carriers. In addition, we expect that we will need to seek
approval from our lenders to change our manager. The loss of Magnus Carriers'
services or its failure to perform its obligations under the management
agreements could materially and adversely affect our business, results of
operations, cash flows, financial condition and our ability to pay dividends.
Although we may have rights against Magnus Carriers if it defaults on its
obligations to us, our shareholders will not directly share that recourse.

     The ability of Magnus Carriers to continue providing services for our
benefit will depend in part on its own financial strength. Circumstances beyond
our control could impair Magnus Carriers' financial strength. Because Magnus
Carriers is privately held, it is unlikely that information about its financial
strength would become public prior to any default by Magnus Carriers under the
management agreements. As a result, an investor in our shares might have little
advance warning of problems affecting Magnus Carriers, even though those
problems could have a material adverse effect on us.

Magnus Carriers and its affiliates may acquire or charter vessels that compete
with our fleet.

     Magnus Carriers, its principals or any of their controlled affiliates may
acquire or charter additional products tankers and container vessels in the
future, subject to a right of first refusal that Magnus Carriers and its
principals have granted to us for as long as Magnus Carriers is managing our
vessels. If we do not purchase or charter these vessels, they could compete with
our fleet, and Magnus Carriers and its affiliates might be faced with conflicts
of interest between their own interests and Magnus Carriers' obligations to us
under the ship management agreements.

We are a holding company, and we depend on the ability of our subsidiaries to
distribute funds to us in order to satisfy our financial and other obligations
and to make dividend payments.

     We are a holding company, and we have no significant assets other than the
equity interests in our subsidiaries. Our subsidiaries own all our vessels, and
payments under the charters with our charterers are made to our subsidiaries. As
a result, our ability to satisfy our financial and other obligations and to pay
dividends depends on the performance of our subsidiaries and their ability to
distribute funds to us. If we are unable to obtain funds from our subsidiaries,
we will not be able to pay dividends unless we obtain funds from other sources.
We cannot assure you that we will be able to obtain the necessary funds from
other sources.

We may not be able to grow or effectively manage our growth.

     A principal focus of our strategy is to grow by expanding our business. Our
future growth will depend on a number of factors, some of which we can control
and some of which we cannot. These factors include our ability to:

     o    identify vessels for acquisition;

     o    consummate acquisitions;

     o    integrate acquired vessels successfully with our existing operations;
          and

     o    obtain required financing for our existing and new operations.

     A deficiency in any of these factors could adversely affect our ability to
achieve anticipated growth in cash flows or realize other anticipated benefits.
In addition, competition from other buyers could reduce our acquisition
opportunities or cause us to pay a higher price than we might otherwise pay.

     The process of integrating acquired vessels into our operations may result
in unforeseen operating difficulties, may absorb significant management
attention and may require significant financial resources that would otherwise
be available for the ongoing development and expansion of our existing
operations. Future acquisitions could result in the incurrence of additional
indebtedness and liabilities that could have a material adverse effect on our
business, results of operations, cash flows, financial condition and ability to
pay dividends. Further, if we issue additional common shares, your interest in
our company will be diluted, and dividends to you, if any, may be reduced.

Capital expenditures and other costs necessary to operate and maintain our
vessels may increase due to changes in governmental regulations, safety or other
equipment standards.

     Changes in 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
additional expenditures. In order to satisfy these requirements, we may, from
time to time, be required to take 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 some or
all of our vessels profitably during the remainder of their economic lives.

If we are unable to fund our capital expenditures, we may not be able to
continue to operate some of our vessels, which would have a material adverse
effect on our business and our ability to pay dividends.

     In order to fund our capital expenditures, we may be required to incur
borrowings or raise capital through the sale of debt or equity securities. Our
ability to access the capital markets through future offerings may be limited by
our financial condition at the time of any such offering as well as by adverse
market conditions resulting from, among other things, general economic
conditions and contingencies and uncertainties that are beyond our control. Our
failure to obtain the funds for necessary future capital expenditures would
limit our ability to continue to operate some of our vessels and could have a
material adverse effect on our business, results of operations, financial
condition and our ability to pay dividends. Even if we are successful in
obtaining such funds through financings, the terms of such financings could
further limit our ability to pay dividends.

Aries Energy, an affiliate, is able to control our company, including the
outcome of shareholder votes through its wholly owned indirect subsidiary,
Rocket Marine Inc.

     Aries Energy, an affiliate, owns approximately 52% of our outstanding
common shares. As a result of this share ownership and for so long as Aries
Energy owns a significant percentage of our outstanding common shares, Aries
Energy will be able to control or influence the outcome of any shareholder vote,
including the election of directors, the adoption or amendment of provisions in
our memorandum of association or bye-laws and possible mergers, amalgamations,
corporate control contests and other significant corporate transactions. This
concentration of ownership may have the effect of delaying, deferring or
preventing a change in control, merger, amalgamation, consolidation, takeover or
other business combination. This concentration of ownership could also
discourage a potential acquirer from making a tender offer or otherwise
attempting to obtain control of us, which could in turn have an adverse effect
on the market price of our common shares.

Exposure to currency exchange rate fluctuations will result in fluctuations in
our cash flows and operating results.

     We generate all our revenues in U.S. dollars, but our manager, Magnus
Carriers, incurs approximately 30% of vessel operating expenses and we incur
general and administrative expenses in currencies other than the U.S. dollar.
This difference could lead to fluctuations in our vessel operating expenses,
which would affect our financial results. Expenses incurred in foreign
currencies increase when the value of the U.S. dollar falls, which would reduce
our profitability. For example, in the year ended December 31, 2006, the value
of the U.S. dollar depreciated by approximately 11% against the Euro.

Our incorporation under the laws of Bermuda may limit the ability of our
shareholders to protect their interests.

     We are a Bermuda company. Our memorandum of association and bye-laws and
the Companies Act 1981 of Bermuda, or the BCA, as amended, govern our corporate
affairs. Investors may have more difficulty in protecting their interests in the
face of actions by management, directors or controlling shareholders than would
shareholders of a corporation incorporated in a United States jurisdiction.
Under Bermuda law, a director generally owes a fiduciary duty only to the
company, not to the company's shareholders. Our shareholders may not have a
direct cause of action against our directors. In addition, Bermuda law does not
provide a mechanism for our shareholders to bring a class action lawsuit under
Bermuda law. Further, our bye-laws provide for the indemnification of our
directors or officers against any liability arising out of any act or omission,
except for an act or omission constituting fraud or dishonesty.

Anti-takeover provisions in our organizational documents could have the effect
of discouraging, delaying or preventing a merger, amalgamation or acquisition,
which could adversely affect the market price of our common shares.

     Several provisions of our bye-laws could discourage, delay or prevent a
merger or acquisition that shareholders may consider favorable. These include
provisions:

     o    authorizing our board of directors to issue "blank check" preference
          shares without shareholder approval;

     o    establishing a classified board of directors with staggered,
          three-year terms;

     o    prohibiting us from engaging in a "business combination" with an
          "interested shareholder" for a period of three years after the date of
          the transaction in which the person becomes an interested shareholder
          unless certain conditions are met;

     o    not permitting cumulative voting in the election of directors;

     o    authorizing the removal of directors only for cause and only upon the
          affirmative vote of the holders of at least 80% of our outstanding
          common shares;

     o    limiting the persons who may call special meetings of shareholders to
          our board of directors, subject to certain rights guaranteed to
          shareholders under the BCA; and

     o    establishing advance notice requirements for nominations for election
          to our board of directors and for proposing matters that can be acted
          on by shareholders at our shareholder meetings.

     These provisions could have the effect of discouraging, delaying or
preventing a merger, amalgamation or acquisition, which could adversely affect
the market price of our common shares.

It may not be possible for investors to enforce U.S. judgments against us.

     We and all our subsidiaries are incorporated in jurisdictions outside the
U.S., substantially all of our assets and those of our subsidiaries are located
outside the U.S. In addition, most of our directors and officers are
non-residents of the U.S., and all or a substantial portion of the assets of
these non-residents are located outside the U.S. As a result, it may be
difficult or impossible for U.S. investors to serve process within the U.S. upon
us, our subsidiaries or our directors and officers or to enforce a judgment
against us for civil liabilities in U.S. courts. In addition, you should not
assume that courts in the countries in which we or our subsidiaries are
incorporated or where our or the assets of our subsidiaries are located (1)
would enforce judgments of U.S. courts obtained in actions against us or our
subsidiaries based upon the civil liability provisions of applicable U.S.
federal and state securities laws or (2) would enforce, in original actions,
liabilities against us or our subsidiaries based on those laws.

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.
shareholders.

     A foreign corporation 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 its gross income for any taxable year consists of certain types of
"passive income" or (2) at least 50% of the average value of the corporation's
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 which 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. shareholders of a PFIC are subject to a
disadvantageous U.S. federal income tax regime applicable 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 method of operation, we do not believe that we will be a PFIC.
In this regard, we treat the gross income we derive or are deemed to derive from
our chartering activities as services income, rather than rental income.
Accordingly, we believe that our income from our chartering activities does not
constitute "passive income," and the assets that we own and operate in
connection with the production of that income do not constitute passive assets.

     There is, however, no direct legal authority under the PFIC rules
addressing our method of operation. Accordingly, no assurance can be given that
the U.S. Internal Revenue Service, or IRS, or a court of law will accept our
position, and there is a risk that the IRS or a court of law could determine
that we are a PFIC. Moreover, no assurance can be given that we would not
constitute a PFIC for any future taxable year if there were to be changes in the
nature and extent of our operations.

     If the IRS were to find that we are or have been a PFIC for any taxable
year, our U.S. shareholders would face adverse and special U.S. tax
consequences. Among other things, the distributions a shareholder received with
respect to our shares and the gain, if any, a shareholder derived from his sale
or other disposition of our shares would be taxable as ordinary income (rather
than as qualified dividend income or capital gain, as the case may be), would be
treated as realized ratably over his holding period in our common shares, and
would be subject to an additional interest charge. However, a U.S. shareholder
may be able to make certain tax elections which would ameliorate these
consequences.

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

     Under the Code, 50% of the gross shipping income of a vessel owning or
chartering corporation, such as our company 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 is subject to a 4% United States federal income tax without allowance for
deduction, unless that corporation qualifies for exemption from tax under
Section 883 of the Code and the related Treasury Regulations, which the IRS has
adopted and which became effective on January 1, 2005 for calendar year
taxpayers such as ourselves and our subsidiaries.

     We expect that we and each of our subsidiaries qualify for this statutory
tax exemption, and we take this position for United States federal income tax
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 United States federal income tax on our United States source income.

     For example, Aries Energy Corporation, or Aries Energy (through its wholly
owned subsidiary Rocket Marine Inc., or Rocket Marine), owns approximately 52%
of our outstanding common shares. We are ineligible to qualify for exemption
under Section 883 for any taxable year in which Aries Energy alone or together
with other shareholders with a 5% or greater interest in our common shares, or
the 5% shareholder group, own 50% or more of our outstanding common shares on
more than half the days during such taxable year and we are unable to establish
in accordance with the Treasury Regulations that within the 5% shareholder group
there are sufficient qualified shareholders for purposes of Section 883 to
preclude non-qualified shareholders within such group from owning 50% or more of
the value of our common stock for more than half the number of days during the
taxable year. In order to establish this, qualified shareholders within the 5%
shareholder group would have to provide us with certain information in order to
substantiate their identity as qualified shareholders. Captain Gabriel Petridis,
the 50% beneficial owner of Aries Energy, has agreed to provide us with such
information. Notwithstanding this agreement, we may be unable to establish in
conformity with the Treasury Regulations that there are sufficient qualified
shareholders within the 5% shareholder group to allow us to qualify for
exemption under Section 883. Due to the factual nature of the issues involved,
we can give no assurances regarding our tax-exempt status or that of any of our
subsidiaries.

     If we or our subsidiaries are not entitled to exemption under Section 883
of the Code for any taxable year, the imposition of a 4% U.S. federal income tax
on our U.S. source shipping income and that of our subsidiaries could have a
negative effect on our business and would result in decreased earnings available
for distribution to our shareholders.

Purchase options with respect to two of our vessels could result in our
receiving less than if we were to sell these ships in the open market.

     The charterer for two of our vessels, the Altius and the Fortius, has an
option to purchase 50% of the equity in those vessels exercisable six months
before the expiration of their current charters in June and August 2009,
respectively. If the option prices are lower than the prevailing market prices
of these vessels at the time of exercise, we would receive less for the equity
interests than we would receive if we were to sells the vessels in the open
market, which could negatively impact our results of operations.

Risks Relating to Our Common Stock

There may not be an active market for our common shares, which may cause our
common shares to trade at a discount and make it difficult to sell the common
shares you purchase.

     We cannot assure you that an active trading market for our common shares
will be sustained. We cannot assure you of the price at which our common shares
will trade in the public market in the future or that the price of our shares in
the public market will reflect our actual financial performance. You may not be
able to resell your common shares at or above their current market price.
Additionally, a lack of liquidity may result in wide bid-ask spreads, contribute
to significant fluctuations in the market price of our common shares and limit
the number of investors who are able to buy the common shares.

     The products tanker and container vessel sectors have been highly
unpredictable and volatile. The market price of our common shares may be
similarly volatile.

Future sales of our common shares could cause the market price of our common
shares to decline.

     The market price of our common shares could decline due to sales of a large
number of shares in the market, including sales of shares by our large
shareholders, or the perception that these sales could occur. These sales, or
the perception that these sales could occur, could also make it more difficult
or impossible for us to sell equity securities in the future at a time and price
that we deem appropriate to raise funds through future offerings of common
shares.

     Aries Energy owns approximately 52% of our common shares. Aries Energy
through Rocket Marine is eligible to sell any of our common shares, directly or
indirectly, in the public market following the applicable lock-up period, which
expired in December 2005. We have entered into a registration rights agreement
with Rocket Marine that entitles it to have all of its remaining shares
registered for sale in the public market following the expiration of that
restricted period. In addition, these shares could be sold into the public
market after one year pursuant to Rule 144 under the Securities Act of 1933, as
amended, or the Securities Act, subject to certain volume, manner of sale and
notice requirements. Sales or the possibility of sales of substantial amounts of
our common shares by Aries Energy in the public markets could adversely affect
the market price of our common shares.

ITEM 4. INFORMATION ON THE COMPANY

A.   History and Development of the Company

     We are Aries Maritime Transport Limited, or Aries Maritime, a Bermuda
company incorporated in January 2005 as a wholly owned indirect subsidiary of
Aries Energy Corporation, or Aries Energy. We are an international shipping
company that owns products tankers and container vessels. In March 2005,
subsidiaries of Aries Energy contributed to us all of the issued and outstanding
stock of 10 vessel-owning companies in exchange for shares in our company.
Before this contribution, each of the Aries Energy subsidiaries held 100% of the
issued and outstanding stock of the respective vessel-owning company or
companies owned by it. We now hold 100% of the issued and outstanding stock of
each vessel-owning company. Because our ownership percentage in each
vessel-owning company was identical to each contributing subsidiary's prior
ownership percentage in the same vessel-owning company, the group reorganization
was accounted for as an exchange of equity interests at historical cost. On June
8, 2005 Aries Maritime closed its initial public offering of 12,240,000 common
shares at an offering price of $12.50 per share. Our common stock is listed on
the Nasdaq Global Market under the symbol "RAMS". The address of our principal
executive office is 18 Zerva Nap., Glyfada, Athens 166 75, Greece.

     Our primary capital expenditures are in connection with the acquisitions of
vessels. Since the date of our incorporation, we have exercised an option to
re-acquire two additional container vessels, CMA CGM Seine and CMA CGM Makassar,
from an affiliate of Aries Energy and took delivery of the ships in June and
July 2005. Also, in October 2005, contracts were entered into for the purchase
of two new products tankers, Stena Compass and Stena Compassion. The Stena
Compass was delivered in February 2006 and the Stena Compassion in June 2006. In
November 2005, we took delivery of the 2001 built products tanker Chinook. As a
result of these acquisitions, our fleet now consists of ten product tankers with
an aggregate capacity of approximately 575,325 dwt and five container vessels
with an aggregate capacity of approximately 12,509 TEU. The aggregate purchase
price of the three vessels we acquired in 2005 was $103.2 million and the
aggregate purchase price of the two vessels we acquired in 2006 was $112.2
million. See note 6 to our consolidated and predecessor combined carve-out
financial statements included in this report.

B.   Business Overview

Our Fleet

Our fleet consists of ten products tankers and five container vessels. Our ten
products tankers consist of five double-hulled MR tankers, one of which has a
cargo-carrying capacity of 41,450 dwt, one which has a cargo-carrying capacity
of 41,502 dwt and three of which have a cargo-carrying capacity of 38,701 dwt;
four double-hulled Panamax tankers, two of which have a cargo-carrying capacity
of 73,400 dwt and two of which have a cargo-carrying capacity of 72,750 dwt; and
one double-hulled Aframax tanker, which has a cargo-carrying capacity of 83,970
dwt. Our products tankers are designed to transport several different refined
petroleum products simultaneously in segregated coated cargo tanks. These
cargoes typically include gasoline, jet fuel, kerosene, naphtha and heating oil,
as well as edible oils. The average age of our products tankers is approximately
7.7 years. All our products tankers were employed under period charters as of
March 31, 2007, with remaining terms ranging from approximately four months to
2.4 years, with the exception of Bora, now named Ostria, which was operating in
the spot market. Our charterers include PDVSA, the state oil company of
Venezuela, ST Shipping, Deiulemar Compagnia di Navigazione S.p.A./Enel S.p.A.,
Trafigura Beheer B.V. and the Stena Group.

     Our five container vessels range in capacity from 1,799 to 2,917 TEU and
have an average age of 17.4 years. Container vessels of this size are generally
utilized in the North/South trade routes that link Europe and Asia with Latin
America, Africa, India, Australia and New Zealand. Our four largest container
vessels are also utilized in the East/West trade routes that link Europe with
the Far East and the United States. Our smaller container vessel may be employed
on the same trade routes or may serve as a feeder vessel trading between hub
ports, where larger vessels call, and smaller regional ports. All of our
container vessels were employed under time charters as of March 31, 2007, with
remaining terms ranging from approximately three months to 3.4 years. Three of
our container vessels are currently chartered to China Shipping Group,
Mediterranean Shipping Co. S.A. ("MSC") and Islamic Republic of Iran Shipping
Line ("IRISL") with the remaining two container vessels currently chartered to
CMA CGM S.A.

     After our period charters expire, we may employ our vessels under new
period charters or in the spot voyage market between period charters, depending
on the prevailing market conditions at that time. Set forth below is summary
information concerning our fleet as of March 31, 2007.

<TABLE>
<CAPTION>
-------------------------------------------------------------------------------------------------------------------
                                                                                                       Daily total
                                                                                         Net Daily        vessel
                                                                          Charter       Charterhire     operating
Vessel Name                   Size      Year Built      Charterer        Expiration          Rate        expenses
-------------------------------------------------------------------------------------------------------------------
Product Tankers
-------------------------------------------------------------------------------------------------------------------
<S>                        <C>             <C>       <C>               <C>               <C>             <C>
Altius                     73,400 dwt      2004       Deiulemar/Enel      June 2009        $14,860       $4,500
-------------------------------------------------------------------------------------------------------------------
Fortius                    73,400 dwt      2004       Deiulemar/Enel     August 2009       $14,860       $4,500
-------------------------------------------------------------------------------------------------------------------
Nordanvind                 38,701 dwt      2001           PDVSA         November 2008      $19,988       $5,000
-------------------------------------------------------------------------------------------------------------------
Ostria (ex Bora)           38,701 dwt      2000            Spot             Spot            Spot         $5,000
-------------------------------------------------------------------------------------------------------------------
High Land                  41,450 dwt      1992         Trafigura        April 2008        $16,575       $4,700
-------------------------------------------------------------------------------------------------------------------
High Rider                 41,502 dwt      1991         Trafigura        April 2008        $16,575       $4,700
-------------------------------------------------------------------------------------------------------------------
Arius (ex Citius)          83,970 dwt      1986        ST Shipping        July 2007      $18,038(1)      $4,800
-------------------------------------------------------------------------------------------------------------------
Stena Compass              72,750 dwt      2006        Stena Group       August 2008     $18,700(2)        N/A
-------------------------------------------------------------------------------------------------------------------
Stena Compassion           72,750 dwt      2006        Stena Group      December 2008    $18,700(2)        N/A
-------------------------------------------------------------------------------------------------------------------
Chinook                    38,701 dwt      2001        Stena Group       August 2008     $17,062(2)      $5,300 (3)
-------------------------------------------------------------------------------------------------------------------
Container Vessels
-------------------------------------------------------------------------------------------------------------------
CMA CGM Makassar           2,917 TEU       1990          CMA CGM          May 2010         $20,400       $5,100
-------------------------------------------------------------------------------------------------------------------
CMA CGM Seine              2,917 TEU       1990          CMA CGM       September 2010      $20,400       $5,100
-------------------------------------------------------------------------------------------------------------------
Energy 1 (ex ANL Energy)   2,438 TEU       1989           IRISL          April 2008        $17,297       $4,800
-------------------------------------------------------------------------------------------------------------------
MSC OSLO (ex SCI Tej)      2,438 TEU       1989            MSC           March 2009        $15,000       $4,800
-------------------------------------------------------------------------------------------------------------------
Ocean Hope                 1,799 TEU       1989       China Shipping      June 2007        $13,956       $4,400
                                                     Container Lines
-------------------------------------------------------------------------------------------------------------------
</TABLE>

(1)  Plus 50% of profits of over and above $18,000 per day, under the profit
     sharing provisions of our charter agreement with ST Shipping, plus an
     additional $244 per day for a third oil major approval as and when
     obtained.

(2)  Plus additional income under profit sharing provisions of our charter
     agreement with Stena Group.

(3)  This refers to the actual daily vessel operating expenses during 2006.

Vessel Charters

     Our product tankers, except Bora, now named Ostria, which is currently
operating in the spot market, and container vessels are currently committed
under period employment agreements with national, regional and international
companies. Pursuant to these agreements, known as charterparties, we provide
these companies, or charterers, with a vessel and crew at a fixed, per-day rate
for a specified term.

     The charterers under the time charters referenced below are generally
responsible for, among other things, the cost of all fuels with respect to the
vessels (with certain exceptions, including during off-hire periods), port
charges, costs related to towage, pilotage, mooring expenses at loading and
discharging facilities and certain operating expenses. The charterers are not
obligated to pay us charterhire for off-hire days, which include days a vessel
is out-of-service due to, among other things, repairs or drydockings. Under the
time charters, we are generally required, among other things, to keep the
related vessels seaworthy, to crew and maintain the vessels and to comply with
applicable regulations. We are also required to provide protection and
indemnity, hull and machinery, war risk and oil pollution insurance cover. Our
shipmanagement companies perform these duties for us under the ship management
agreements.

     Charter periods are typically, at the charterer's option, subject to (1)
extension or reduction by between 15 and 60 days at the end of the final charter
period and (2) extension by any amount of time during the charter period that
the vessel is off-hire. A vessel is generally considered to be "off-hire" during
any period that it is out-of-service due to damage to or breakdown of the vessel
or its equipment or a default or deficiency of its crew. Under certain
circumstances our charters may terminate prior to their scheduled termination
dates. The terms of our charters vary as to which events or occurrences will
cause a charter to terminate or give the charterer the option to terminate the
charter, but these generally include a total or constructive total loss of the
related vessel, the requisition for hire of the related vessel or the failure of
the related vessel to meet specified performance criteria.

     Two of our vessels, Altius and Fortius, which are sister ships, are
employed under time charters with Deiulemar Compagnia di Navigazione S.p.A
("Deiulemar"), an Italian shipping company, at a daily charter rate of $14,860
per vessel, net of commissions, which commenced in August and June 2004,
respectively. Deiulemar has in turn sub-chartered these vessels to Enel.FTL, an
Italian energy company partly owned by the Italian state. Under the Deiulemar
charterparties, Deiulemar has the option to purchase 50% of each vessel's equity
upon the expiration of the charter for 50% of the difference between $29.5
million and the debt balance on each vessel. If Deiulemar exercises this option,
Magnus Carriers will continue to provide technical management services and
Deiulemar will have a right of first refusal for the provision of commercial
management services for the purchased vessel or vessels. The time charters with
Deiulemar for Altius and Fortius are scheduled to expire in August and June
2009, respectively, subject to the typical adjustments discussed above.

     Our vessel Nordanvind is employed under a time charter with PDVSA, S.A.
("PDVSA"), the state oil company of Venezuela. Under the terms of the time
charter, which commenced in November 2005, PDVSA is required to pay a daily
charter rate of $19,988, net of commissions, until November 2008, subject to the
typical adjustments discussed above. In May 2006, we withdrew our sister vessel
Bora, now named Ostria, from its charter with PDVSA and began marketing the
vessel in the spot market.

     Two of our vessels, High Land and High Rider, which are sister ships, have
been employed since April 2006 under time charters to Trafigura Beheer
B.V.("Trafigura"), a global trading group involved in the trade, transportation,
storage and distribution of oil, oil products, minerals and metals. Trafigura is
required to pay a daily charter rate of $16,575 per vessel, net of commissions.
The charters will expire in April 2008.

     Our vessel Arius (ex Citius) entered into a new time charter for an initial
period of 6 months with ST Shipping and Transportation Inc., ("ST Shipping"),
the shipping division of Glencore International A.G., a company based in
Switzerland. Glencore International A.G. supplies a range of commodities and raw
materials to companies in industries such as automotive, power generation, steel
production and food processing. Under the terms of the time charter, ST Shipping
is required to pay us a basic hire of $17,550 per day, net of commissions plus
an additional $243.75 net of commissions per day for every oil major approval as
and when obtained until three are obtained. The vessel currently has two oil
major approvals. The charterer is also required to pay us additional hire
equalling 50% of any trading income (revenue less voyage-related expenses) in
excess of $18,000 per day. The charter period to ST Shipping is scheduled to
expire in July 2007. Under the terms of the charter, the charterer has the
option to extend the charter period for a period of six months and subject to
the typical adjustments discussed above. The vessel commenced this charter on
August 1, 2006.

     An agreement has been made between the Company and ST Shipping to settle ST
Shipping's claim of $930,000 for alleged loss of profit, on the basis of a full
and final settlement in the amount of $750,000, which ST Shipping will recoup
from their share of the profit sharing generated by the vessel under the new
charter since August 1, 2006 and the Company has provided a guarantee that if
insufficient profits are made by the end of the new charter, Aries will pay any
shortfall at the end of the charter.

     Our vessel Chinook, sister ship to the Nordanvind and Ostria, is employed
under time charter to the Stena Group for an initial period of 18 months at a
daily rate of $17,062.50 net of commissions. This charter commenced on February
20, 2007. The charterer has an option to extend the time charter for a period of
twelve months at the same rate subject to the typical adjustments discussed
above. The time charter also includes a profit sharing component with a 50%
share for the Company, based on any trading income (revenue less voyage-related
expenses) in excess of the daily hire gross of commissions.

     Our vessels CMA CGM Makassar and CMA CGM Seine, which are sister ships, are
employed under time charters to CMA CGM S.A. ("CMA CGM"), a worldwide container
shipping company based in France. Under the terms of these time charters, CMA
CGM is required to pay a daily charter rate of $20,400 per vessel, net of
commissions. These five year time charters commenced in May 2005 and September
2005 respectively and are subject to the typical adjustments discussed above.

     Our vessel Energy 1 (ex ANL Energy) has been employed under time charter to
IRISL since October 2006. Under the terms of the charter, IRISL is required to
pay us a daily charter rate of $17,297 net of commissions. The charter will
expire in April 2008, subject to a 6-month extension at the charterers' option
and subject to the typical adjustments discussed above.

     Our vessel MSC OSLO (ex SCI Tej), sister vessel of M/V Energy 1, is
employed under time charter to MSC, a privately-owned company founded in 1970
which is the second largest container shipping line in the world. Under the
terms of the time charter, MSC is required to pay us a daily charter rate of
$15,000 net of commissions, subject to the typical adjustments discussed above.
This timecharter commenced on March 8, 2007 and is for two years.

     Our vessel Ocean Hope is currently employed under a time charter with China
Shipping Container Lines (Asia) Co. Ltd. ("CSCL"), a company within the China
Shipping Group, a state-owned Chinese shipping conglomerate. Under the terms of
the time charter, CSCL is required to pay a daily charter rate of $13,956, net
of commissions. The time charter to CSCL commenced in June 2004 and is scheduled
to expire in June 2007, subject to the typical adjustments discussed above.

     Our vessels Stena Compass and Stena Compassion are currently employed under
bareboat charters with two companies of the Stena Group (Panvictory Ltd. and
Panvision Ltd. respectively). Under the terms of the bareboat charters, the
Stena Group companies are required to pay a basic daily charter rate of $18,700,
there being no commissions. In addition, the Stena Group companies are required
to pay an additional hire equal to 30% of the time charter equivalent weighted
average hire for each quarter in excess of $24,500 per day. The bareboat
charters expire in August 2008 and December 2008 respectively.

     The charterers under the bareboat charters referenced above are generally
responsible for the running cost of the vessels, which include, among other
things, operation, maintenance, insurance (protection and indemnity, hull and
machinery, war risk and oil pollution) and repairs, drydocking and crew. Also,
charter hire is not subject to deductions for off-hire days under the bareboat
charters.

     For the periods ended December 31, 2006, 2005 and 2004, our revenues from
products tankers were $53 million, $42.9 million and $20.7 million respectively.
For the periods ended December 31, 2006, 2005 and 2004, our revenues from
container vessels were $41.2 million, $33 million and $27.6 million
respectively. These revenues include Deferred Revenue (for which please refer to
Item 5 - Operating and Financial Review and Prospects). Our fleet did not
include any container vessels in 2003.

Fleet Management

     Certain of our vessel-owning subsidiaries have entered into ten-year ship
management agreements with Magnus Carriers, which is cancelable by us on two
months' prior notice. Eleven of these twelve existing management agreements with
Magnus Carriers were entered into in June 2005 with the last entered into in
July 2005. Under these management agreements, Magnus Carriers is responsible for
all technical management of our vessels, including crewing, maintenance, repair,
capital expenditures, drydocking, payment of vessel taxes and other vessel
operating activities. Magnus Carriers is also obligated under our management
agreements to maintain, at our expense, insurance for each of our vessels,
including marine hull and machinery insurance, protection and indemnity
insurance (including pollution risks and crew insurances), war risk insurance
and off-hire insurance.

     As compensation for these services, we pay Magnus Carriers an amount equal
to the budgeted vessel operating expenses, which we have established jointly
with Magnus Carriers. These initial budgeted vessel operating expenses increased
by 3% during the year ended December 31, 2006. They are also subject to
adjustment every three years. The initial annual management fee was set at
$146,000 per vessel and during 2006 increased by 3% to $150,380 per vessel. The
ship management agreements provide that, if actual total vessel operating
expenses exceed the corresponding budgeted amounts, we and Magnus Carriers will
bear the excess expenditures equally (except for costs relating to any
improvement, structural changes or installation of new equipment required by law
or regulation, which will be paid solely by us). On the other hand, if actual
total vessel operating expenses are less than the corresponding budgeted
amounts, we and Magnus Carriers will share the cost savings equally. Vessel
operating expenses are payable by us monthly in advance.

     We also use Magnus Carriers and its affiliates non-exclusively for
commercial management of all our vessels except Stena Compass and Stena
Compassion, which includes finding employment for our vessels and identifying
and developing vessel acquisition opportunities that will fit our strategy.
Under the terms of the ship management agreements, Magnus Carriers provides
chartering services in accordance with our instructions and we pay Magnus
Carriers 1.25% of any gross charterhire and freight paid to us for new charters.
In addition, Magnus Carriers will supervise the sale of our vessels and the
purchase of additional vessels in accordance with our instructions. We pay
Magnus Carriers 1% of the sale or purchase price in connection with a vessel
sale or purchase that Magnus Carriers brokers for us.

     Magnus Carriers has agreed to indemnify us against the consequences of any
failure by Magnus Carriers to perform its obligations under the ship management
agreements up to an amount equal to ten times the annual management fee. Any
indemnification by Magnus Carriers for environmental matters is limited to the
insurance and indemnity coverage it is required to maintain for each vessel
under its ship management agreement.

     In addition, as long as Magnus Carriers is managing our vessels, Magnus
Carriers and its principals have granted us a right of first refusal to acquire
or charter any container vessels or any products tankers ranging from 20,000 to
85,000 dwt, which Magnus Carriers, its principals or any of their controlled
affiliates may consider for acquisition or charter in the future.

     Magnus Carriers is an established ship management company that provides
ship management services for affiliated companies, such as our company, as well
as third parties including commercial banks. Since its inception in 1997, Magnus
Carriers has managed more than 50 vessels, including oil tankers, products
tankers, LPG tankers, chemical tankers, container vessels, dry bulk carriers and
reefer vessels. Magnus Carriers and its affiliates have offices in Athens,
Greece and London, England and have 34 land-based administrative employees and
employ more than 400 seafarers on 18 vessels.

Crewing and Employees

     As of December 31, 2006 our wholly-owned subsidiary, AMT Management Ltd.,
employed 3 employees, all of whom are shore-based. Magnus Carriers ensures that
all seamen have the qualifications and licenses required to comply with
international regulations and shipping conventions, and that our vessels employ
experienced and competent personnel.

     All of the employees of Magnus Carriers are subject to a general collective
bargaining agreement covering employees of shipping agents. These agreements set
industry-wide minimum standards. We have not had any labor interruptions with
our employees under this collective bargaining agreement.

Environmental and Other Regulation

     Government regulation significantly affects the ownership and operation of
our fleet. We are subject to various international conventions and treaties,
laws and regulations in force in the countries in which our vessels may operate
or are registered relating to safety and health and environmental protection
including the storage, handling, emission, transportation and discharge of
hazardous and non-hazardous materials, and the remediation of contamination and
liability for damage to natural resources.

     A variety of governmental and private entities subject our vessels to both
scheduled and unscheduled inspections. These entities include the local port
authorities, (applicable national authorities such as the U.S. Coast Guard and
harbor masters), classification societies, flag state administration (country of
registry) and charterers, particularly terminal operators and oil companies.
Some of these entities require us to obtain permits, licenses, certificates and
other authorizations for the operation of our fleet. Our failure to maintain
necessary permits or approvals could require us to incur substantial costs or
temporarily suspend operation of one or more of the vessels in our fleet.

     In recent periods, heightened levels of environmental and quality concerns
among insurance underwriters, regulators and charterers have led to greater
inspection and safety requirements on all ships and may accelerate the scrapping
of older vessels throughout the industry. Increasing environmental concerns have
created a demand for vessels that conform to the stricter environmental
standards. Magnus Carriers and Ernst Jacob, the technical manager of our vessel
Chinook and the Stena Group companies managing the Stena Compass and Stena
Compassion, are required to maintain operating standards for all of our vessels
emphasizing operational safety, quality maintenance, continuous training of our
officers and crews and compliance with applicable local, national and
international environmental laws and regulations. We believe that the operation
of our vessels is in substantial compliance with applicable environmental laws
and regulations and that our vessels have all material permits, licenses,
certificates or other authorizations necessary for the conduct of our
operations; however, because such laws and regulations are frequently changed
and may impose increasingly stricter requirements, we cannot predict the
ultimate cost of complying with these requirements, or the impact of these
requirements on the resale value or useful lives of our vessels. In addition, a
future serious marine incident that results in significant oil pollution or
otherwise causes significant adverse environmental impact could result in
additional legislation or regulation that could negatively affect our
profitability.

International Maritime Organization

     The International Maritime Organization, or IMO (the United Nations agency
for maritime safety and the prevention of marine pollution by ships), has
adopted the International Convention for the Prevention of Marine Pollution,
1973, as modified by the Protocol of 1978 relating thereto, which has been
updated through various amendments (the "MARPOL Convention"). The MARPOL
Convention relates to environmental standards including oil leakage or spilling,
garbage management, as well as the handling and disposal of noxious liquids,
harmful substances in packaged forms, sewage and air emissions. The IMO adopted
regulations that set forth pollution prevention requirements applicable to
tankers. These regulations, which have been adopted by over 150 nations,
including many of the jurisdictions in which our tankers operate, provide for,
among other things, phase-out of single-hulled tankers and more stringent
inspection requirements; including, in part, that:

     o    tankers between 25 and 30 years old must be of double-hulled
          construction or of a mid-deck design with double-sided construction,
          unless: (1) they have wing tanks or double-bottom spaces not used for
          the carriage of oil, which cover at least 30% of the length of the
          cargo tank section of the hull or bottom; or (2) they are capable of
          hydrostatically balanced loading (loading less cargo into a tanker so
          that in the event of a breach of the hull, water flows into the
          tanker, displacing oil upwards instead of into the sea);

     o    tankers 30 years old or older must be of double-hulled construction or
          mid-deck design with double sided construction; and

     o    all tankers are subject to enhanced inspections.

     Also, under IMO regulations, a tanker must be of double-hulled construction
or a mid-deck design with double-sided construction or be of another approved
design ensuring the same level of protection against oil pollution if the
tanker:

     o    is the subject of a contract for a major conversion or original
          construction on or after July 6, 1993;

     o    commences a major conversion or has its keel laid on or after January
          6, 1994; or

     o    completes a major conversion or is a newbuilding delivered on or after
          July 6, 1996.

     Effective September 2002, the IMO accelerated its existing timetable for
the phase-out of single hull oil tankers. At that time, these regulations
required the phase-out of most single hull oil tankers by 2015 or earlier,
depending on the age of the tanker and whether it has segregated ballast tanks.
Under the regulations, the flag state administration may allow for some newer
single hull ships registered in its country that conform to certain technical
specifications to continue operating until the 25th anniversary of their
delivery. Any port state, however, may deny entry of those single hull tankers
that are allowed to operate until their 25th anniversary to ports or offshore
terminals.

     However, as a result of the oil spill in November 2002 relating to the loss
of the m.t. Prestige, which was owned by a company not affiliated with us, in
December 2003, the Marine Environmental Protection Committee of the IMO, or
MEPC, adopted an amendment to the MARPOL Convention, which became effective in
April 2005. The amendment revised an existing regulation 13G accelerating the
phase-out of single hull oil tankers and adopted a new regulation 13H on the
prevention of oil pollution from oil tankers when carrying heavy grade oil.
Under the revised regulation, single hull oil tankers must be phased out no
later than April 5, 2005 or the anniversary of the date of delivery of the ship
on the date or in the year specified in the following table:

--------------------------------------------------------------------------------
Category of Oil Tankers                 Date or Year
--------------------------------------------------------------------------------
Category 1- oil tankers of 20,000
dwt and above carrying crude oil,
fuel oil, heavy diesel oil or           April 5, 2005 for ships delivered
lubricating oil as cargo, and of        on April 5, 1982 or earlier; or
30,000 dwt and above carrying other     2005 for ships delivered after
oils, which do not comply with the      April 5, 1982
requirements for protectively
located segregated ballast tanks

--------------------------------------------------------------------------------
Category 2 - oil tankers of 20,000
dwt and above carrying crude oil,       April 5, 2005 for ships delivered
fuel oil, heavy diesel oil or           on April 5, 1977 or earlier
lubricating oil as cargo, and of        2005 for ships delivered after
30,000 dwt and above carrying other     April 5, 1977 but before January 1,
oils, which do comply with the          1978
protectively located segregated         2006 for ships delivered in 1978
ballast tank requirements               and 1979
                                        2007 for ships delivered in 1980
and                                     and 1981
                                        2008 for ships delivered in 1982
Category 3 - oil tankers of 5,000       2009 for ships delivered in 1983
dwt and above but less than the         2010 for ships delivered in 1984 or
tonnage specified for Category 1        later
and 2 tankers.
--------------------------------------------------------------------------------

     Under the revised regulations, the flag state administration may allow for
some newer single hull oil tankers registered in its country that conform to
certain technical specifications to continue operating until the earlier of the
anniversary of the date of delivery of the vessel in 2015 or the 25th
anniversary of their delivery. Any port state, however, may deny entry of those
single hull oil tankers that are allowed to operate until the earlier of their
anniversary date of delivery in 2015 or their 25th anniversary to ports or
offshore terminals.

     The MEPC, in October 2004, adopted a unified interpretation to regulation
13G that clarified the date of delivery for tankers that have been converted.
Under the interpretation, where an oil tanker has undergone a major conversion
that has resulted in the replacement of the fore-body, including the entire
cargo carrying section, the major conversion completion date of the oil tanker
shall be deemed to be the date of delivery of the ship, provided that:

     o    the oil tanker conversion was completed before July 6, 1996;

     o    the conversion included the replacement of the entire cargo section
          and fore-body and the tanker complies with all the relevant provisions
          of MARPOL Convention applicable at the date of completion of the major
          conversion; and

     o    the original delivery date of the oil tanker will apply when
          considering the 15 years of age threshold relating to the first
          technical specifications survey to be completed in accordance with
          MARPOL Convention.

     In December 2003, the MEPC adopted a new regulation 13H on the prevention
of oil pollution from oil tankers when carrying heavy grade oil, or HGO. The new
regulation bans the carriage of HGO in single hull oil tankers of 5,000 dwt and
above after April 5, 2005, and in single hull oil tankers of 600 dwt and above
but less than 5,000 dwt, no later than the anniversary of their delivery in
2008.

     Under regulation 13H, HGO means any of the following:

     o    crude oils having a density at 15(0)C higher than 900 kg/m3;

     o    fuel oils having either a density at 15(0)C higher than 900 kg/ m3 or
          a kinematic viscosity at 50(0)C higher than 180 mm2/s;

     o    bitumen, tar and their emulsions.

     Under the regulation 13H, the flag state administration may allow continued
operation of oil tankers of 5,000 dwt and above, carrying crude oil with a
density at 15(0)C higher than 900 kg/m3 but lower than 945 kg/m3, that conform
to certain technical specifications and, in the opinion of the such
administration, the ship is fit to continue such operation, having regard to the
size, age, operational area and structural conditions of the ship and provided
that the continued operation shall not go beyond the date on which the ship
reaches 25 years after the date of its delivery. The flag state administration
may also allow continued operation of a single hull oil tanker of 600 dwt and
above but less than 5,000 dwt, carrying HGO as cargo, if, in the opinion of the
such administration, the ship is fit to continue such operation, having regard
to the size, age, operational area and structural conditions of the ship,
provided that the operation shall not go beyond the date on which the ship
reaches 25 years after the date of its delivery.

     The flag state administration may also exempt an oil tanker of 600 dwt and
above carrying HGO as cargo if the ship is either engaged in voyages exclusively
within an area under its jurisdiction, or is engaged in voyages exclusively
within an area under the jurisdiction of another party, provided the party
within whose jurisdiction the ship will be operating agrees. The same applies to
vessels operating as floating storage units of HGO.

     Any port state, however, can deny entry of single hull tankers carrying HGO
which have been allowed to continue operation under the exemptions mentioned
above, into the ports or offshore terminals under its jurisdiction, or deny
ship-to-ship transfer of HGO in areas under its jurisdiction except when this is
necessary for the purpose of securing the safety of a ship or saving life at
sea.

     Revised Annex I to the MARPOL Convention entered into force in January
2007. Revised Annex I incorporates various amendments adopted since the MARPOL
Convention entered into force in 1983, including the amendments to Regulation
13G (regulation 20 in the revised Annex) and Regulation 13H (regulation 21 in
the revised Annex). Revised Annex I also imposes construction requirements for
oil tankers delivered on or after January 1, 2010. A further amendment to
revised Annex I includes an amendment to the definition of "heavy grade oil"
that will broaden the scope of regulation 21.

     The IMO has also negotiated international conventions that impose liability
for oil pollution in international waters and a signatory's territorial waters.
In September 1997, the IMO adopted Annex VI to the MARPOL Convention to address
air pollution from ships. Annex VI was ratified in May 2004, and took effect May
19, 2005. Annex VI sets limits on sulfur oxide and nitrogen oxide emissions from
ship exhausts and prohibits deliberate emissions of ozone depleting substances,
such as chlorofluorocarbons. Annex VI also includes a global cap on the sulfur
content of fuel oil and allows for special areas to be established with more
stringent controls on sulfur emissions. Annex VI regulations pertaining to
nitrogen oxide emissions apply to diesel engines on vessels built on or after
January 1, 2000 or diesel engines undergoing major conversion after such date.
We believe that all our vessels comply with Annex VI in all material respects as
of its effective date. Additional or new conventions, laws and regulations may
be adopted that could adversely affect our business, cash flows, results of
operations and financial condition.

     The IMO also has adopted the International Convention for the Safety of
Life at Sea, or SOLAS Convention, which imposes a variety of standards to
regulate design and operational features of ships. SOLAS standards are revised
periodically. We believe that all our vessels are in substantial compliance with
SOLAS standards.

     Under the International Safety Management Code for the Safe Operation of
Ships and for Pollution Prevention, or ISM Code, promulgated by the IMO, 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. In 1994, the ISM Code became mandatory with the
adoption of Chapter IX of SOLAS. We intend to rely on the safety management
systems that Magnus Carriers and our other ship management companies have
developed.

     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 operator has been awarded a
document of compliance, issued by each flag state, under the ISM Code. We
believe that Magnus Carriers and our other ship management companies have all
material requisite documents of compliance for their offices and safety
management certificates for vessels in our fleet for which the certificates are
required by the IMO. Magnus Carriers and our other ship management companies
will be required to review these documents of compliance and safety management
certificates annually.

     Noncompliance with the ISM Code and other IMO regulations may subject the
shipowner 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 U.S. Coast Guard and European Union
authorities have indicated that vessels not in compliance with the ISM Code will
be prohibited from trading in U.S. and European Union ports.

     Although the United States is not a party to these conventions, many
countries have ratified and follow the liability plan adopted by the IMO and set
out in the International Convention on Civil Liability for Oil Pollution Damage
of 1969. Under this convention and depending on whether the country in which the
damage results is a party to the 1992 Protocol to the International Convention
on Civil Liability for Oil Pollution Damage, a vessel's registered owner is
strictly liable for pollution damage caused in the territorial waters of a
contracting state by discharge of persistent oil, subject to certain complete
defenses. Under an amendment to the 1992 Protocol that became effective on
November 1, 2003, for vessels of 5,000 to 140,000 gross tons (a unit of
measurement for the total enclosed spaces within a vessel), liability will be
limited to approximately $6.8 million plus $955.3 for each additional gross ton
over 5,000. For vessels of over 140,000 gross tons, liability will be limited to
approximately $136.0 million. As the convention calculates liability in terms of
a basket of currencies, these figures are based on currency exchange rates on
March 22, 2006. Under the 1969 Convention, the right to limit liability is
forfeited where the spill is caused by the owner's actual fault; under the 1992
Protocol, a shipowner cannot limit liability where the spill is caused by the
owner's intentional or reckless conduct. Vessels trading in jurisdictions that
are parties to these conventions must provide evidence of insurance covering the
liability of the owner. In jurisdictions where the International Convention on
Civil Liability for Oil Pollution Damage has not been adopted, various
legislative schemes or common law govern, and liability is imposed either on the
basis of fault or in a manner similar to that convention. We believe that our
protection and indemnity insurance will cover the liability under the plan
adopted by the IMO.

U.S. Oil Pollution Act of 1990 and Comprehensive Environmental Response,
Compensation and Liability Act

     The United States regulates the tanker sector with an extensive regulatory
and liability regime for environmental protection and cleanup of oil spills,
consisting primarily of OPA and the Comprehensive Environmental Response,
Compensation and Liability Act, or CERCLA. OPA affects all owners and operators
whose vessels trade with the United States or its territories or possessions, or
whose vessels operate in the waters of the United States, which include the U.S.
territorial sea and the 200 nautical mile exclusive economic zone around the
United States. CERCLA applies to the discharge of hazardous substances other
than oil, whether on land or at sea. Both OPA and CERCLA impact our operations.

     Under OPA, vessel owners, operators and bareboat charterers are
"responsible parties" who 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 and the responsible party reports the incident and reasonably
cooperates with the appropriate authorities) for all containment and clean-up
costs and other damages arising from oil spills from their vessels. These other
damages are defined broadly to include:

     o    natural resource damages and related assessment costs;

     o    real and personal property damages;

     o    net loss of taxes, royalties, rents, profits or earnings capacity;

     o    net cost of public services necessitated by a spill response, such as
          protection from fire, safety or health hazards;

     o    loss of profits or impairment of earning capacity due to injury,
          destruction or loss of real property, personal property and natural
          resources; and

     o    loss of subsistence use of natural resources.

     OPA limits the liability of responsible parties to the greater of $1,200
per gross ton or $10 million per tanker that is over 3,000 gross tons per
discharge (subject to possible adjustment for inflation). Amendments to OPA
signed into law in July 2006 increased the OPA liability limits to the greater
of $1,900 per gross ton or $16.0 million per double-hull tanker that is over
3,000 gross tons per discharge (subject to possible adjustment for inflation).
The act specifically permits individual states to impose their own liability
regimes with regard to oil pollution incidents occurring within their
boundaries, including adjacent waters, and some states have enacted legislation
providing for unlimited liability for discharge of pollutants within their
waters. In some cases, states that have enacted this type of legislation have
not yet issued implementing regulations defining vessel owners' responsibilities
under these laws. CERCLA, which applies to owners and operators of vessels,
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 $5 million.

     Although OPA is primarily directed at oil tankers, it also applies to
non-tanker vessels, such as container vessels, with respect to the fuel carried
on board. OPA limits the liability of non-tanker owners to the greater of $600
per gross ton or $500,000 per discharge, which may be adjusted periodically for
inflation.

     These limits of liability do not apply, however, where the incident is
caused by violation of applicable U.S. federal safety, construction or operating
regulations, or by the gross negligence or wilful misconduct of the responsible
party or the responsible party's agent or employee or any person acting in a
contractual relationship with the responsible party. In addition, these limits
do not apply if the responsible party or the responsible party's agent or
employee or any person acting in a contractual relationship with the responsible
party fails or refuses to report the incident or to cooperate and assist in
connection with the substance removal activities. OPA and CERCLA each preserve
the right to recover damages under other laws, including maritime tort law.

     OPA also requires owners and operators of vessels to establish and maintain
with the U.S. Coast Guard evidence of financial responsibility sufficient to
meet the limit of their potential strict liability under the act. The U.S. Coast
Guard has adopted regulations requiring evidence of financial responsibility in
the amount of $1,500 per gross ton for tankers, combining the OPA limitation on
liability of $1,200 per gross ton with the CERLA liability limit of $300 per
gross ton. The U.S. Coast Guard has indicated that it expects to adopt
regulations requiring evidence of financial responsibility in the amounts that
reflect the higher limits of liability imposed by the July amendments to OPA, as
described above. Under the regulations, evidence of financial responsibility may
be demonstrated by insurance, surety bond, self-insurance, guaranty or an
alternative method subject to approval by the Director of the U.S. Coast Guard
National Pollution Funds Center. Under OPA regulations, an owner or operator of
more than one vessel is required to demonstrate evidence of financial
responsibility for the entire fleet in an amount equal only to the financial
responsibility requirement of the vessel having the greatest maximum strict
liability under OPA and CERCLA. Magnus Carriers has provided the requisite
guarantees and has received certificates of financial responsibility from the
U.S. Coast Guard for each of our vessels required to have one.

     Magnus Carriers and the Stena Group companies managing Stena Compass and
Stena Compassion have arranged insurance for our tankers with pollution
liability insurance in the amount of $1 billion. However, a catastrophic spill
could exceed the insurance coverage available, in which event there could be a
material adverse effect on our business and on the ship management companies'
business, which could impair their ability to manage our vessels.

     Under OPA, oil tankers as to which a contract for construction or major
conversion was put in place after June 30, 1990 are required to have double
hulls. In addition, oil tankers without double hulls will not be permitted to
come to U.S. ports or trade in U.S. waters by 2015. All of the tankers in our
fleet have double hulls.

     OPA also amended the Federal Water Pollution Control Act to require that
owners or operators of tankers operating in the waters of the United States must
file vessel response plans with the U.S. Coast Guard, and their tankers are
required to operate in compliance with their U.S. Coast Guard approved plans.
These response plans must, among other things:

     o    address a "worst case" scenario and identify and ensure, through
          contract or other approved means, the availability of necessary
          private response resources to respond to a "worst case discharge";

     o    describe crew training and drills; and

     o    identify a qualified individual with full authority to implement
          removal actions.

     Vessel response plans for our tankers operating in the waters of the United
States have been approved by the U.S. Coast Guard. In addition, we conduct
regular oil spill response drills in accordance with the guidelines set out in
OPA. The U.S. Coast Guard has announced it intends to propose similar
regulations requiring certain vessels to prepare response plans for the release
of hazardous substances. Under the management agreements, Magnus Carriers and
our other ship management companies are responsible for ensuring our vessels
comply with any such additional regulations.

     As discussed above, OPA does not prevent individual states from imposing
their own liability regimes with respect to oil pollution incidents occurring
within their boundaries, including adjacent coastal waters. In fact, most U.S.
states that border a navigable waterway have enacted environmental pollution
laws that impose strict liability on a person for removal costs and damages
resulting from a discharge of oil or a release of a hazardous substance. These
laws may be more stringent than U.S. federal law.

Additional U.S. Environmental Requirements

     The U.S. Clean Air Act of 1970, as amended by the Clean Air Act Amendments
of 1977 and 1990 (the " CAA"), requires the U.S. Environmental Protection
Agency, or EPA, to promulgate standards applicable to emissions of volatile
organic compounds and other air contaminants. Our vessels are subject to vapor
control and recovery requirements for certain cargoes when loading, unloading,
ballasting, cleaning and conducting other operations in regulated port areas.
Our vessels that operate in such port areas are equipped with vapor control
systems that satisfy these requirements. The CAA also requires states to draft
State Implementation Plans, or SIPs, designed to attain national health-based
air quality standards in primarily major metropolitan and/or industrial areas.
Several SIPs regulate emissions resulting from vessel loading and unloading
operations by requiring the installation of vapor control equipment. As
indicated above, our vessels operating in covered port areas are already
equipped with vapor control systems that satisfy these requirements. Although a
risk exists that new regulations could require significant capital expenditures
and otherwise increase our costs, we believe, based on the regulations that have
been proposed to date, that no material capital expenditures beyond those
currently contemplated and no material increase in costs are likely to be
required.

     The Clean Water Act ("CWA") prohibits the discharge of oil or hazardous
substances into navigable waters and imposes strict liability in the form of
penalties for any unauthorized discharges. The CWA also imposes substantial
liability for the costs of removal, remediation and damages. State laws for the
control of water pollution also provide varying civil, criminal and
administrative penalties in the case of a discharge of petroleum or hazardous
materials into state waters. The CWA complements the remedies available under
the more recent OPA and CERCLA, discussed above. Under current regulations of
the EPA, vessels are not required to obtain CWA permits for the discharge of
ballast water in U.S. ports. However, on March 31, 2005, a U.S. District Court
ruled that the EPA exceeded its authority in creating an exemption for ballast
water. On September 18, 2006, the court issued an order invalidating the
exemption in the EPA's regulations for all discharges incidental to the normal
operation of a vessel as of September 30, 2008, and directing the EPA to develop
a system for regulating all discharges from vessels by that date. Although the
EPA has indicated that it will appeal this decision, if the exemption is
repealed, we may be subject to CWA permit requirements that may include ballast
water treatment obligations that could increase the cost of operating in the
United States. For example, this 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 which may restrict
our vessels from entering U.S. ports. We cannot assure you that any costs
associated with compliance with the CWA's permitting requirements will not be
material to our results of operations.

     The National Invasive Species Act ("NISA") was enacted in 1996 in response
to growing reports of harmful organisms being released into U.S. ports through
ballast water taken on by ships in foreign ports. NISA established a ballast
water management program for ships entering U.S. waters. Under NISA, mid-ocean
ballast water exchange is voluntary, except for ships heading to the Great
Lakes, Hudson Bay, or vessels engaged in the foreign export of Alaskan North
Slope crude oil. However, NISA's exporting and record-keeping requirements are
mandatory for vessels bound for any port in the United States. Although ballast
water exchange is the primary means of compliance with the act's guidelines,
compliance can also be achieved through the retention of ballast water onboard
the ship, or the use of environmentally sound alternative ballast water
management methods approved by the U.S. Coast Guard. If the mid-ocean ballast
exchange is made mandatory throughout the United States, or if water treatment
requirements or options are instituted, the costs of compliance could increase
for ocean carriers.

     Our operations occasionally generate and require the transportation,
treatment and disposal of both hazardous and non-hazardous wastes that are
subject to the requirements of the U.S. Resource Conservation and Recovery Act,
or RCRA, or comparable state, local or foreign requirements. In addition, from
time to time we arrange for the disposal of hazardous waste or hazardous
substances at offsite disposal facilities. If such materials are improperly
disposed of by third parties, we might still be liable for clean up costs under
applicable laws.

European Union Tanker Restrictions

     In July 2003, in response to the MT Prestige oil spill in November 2002,
the European Union adopted legislation that accelerates the IMO single hull
tanker phase-out timetable and, by 2010 will prohibit all single-hulled tankers
used for the transport of oil from entering into its ports or offshore
terminals. The European Union, following the lead of certain European Union
nations such as Italy and Spain, has also banned, as of October 21, 2003, all
single-hulled tankers carrying heavy grades of oil, regardless of flag, from
entering or leaving its ports or offshore terminals or anchoring in areas under
its jurisdiction. Commencing in 2005, certain single-hulled tankers above 15
years of age will also be restricted from entering or leaving European Union
ports or offshore terminals and anchoring in areas under European Union
jurisdiction. The European Union has also adopted legislation that: (1) bans
manifestly sub-standard vessels (defined as those over 15 years old that have
been detained by port authorities at least twice in a six-month period) from
European waters and creates an obligation of port states to inspect vessels
posing a high risk to maritime safety or the marine environment; and (2)
provides the European Union with greater authority and control over
classification societies, including the ability to seek to suspend or revoke the
authority of negligent societies. It is impossible to predict what legislation
or additional regulations, if any, may be promulgated by the European Union or
any other country or authority.

     All of the tankers in our fleet are double-hulled; however, because of
certain age restrictions and requirements set forth in the regulations described
above, High Land and High Rider and the Arius (ex Citius) are subject to certain
restrictions in trading.

Vessel 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, the U.S. 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 SOLAS created a
new chapter of the convention dealing specifically with maritime security. The
new chapter became effective in July 2004 and imposes various detailed security
obligations on vessels and port authorities, most of which are contained in the
newly created International Ship and Port Facilities Security Code, or the ISPS
Code. The ISPS Code is designed to protect ports and international shipping
against terrorism. After July 1, 2004, to trade internationally, a vessel must
attain an International Ship Security Certificate from a recognized security
organization approved by the vessel's flag state. Among the various requirements
are:

     o    on-board installation of automatic identification systems to provide a
          means for the automatic transmission of safety-related information
          from among similarly equipped ships and shore stations, including
          information on a ship's identity, position, course, speed and
          navigational status;

     o    on-board installation of ship security alert systems, which do not
          sound on the vessel but only alerts the authorities on shore;

     o    the development of vessel security plans;

     o    ship identification number to be permanently marked on a vessel's
          hull;

     o    a continuous synopsis record kept onboard showing a vessel's history
          including, name of the ship and of the state whose flag the ship is
          entitled to fly, the date on which the ship was registered with that
          state, the ship's identification number, the port at which the ship is
          registered and the name of the registered owner(s) and their
          registered address; and

     o    compliance with flag state security certification requirements.

     The U.S. Coast Guard regulations, intended to align with international
maritime security standards, exempt from MTSA vessel security measures non-U.S.
vessels that have on board, as of July 1, 2004, a valid ISSC attesting to the
vessel's compliance with SOLAS security requirements and the ISPS Code. Magnus
Carriers has implemented the various security measures addressed by MTSA, SOLAS
and the ISPS Code, and our fleet is in compliance with applicable security
requirements.

Risk of Loss and Insurance

     The operation of any cargo vessel includes risks such as mechanical
failure, physical damage, collision, property loss, 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 U.S. Oil Pollution Act of 1990, or OPA, which imposes
virtually unlimited liability upon owners, operators and 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 U.S. market. While we
believe that our present insurance coverage is adequate, not all risks can be
insured against, 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.

     We have obtained marine hull and machinery and war risk insurance, which
includes the risk of actual or constructive total loss, for all our vessels. The
vessels are each covered up to at least fair market value.

     We also arranged increased value insurance for most of our vessels. Under
the increased value insurance, in case of total loss of the vessel, we will be
able to recover the sum insured under the policy in addition to the sum insured
under our 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.

     Protection and indemnity insurance, which covers our third party
liabilities in connection with our shipping activities, is provided by mutual
protection and indemnity associations, or P&I Associations. This insurance
covers 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, or "clubs." Our coverage, except for pollution,
is unlimited.

     Our current protection and indemnity insurance coverage for pollution is
$1.0 billion per vessel per incident. The 13 P&I Associations that compose the
International Group insure approximately 90% of the world's commercial tonnage
and have entered into a pooling agreement to reinsure each association's
liabilities. Each P&I Association has capped its exposure to this pooling
agreement at $4.5 billion. As a member of a P&I Association that is a member of
the International Group, we are subject to calls payable to the associations
based on our claim records as well as the claim records of all other members of
the individual associations, and members of the International Group.

Inspection by a Classification Society

     Our vessels have been certified as being "in-class" by either Nippon
Kaijori Kyokai Corp., Lloyds Register of Shipping, Bureau Veritas, Germanischer
Lloyd or Det Norske Veritas, each of which is a member of the International
Association of Classification Societies. Every commercial vessel's hull and
machinery is evaluated by a classification society authorized by its country of
registry. The classification society certifies 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.
Each vessel is inspected by a surveyor of the classification society in three
surveys of varying frequency and thoroughness: every year for the annual survey,
every two to three years for intermediate surveys and every four to five years
for special surveys. Should any defects be found, the classification surveyor
will issue a "recommendation" for appropriate repairs, which have to be made by
the shipowner within the time limit prescribed. Vessels may be required, as part
of the annual and intermediate survey process, to be drydocked for inspection of
the underwater portions of the vessel and for necessary repair stemming from the
inspection. Special surveys always require drydocking.

Competition

     We operate in markets that are highly competitive and based primarily on
supply and demand. We compete for charters on the basis of price, vessel
location, size, age and condition of the vessel, as well as on our reputation as
an operator. We typically arrange our charters in the period market through the
use of brokers, who negotiate the terms of the charters based on market
conditions. We compete primarily with owners of container ships and owners of
products tankers in the Aframax, Panamax and Handymax class sizes. Ownership of
tankers is highly fragmented and is divided among major oil companies and
independent vessel owners.

Legal Proceedings Against Us

     From time to time in the future we may be subject to legal proceedings and
claims in the ordinary course of business, principally personal injury and
property casualty claims. Those claims, even if lacking merit, could result in
the expenditure of significant financial and managerial resources. We have not
been involved in any legal proceedings which may have, or have had a significant
effect on our financial position, nor are we aware of any proceedings that are
pending or threatened which may have a significant effect on our financial
position.

C.   Organizational Structure

Aries Maritime Transport Limited is the sole owner of all outstanding shares of
the subsidiaries listed in note 1 of our consolidated and predecessor combined
carve-out financial statements included in this report.

D.   Properties, Plants and Equipment

     We lease office space in Athens, Greece, from Domina Petridou O.E., which
is owned by Mons S. Bolin, our President and Chief Executive Officer, and Domina
Petridou. In November 2005 we entered into a ten-year lease agreement with the
landowner. We refer you to "Our Fleet" above in this item for a discussion of
our vessels.

ITEM 4A UNRESOLVED STAFF COMMENTS

Not applicable

ITEM 5. OPERATING AND FINANCIAL REVIEW AND PROSPECTS

     The following discussion of our financial condition and results of
operations should be read in conjunction with our consolidated and predecessor
combined carve-out financial statements, which we call our consolidated and
combined financial statements, and the related notes, and the other financial
and other information included in this document. This discussion contains
forward-looking statements, which are based on our assumptions about the future
of our business. Our actual results will likely differ materially from those
contained in the forward-looking statements and such differences may be
material. Please read "Forward-Looking Statements" for additional information
regarding forward-looking statements used in this document. Reference in the
following discussion to " our" and " us" and " the company" refer to our
company, our subsidiaries and the predecessor operations of Aries Maritime
Transport Limited, except where the context otherwise indicates or requires.

General

     We are Aries Maritime Transport Limited, or Aries Maritime, a Bermuda
company incorporated in January 2005 as a wholly owned indirect subsidiary of
Aries Energy Corporation, or Aries Energy. We are an international shipping
company that owns products tankers and container vessels. In March 2005,
subsidiaries of Aries Energy contributed to us all of the issued and outstanding
stock of 10 vessel-owning companies in exchange for shares in our company.
Before this contribution, each of the Aries Energy subsidiaries held 100% of the
issued and outstanding stock of the respective vessel-owning company or
companies owned by it. We now hold 100% of the issued and outstanding stock of
each vessel-owning company. Because our ownership percentage in each
vessel-owning company is identical to each contributing subsidiary's prior
ownership percentage in the same vessel-owning company, the group reorganization
was accounted for as an exchange of equity interests at historical cost. On June
8, 2005 Aries Maritime closed its initial public offering of 12,240,000 common
shares at an offering price of $12.50 per share.

     The combined financial statements included in this document have been
carved out of the consolidated financial statements of Aries Energy, which owned
and operated seven products tankers and five container vessels during the year
ended December 31, 2004. Results have been included from the respective dates
that the vessel-owning subsidiaries came under the control of the shareholders
of Aries Energy. Aries Energy's shipping interests and other assets,
liabilities, revenues and expenses that do not relate to the vessel-owning
subsidiaries acquired by us are not included in our combined financial
statements. Our financial position, results of operations and cash flows
reflected in our combined financial statements include all expenses allocable to
our business, but may not be indicative of those that would have been achieved
had we operated as a public entity for all periods presented or of future
results. From March 17, 2005, the consolidated financial statements reflect the
consolidated results of Aries Maritime.

A.   Operating Results

Important Factors to Consider When Evaluating our Historical and Future Results
of Operations

     We acquired our first two vessels, the High Land and the High Rider, in
March 2003. These two vessels were the only vessels in our fleet to operate for
the entire year ended December 31, 2004. At various times between April and
December 2004, we acquired five products tankers and five container vessels.
These ten vessels were placed into service shortly after their respective
delivery dates. In December 2004, Aries Energy sold the Makassar and the Seine
to an affiliate. As a result of these disposals, our fleet consisted of seven
products tankers and three container vessels at December 31, 2004.

     We exercised an option to re-acquire the Makassar and the Seine shortly
after the closing of the initial public offering and took delivery of these
ships in June and July 2005, respectively. In October 2005, contracts were
entered into for the purchase of two new products tankers; two 72,750 dwt
vessels, Stena Compass and Stena Compassion. The Stena Compass was delivered in
February 2006. The Stena Compassion was delivered in June 2006. In November 2005
we took delivery of the 2001 built products tanker Chinook. As a result of these
acquisitions, our fleet consisted of eight products tankers and five container
vessels as of December 31, 2005 and ten products tankers and five container
vessels as of December 31, 2006.

     The products tanker and container vessel sectors have historically been
highly cyclical, experiencing volatility in profitability, vessel values and
charter rates. In particular, charter rates are strongly influenced by the
supply of vessels and the demand for oil and oil products and container
transportation services.

Lack of Historical Operating Data for Vessels Before their Acquisition

     Consistent with shipping industry practice, other than inspection of the
physical condition of the vessels and examinations of classification society
records, there is no historical financial due diligence process when we acquire
vessels. Accordingly, we do not obtain the historical operating data for the
vessels from the sellers because that information is not material to our
decision to make acquisitions, nor do we believe it would be helpful to
potential investors in our common shares in assessing our business or
profitability. Most vessels are sold under a standardized agreement, which,
among other things, provides the buyer with the right to inspect the vessel and
the vessel's classification society records. The standard agreement does not
give the buyer the right to inspect, or receive copies of, the historical
operating data of the vessel. Prior to the delivery of a purchased vessel, the
seller typically removes from the vessel all records, including past financial
records and accounts related to the vessel. In addition, the technical
management agreement between the seller's technical manager and the seller is
automatically terminated and the vessel's trading certificates are revoked by
its flag state following a change in ownership.

     Consistent with shipping industry practice, we treat the acquisition of a
vessel (whether acquired with or without charter) as the acquisition of an asset
rather than a business. Although vessels are generally acquired free of charter,
we have acquired (and may in the future acquire) some vessels with period
charters. Where a vessel has been under a voyage charter, the vessel is
delivered to the buyer free of charter. It is rare in the shipping industry for
the last charterer of the vessel in the hands of the seller to continue as the
first charterer of the vessel in the hands of the buyer. In most cases, when a
vessel is under period charter and the buyer wishes to assume that charter, the
vessel cannot be acquired without the charterer's consent and the buyer's
entering into a separate direct agreement with the charterer to assume the
charter. The purchase of a vessel itself does not transfer the charter, because
it is a separate service agreement between the vessel owner and the charterer.
When we purchase a vessel and assume a related period charter, we must take the
following steps before the vessel will be ready to commence operations:

     o    obtain the charterer's consent to us as the new owner;

     o    obtain the charterer's consent to a new technical manager;

     o    in some cases, obtain the charterer's consent to a new flag for the
          vessel;

     o    arrange for a new crew for the vessel;

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

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

     o    register the vessel under a flag state and perform the related
          inspections in order to obtain new trading certificates from the flag
          state;

     o    implement a new planned maintenance program for the vessel; and

     o    ensure that the new technical manager obtains new certificates for
          compliance with the safety and vessel security regulations of the flag
          state.

     The following discussion is intended to help you understand how
     acquisitions of vessels affect our business and results of operations.

     Our business is comprised of the following main elements:

     o    employment and operation of our products tankers and container
          vessels; and

     o    management of the financial, general and administrative elements
          involved in the conduct of our business and ownership of our products
          tankers and container vessels.

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

     o    vessel maintenance and repair;

     o    crew selection and training;

     o    vessel spares and stores supply;

     o    contingency response planning;

     o    onboard safety procedures auditing;

     o    accounting;

     o    vessel insurance arrangement;

     o    vessel chartering;

     o    vessel hire management;

     o    vessel surveying; and

     o    vessel performance monitoring.

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

     o    management of our financial resources, including banking
          relationships, i.e., administration of bank loans and bank accounts;

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

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

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

Principal Factors that Affect Our Business

     The principal factors that affect our financial position, results of
     operations and cash flows include:

     o    charter rates and periods of charterhire;

     o    vessel operating expenses and voyage costs, which are incurred in both
          U.S. Dollars and other currencies, primarily Euros;

     o    depreciation expenses, which are a function of the cost of our
          vessels, significant vessel improvement costs and our vessels'
          estimated useful lives;

     o    financing costs related to our indebtedness, which totalled $284.8
          million at December 31, 2006; and

     o    fluctuations in foreign exchange rates.

     The amounts estimated below are not intended to constitute pro forma
financial information within the meaning of regulations promulgated by the
Securities and Exchange Commission, but in our view, have been determined on a
reasonable basis, and reflect our best currently available estimates and
judgements. These estimates do not represent actual results and should not be
relied upon as being necessarily indicative of future results, and investors are
cautioned not to place undue reliance on this information. This financial
information was not prepared with a view toward compliance with published
guidelines of the Securities and Exchange Commission or the guidelines
established by the American Institute of Certified Public Accountants for
preparation and presentation of prospective financial information. This
forward-looking financial information has been prepared by us, and is our
responsibility.

     You should read the following discussion together with the information
contained in the table of vessel information under "Item 4 -- Information on the
Company -- Business Overview -- Our Fleet". The net daily charterhire rates
detailed in that table under "Net Daily Charterhire Rate" are fixed rates and
all detailed vessels, except Bora, now named Ostria, which is currently trading
in the spot market, are employed under period charters. Revenues from period
charters are stable over the duration of the charter, provided there are no
unexpected or periodic survey off-hire periods and no performance claims from
the charterer or charterer defaults. We cannot guarantee that actual results
will be as anticipated.

     Our strategy is to employ vessels on period charters in order to generate
stable cash flow over a period of time. Fourteen of our fifteen vessels are
employed, on period charters and, with the exception of the Stena Compass and
Stena Compassion, are employed on time charters. The Stena Compass and Stena
Compassion charters are bareboat charters. The average remaining term under our
existing period charters on our fleet was 1.5 years as of December 31, 2006 with
30% of the charter parties for our products tankers containing profit sharing
arrangements. The Ostria (ex Bora) and MSC Oslo (ex SCI Tej) were not employed
on period charter as of December 31, 2006. Our policy is to carry loss-of-hire
insurance, which will provide the equivalent of the charter rate on the vessel
in the event that a vessel is off-hire for more than 14 days up to a maximum of
60 days.

     The daily net charterhire under our existing charter agreements is
increased by any profit sharing and by the amortization of the deferred revenue
associated with our assumption of charters when acquiring certain vessels. The
total profit sharing earned during the year ended December 31, 2006 was
$572,012. The total deferred revenue amortization in respect of the relevant
vessels was $11.7 million during the year ended December 31, 2006. The
recognition of deferred revenue will only continue for the duration of the
charters assumed with the acquisition of the relevant vessels.

     Vessels typically operate for 360 days per year, which is a level commonly
used as an industry average. The five days of non-operation per year are to
provide for time spent in dry-dock and off-hire time. Should a vessel be
operational for 355 days, instead of 360 days in any year, charterhire income
from that vessel would decrease by 1.4% in that year. We earned revenues,
excluding deferred revenue, of $82.5 million in the year ended December 31,
2006. An average 1.4% decrease in charterhire income for the vessels then
comprising our fleet would have resulted in a decrease of revenues by $1.1
million to $81.4 million.

     With regard to total vessel operating expenses, defined as the sum of the
vessel operating expenses, amortization of actual dry-docking and special survey
expenses and management fees, the ship management agreements with Magnus
Carriers for the twelve vessels under Magnus Carriers' technical management set
out the initial twelve months agreed total daily vessel operating expenses. For
further information on the ship management agreements with Magnus Carriers
please read, "Technical and Commercial Management of Our Fleet" in "Item 5 -
Operating and Financial Review and Prospects." Any variance between the agreed
total vessel operating expenses and the actual total vessel operating expenses
is shared equally between Magnus Carriers and us. The daily operating expenses
detailed in the table under "Our Fleet" in the column headed "Daily total vessel
operating expenses" represents the initial agreed vessel operating expenses
under our management agreements with Magnus Carriers, with the exception of the
daily operating expense detailed for Chinook, which is the actual daily vessel
operating expense for 2006 as this vessel is not managed by Magnus Carriers.
Chinook is subject to a ship management agreement with an unrelated company,
which contains no variance sharing arrangement. Stena Compass, which was
delivered in February 2006 and Stena Compassion, which was delivered in June,
2006, are both employed on bareboat charters and under such contracts the
charterer is responsible for vessel operating expenses.

     The main factors that could increase total vessel operating expenses are
crew salaries, insurance premiums, dry-docking and special survey costs, spare
parts orders, repairs that are not covered under insurance policies and
lubricants prices. The ship management agreements provide for a cost of
inflation increase in total vessel operating expenses of 3% per annum and are
subject to adjustment every three years.

     On the basis of total vessel operating expenses for the twelve ships
subject to the management agreements with Magnus Carriers, at the initial level
contained in those management agreements as set out in the table of vessel
information under "Our Fleet," the aggregate of the daily total vessel operating
expenses was $57,400. Following the 3% increase during the year ended December
31, 2006, in accordance with the terms of the management agreements, the
aggregate of the daily total vessel operating expenses for the twelve vessels
managed by Magnus Carriers was $59,122.

     During the year ended December 31, 2006, we incurred vessel operating
expenses and management fees to Magnus Carriers for the twelve ships under its
management totaling $33.4 million. Under the management agreements with Magnus
Carriers, the vessel operating expenses and management fees for the same period
were expected to total $19.8 million. The "Vessel operating expenses" in our
consolidated and combined financial statements for the year ended December 31,
2006 have been adjusted to reflect the variance sharing contribution due from
Magnus Carriers of $6.5 million under the terms of the management agreements.

Revenues

     At December 31, 2006, all our revenues were derived from the time, bareboat
and voyage charters of our ten products tankers and five container vessels. Our
vessels were chartered to reputable charterers with remaining periods ranging
from approximately one month to 3.7 years, with an average of approximately 1.5
years as of December 31, 2006. Our vessels have been employed with these
charterers for periods ranging from 2 months to 3.2 years. We believe that the
performance of the charterers to date has been in accordance with our
charterparties. At the maturity of each charter, we will seek to renew these
charters with the same or other reputable charterers.

     Our revenues for the period ended December 31, 2006 reflect the operation
of eight products tankers and five container vessels for the entire year. During
the year ended December 31, 2006, we took delivery of two additional products
tankers, which increased our revenues for that period in relation to the year
ended December 31, 2005. During the year ended December 31, 2006, the products
tanker Citius, now named Arius, was out-of-service for 7 months undergoing major
works and the products tanker Bora, now named Ostria, recorded 264 non-revenue
days due to dry-docking for repairs and vessel upgrades. Non-revenue days are
defined as the days the vessel was in our possession, but off-hire or
out-of-service and not earning charterhire. In addition, certain of our vessels
were out-of-service due to scheduled drydocking and special survey, upgradings
and preventative maintenance works for total of 304 days. These periods of off
hire and out-of-service time reduced our revenues for the year ended December
31, 2006 as compared to the year ended December 31, 2005.

     Our revenues include an amount for the amortization of deferred revenue
arising from the purchase of vessels together with the assumption of a below
market value period charter. We value the liability upon acquisition of the
vessel by determining the difference between the market charter rate and assumed
charter rate, discounting the result using our weighted average cost of capital
and record the balance as deferred revenue, amortizing it to revenue over the
remaining life of the period charter.

Commissions

     Chartering commissions are paid to chartering brokers and are typically
based on a percentage of the charterhire rate. We are currently paying
chartering commissions ranging from 1.25% to 6.50%, with an average of 2.92%. We
do not pay chartering commissions for vessels on bareboat charters.

Voyage Expenses

     Voyage expenses are incurred due to a vessel's travelling from a loading
port to a discharging port, to repair facilities or on a repositioning voyage,
and include fuel (bunkers) cost, port expenses, agent's fees, canal dues and
extra war risk insurance. Typically, under period charters, the charterer is
responsible for paying voyage expenses while the vessel is on hire.

General & Administrative Expenses

     These expenses include executive and director compensation, audit fees,
liability insurance premium and company administration costs.

Gain on Disposal of Vessels

     Gain on disposal of vessels is the difference between the net proceeds
received from the sale of vessels and their net book value at the date of sale.

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. Vessel
operating expenses exclude fuel cost, port expenses, agents' fees, canal dues
and extra war risk insurance, which are included in "voyage expenses."

     Certain vessel operating expenses are higher during the initial period of a
vessel's operation. Initial daily vessel operating expenses are usually higher
than normal as newly acquired vessels are inspected and modified to conform to
the requirements of our fleet.

Depreciation

     Depreciation is the periodic cost charged to our income for the reduction
in usefulness and long-term value of our vessels. We depreciate the cost of our
vessels over 25 years on a straight-line basis. No charge is made for
depreciation of vessels under construction until they are delivered.

Amortization of Special Survey and Dry-docking Costs

     Special survey and dry-docking costs incurred are deferred and amortized
over a period of five and two and a half years, respectively, which reflects the
period between each required special survey and minimum period between each
dry-docking.

Interest Expenses

     Interest expenses include interest, commitment fees, arrangement fees,
amortization of deferred financing costs, debt discount, interest incurred from
discounting deferred revenue and other similar charges. Interest incurred during
the construction of a newbuilding is capitalized in the cost of the newbuilding.
The amount of interest expense is determined by the amount of loans and advances
outstanding from time to time and interest rates. The effect of changes in
interest rates may be reduced by interest rate swaps or other derivative
instruments. We use interest rate swaps to hedge our interest rate exposure
under our loan agreements.

Change in Fair Value of Derivatives

     At the end of each accounting period, the fair values of our interest rate
swaps are assessed by marking each swap to market. Changes in the fair value
between periods are recognized in the statements of income.

Foreign Exchange Rates

     Foreign exchange rate fluctuations, particularly between the Euro and
Dollar, have had an impact on our vessel operating expenses and administrative
expenses. We actively seek to manage such exposure. Currently, approximately 30%
of our vessel operating cost is incurred in currencies other than the U.S.
dollar. Close monitoring of foreign exchange rate trends, maintaining foreign
currency accounts and buying foreign currency in anticipation of our future
requirements are the main ways we manage our exposure to foreign exchange risk.

Technical and Commercial Management of Our Fleet

     Twelve of our vessel-owning subsidiaries entered into ten-year ship
management agreements with Magnus Carriers, a related party, to provide
primarily for the technical management of our vessels, including crewing,
maintenance, repair, capital expenditures, dry-docking, payment of vessel
tonnage taxes, maintaining insurance and other vessel operating activities.
These ship management agreements are cancellable by the vessel-owning
subsidiaries with two months' notice, while Magnus Carriers has no such option.

     Under the ship management agreements, we pay Magnus Carriers an amount
equal to the budgeted total vessel operating expenses, which we have established
jointly with Magnus Carriers, and which ranged from $4,400 to $5,100 per vessel
per day initially. The budgeted initial total vessel operating expenses, which
include the management fees paid to Magnus Carriers of $146,000 per annum per
vessel initially, increase by 3% annually and are subject to adjustment every
three years. The ship management agreements provide that if actual total vessel
operating expenses exceed the corresponding budgeted amounts, we and Magnus
Carriers will bear the excess expenditures equally (except for costs relating to
any improvement, structural changes or installation of new equipment required by
law or regulation, which will be paid solely by us). If the actual total vessel
operating expenses are less than the corresponding budgeted amounts, we and
Magnus Carriers will share the cost savings equally.

     We also use Magnus Carriers and its affiliates non-exclusively for
commercial management, which includes finding employment for our vessels and
identifying and developing new business that will fit our strategy. For such
services, we will pay Magnus Carriers a commercial management fee equal to 1.25%
of any gross charterhire or freight we receive for new charters. In addition,
Magnus Carriers will supervise the sale or purchase of vessels in accordance
with our instructions. We pay Magnus Carriers 1% of the sale or purchase price
in connection with a vessel sale or purchase that Magnus Carriers brokers for
us. We may also use third parties for commercial management services from time
to time. In the case of the Chinook, whose ship management agreement with an
unrelated ship management company is for technical and operational vessel
management only, we have entered into a separate commercial management agreement
with Magnus Carriers for the provision of commercial and vessel accounting
services for a fixed fee of $60,000 per annum.

     In addition, as long as Magnus Carriers is managing vessels in our fleet,
Magnus Carriers and its principals have granted us a right of first refusal to
acquire or charter any container vessels or any products tankers ranging from
20,000 to 85,000 dwt, which Magnus Carriers, its principals or any of their
controlled affiliates may consider for acquisition or charter in the future.

Critical Accounting Policies

     Critical accounting policies are those that reflect significant judgments
of uncertainties and potentially result in materially different results under
different assumptions and conditions. We have described below what we believe
are our most critical accounting policies, because they generally involve a
comparatively higher degree of judgment in their application. For a description
of our significant accounting policies, see Note 2 to our consolidated and
predecessor combined carve-out financial statements included herein.

     Our financial position, results of operations and cash flows include all
expenses allocable to our business, but may not be indicative of the results we
would have achieved had we operated as a public entity under our current
chartering, management and other arrangements for the entire periods presented
or for future periods.

     The discussion and analysis of our financial condition and results of
operations is based upon our consolidated and combined financial statements,
which have been prepared in accordance with U.S. GAAP. The preparation of those
financial statements requires us to make estimates and judgments that affect the
reported amounts 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 and conditions.

Depreciation

     Our vessels represent our most significant assets. We record the value of
our vessels at their cost (which includes acquisition costs directly
attributable to the vessel and expenditures made to prepare the vessel for its
initial voyage) less accumulated depreciation. We depreciate our vessels on a
straight-line basis over their estimated useful life, which is estimated to be
25 years from date of initial delivery from the shipyard. We believe that a
25-year depreciable life is consistent with that of other shipping companies and
it represents the most reasonable useful life for each of the vessels.
Depreciation is based on cost less the estimated residual scrap value. We
estimate the residual values of our vessels based on a scrap value of $180 or
$190 per lightweight ton, which we believe are levels common in the shipping
industry. An increase in the useful life of a vessel or in its residual value
would have the effect of decreasing the annual depreciation charge and extending
it into later periods. A decrease in the useful life of a vessel or in its
residual value would have the effect of increasing the annual depreciation
charge. However, when regulations place limitations over the ability of a vessel
to trade, the vessel's useful life is adjusted to end at the date such
regulations become effective.

     In the year ended December 31, 2006, a one year reduction in useful life
would increase our total depreciation charge by $2.4 million.

     If circumstances cause us to change our assumptions in making
determinations as to whether vessel improvements should be capitalized, the
amounts we expense each year as repairs and maintenance costs could increase,
partially offset by a decrease in depreciation expense.

Impairment of Long-lived Assets

     We evaluate the carrying amounts and periods over which long-lived assets
are depreciated to determine if events have occurred which would require
modification to their carrying values or useful lives. In evaluating useful
lives and carrying values of long-lived assets, we review certain indicators of
potential impairment, such as undiscounted projected operating cash flows,
vessel sales and purchases, business plans and overall market conditions. We
determine undiscounted projected net operating cash flow for each vessel and
compare it to the vessel carrying value. In the event that an impairment were to
occur, we would determine the fair value of the related asset and record a
charge to operations calculated by comparing the asset's carrying value to the
estimated fair value. We estimate fair value primarily through the use of
third-party valuations performed on an individual vessel basis. To date, we have
not identified any impairment of our long-lived assets.

Deferred Dry-docking and Special Survey Costs

     Our vessels are required to be dry-docked every 30 months for major repairs
and maintenance that cannot be performed while the vessels are operating. Our
vessels are required to undergo special surveys every 60 months.

     We capitalize the costs associated with dry-dockings and special surveys as
they occur and amortize these costs on a straight-line basis over the period
between dry-dockings and surveys, respectively. We believe that these criteria
are consistent with U.S. GAAP guidelines and industry practice and that our
policy of capitalization reflects the economics and market values of the
vessels.

Revenue Recognition

     Revenues are generated from bareboat, time and voyage charters. In
recognizing revenue we are required to make certain estimates and assumptions.
Historically, differences between our estimates and actual results have not been
material to our financial results.

Bareboat and time charter revenues are recorded over the term of the charter as
service is provided. Any profit sharing additional hires generated are recorded
over the term of the charter as the service is provided. Deferred income
represents revenue applicable to periods after the balance sheet date.

     The operating results of voyages in progress at a reporting date are
estimated and recognized pro-rata on a per day basis.

Fair Value of Financial Instruments

     In determining the fair value of interest rate swaps, a number of
assumptions and estimates are required to be made. These assumptions include
future interest rates.

     These assumptions are assessed at the end of each reporting period based on
available information existing at that time. Accordingly, the assumptions upon
which these estimates are based are subject to change and may result in a
material change in the fair value of these items.

Purchase of Vessels

     Where we identify any intangible assets or liabilities associated with the
acquisition of a vessel, we record all identified tangible and intangible assets
or liabilities at fair value. Fair value is determined by reference to market
data and the discounted amount of expected future cash flows. Where we have
assumed an existing charter obligation at charter rates that are less than
market charter rates, we record a liability, being the difference between the
assumed charter rate and the market charter rate for an equivalent vessel. This
deferred revenue is amortized to revenue over the remaining period of the
charter. 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, future
vessel operating expenses, the level of utilization of our vessels and our
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 our financial position and results of operations.

Results of Operations

For the Year Ended December 31, 2006 Compared to the Year Ended December 31,
2005

Revenues

     Total revenues increased by approximately 24% to $94.2 million in the year
ended December 31, 2006 compared to $75.9 million in the year ended December 31,
2005. This increase is primarily attributable to the growth of the Company's
fleet (we acquired two products tankers, Stena Compass and Stena Compassion) and
increase in operating days and certain vessels commencing period charters at
higher rates of charterhire during the year ended December 31, 2006.
Out-of-service and off-hire time for certain vessels, primarily the products
tankers Citius, now named Arius, and Bora, now named Ostria, during the year
ended December 31, 2006 partially offset the increase in revenue.

     During the year ended December 31, 2006 vessel operating days totalled
5,265, compared to total vessel operating days of 4,042 for the year ended
December 31, 2005. The Company defines operating days as the total days the
vessels were in the Company's possession for the relevant period. Actual revenue
days during the year ended December 31, 2006 were 4,485 days compared to 3,998
days for the year ended December 31, 2005. The Company defines revenue days as
the total days the vessels were not off-hire or out-of-service.

     Of the total revenue earned by our vessels during the year ended December
31, 2006, 56% was earned by our products tankers and 44% by our container
vessels.

     We have recognized $11.7 million of deferred revenue during the year ended
December 31, 2006 compared to $9.3 million during the year ended December 31,
2005, as a result of the assumption of charters associated with certain vessel
acquisitions. These assumed charters were at set charter rates, which were less
than market rates at the date of the vessels' acquisition.

Commissions

     Chartering commissions increased by approximately 8% to $1.4 million in the
year ended December 31, 2006, compared to $1.3 million in the year ended
December 31, 2005. This increase is primarily due to the aggregate effect of an
increase in operating days.

Voyage Expenses

     Voyage expenses increased by approximately 1,950% to $4.1 million in the
year ended December 31, 2006, compared to $0.2 million in the year ended
December 31, 2005. This increase is primarily due to the costs incurred by
certain vessels travelling on voyage charters and to repair facilities during
the year ended December 31, 2006. During the year ended December 31, 2005, all
vessels were employed on time charters, under which the charterers are
responsible for voyage expenses.

Vessel operating expenses

     Vessel operating expenses increased by approximately 52% to $27.1 million
during the year ended December 31, 2006, compared to $17.8 million during the
year ended December 31, 2005. This increase is mainly attributable to the
greater number of operating days during the year ended December 31, 2006 and
higher average fleet running costs partially offset by Magnus Carriers'
contribution under the budget variance sharing arrangement within the ship
management agreements between certain of our vessel-owning subsidiaries and
Magnus Carriers. The Magnus Carriers managed vessel operating expenses for the
year ended December 31, 2006 were budgeted at $18 million. Excluding this budget
variance sharing arrangement, vessel operating expenses were $31.6 million for
the year ended December 31, 2006 compared to $18.7 million for the year ended
December 31, 2005.

     Of the total vessel operating expenses during the year ended December 31,
2006, 54% was incurred by our products tankers and 46% by our container vessels.

General & Administrative Expenses

     General and administrative expenses increased by approximately 162% to $4.2
million in the year ended December 31, 2006 compared to $1.6 million in the year
ended December 31, 2005. This increase is primarily due to the Company operating
as a public company for the entire year ended December 31, 2006 and costs
associated with implementing requirements of the Sarbanes-Oxley Act of 2002
incurred during 2006.

Depreciation and Amortization

     Depreciation increased by approximately 52% to $29.4 million during the
year ended December 31, 2006 compared to $19.4 million during the year ended
December 31, 2005. Amortization of dry-docking and special survey costs
increased by 84% to $3.5 million in the year ended December 31, 2006, compared
to $1.9 million in the year ended December 31, 2005. These increases are
primarily due to the growth of the Company's fleet and increase in operating
days during the year ended December 31, 2006 as well as higher dry-docking and
special survey expenses.

     The $5 million one-time accelerated payment by Magnus Carriers in respect
of the capitalized costs of the Citius, now named Arius, has been recognized as
a reduction in capitalized costs. This accelerated contribution by Magnus
Carriers made during 2006 was in full and final settlement of its share of the
costs of the works the vessel underwent during the period from December 3, 2005
to July 31, 2006.

Management Fees to Related Party

     Management fees paid to Magnus Carriers increased by 27% to $1.8 million in
the year ended December 31, 2006 compared to $1.5 million in the year ended
December 31, 2005. This increase is primarily due to the increase in operating
days.

Interest Expense

     Total interest expense increased by approximately 1% to $19 million during
the year ended December 31, 2006, compared to $18.8 million during the year
ended December 31, 2005. Interest expense on loans increased by approximately
81% to $16.3 million, compared to $9.0 million for the year ended December 31,
2005. This increase is primarily due to the growth of the Company's fleet and
associated increase in debt and financing days. Interest expense relating to
amortization of deferred financing costs and debt discount decreased by
approximately 83% to $1.6 million during the year ended December 31, 2006,
compared to $9.2 million during the year ended December 31, 2005. During the
year ended December 31, 2005, amortization of debt discount as a result of
refinancing was $7.6 million. Debt discount was fully amortized during the year
ended December 31, 2005. Interest expense incurred from discounting the deferred
revenue expense increased by approximately 150% to $1 million during the year
ended December 31, 2006, compared to $0.4 million during the year ended December
31, 2005. This increase is primarily due to the increase in deferred revenue
amortization.

Interest Rate Swaps

     The marking to market of our seven interest rate swaps in effect as of
December 31, 2006 resulted in an unrealized loss of $1.8 million, compared to an
unrealized gain for the year ended December 31, 2005 of $0.95 million, due to
the change in fair value over the period. We had three interest rate swaps in
place as of December 31, 2005. In April 2006, one of these identical swaps was
cancelled with a settlement in our favor of $0.49 million. On July 5, 2006, we
entered into five additional swaps for a total notional amount of $100 million.
Our seven interest rate swaps comprise two sets of swaps. We entered into a set
of five interest rate swaps with a termination date of April 4, 2011 for a
notional amount of $20 million each, under which we pay a maximum fixed rate of
5.63%. The marking to market valuation of this set of five interest rate swaps
as at December 31, 2006 resulted in an unrealized loss of $2.5million. We also
entered into a set of two swaps with a termination date of March 6, 2009 for a
notional amount of $46.67 million each, under which we pay a maximum fixed rate
of 4.88%. The marking to market valuation of this set of two swaps as at
December 31, 2006 resulted in an unrealized gain for the Company of $0.67
million.

Foreign Exchange Rates

     During the year ended December 31, 2006 a charge of $0.4 million was
recorded due to adverse movement in foreign exchange rates. Foreign exchange
differences are included in General & Administrative Expenses.

Net Income

     Net income was $2.2 million in the year ended December 31, 2006, compared
to $14.8 million in the year ended December 31, 2005, a decrease of 85%. This
decrease is primarily due to the greater number of out-of-service and off-hire
days, higher fleet running costs, increased voyage expenses as fuel and port
dues were incurred in connection with certain vessels on voyage charters and
travelling to repair yards, costs associated with operating as a publicly traded
company, as well as the increased depreciation and amortization charges, and the
adverse change in the fair value of derivatives, which are interest rate swaps
entered into to hedge the Company's exposure to US interest rates on its debt.

For the Year Ended December 31, 2005 Compared to the Year Ended December 31,
2004

Revenues

     Total revenues increased by approximately 57% to $75.9 million in the year
ended December 31, 2005 compared to $48.3 million in the year ended December 31,
2004. This increase is primarily attributable to the growth of the Company's
fleet and associated increase in operating days during the year ended December
31, 2005. We have also recognized in our total revenues $1.8 million of
provisions for a cargo claim, speed claims and off-hire periods based on a
review of all outstanding trade receivables at the year ended December 31, 2005.

     At various dates between April and December 2004, we took delivery of ten
vessels: five products tankers and five container vessels. Since their
respective dates of delivery, each of these vessels has operated under time
charters. In December 2004 Aries Energy sold the CMA CGM Seine and CMA CGM
Makassar. Revenue from the employment of the ten vessels delivered during the
year ended December 31, 2004 was $30.1 million and revenue from the High Land
and High Rider, which were the only vessels to operate for the entire year ended
December 31, 2004, was $9.1 million. The company benefited from a full year of
operation of these vessels during 2005.

     During the year ended December 31, 2005 we acquired one product tanker,
Chinook, two container vessels, CMA CGM Seine and CMA CGM Makassar and contracts
were entered into for the purchase of two new products tankers, Stena Compass
and Stena Compassion. Stena Compass was delivered in February 2006 and Stena
Compassion was delivered in June 2006. Revenue from the three vessels delivered
during the year ended December 31, 2005 was $10.8 million and revenue from the
other vessels in the fleet was $65.1 million.

     Of the total revenue earned by our vessels during the year ended December
31, 2005, 57% was earned by our products tankers and 43% by our container
vessels.

     We have recognized $9.3 million of deferred revenue during the year ended
December 31, 2005 compared to $9.1 million during the year ended December 31,
2004, as a result of the assumption of charters associated with certain vessel
acquisitions. These assumed charters were at set charter rates, which were less
than market rates at the date of the vessels' acquisition. This increase was
primarily due to the acquisition of the products tanker Chinook in November
2005.

Commissions

     Chartering commissions increased by approximately 8% to $1.3 million in the
year ended December 31, 2005, compared to $1.2 million in the year ended
December 31, 2004. This increase is primarily due to the aggregate effect of an
increase in operating days associated with growth of the Company's fleet and
reduced chartering commissions paid to Magnus Carriers following implementation
of new ship management agreements during the year ended December 31, 2005.

Vessel operating expenses

     Vessel operating expenses increased by approximately 42% to $17.8 million
during the year ended December 31, 2005, compared to $12.5 million during the
year ended December 31, 2004. This increase is primarily due to the aggregate
effect of the growth of the Company's fleet and associated increase in operating
days, together with the implementation under the new ship management agreements
of our arrangement with Magnus Carriers to share equally in expenses in excess
of the budgeted amounts. Excluding the budget variance sharing arrangement,
total vessel operating expenses were $18.7 million for the year ended December
31, 2005.

     Total vessel operating expenses for the vessels delivered during the year
ended December 31, 2005 were $2.2 million.

     Of the total vessel operating expenses during the year ended December 31,
2005, 59% was incurred by our products tankers and 41% by our container vessels.

General & Administrative Expenses

     General and administrative expenses were $1.6 million in the year ended
December 31, 2005. Before the initial public offering the main elements of
general and administrative expenses, such as executive and director
compensation, audit fees, liability insurance premium and company administration
costs, were accounted for within the administrative costs of the ship management
company.

Depreciation and Amortization

     Depreciation increased by approximately 53% to $19.4 million during the
year ended December 31, 2005 compared to $12.7 million during the year ended
December 31, 2004. Amortization of dry-docking and special survey costs
increased by 27% to $1.9 million in the year ended December 31, 2005, compared
to $1.5 million in the year ended December 31, 2004. These increases are
primarily due to the growth of the Company's fleet and associated increase in
operating days.

Management Fees to Related Party

     Management fees paid to Magnus Carriers increased by 67% to $1.5 million in
the year ended December 31, 2005 compared to $0.9 million of the year ended
December 31, 2004. This increase is primarily due to the growth of the Company's
fleet and associated increase in operating days, together with the payment of
the management fees contained in the new ship management agreements.

Interest Expense

     Total interest expense increased by approximately 119% to $18.8 million
during the year ended December 31, 2005, compared to $8.6 million during the
year ended December 31, 2004. Interest expense on loans increased by
approximately 47% to $9.0 million, compared to $6.1 million for the year ended
December 31, 2004. This increase is primarily due to the growth of the Company's
fleet and associated increase in financing days. Interest expense relating to
amortization of deferred financing costs increased by approximately 327% to $9.4
million during the year ended December 31, 2005, compared to $2.2 million during
the year ended December 31, 2004. This increase is primarily due to the
acceleration of amortization of deferred financing costs and debt discount.
Interest expense incurred from discounting the deferred revenue expense
increased by approximately 33% to $0.4 million during the year ended December
31, 2005, compared to $0.3 million during the year ended December 31, 2004. This
increase is primarily due to the growth of the Company's fleet.

Interest Rate Swaps

     The marking to market of our three interest rate swaps in effect as of
December 31, 2005 resulted in a gain of $0.95 million, compared with a loss as
of December 31, 2004 of $0.03 million, due to the change in fair value over the
period. Interest rates were higher at the end of December 2005, compared with
the end of December 2004.

Net Income

     Net income was $14.8 million in the year ended December 31, 2005, compared
to $25.3 million in the year ended December 31, 2004, a decrease of 41%. This
decrease is primarily due to there being no disposal of vessels during the year
ended December 31, 2005 compared with a gain on disposal of vessels of $14.7
million during the year ended December 31, 2004.

B.   Liquidity and Capital Resources

Overview

     We operate in a capital intensive industry. Our principal sources of
liquidity are cash flows from operations, equity and debt. On April 27, 2006 we
refinanced all our indebtedness under our existing credit facility, which we
refer to as our old credit facility, with a new fully revolving credit facility
of $360 million, which we refer to as our new credit facility, and which
provides for the long term financing of the fleet and which provides
approximately $53 million of undrawn commitment as of April 3, 2007 to enable
future growth of the Company through further vessel acquisitions. As of December
31, 2006 our future liquidity requirements relate to: (1) our operating
expenses, (2) payments under our ship management agreements, (3) quarterly
payments of interest and other debt-related expenses and the repayment of
principal, (4) maintenance of financial covenants under our new credit facility
agreement, (5) maintenance of cash reserves to provide for contingencies and (6)
payment of dividends. During the year ended December 31, 2006, we paid the
balance of the purchase price of $112.2 million and took delivery of the two
products tankers, Stena Compass and Stena Compassion.

     We believe that cash flows from our charters will be sufficient to fund our
interest and other debt-related expenses, any debt amortization under our new
credit facility and our working capital requirements for the short and medium
term. We believe that our anticipated cash flows and the availability of funds
under our existing credit facility will be sufficient to permit us to pay
dividends as contemplated by our dividend policy and to meet our liquidity
requirements over the next 12 months.

     Our longer term liquidity requirements include repayment of the outstanding
debt under our new credit facility. We will require new borrowings and/or
issuances of equity capital or other securities to meet the repayment obligation
when our new credit facility matures in April 2011. For further information on
our new credit facility please read "Indebtedness" below.

Cash flows

     As of December 31, 2006, 2005 and 2004, we had cash balances of $14.9
million, $19.2 million and $10.1 million, respectively.

     For the year ended December 31, 2006, our net cash provided by operating
activities was $24.2 million, compared with $36.97 million during the year ended
December 31, 2005, a decrease of 34.5%. This decrease was primarily due to an
increase of dry-docking and special-survey costs which were $15.1 million during
the year ended December 31, 2006 compared to $1.9 million during the year ended
December 31, 2005.

     For the year ended December 31, 2006, our net cash used in investing
activities was $101.8 million, compared with $114 million in the year ended
December 31, 2005, a decrease of 11%. This decrease was primarily due to lower
expenditure on vessel acquisitions during the year ended December 31, 2006.

     In the year ended December 31, 2006, our net cash provided by financing
activities was $69.96 million, compared to $90.9 million in the year ended
December 31, 2005, a decrease of 23%. This decrease was primarily due to lower
proceeds from the issuance of long-term debt and higher dividend payments.

     For the year ended December 31, 2005, our net cash provided by operating
activities was $36.97 million compared to $21.9 million during the year ended
December 31, 2004, an increase of 69%. This increase was primarily due to an
increase in the number of vessels in our fleet and associated increase in
operating days during the year ended December 31, 2006.

     For the year ended December 31, 2005, net cash used in investing activities
was $114 million compared to $161.8 million in the year ended December 31, 2004,
a decrease of 29%. This decrease was primarily due to lower exependiture on
vessel acquisitions during the year ended December 31, 2005. In addition, for
the year ended December 31, 2004, proceeds from the disposal of vessels of $59.9
million contributed to our net cash used in investing activities.

     In the year ended December 31, 2005, our net cash provided by financing
activities was $90.9 million, compared to $144.5 million in the year ended
December 31, 2004, a decrease of 37%. This decrease was primarily due to lower
proceeds from the issuance of long-term debt.

     In each of these years, our investing activities primarily related to
funding our investments in our vessels. During the year ended December 31, 2006,
we purchased two vessels compared with the year ended December 31, 2005, during
which we purchased three vessels and the year ended December 31, 2004, during
which we purchased eight vessels.

     The net cash provided by financing activities in the year ended December
31, 2006 related primarily to drawings under our new credit facility, which was
used to (i) refinance our old $140 million drawn term loan, (ii) refinance our
old revolving acquisition facility, which was drawn to the extent of $43.8
million at December 31, 2005 and which was further drawn in February 2006 in the
amount of $50.5 million to complete the purchase of the Stena Compass and (iii)
complete the purchase of the Stena Compassion.

     In the year ended December 31, 2005, the net cash provided by financing
activities related primarily to the net proceeds of the initial public offering
and drawings of debt under our old credit facility, which was used in the
refinancing of existing debt and related obligations and payment of $6.5 million
in settlement of the participation liability. The participation liability
related to additional participation arrangements under a fee agreement related
to certain of the loans outstanding with the Bank of Scotland as of December 31,
2004.

     In the year ended December 31, 2004, the net cash provided by financing
activities related to funding our investments in our vessels.

Indebtedness

     We had long-term debt outstanding of $284.8 million at December 31, 2006,
compared to $183.8 million at December 31, 2005 and $214.6 million at December
31, 2004. Our long-term debt at December 31, 2006 represents amounts borrowed
under our new credit facility. As of December 31, 2006, borrowings under our new
credit facility bore an annual interest rate, including the margin of 6.55%.

     We use interest rate swaps to swap our floating rate interest payment
obligations for fixed rate obligations. For additional information regarding our
interest rate swaps, please read "--Quantitative and Qualitative Disclosures
About Market Risk--Interest Rate Exposure" below.

     We entered into a $360 million fully revolving credit facility, which we
refer to as our new credit facility in April 2006 with Bank of Scotland and
Nordea Bank Finland as lead arrangers.We have used the new credit facility to
(i) refinance our old $140 million drawn term loan; (ii) refinance our old
revolving acquisition facility, which was drawn to the extent of $43.8 million
at December 31, 2005 and which was further drawn in February 2006 in the amount
of $50.5 million to complete the purchase of the Stena Compass and (iii) to
complete the purchase of the Stena Compassion. The new credit facility has a
five year term and is subject to fixed reductions during the five years. The
other main terms and conditions of the new credit facility are as follows:

     Borrowings under the new credit facility can be used to fund the purchase
price (and, with respect to new buildings, reasonable pre-delivery interest and
inspection costs) of one or more additional vessels that meet the following
requirements:

     o    each vessel must be a double-hulled crude or products tanker or
          container vessel;

     o    each vessel must be aged 8 years or less, or such other age as may be
          agreed by the lenders, at the time of acquisition;

     o    each vessel's purchase price may not exceed its fair market value;

     o    each vessel must enter into a minimum employment of 12 months with a
          reputable charterer within 6 months of the relevant drawdown; and each
          vessel must maintain a flag and class acceptable to the lead arrangers
          and satisfy certain other conditions.

     The new credit facility may also be used to the extent of $5.0 million for
general corporate purposes.

     For the first thirty months of the new credit facility, if the total amount
borrowed under the facility exceeds 65% of the fair market value of the
collateral vessels, we will be unable to borrow further amounts under the
facility until we either prepay some of the debt or the fair market value of the
collateral vessels increases. We will be able to borrow further amounts under
the facility again once the total amount borrowed under the facilities no longer
exceeds 65% of the fair market value of the collateral vessels. For the second
thirty months of the new credit facility, if the total amount borrowed under the
facility exceeds 60% of the fair market value of the collateral vessels, we will
be unable to borrow further amounts under the facility until we either prepay
some of the debt or the fair market value of the collateral vessels increases.
We will be able to borrow further amounts under the facility again once the
total amount borrowed under the facilities no longer exceeds 60% of the fair
market value of the collateral vessels. If a vessel becomes a total loss or is
sold, no further amounts may be borrowed under this agreement, except for
advances for additional ships already approved by the lenders, until we have
applied the full sale or insurance proceeds in repayment of the facility, unless
the lenders otherwise agree.

     Our obligations under the new credit facility are secured by a first
priority security interest, subject to permitted liens, in all vessels in our
fleet and any other vessels we subsequently acquire. In addition, the lenders
will have a first priority security interest in all earnings from and insurances
on our vessels, all existing and future charters relating to our vessels, our
ship management agreements and all equity interests in our subsidiaries. Our
obligations under the credit agreement are also guaranteed by all subsidiaries
that have an ownership interest in any of our vessels.

     The $338 million remaining commitment as of April 3, 2007 contained in the
credit agreement is subject to an $11 million reduction every six months from
October 3, 2007, with the residual commitment, after the equal semi-annual
reductions of $11 million, of $261 million to be reduced to zero or repaid in
full in one instalment in April 2011. As of April 3, 2007 the amount available
to draw down is $53 million.

     Indebtedness under the new credit facility bears interest at an annual rate
equal to LIBOR plus a margin equal to:

     o    1.125% if our total liabilities divided by our total assets, adjusting
          the book value of our fleet to its market value, is less than 50%; and

     o    1.25% if our total liabilities divided by our total assets, adjusting
          the book value of our fleet to its market value, is equal to or
          greater than 50% but less than 60%; and

     o    1.375% if our total liabilities divided by our total assets, adjusting
          the book value of our fleet to its market value, is equal to or
          greater than 60% but less than 65%; and

     o    1.5% if our total liabilities divided by our total assets, adjusting
          the book value of our fleet to its market value, is equal to or
          greater than 65%.

The interest rate on overdue sums will be equal to the applicable rate described
above plus 2%.

     We paid a one-time arrangement fee of approximately $2.3 million at the
initial draw down of the facility together with the first year's agency fee of
$50,000, and pay, quarterly in arrears, a commitment fee equal to 0.5% per annum
of the unused commitment of each lender under the facility. We may prepay all
loans under the credit agreement without premium or penalty other than customary
LIBOR breakage costs.

     The credit agreement will require us to adhere to certain financial
covenants as of the end of each fiscal quarter, including the following:

o    our shareholders' equity as a percentage of our total assets, adjusting the
     book value of our fleet to its market value, must be no less than 35%;

o    free cash and cash equivalents plus the undrawn element of the $5 million
     portion of the new credit facility available for general corporate purposes
     must be no less than 5% of interest bearing debt;

o    the ratio of EBITDA (earnings before interest, taxes, depreciation and
     amortization) to interest expense must be no less than 3.00 to 1.00 on a
     trailing four quarter basis. Primarily due to vessel out-of-service time
     and off-hire days incurred during the year ended December 31, 2006 and
     consequent adverse effect on revenues, the interest coverage ratio
     financial covenant contained in the new credit facility would not be met
     and the lender agreed to lower the ratio for this covenant. Our lenders
     agreed to lower this ratio to 2.50 to 1.00 for the periods ending December
     31, 2006, March 31, 2007 and June 30, 2007. For subsequent periods the
     lower ratio will not apply and the ratio reverts back to 3.00 to 1.00,
     which we believe we will meet. With effect from January 3, 2007 and until
     the lower ratio no longer applies, we will pay an increased margin of
     1.75%;

o    our current liabilities, excluding deferred revenue and derivative
     financial instruments, may not exceed our current assets, excluding
     derivative financial instruments; and

o    the aggregate fair market value of our vessels must be no less than 140% of
     the aggregate outstanding loans under the credit facility.

     In addition, Magnus Carriers is required to maintain a credit balance in an
account opened with the lender of at least $1.0 million. The credit agreement
also requires our two principal beneficial equity holders to maintain a
beneficial ownership interest in our company of no less than 10% each.

     Our credit agreement prevents us from declaring dividends if any event of
default, as defined in the credit agreement, occurs or would result from such
declaration. Each of the following will be an event of default under the credit
agreement:

     o    the failure to pay principal, interest, fees, expenses or other
          amounts when due;

     o    breach of certain financial covenants, including those which require
          Magnus Carriers to maintain a minimum cash balance;

     o    the failure of any representation or warranty to be materially
          correct; the occurrence of a material adverse change (as defined in
          the credit agreement);

     o    the failure of the security documents or guarantees to be effective;

     o    judgments against us or any of our subsidiaries in excess of certain
          amounts; and

     o    bankruptcy or insolvency events; and the failure of our principal
          beneficial equity holders to maintain their investment in us.

     The old credit facility consisted of a $140 million drawn term loan
facility and a $150 million revolving acquisition facility, which was drawn to
the extent of $94.3 million when it was refinanced by our new credit facility on
April 27, 2006.

     Our obligations under the old credit facility were secured by a first
priority security interest, subject to permitted liens, in all vessels in our
fleet and any other vessels we would subsequently acquire. In addition, the
lenders had a first priority security interest in all earnings from and
insurances on our vessels, all existing and future charters relating to our
vessels, our ship management agreements and all equity interests in our
subsidiaries. Our obligations under the old credit facility were also guaranteed
by all subsidiaries that had an ownership interest in any of our vessels.

     The old term loan was payable in full in one instalment in June 2009.
Borrowings under the old revolving acquisition facility were repayable in
quarterly instalments commencing nine months after a vessel acquisition, unless:

     o    at least 60% of the principal amount of a revolving loan had been
          repaid, in which case no payment needed be made until the earlier of
          (1) the date on which the vessel that the relevant borrowing was used
          to acquire is 15 years old and (2) June 3, 2009; or

     o    a vessel had not been chartered for a minimum of 12 months with a
          reputable charterer within 6 months of the relevant drawdown, in which
          case at least 75% of the purchase price of that vessel needed be
          repaid within 9 months of its acquisition.

     The amortization period for each loan under the acquisition facility was
equal to the difference between 15 years and the age of the vessel that the loan
was used to acquire. All amounts that remain outstanding under the acquisition
facility in June 2009 would be due at such time.

     Indebtedness under the term loan and the acquisition facility bore interest
at an annual rate equal to LIBOR plus a margin equal to:

     o    1.25% if our total liabilities divided by our total assets, adjusting
          the book value of our fleet to its market value, was less than 60%;
          and

     o    1.375% if our total liabilities divided by our total assets, adjusting
          the book value of our fleet to its market value, was equal to or
          greater than 60%.

     The interest rate on overdue sums was equal to the applicable rate
described above plus 2%.

     We paid a one-time arrangement fee of approximately $2.0 million at the
closing of the facility in June 2005 and incurred an annual commitment fee equal
to 0.5% per annum of the unused commitment of each lender under the acquisition
facility. We could have prepaid all loans under the existing credit facility
without premium or penalty other than customary LIBOR breakage costs.

     We were subject to certain financial covenants as of the end of each fiscal
quarter, including the following:

     o    our shareholders' equity as a percentage of our total assets,
          adjusting the book value of our fleet to its market value, should be
          no less than 35%;

     o    we should maintain cash and cash equivalents of no less than the
          higher of (1) the amount of interest and principal scheduled to be
          repaid in the following two quarters and (2) $5 million, which
          increases by $1.25 million per year and by an additional $800,000 for
          every $10 million borrowed under the revolving acquisition facility;

     o    our current at the time liabilities should not exceed our current
          assets;

     o    the ratio of EBITDA (earnings before interest, taxes, depreciation and
          amortization) to interest expense should be no less than 3.00 to 1.00
          on a trailing four quarter basis; and

     o    the aggregate fair market value of our vessels should be no less than
          145% of the aggregate outstanding loans under the facility.

     In addition, Magnus Carriers was required to maintain a credit balance in
an account opened with the lender of at least $1 million. The existing credit
facility also required our two principal beneficial equity holders to maintain a
beneficial ownership interest in our company of no less than 10% each.

C.   Research and development, patents and licenses

Not Applicable

D.   Trend Information

Not Applicable

E.   Off Balance Sheet Arrangements

We do not have any off-balance sheet arrangements.

F.   Tabular Disclosure of Contractual Obligations

     As of December 31, 2006 significant existing contractual obligations and
contingencies consisted of our obligations as borrower under our new credit
facility. In addition, we had contractual obligations under interest rate swap
contracts, ship management agreements and an office rental agreement.

Long-Term Financial Obligations and Other Commercial Obligations

     The following table sets out long-term financial and other commercial
obligations, outstanding as of December 31, 2006 (all figures in thousands of
U.S. Dollars):

--------------------------------------------------------------------------------
Payment due by
Period
--------------------------------------------------------------------------------
                                                                          More
  Contractual                        Less than     1-3         3-5        than
  Obligations             Total       1 year      years       years      5 years
--------------------------------------------------------------------------------
Long-term debt           284,800           0           0     284,800          0
obligation(1)
--------------------------------------------------------------------------------
Interest payments(2)      78,102      18,652      37,274      22,176          0
--------------------------------------------------------------------------------
Vessel operating         194,874      20,664      43,207      45,838     85,165
expenses(3)
--------------------------------------------------------------------------------
Management fees(4)        18,707       1,899       3,837       4,071      8,900
--------------------------------------------------------------------------------
Rental agreement (5)         751          68         148         164        371
--------------------------------------------------------------------------------
Total                    577,234      41,283      84,466     357,049     94,436
--------------------------------------------------------------------------------

Notes:

(1)  Refers to our obligations to repay the indebtedness outstanding as of
     December 31, 2006.

(2)  Refers to our expected interest payments over the term of the indebtedness
     outstanding as of December 31, 2006, assuming a weighted average interest
     rate of 6.549% per annum.

(3)  Refers to our obligations under the 10-year ship management agreements that
     twelve of our vessel-owning subsidiaries have entered into with Magnus
     Carriers. These figures represent the aggregate amount of the individual
     initial vessel operating expenses for 12 vessels, which increases by 3%
     every year under the management agreements with an assumed start date of
     January 1, 2006. The vessel operating expenses are subject to adjustments
     every three years and thus may vary.

(4)  Refers to the management fees payable to Magnus Carriers under the 10-year
     ship management agreements. These figures represent the aggregate amount of
     the individual initial vessel management fees for 12 vessels, which
     increases by 3% every year under the management agreements with an assumed
     start date of January 1, 2006. The commercial management fees paid to
     Magnus Carriers and the technical management fees paid to Ernst Jacob in
     respect of the Chinook are also included.

(5)  Refers to our obligations under a rental agreement for office space for the
     Company.

Quantitative and Qualitative Disclosures About Market Risk

Interest Rate Exposure

Our debt obligations under our new credit facility bear interest at LIBOR plus a
margin ranging from 1.125% to 1.5% per annum. With effect from January 3, 2007
and until the relaxation of the interest cover financial convenant no longer
applies the margin will be 1.75%. Increasing interest rates could adversely
affect our future profitability. We entered into three interest swap
transactions with three banks during 2005. On April 7, 2006 one of the interest
rate swaps was terminated and the settlement proceeds amounted to $0.49 million.
Under the two swap agreements we have limited the interest rate we pay on $93.3
million of our outstanding indebtedness to a maximum of 4.885% per annum,
excluding the margin, effective from January 3, 2006 and until the swap
agreements mature in June 2009.

On July 5, 2006 the Company entered into interest rate swaps with five banks on
identical terms. These five swaps had an effective date of July 3, 2006 and a
maturity date of April 3, 2011. Under the terms of the swap agreements, we pay a
fixed interest rate of 5.63% per annum on a total of $100 million of the
long-term debt drawn under the new credit facility.

     A 100 basis point increase in LIBOR would have resulted in an increase of
approximately $1 million in our interest expense on the $91.5 million unhedged
element of drawings under the new credit facility for the year ended December
31, 2006.

Foreign Exchange Rate Exposure

     Our vessel-owning subsidiaries generate revenues in U.S. dollars but incur
a portion of their vessel operating expenses, and we incur our general and
administrative costs, in other currencies, primarily Euros.

     We monitor trends in foreign exchange rates closely and actively manage our
exposure to foreign exchange rates. We maintain foreign currency accounts and
buy foreign currency in anticipation of our future requirements in an effort to
manage foreign exchange risk. As of December 31, 2006, a 1% adverse movement in
U.S. dollar exchange rates would have increased our vessel operating expenses by
approximately $81,273.

Recent Accounting Developments

In September 2006, the Financial Accounting Standard Board issued Statement of
Financial Accounting Standards No. 157 (SFAS 157) "Fair Value Measurement". SFAS
157 defines fair value, establishes a framework for measuring fair value in
generally accepted accounting principles (GAAP) and expands disclosures about
fair value measurements. SFAS 157 is effective for financial statements issued
for fiscal years beginning after November 15, 2007, and interim periods within
those fiscal years. The provisions of SFAS 157 should be applied prospectively
as of the beginning of the fiscal year in which it is initially applied. The
Group does not expect the adoption of this Accounting Standard to have an effect
on its financial statements. SFAS 157 will be effective for the Group for the
year beginning on January 1, 2008.

In February, 2007, the FASB issued SFAS No. 159 "The Fair Value Option for
Financial Assets and Financial Liabilities" (SFAS No. 159). SFAS No. 159 permits
entities to choose to measure many financial assets and financial liabilities at
fair value. Unrealized gains and losses on items for which the fair value option
has been elected are reported in earnings. SFAS No. 159 is effective for fiscal
years beginning after November 15, 2007. The Group is currently assessing the
impact of SFAS No. 159 on its consolidated financial position and results of
operations.

Subsequent Events

MSC Oslo

     The vessel changed its name to MSC Oslo from SCI Tej and entered into a
2-year time charter to MSC on March 8, 2007 at a daily rate of $15,000 net of
commissions.

Chinook

     In February 2007, the Chinook entered into an 18-month time charter
(extendable by 12 months at the charterer's option) with the Stena Group at a
daily rate of $17,062.50 net of commissions, which includes a profit sharing
component of 50% for the Company.

Dividend

     On March 9, 2007 the Directors of Aries Maritime declared a dividend of $
0.07 per share in respect of the fourth quarter of 2006. The dividend was paid
on March 30, 2007 to shareholders on record as of March 19, 2007.

ITEM 6. DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES

A.   Directors and Senior Management

     Set forth below are the names, ages (as of December 31, 2006) and positions
of our directors and executive officers. Our board of directors is elected
annually on a staggered basis, and each director elected holds office until his
successor shall have been duly elected, except in the event of his death,
resignation, removal or the earlier termination of his office. The business
address of each of our executive officers and directors is 18 Zerva Nap.,
Glyfada, Athens 166 75, Greece.

Name                  Age   Position
----                  ---   --------

Mons S. Bolin         53    Class I Director, President and Chief Executive
                            Officer

Richard J.H. Coxall   50    Class I Director and Chief Financial Officer

Per Olav Karlsen      53    Class II Director and Chairman

Henry S. Marcus       63    Class II Director

Panagiotis Skiadas    36    Class III Director and Deputy Chairman

     Certain biographical information about each of these individuals is set
forth below.

     Mons S. Bolin has served as our President, Chief Executive Officer and a
director since April 2005. He has over 30 years of shipping industry experience.
After graduating with distinction in Law (LLB), Economics and Business
Administration from the University of Lund in Sweden, Mr. Bolin completed his
military service as an officer in the Swedish Royal Marines in 1975. Mr. Bolin
worked as a shipbroker for Fearnleys A/S in Oslo, Norway from 1975 to 1977 and
was then a director and partner in the shipbrokering firm of Alexandrakis
Brandts in Greece for eight years before co-founding an oil/commodity trading
and ship operating business, Westminster Oil and Gas Ltd., in London in 1985. In
1991 he co-founded with Gabriel Petridis, Southern Seas Shipping Corporation, an
affiliate of Aries Energy, which he still beneficially owns with Mr Petridis.
From February 1997 to April 2005, Mr. Bolin was co-managing director of Magnus
Carriers. He remains a director of Sea Breeze UK Ltd., an affiliate of Aries
Energy. Mr. Bolin is a citizen of Sweden and a resident of Great Britain.

     Richard J. H. Coxall has served as our Chief Financial Officer and a
director since January 2005. Since 2000, Mr. Coxall has been the Finance
Director of Magnus Carriers. Mr. Coxall studied at Havering Technical College
and Polytechnic of Central London. He holds an International Banking Diploma
from the Chartered Institute of Bankers. Between 1974 and 1994 Mr. Coxall worked
for Barclays Bank International in various banking operations and for Barclays
Bank PLC, London as a manager in ship finance. In 1995, Mr. Coxall established
the representative office of the Commercial Bank of Greece in London and ran
that office until 1996, developing shipping finance business for the second
largest bank in Greece. In 1996, Mr. Coxall was appointed director of Barclays
Bank ship finance in Greece. Between 1998 and 2000, Mr. Coxall was an
independent consultant in ship finance and projects to international shipping
companies. Mr. Coxall is a citizen of Great Britain and a resident of Greece.

     Per Olav Karlsen has served as the Chairman of our board of directors since
the closing of our initial public offering in June 2005. Since 2000, Mr. Karlsen
has been one of three partners and the joint managing director of Cleaves
Shipbrokers Ltd. Since September 2005, he has been responsible for the formation
of a new marine finance company in Oslo, Norway. From 1993 through 2000, he was
President of R.S. Platou (S) Pte Ltd., a ship brokerage company. Mr. Karlsen has
also worked for Fearnleys AS for 10 years in various positions and capacities.
Mr. Karlsen has also served as managing director of Pacship (UK) Ltd, a company
controlled by Pacific Carriers Ltd, a company in the Kuok Group. He has worked
in the shipping industry for approximately 26 years. In 1993, Wind Shipping
Group, a company for which Mr. Karlsen served as a director, was the subject of
an insolvency proceeding. He is a citizen of Norway and a resident of England.

     Henry S. Marcus has served as a member of our board of directors since the
closing of our offering in June 2005. Dr. Marcus has been a faculty member of
the Massachusetts Institute of Technology for more than thirty years. Currently,
he is a Professor of Marine Systems in the Center for Ocean Engineering. Dr.
Marcus works as a consultant to various government organizations, academic
institutions and corporations. He holds a bachelor's degree in Naval
Architecture and Marine Engineering from the Webb Institute of Naval
Architecture. He holds master's degrees in Shipping and Shipbuilding Management
and Naval Architecture and Marine Engineering from Massachusetts Institute of
Technology. Dr. Marcus also holds a doctorate degree in business administration,
specializing in Transportation and Logistics, from Harvard University, Graduate
School of Business Administration. He is a citizen and a resident of the United
States.

     Panagiotis Skiadas has served as a member of our board of directors and our
Deputy Chairman since the closing of our initial public offering in June 2005.
Mr. Skiadas has been the Environmental Manager of VIOHALCO S.A., the parent
company of the largest Greek metals group of companies that incorporates
approximately 80 companies. Prior to joining VIOHALCO in April 2006, Mr. Skiadas
performed the same role for a subsidiary of VIOHALCO, ELVAL S.A. since 2004. He
has also served as the Section Manager of Environmental Operations for the
Organizational Committee of Olympic Games, Athens 2004 S.A. Mr. Skiadas holds a
bachelor's degree in Environmental Engineering from the University of Florida.
He holds a master's degree in Environmental and Water Quality Engineering from
the Massachusetts Institute of Technology. Mr. Skiadas is a citizen and a
resident of Greece.

B.   Compensation

     During 2006, we paid to the members of our senior management and to our
directors aggregate compensation of approximately $540,833 and $78,216
respectively and $408,362 and $45,000 respectively in 2005. We did not pay any
compensation to members of our senior management or our directors in the year
ended 2004. In addition, each director will be reimbursed for out-of-pocket
expenses incurred while attending any meeting of the board of directors or any
board committee. Officers who also serve as directors do not receive additional
compensation for their service as directors.

     At a meeting held on August 4, 2006, the Board of Directors determined to
grant 40,000 restricted shares to each director who was not also an officer of
the Company. This decision was confirmed on March 28, 2007. Accordingly, the
Company will issue 40,000 restricted shares to each non-executive director with
the following vesting periods:

     o    20,000 shares will vest on July 1, 2007;

     o    10,000 shares will vest on July 1, 2008; and

     o    10,000 shares on will vest on July 1, 2009.

     We adopted an equity incentive plan, which enables our officers, key
employees and directors to receive options to acquire common shares. We reserved
a total of 500,000 common shares for issuance under the plan. Our board of
directors will administer this plan once it is implemented. Under the terms of
the plan, our board of directors will be able to grant new options exercisable
at a price per common share to be determined by our board of directors. We
expect that the exercise price for the first options granted under the plan will
be equal to the higher of the offering price in our initial public offering or
the price of our common shares on the date the options are granted. All options
will expire no later than 10 years from the date of the grant. Other securities,
including restricted and unrestricted shares, performance shares and stock
appreciation rights, may also be granted under the plan. Unless terminated
earlier pursuant to its terms, the plan will terminate ten years from the date
it was adopted by the board of directors.

C.   Board Practices

Committees of the Board of Directors

     We have established an audit committee comprised of our three independent
directors responsible for reviewing our accounting controls and recommending to
the board of directors the engagement of our outside auditors. The members of
our audit committee are Messrs. Per Olav Karlsen, Panagiotis Skiadas and Henry
S. Marcus.

Corporate Governance Practices

     We have certified to Nasdaq that our corporate governance practices are in
compliance with, and are not prohibited by, the laws of Bermuda. Therefore, we
are exempt from many of Nasdaq's corporate governance practices other than the
requirements regarding the disclosure of a going concern audit opinion,
submission of a listing agreement, notification of material non-compliance with
Nasdaq corporate governance practices and the establishment and composition of
an audit committee and a formal written audit committee charter. The practices
that we follow in lieu of Nasdaq's corporate governance rules are described
below.

     o    We have a board of directors with a majority of independent directors
          which holds at least one annual meeting at which only independent
          directors are present, consistent with Nasdaq corporate governance
          requirements. We are not required under Bermuda law to maintain a
          board of directors with a majority of independent directors, and we
          cannot guarantee that we will always in the future maintain a board of
          directors with a majority of independent directors.

     o    In lieu of a compensation committee comprised of independent
          directors, our board of directors is responsible for establishing the
          executive officers' compensation and benefits. Under Bermuda law,
          compensation of the executive officers is not required to be
          determined by an independent committee.

     o    In lieu of a nomination committee comprised of independent directors,
          our board of directors is responsible for identifying and recommending
          potential candidates to become board members and recommending
          directors for appointment to board committees. Shareholders may also
          identify and recommend potential candidates to become candidates to
          become board members in writing. No formal written charter has been
          prepared or adopted because this process is outlined in our bye-laws.

     o    In lieu of obtaining an independent review of related party
          transactions for conflicts of interests, consistent with Bermuda law
          requirements, our bye-laws require any director who has a potential
          conflict of interest to identify and declare the nature of the
          conflict to our board of directors at the first meeting of the board
          of directors. Our bye-laws additionally provide that related party
          transactions must be approved by independent and disinterested
          directors.

     o    In lieu of obtaining shareholder approval prior to the issuance of
          securities, we were required to obtain the consent of the Bermuda
          Monetary Authority as required by Bermuda law before we issued
          securities. We have obtained blanket consent from the Bermuda Monetary
          Authority. If we choose to issue additional securities, we will not be
          required to obtain any further consent so long as our common shares
          are listed.

     o    As a foreign private issuer, we are not required to solicit proxies or
          provide proxy statements to Nasdaq pursuant to Nasdaq corporate
          governance rules or Bermuda law. Consistent with Bermuda law, we will
          notify our shareholders of meetings between 15 and 60 days before the
          meeting. This notification will contain, among other things,
          information regarding business to be transacted at the meeting. In
          addition, our bye-laws provide that shareholders must give us advance
          notice to properly introduce any business at a meeting of the
          shareholders. Our bye-laws also provide that shareholders may
          designate a proxy to act on their behalf (in writing or by telephonic
          or electronic means as approved by our board from time to time).

     Other than as noted above, we are in full compliance with all other
applicable Nasdaq corporate governance standards.

D.   Employees

See "Item 4 -- Information on the Company -- Business Overview --Crewing and
Employees."

E.   Share ownership

     The common shares beneficially owned by our directors and officers and/or
companies affiliated with these individuals are disclosed in "Item 7 -- Major
Shareholders and Related Party Transactions" below.

ITEM 7. MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS

Major shareholders.

     The following table sets forth information regarding (i) the owners of more
than five percent of our common stock that we are aware of and (ii) the total
number of shares of our common stock held by officers and directors as of April
18, 2007.

--------------------------------------------------------------------------------
                                                                        Percent
Title of Class            Identity of Person or Group    Amount Owned   of Class
--------------------------------------------------------------------------------
Common stock, par value
$0.01 per share           Rocket Marine Inc. (1)         14,766,877     52%
--------------------------------------------------------------------------------
                          Mons Bolin (1)                 14,766,877     52%
--------------------------------------------------------------------------------
                          Captain Gabriel Petridis (1)   14,766,877     52%
--------------------------------------------------------------------------------
                          Richard Coxall                 *              *
--------------------------------------------------------------------------------
                          Directors and Executive        14,776,877     52%
                          Officers as a Group
--------------------------------------------------------------------------------
                          Wellington Management          2,064,910      7.27%
                          Company, LLP (2)
--------------------------------------------------------------------------------
                          Transamerica Investment        2,082,060      7.89%
                          Management, LLC (3)
--------------------------------------------------------------------------------

*    Less than one percent.

(1)  Rocket Marine Inc., a Marshall Islands corporation, is a wholly owned
     indirect subsidiary of Aries Energy Corporation, which is also a Marshall
     Islands corporation. Mons Bolin and Captain Gabriel Petridis each own 50%
     of the issued and outstanding capital stock of Aries Energy Corporation and
     Magnus Carriers. Each of Aries Energy Corporation, Mons Bolin and Captain
     Gabriel Petridis disclaims beneficial ownership of such shares.

(2)  According to Schedule 13G filed with the Securities and Exchange Commission
     by Wellington Management Company on February 14, 2007.

(3)  According to Schedule 13G filed with the Securities and Exchange Commission
     by Transamerica Investment Management, LLC on February 21, 2007.

Related Party Transactions

     Aries Energy, through its wholly-owned indirect subsidiary Rocket Marine
Inc., owns 52% of our outstanding common stock. Mr. Mons Bolin, our President,
Chief Executive Officer and a director, owns 50% of the issued and outstanding
capital stock of Aries Energy and of Magnus Carriers.

     We have entered into ship management agreements with Magnus Carriers.
Consistent with Bermuda law requirements, our bye-laws require any director who
has a potential conflict of interest to identify and declare the nature of the
conflict to our board of directors at the first meeting of the board of
directors. Our bye-laws additionally provide that related party transactions
must be approved by independent and disinterested directors.

Contributions under management agreements

     During the year ended December 31, 2006 the Group received $5 million in
full and final settlement by Magnus Carriers of the dry-docking expenses
incurred by M/T Arius. This amount has been deducted from the vessel's
dry-docking expenses. During the year ended December 31, 2006 the Group received
an additional $6.5 million (2005 $0.8 million) from Magnus Carriers under the
ship-management cost-sharing agreements for vessel operating expenses. These
amounts are reflected in the operating expenses of the vessels in the income
statement. Also received during the year ended December 31, 2006 was an amount
of $0.2 (2005 $NIL) for special survey and dry-docking amortization. This amount
is reflected in the amortization and dry-docking expense in the income
statement.

Amounts due from/to related parties

     Amounts due from related parties were $2.5 million at December 31, 2006 and
$1.2 million at December 31, 2005. These amounts represent payments less
receipts made by the Group on behalf of (i) other vessel-owning companies under
common control with the Group, consisting of $0.03 million (due from) at
December 31, 2006 and $0.4 million (due from) at December 31, 2005 and (ii)
Magnus Carriers Corporation, consisting of $2.5 million (due from) at December
31, 2006 and $0.9 million (due from) at December 31, 2005. There are no terms of
settlement for these amounts, as of December 31, 2006. These amounts were
collected in the month following the relevant quarter.

Management fees

The vessel-owning companies included in the Group receive technical and
commercial management services from Magnus Carriers, a company beneficially
owned by Mons Bolin, our Chief Executive Officer, and Captain Gabriel Petridis,
pursuant to ship management agreements. Under these agreements, the Group paid
management fees to Magnus Carriers of $1.8 million for the year ended December
31, 2006, $1.5 million for the year ended December 31, 2005 and $0.9 million for
the year ended December 31, 2004 which is separately reflected in the statements
of income.

Commissions

     Magnus Carriers and Trampocean S.A., related companies under common
control, provide chartering services to the vessel-owning companies included in
the Group at a commission of 1.25% of hires and freights earned by the vessels.
The Group paid these companies fees of $0.03 million for chartering services for
the year ended December 31, 2006, $0.05 million for the year ended December 31,
2005 and $0.4 million for the year ended December 31, 2004. These commissions
relate to agreements between Magnus Carriers and the vessel-owning subsidiaries.
From the effective date of the new ship management agreements Magnus Carriers
may only receive commissions on new charters. Under the new ship management
agreements, Magnus Carriers will be paid 1% of the sale or purchase price in
connection with a vessel sale or purchase that Magnus Carriers brokers for the
Group.

Rental agreement

     During 2005, the Group entered into a rental agreement with a related
party, a company with common ultimate beneficial shareholders. The Group paid
$0.06 million to the related party during the year ended December 31, 2006
(2005: $0.004 million and 2004: $NIL).

Crewing

     Some crewing for the Group is undertaken by Magnus Carriers through a
related entity, Poseidon Marine Agency. The Group paid manning fees of $0.3
million for the year ended December 31, 2006, $0.3 million for the year ended
December 31, 2005 and $0.3 million for the year ended December 31, 2004.

Vessel purchase

     Aries Maritime exercised its right to acquire the Chinook under the Right
of First Refusal Agreement with Magnus Carriers in October 2005. The acquisition
was offered to Aries Maritime by Magnus Carriers on either of two bases: (a)
with retention of the five year head charter dated June 16, 2003 between the
sellers and Pacific Breeze Tankers Ltd. (a joint venture company, 50% of which
is ultimately owned between Mons Bolin, President and Chief Executive Officer of
Aries Maritime and Gabriel Petridis equally) as charterers, at a rate of $13,000
per day, in which case the purchase consideration would be $30.6 million; or (b)
without the head charter, in which case the purchase consideration would be
$32.6 million. Aries Maritime exercised its right on basis (b). The total
purchase consideration of $32.6 million for the Chinook, paid on November 30,
2005, comprised purchase consideration under the terms of a Memorandum of
Agreement dated October 25, 2006 of $30.6 million and a $2 million additional
purchase consideration to the sellers under the terms of a separate agreement
relating to the termination of the head charter.

Pursuant to an agreement dated December 28, 2004 Aries Maritime exercised its
right to acquire CMA CGM Seine and CMA CGM Makassar in June, 2005 and took
delivery of these vessels on June 24, 2005 and July 15, 2005 respectively. Both
vessels were purchased from International Container Ships KS (a Norwegian
limited partnership, of which Mons Bolin, our President and Chief Executive
Officer and Gabriel Petridis equally together, ultimately owned 25%). The
purchase price paid for the CMA CGM Seine was $35.4 million and for the CMA CGM
Makassar was $35.3 million.

General and administrative expenses

     During the year ended December 31, 2006 the Group paid directors' fees of
$0.6 million (2005: $0.5 million and 2004: $NIL). Such fees are included in
general and administrative expenses in the accompanying consolidated statements
of income.

Minimum liquidity

Under the Group's new credit facility, Magnus Carriers is required to maintain
at least $1 million in an account with the lender.

C.   Interests of experts and counsel.

     Not applicable.

ITEM 8. FINANCIAL INFORMATION

A.   Consolidated Statements and Other Financial Information.

     See Item 18.

Legal Proceedings Against Us

     From time to time in the future we may be subject to legal proceedings and
claims in the ordinary course of business, principally personal injury and
property casualty claims. Those claims, even if lacking merit, could result in
the expenditure of significant financial and managerial resources. We have not
been involved in any legal proceedings which may have, or have had a significant
effect on our financial position, nor are we aware of any proceedings that are
pending or threatened which may have a significant effect on our financial
position.

Dividend Policy

     We intend to pay quarterly dividends to the holders of our common shares in
March, May, August and November of each year in amounts substantially equal to
the charterhire received by us under the charters for our vessels during the
preceding calendar quarter, less cash expenses for that quarter (principally
vessel operating expenses and debt service and administrative expenses) and any
reserves our board of directors determines we should maintain. These reserves
may cover, among other things, drydocking, repairs, claims, liabilities and
other obligations, interest expense and debt amortization, acquisitions of
additional assets and working capital.

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

     Our board of directors must approve the declaration and payment of any
dividends. Under the terms of our new credit facility, we will not be able to
declare or pay any dividends if we are in default under our new credit facility
or if paying a dividend will result in a default under the credit facility. In
addition, the requirement that we satisfy various financial covenants under the
credit agreement, as well as the terms under any other loan agreements, which we
may obtain in the future, could impose restrictions on our ability to pay
dividends in the future.

B.   Significant Changes.

     Not Applicable.

ITEM 9. THE OFFER AND LISTING

A.   Offer and Listing Details

     The trading market for our common stock is the Nasdaq Global Market, on
which the shares are listed under the symbol "RAMS". The following table sets
forth the high and low closing prices for our common stock since our initial
public offering of common stock at $12.50 per share on June 3, 2005, as reported
by the Nasdaq Global Market. The high and low closing prices for our common
stock for the periods indicated were as follows:

--------------------------------------------------------------------------------
                                                          High       Low
--------------------------------------------------------------------------------
For the period from June 3, 2005 to December 31, 2005     $15.99     $12.50
--------------------------------------------------------------------------------
For the Fiscal Year Ended December 31, 2006               $14.36      $9.15
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
For the Quarter Ended
--------------------------------------------------------------------------------
June 3 to June 30, 2005                                   $13.60     $12.50
--------------------------------------------------------------------------------
September 30, 2005                                        $15.99     $12.50
--------------------------------------------------------------------------------
December 31, 2005                                         $15.63     $12.63
--------------------------------------------------------------------------------
March 31, 2006                                            $14.36     $12.43
--------------------------------------------------------------------------------
June 30, 2006                                             $13.97     $10.65
--------------------------------------------------------------------------------
September 30, 2006                                        $12.70      $9.50
--------------------------------------------------------------------------------
December 31, 2006                                         $10.81      $9.15
--------------------------------------------------------------------------------
March 31, 2007                                             $9.43      $7.48
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
For the Month
--------------------------------------------------------------------------------
October 2006                                              $10.81     $10.30
--------------------------------------------------------------------------------
November 2006                                             $10.57      $9.81
--------------------------------------------------------------------------------
December 2006                                             $10.13      $9.17
--------------------------------------------------------------------------------
January 2007                                               $9.07      $8.40
--------------------------------------------------------------------------------
February 2007                                              $9.37      $8.37
--------------------------------------------------------------------------------
March 2007                                                 $8.62      $7.48
--------------------------------------------------------------------------------

C.   Markets

See Item 9. A. above.

ITEM 10. ADDITIONAL INFORMATION

A.   Share Capital

Not applicable

B.   Memorandum and Articles of Association

     The following description of our capital stock summarizes the material
terms of our Memorandum of Association and our bye-laws. Under our Memorandum of
Association, as amended, our authorized capital consists of 30 million shares of
preferred stock, par value $0.01 per share and 100 million shares of common
stock, par value of $0.01 per share.

Common shares

     Holders of common shares have no pre-emptive, subscription, redemption,
conversion or sinking fund rights. Holders of common shares are entitled to one
vote for each share held of record on all matters submitted to a vote of our
shareholders. Holders of common shares have no cumulative voting rights. Holders
of common shares are entitled to dividends if and when they are declared by our
board of directors, subject to any preferred dividend right of holders of any
preference shares. Directors to be elected by holders of common shares require a
plurality of votes cast at a meeting at which a quorum is present. For all other
matters, unless a different majority is required by law or our bye-laws,
resolutions to be approved by holders of common shares require approval by a
majority of votes cast at a meeting at which a quorum is present.

     Upon our liquidation, dissolution or winding up, our common shareholders
will be entitled to receive, ratably, our net assets available after the payment
of all our debts and liabilities and any preference amount owed to any
preference shareholders.

     The rights of our common shareholders, including the right to elect
directors, are subject to the rights of any series of preference shares we may
issue in the future.

Preference Shares

     Under the terms of our bye-laws, our board of directors has authority to
issue up to 30 million "blank check" preference shares in one or more series and
to fix the rights, preferences, privileges and restrictions of the preference
shares, including voting rights, dividend rights, conversion rights, redemption
terms (including sinking fund provisions) and liquidation preferences and the
number of shares constituting a series or the designation of a series.

     The rights of holders of our common shares will be subject to, and could be
adversely affected by, the rights of the holders of any preference shares that
we may issue in the future. Our board of directors may designate and fix rights,
preferences, privileges and restrictions of each series of preference shares
which are greater than those of our common shares. Our issuance of preference
shares could, among other things:

     o    restrict dividends on our common shares;

     o    dilute the voting power of our common shares;

     o    impair the liquidation rights of our common shares; and

     o    discourage, delay or prevent a change of control of our company.

     Our board of directors does not at present intend to seek shareholder
approval prior to any issuance of currently authorized preference shares, unless
otherwise required by applicable law or Nasdaq requirements. Although we
currently have no plans to issue preference shares, we may issue them in the
future.

Dividends

     Under Bermuda law, a company may not declare or pay dividends if there are
reasonable grounds for believing either that the company is, or would after the
payment be, unable to pay its liabilities as they become due, or that the
realizable value of its assets would thereby be less than the sum of its
liabilities, its issued share capital (the total par value of all outstanding
shares) and share premium accounts (the aggregate amount paid for the
subscription for its shares in excess of the aggregate par value of such
shares). If the realizable value of our assets decreases, our ability to pay
dividends may require our shareholders to approve resolutions reducing our share
premium account by transferring an amount to our contributed surplus account.
There are no restrictions on our ability to transfer funds (other than funds
denominated in Bermuda dollars) in and out of Bermuda or to pay dividends to
U.S. residents who are holders of our common shares.

Anti-Takeover Effects of Provisions of Our Constitutional Documents

     Several provisions of our bye-laws may have anti-takeover effects. These
provisions are intended to avoid costly takeover battles, lessen our
vulnerability to a hostile change of control and enhance the ability of our
board of directors to maximize shareholder value in connection with any
unsolicited offer to acquire us. However, these anti-takeover provisions, which
are summarized below, could also discourage, delay or prevent (1) the merger,
amalgamation or acquisition of our company by means of a tender offer, a proxy
contest or otherwise, that a shareholder may consider in its best interest and
(2) the removal of our incumbent directors and executive officers.

Blank Check Preference Shares

     Under the terms of our bye-laws, subject to applicable legal or Nasdaq
requirements, our board of directors has authority, without any further vote or
action by our shareholders, to issue up to 30 million preference shares with
such rights, preferences and privileges as our board may determine. Our board of
directors may issue preference shares on terms calculated to discourage, delay
or prevent a change of control of our company or the removal of our management.

Classified Board of Directors

     Our bye-laws provide for the division of our board of directors into three
classes of directors, with each class as nearly equal in number as possible,
serving staggered, three year terms. One-third (or as near as possible) of our
directors will be elected each year. Our bye-laws also provide that directors
may only be removed for cause upon the vote of the holders of no less than 80%
of our outstanding common shares. These provisions could discourage a third
party from making a tender offer for our shares or attempting to obtain control
of our company. It could also delay shareholders who do not agree with the
policies of the board of directors from removing a majority of the board of
directors for two years.

Business Combinations

     Although the BCA does not contain specific provisions regarding "business
combinations" between companies organized under the laws of Bermuda and
"interested shareholders", we have included these provisions in our bye-laws.
Specifically, our bye-laws contain provisions which prohibit us from engaging in
a business combination with an interested shareholder for a period of three
years after the date of the transaction in which the person became an interested
shareholder, unless, in addition to any other approval that may be required by
applicable law:

     o    prior to the date of the transaction that resulted in the shareholder
          becoming an interested shareholder, our board of directors approved
          either the business combination or the transaction that resulted in
          the shareholder becoming an interested shareholder;

     o    upon consummation of the transaction that resulted in the shareholder
          becoming an interested shareholder, the interested shareholder owned
          at least 85% of our voting shares outstanding at the time the
          transaction commenced; or

     o    after the date of the transaction that resulted in the shareholder
          becoming an interested shareholder, the business combination is
          approved by the board of directors and authorized at an annual or
          special meeting of shareholders by the affirmative vote of at least
          80% of our outstanding voting shares that are not owned by the
          interested shareholder.

     For purposes of these provisions, a "business combination" includes
mergers, amalgamations, consolidations, exchanges, asset sales, leases, certain
issues or transfers of shares or other securities and other transactions
resulting in a financial benefit to the interested shareholder. An "interested
shareholder" is any person or entity that beneficially owns 15% or more of our
outstanding voting shares and any person or entity affiliated with or
controlling or controlled by that person or entity, except that so long as
Rocket Marine owns 15% or more of our outstanding voting shares, Rocket Marine
shall not be an interested shareholder unless it acquires additional voting
shares representing 8% or more of our outstanding voting shares.

Election and Removal of Directors

     Our bye-laws do not permit cumulative voting in the election of directors.
Our bye-laws require shareholders wishing to propose a person for election as a
director (other than persons proposed by our board of directors) to give advance
written notice of nominations for the election of directors. Our bye-laws also
provide that our directors may be removed only for cause and only upon the
affirmative vote of the holders of at least 80% of our outstanding common
shares, voted at a duly authorized meeting of shareholders called for that
purpose, provided that notice of such meeting is served on such director at
least 14 days before the meeting. These provisions may discourage, delay or
prevent the removal of our incumbent directors.

Shareholder Meetings

     Under our bye-laws annual meetings of shareholders will be held at a time
and place selected by our board of directors each calendar year. Special
meetings of shareholders may be called by our board of directors at any time and
must be called at the request of shareholders holding at least 10% of our
paid-up share capital carrying the right to vote at general meetings. Under our
bye-laws at least 15, but not more than 60, days' notice of an annual meeting or
any special meeting must be given to each shareholder entitled to vote at that
meeting. Under Bermuda law accidental failure to give notice will not invalidate
proceedings at a meeting. Our board of directors may set a record date between
15 and 60 days before the date of any meeting to determine the shareholders who
will be eligible to receive notice and vote at the meeting.

Limited Actions by Shareholders

     Any action required or permitted to be taken by our shareholders must be
effected at an annual or special meeting of shareholders or (except for certain
actions) by unanimous written consent without a meeting. Our bye-laws provide
that, subject to certain exceptions and to the rights granted to shareholders
pursuant to the BCA, only our board of directors may call special meetings of
our shareholders and the business transacted at a special meeting is limited to
the purposes stated in the notice for that meeting. Accordingly, a shareholder
may be prevented from calling a special meeting for shareholder consideration of
a proposal over the opposition of our board of directors and shareholder
consideration of a proposal may be delayed until the next annual meeting.

     Subject to certain rights set out in the BCA, our bye-laws provide that
shareholders are required to give advance notice to us of any business to be
introduced by a shareholder at any annual meeting. The advance notice provisions
provide that, for business to be properly introduced by a shareholder when such
business is not specified in the notice of meeting or brought by or at the
direction of our board of directors, the shareholder must have given our
secretary notice not less than 90 nor more than 120 days prior to the
anniversary date of the immediately preceding annual meeting of the
shareholders. In the event the annual meeting is called for a date that is not
within 30 days before or after such anniversary date, the shareholder must give
our secretary notice not later than 10 days following the earlier of the date on
which notice of the annual meeting was mailed to the shareholders or the date on
which public disclosure of the annual meeting was made. The chairman of the
meeting may, if the facts warrant, determine and declare that any business was
not properly brought before such meeting and such business will not be
transacted.

Amendments to Bye-Laws

     Our bye-laws require the affirmative vote of the holders of not less than
80% of our outstanding voting shares to amend, alter, change or repeal the
following provisions in our bye-laws:

     o    the classified board and director removal provisions;

     o    the percentage of approval required for our shareholders to amend our
          bye-laws;

     o    the limitations on business combinations between us and interested
          shareholders;

     o    the provisions requiring the affirmative vote of the holders of not
          less than 80% of our outstanding voting shares to amend the foregoing
          provisions; and

     o    the limitations on shareholders' ability to call special meetings,
          subject to certain rights guaranteed to shareholders under the BCA.

     These requirements make it more difficult for our shareholders to make
changes to the provisions in our bye-laws that could have anti-takeover effects.

C.   Material Contracts

     As of December 31, 2006 we had long term debt obligations under our new
credit facility, with a group of international lenders. On April 3, 2006 we
entered into a new credit facility for $360 million with Bank of Scotland and
Nordea Bank Finland as joint lead arrangers, which has been subject to
subsequent amendment. For a full description of our credit facilities see "Item
5 -- Operating and Financial Review and Prospects - Indebtedness."

D.   Exchange controls

     The Company has been designated as a non-resident of Bermuda for exchange
control purposes by the Bermuda Monetary Authority, whose permission for the
issue of the Common Shares was obtained prior to the offering thereof.

     The transfer of shares between persons regarded as resident outside Bermuda
for exchange control purposes and the issuance of Common Shares to or by such
persons may be effected without specific consent under the Bermuda Exchange
Control Act of 1972 and regulations thereunder. Issues and transfers of Common
Shares involving any person regarded as resident in Bermuda for exchange control
purposes require specific prior approval under the Bermuda Exchange Control Act
1972.

     Subject to the foregoing, there are no limitations on the rights of owners
of the Common Shares to hold or vote their shares. Because the Company has been
designated as non-resident for Bermuda exchange control purposes, there are no
restrictions on its ability to transfer funds in and out of Bermuda or to pay
dividends to United States residents who are holders of the Common Shares, other
than in respect of local Bermuda currency.

     In accordance with Bermuda law, share certificates may be issued only in
the names of corporations or individuals. In the case of an applicant acting in
a special capacity (for example, as an executor or trustee), certificates may,
at the request of the applicant, record the capacity in which the applicant is
acting. Notwithstanding the recording of any such special capacity, the Company
is not bound to investigate or incur any responsibility in respect of the proper
administration of any such estate or trust.

     The Company will take no notice of any trust applicable to any of its
shares or other securities whether or not it had notice of such trust.

     As an " exempted company," the Company is exempt from Bermuda laws which
restrict the percentage of share capital that may be held by non-Bermudians, but
as an exempted company, the Company may not participate in certain business
transactions including: (i) the acquisition or holding of land in Bermuda
(except that required for its business and held by way of lease or tenancy for
terms of not more than 21 years) without the express authorization of the
Bermuda legislature; (ii) the taking of mortgages on land in Bermuda to secure
an amount in excess of $50,000 without the consent of the Minister of Finance of
Bermuda; (iii) the acquisition of securities created or issued by, or any
interest in, any local company or business, other than certain types of Bermuda
government securities or securities of another " exempted company, exempted
partnership or other corporation or partnership resident in Bermuda but
incorporated abroad; or (iv) the carrying on of business of any kind in Bermuda,
except in so far as may be necessary for the carrying on of its business outside
Bermuda or under a license granted by the Minister of Finance of Bermuda.

     There is a statutory remedy under Section 111 of the Companies Act 1981
which provides that a shareholder may seek redress in the Bermuda courts as long
as such shareholder can establish that the Company's affairs are being
conducted, or have been conducted, in a manner oppressive or prejudicial to the
interests of some part of the shareholders, including such shareholder. However,
this remedy has not yet been interpreted by the Bermuda courts.

     The Bermuda government actively encourages foreign investment in "exempted"
entities like the Company that are based in Bermuda but do not operate in
competition with local business. In addition to having no restrictions on the
degree of foreign ownership, the Company is subject neither to taxes on its
income or dividends nor to any exchange controls in Bermuda. In addition, there
is no capital gains tax in Bermuda, and profits can be accumulated by the
Company, as required, without limitation. There is no income tax treaty between
the United States and Bermuda pertaining to the taxation of income other than
applicable to insurance enterprises.

E.   Taxation

     The following is a discussion of the material Bermuda and United States
federal income tax considerations with respect to the Company and holders of
common shares. This discussion does not purport to deal with the tax
consequences of owning common shares to all categories of investors, some of
which, such as dealers in securities, investors whose functional currency is not
the United States dollar and investors that own, actually or under applicable
constructive ownership rules, 10% or more of our common shares, may be subject
to special rules. This discussion deals only with holders who hold the common
shares as a capital asset. Holders of common shares are encouraged to consult
their own tax advisors concerning the overall tax consequences arising in their
own particular situation under United States federal, state, local or foreign
law of the ownership of common shares.

Bermuda Tax Considerations

     As of the date of this document, we are not subject to taxation under the
laws of Bermuda, and distributions to us by our subsidiaries also are not
subject to any Bermuda tax. As of the date of this document, there is no Bermuda
income, corporation or profits tax, withholding tax, capital gains tax, capital
transfer tax, estate duty or inheritance tax payable by non-residents of Bermuda
in respect of capital gains realized on a disposition of our common shares or in
respect of distributions by us with respect to our common shares. This
discussion does not, however, apply to the taxation of persons ordinarily
resident in Bermuda. Bermuda holders should consult their own tax advisors
regarding possible Bermuda taxes with respect to dispositions of, and
distributions on, our common shares.

United States Federal Income Tax Considerations

     The following are the material United States federal income tax
consequences to us of our activities and to U.S. Holders and Non-U.S. Holders,
each as defined below, of our common shares. The following discussion of United
States federal income tax matters is based on the United States Internal Revenue
Code of 1986, or the Code, judicial decisions, administrative pronouncements,
and existing and proposed regulations issued by the United States Department of
the Treasury, all of which are subject to change, possibly with retroactive
effect. The discussion below is based, in part, on the description of our
business as described in "Item 4 -- Information on the Company" above and
assumes that we conduct our business as described in that section. Except as
otherwise noted, this discussion is based on the assumption that we will not
maintain an office or other fixed place of business within the United States.
References in the following discussion to "we" and "us" are to Aries Maritime
Transport Limited and its subsidiaries on a consolidated basis.

United States Federal Income Taxation of Our Company

Taxation of Operating Income: In General

     We earn substantially all of our income from the use of vessels, from the
hiring or leasing of vessels for use on a time, voyage or bareboat charter basis
or from the performance of services directly related to those uses, which we
refer to as "shipping income."

     Fifty percent 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."

     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. We are not permitted 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 is not considered to be 100% derived from sources outside the United
States. Shipping income derived from sources outside the United States is not
subject to any United States federal income tax.

     In the absence of exemption from tax under Section 883, our gross U.S.
source shipping income is subject to a 4% tax imposed without allowance for
deductions as described below.

Exemption of Operating Income from United States Federal Income Taxation

     Under Section 883 of the Code, a foreign corporation will be exempt from
United States federal income taxation on its U.S.-source shipping income if:

     (1)  it is organized in a qualified foreign country, which is one that
          grants an "equivalent exemption" to corporations organized in the
          United States in respect of such category of the shipping income for
          which exemption is being claimed under Section 883 and which we refer
          to as the "Country of Organization Test" and

     (2)  either

          (A)  more than 50% of the value of its stock is beneficially owned,
               directly or indirectly, by individuals who are "residents" of a
               qualified foreign country, which we refer to as the "50%
               Ownership Test," or

          (B)  its stock is "primarily and regularly traded on an established
               securities market" in its country of organization, in another
               qualified foreign country or in the United States, which we refer
               to as the "Publicly Traded Test."

     The Country of Organization Test is satisfied since we are incorporated in
Bermuda, and each of our subsidiaries is incorporated in the British Virgin
Islands, the Marshall Islands, or Malta, all of which we believe are qualified
foreign countries in respect of each category of Shipping Income we currently
earn and expect to earn in the future. Therefore, we and our subsidiaries are
exempt from United States federal income taxation with respect to our
U.S.-source shipping income as we and each of our subsidiaries meet either of
the 50% Ownership Test or the Publicly Traded Test. Under a special attribution
rule of Section 883, each of our Subsidiaries is deemed to have satisfied the
50% Ownership Test if we satisfy such test or the Publicly Traded Test. Due to
the widely-held nature of our stock, we may have difficulty satisfying the 50%
Test.

     The Treasury Regulations provide, in pertinent part, that stock of a
foreign corporation is 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
shares, which are our sole class of issued and outstanding stock, are "primarily
traded" on the Nasdaq Global Market, which is an established securities market
in the United States.

     Under the Treasury Regulations, our common shares are considered to be
"regularly traded" on an established securities market if one or more classes of
our shares representing 50% or more of our outstanding shares, by total combined
voting power of all classes of shares entitled to vote and total value, is
listed on an established securities market, which we refer to as the listing
threshold. Since our common shares are our sole class of issued and outstanding
stock and are listed on the Nasdaq Global Market, we meet the listing threshold.

     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 in minimal 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 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 satisfy these
trading frequency and trading volume tests. Even if this were not the case, the
Treasury regulations provide that the trading frequency and trading volume tests
will be deemed satisfied if, as we expect to be the case with our common shares,
such class of stock is traded on an established market in the United States and
such stock is regularly quoted by dealers making a market in such stock.

     Notwithstanding the foregoing, the Treasury Regulations provide, in
pertinent part, that our shares are 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 our outstanding common shares 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 outstanding stock, which we refer to as the "5 Percent Override
Rule."

     To determine the persons who own 5% or more of the vote and value of our
shares, or "5% Shareholders," the Treasury Regulations permit us to rely on
those persons that are identified on Form 13G and Form 13D filings with the
United States Securities and Exchange Commission, or the "SEC," as having a 5%
or more beneficial interest in our common shares. The Treasury Regulations
further provide that an investment company which is registered under the
Investment Company Act of 1940, as amended, will not be treated as a 5%
Shareholder for such purposes.

     In the event the 5 Percent Override Rule is triggered, the Treasury
Regulations provide that the 5 Percent Override Rule does not apply if we can
establish in conformity with the Treasury Regulations that within the group of
5% Shareholders, sufficient shares are owned by qualified shareholders for
purposes of Section 883 to preclude non-qualified shareholders in such group
from owning 50% or more of the value of our shares for more than half the number
of days during such year.

     Aries Energy (through its wholly owned subsidiary Rocket Marine Inc.) owns
approximately 52% of our outstanding common shares. If Aries Energy alone or
together with other 5% Shareholders were to own 50% of our outstanding shares on
more than half the days of any taxable year, the 5 Percent Override Rule would
be triggered. In order to preclude the application of the 5 Percent Override
Rule, Aries Energy, Rocket Marine Inc. and Captain Gabriel Petridis, the 50%
beneficial owner of Aries Energy, have provided information to establish that
Captain Petridis is a qualified shareholder.

     As a result, we believe we are able to preclude the application of the 5
Percent Override Rule and therefore satisfy the Publicly Traded Test. However,
there can be no assurance that we are able to continue to satisfy the Publicly
Traded Test if (i) Captain Petridis's status as a qualified shareholder changes,
(ii) the direct or indirect beneficial ownership of the shares held by Captain
Petridis changes, (iii) the ownership of shares not directly or indirectly owned
by Captain Petridis comes to be concentrated in 5% Shareholders that either are
not qualified shareholders or who fail to comply with applicable documentation
requirements or (iv) Captain Petridis, Aries Energy or Rocket Marine fail to
satisfy the applicable documentation requirements.

     Even though we believe that we will be able to qualify for the benefits of
Section 883 under the Publicly-Traded Test, we can provide no assurance that we
will be able to continue to so qualify in the future.

Taxation In The Absence of Section 883 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% 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, in lieu of the 4% gross basis tax described above, 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" tax on earnings
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:

     o    we have, or are considered to have, a fixed place of business in the
          United States involved in the earning of shipping income; and

     o    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 have, or permit circumstances that would result in our having, a
fixed place of business in the United States involved in the earning of shipping
income and therefore, 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 qualify for exemption under Section 883, we will
not be subject to United States federal income taxation with respect to gain
realized on a sale of a vessel, provided the sale is considered to occur outside
of the United States under United States federal income tax principles. In
general, a sale of a vessel will be considered to occur outside of the United
States for this purpose if title to the vessel, and risk of loss with respect to
the vessel, pass to the buyer outside of the United States. It is expected that
any sale of a vessel by us will be considered to occur outside of the United
States.

United States Federal Income Taxation of U.S. Holders

     As used herein, the term " U.S. Holder" means a beneficial owner of common
shares that is a United States citizen or resident, United States corporation or
other United States entity taxable as a corporation, an estate the income of
which is subject to United States federal income taxation regardless of its
source, or a trust if a court within the United States is able to exercise
primary jurisdiction over the administration of the trust and one or more United
States persons have the authority to control all substantial decisions of the
trust.

     If a partnership holds our common shares, the tax treatment of a partner
will generally depend upon the status of the partner and upon the activities of
the partnership. If you are a partner in a partnership holding our common
shares, you should consult your tax advisor.

Distributions

     Subject to the discussion of passive foreign investment companies below,
any distributions made by us with respect to our common shares to a U.S. Holder
will generally constitute dividends, which may be taxable as ordinary income or
"qualified dividend income" as described in more detail below, to the extent of
our current or accumulated earnings and profits, as determined under United
States federal income tax principles. Distributions in excess of our 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 his common shares on a
dollar-for-dollar basis and thereafter as capital gain. Because we are not a
United States 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 our common
shares will generally be treated as "passive income" (or "passive category
income" for taxable years beginning after December 31, 2006) or, in the case of
certain types of U.S. Holders, "financial services income," (which will be
treated as "general category income" income for taxable years beginning after
December 31, 2006) for purposes of computing allowable foreign tax credits for
United States foreign tax credit purposes.

     Dividends paid on our common shares to a U.S. Holder who is an individual,
trust or estate (a " U.S. Individual Holder" ) will generally be treated as "
qualified dividend income" that is taxable to such U.S. Individual Holders at
preferential tax rates (through 2010) provided that (1) the common shares are
readily tradable on an established securities market in the United States (such
as the Nasdaq Global Market, on which our common shares are traded); (2) we are
not a passive foreign investment company for the taxable year during which the
dividend is paid or the immediately preceding taxable year (which we do not
believe we are, have been or will be); and (3) the U.S. Individual Holder has
owned the common shares for more than 60 days in the 121-day period beginning 60
days before the date on which the common shares becomes ex-dividend. Therefore,
there is no assurance that any dividends paid on our common shares will be
eligible for these preferential rates in the hands of a U.S. Individual Holder.
Any dividends paid by the Company which are not eligible for these preferential
rates will be taxed as ordinary income to a U.S. Individual Holder.

     Special rules may apply to any "extraordinary dividend"generally, a
dividend in an amount which is equal to or in excess of ten percent of a
shareholder's adjusted basis (or fair market value in certain circumstances) in
a common share paid by us. If we pay an "extraordinary dividend" on our common
shares that is treated as "qualified dividend income," then any loss derived by
a U.S. Individual Holder from the sale or exchange of such common shares will be
treated as long-term capital loss to the extent of such dividend.

Sale, Exchange or other Disposition of Common Shares

     Assuming we do not constitute a passive foreign investment company for any
taxable year, a U.S. Holder generally recognizes taxable gain or loss upon a
sale, exchange or other disposition of our common shares 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 tax basis in such stock.
Such gain or loss is 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 is generally treated as
U.S.-source income or loss, as applicable, for U.S. foreign tax credit purposes.
A U.S. Holder's ability to deduct capital losses is subject to certain
limitations.

Passive Foreign Investment Company Status and Significant Tax Consequences

     Special United States federal income tax rules apply to a U.S. Holder that
holds stock in a foreign corporation classified as a passive foreign investment
company for United States federal income tax purposes. In general, we are
treated as a passive foreign investment company with respect to a U.S. Holder
if, for any taxable year in which such holder held our common shares, either

     o    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

     o    at least 50% of the average value of the assets held by the
          corporation during such taxable year produce, or are held for the
          production of, passive income.

     For purposes of determining whether we are a passive foreign investment
company, we are treated as earning and owning our proportionate share of the
income and assets, respectively, of any of our subsidiary corporations in which
we own at least 25 percent of the value of the subsidiary's stock. Income
earned, or deemed earned, by us in connection with the performance of services
would not constitute passive income. By contrast, rental income would generally
constitute "passive income" unless we were treated under specific rules as
deriving our rental income in the active conduct of a trade or business.

     Based on our current operations and future projections, we do not believe
that we are, nor do we expect to become, a passive foreign investment company
with respect to any taxable year. Although there is no legal authority directly
on point, and we are not relying upon an opinion of counsel on this issue, our
belief is based principally on the position that, for purposes of determining
whether we are a passive foreign investment company, the gross income we derive
or are deemed to derive from the time chartering and voyage chartering
activities of our wholly owned subsidiaries should constitute services income,
rather than rental income. Correspondingly, such income should not constitute
passive income, and the assets that we or our wholly-owned subsidiaries own and
operate in connection with the production of such income, in particular, the
vessels, should not constitute passive assets for purposes of determining
whether we are a passive foreign investment company. We believe there is
substantial legal authority supporting our position consisting of case law and
Internal Revenue Service pronouncements concerning the characterization of
income derived from time charters and voyage charters as services income for
other tax purposes. However, in the absence of any legal authority specifically
relating to the statutory provisions governing passive foreign investment
companies, the Internal Revenue Service or a court could disagree with our
position. In addition, although we intend to conduct our affairs in a manner to
avoid being classified as a passive foreign investment company with respect to
any taxable year, we cannot assure you that the nature of our operations will
not change in the future.

     If we were to be treated as a passive foreign investment company, special
and adverse United States federal income tax rules would apply to a U.S. Holder
of our shares. Among other things, the distributions a U.S. Holder received with
respect to our shares and gains, if any, a U.S. Holder derived from his sale or
other disposition of our shares would be taxable as ordinary income (rather than
as qualified dividend income or capital gain, as the case may be), would be
treated as realized ratably over his holding period in our common shares, and
would be subject to an additional interest charge. However, a U.S. Holder might
be able to make certain tax elections which ameliorate these consequences.

United States Federal Income Taxation of "Non-U.S. Holders"

     A beneficial owner of common shares that is not a U.S. Holder is referred
to herein as a "Non-U.S. Holder."

Dividends on Common Shares

     Non-U.S. Holders generally are not subject to United States federal income
tax or withholding tax on dividends received from us with respect to our common
shares, unless that income is effectively connected with the Non-U.S. Holder's
conduct of a trade or business in the United States. If the Non-U.S. Holder is
entitled to the benefits of a United States income tax treaty with respect to
those dividends, that income is taxable only if it is attributable to a
permanent establishment maintained by the Non-U.S. Holder in the United States.

Sale, Exchange or Other Disposition of Common Shares

     Non-U.S. Holders generally are not subject to United States federal income
tax or withholding tax on any gain realized upon the sale, exchange or other
disposition of our common shares, unless:

     o    the gain is effectively connected with the Non-U.S. Holder's conduct
          of a trade or business in the United States. If the Non-U.S. Holder is
          entitled to the benefits of an income tax treaty with respect to that
          gain, that gain is taxable only if it is attributable to a permanent
          establishment maintained by the Non-U.S. Holder in the United States;
          or

     o    the Non-U.S. Holder is an individual who is present in the United
          States for 183 days or more during the taxable year of disposition and
          other conditions are met.

     If the Non-U.S. Holder is engaged in a United States trade or business for
United States federal income tax purposes, the income from the common shares,
including dividends and the gain from the sale, exchange or other disposition of
the stock that is effectively connected with the conduct of that trade or
business is generally subject to regular United States federal income tax in the
same manner as discussed in the previous section relating to the taxation of
U.S. Holders. In addition, if you are a corporate Non-U.S. Holder, your earnings
and profits that are attributable to the effectively connected income, which are
subject to certain adjustments, may be subject to an additional branch profits
tax at a rate of 30%, or at a lower rate as may be specified by an applicable
income tax treaty.

F. Dividends and paying agents

Not applicable.

G. Statement by experts

Not applicable.

H. Documents on display

     We file annual reports and other information with the SEC. You may read and
copy any document we file with the SEC at its public reference room at 100 F
Street, N.E., Room 1580, Washington, D.C. 20549. You may also obtain copies of
this information by mail from the public reference section of the SEC, 100 F
Street, N.E., Room 1580, Washington, D.C. 20549, at prescribed rates. Please
call the SEC at 1-800-SEC-0330 for further information on the operation of the
public reference room. Our SEC filings are also available to the public at the
web site maintained by the SEC at http://www.sec.gov, as well as on our website
at http://www.ariesmaritime.com.

I. Subsidiary information

Not applicable.

ITEM 11. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

     See " Item 5 - Operating and Financial Review and Prospects - Quantitative
and Qualitative Disclosures About Market Risk."

ITEM 12. DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES

     Not Applicable.
<PAGE>

                                     PART II

ITEM 13. DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES

     Neither we nor any of our subsidiaries have been subject to a material
default in the payment of principal, interest, a sinking fund or purchase fund
installment or any other material default that was not cured within 30 days. In
addition, the payment of our dividends is not, and has not been in arrears or
has not been subject to a material delinquency that was not cured within 30
days.

ITEM 14. MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF
PROCEEDS

     Not Applicable.

ITEM 15. CONTROLS AND PROCEDURES

(a)  Disclosure Controls and Procedures.

     The Chief Executive Officer and Chief Financial Officer, after evaluating
the effectiveness of the Company's disclosure controls and procedures (as
defined by Rules 13a-15(e) and 15d-15(e) under the securities and Exchange Act
of 1934) as of December 31, 2006, have concluded that, as of such date, the
Company's disclosure controls and procedures were effective to provide
reasonable assurance that the information required to be disclosed by the
Company in reports filed under the Securities Exchange Act of 1934, is recorded,
processed, summarized and reported within the time period specified in the SEC's
rules and forms. The Company further believes that a system of controls, no
matter how well designed and operated, cannot provide absolute assurance that
the objectives of the controls are met, and no evaluation of controls can
provide absolute assurance that all control issues and instances of fraud, if
any, within a company have been detected.

(b)  Management's annual report on internal control over financial reporting.

     This annual report does not include an attestation report of the Company's
registered public accounting firm regarding internal control over financial
reporting. Management's report was not subject to attestation by the Company's
registered public accounting firm pursuant to temporary rules of the Securities
and Exchange Commission that permit the Company to provide only management's
report in this annual report.

     Our management is responsible for establishing and maintaining adequate
internal control over financial reporting as defined in Rule 13a-15(f) or
15d-15(f) under the Exchange Act. Our internal control system was designed to
provide reasonable assurance to our management and board of directors regarding
the reliability of financial reporting and the preparation of published
financial statements in accordance with Generally Accepted Accounting
Principles. All internal control systems, no matter how well designed, have
inherent limitations. Therefore, even those systems determined to be effective
may not prevent or detect misstatements and can provide only reasonable
assurance with respect to financial statement preparation and presentation.

     Our management assessed the effectiveness of our internal control over
financial reporting as of December 31, 2006. In making this assessment,
management used the criteria for effective internal control over financial
reporting set forth by the Committee of Sponsoring Organizations of the Treadway
Commission ("COSO") in Internal Control-Integrated Framework. Based on this
assessment, management has concluded that, as of December 31, 2006, our internal
control over financial reporting was effective based on those criteria.

(c)  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, the Company's internal controls over financial reporting.

ITEM 16A. AUDIT COMMITTEE FINANCIAL EXPERT

     We have established an audit committee comprised of three members which is
responsible for reviewing our accounting controls and recommending to the board
of directors the engagement of our outside auditors. Each member is an
independent director under the corporate governance rules of the Nasdaq Global
Market. The members of the audit committee are Messrs. Per Olav Karlsen, Henry
S. Marcus and Panagiotis Skiadas. The board of directors has determined that the
Chairman, Per Olav Karlsen, qualifies as an audit committee financial expert.

ITEM 16B. CODE OF ETHICS

     As a foreign private issuer, we are exempt from the rules of the Nasdaq
Global Market that require the adoption of a code of ethics. However, we have
voluntarily adopted a code of ethics that applies to our principal executive
officer, principal financial officer and persons performing similar functions.
We will also provide any person a hard copy of our code of ethics free of charge
upon written request. Shareholders may direct their requests to the Company at
18 Zerva Nap., Glyfada, Athens 166 75 Greece, Attn: Corporate Secretary.

ITEM 16C. PRINCIPAL ACCOUNTANT FEES AND SERVICES

     Audit Fees
     ----------

     Our principal accountants for the fiscal years ended December 31, 2006 and
2005 were PricewaterhouseCoopers S.A. Our audit fees for 2006 and 2005 were
$305,000 and $268,000, respectively.

     Audit-Related Fees
     ------------------

     Our audit-related fees for 2006 were $78,000. We did not incur
audit-related fees for 2005.

     Tax Fees
     --------

     We did not incur tax fees for 2006 or 2005.

     All Other Fees
     --------------

     We incurred fees of $471,643.91 in connection with our initial public
offering in June 2005.

     Our audit committee pre-approves all audit, audit-related and non-audit
services not prohibited by law to be performed by our independent auditors and
associated fees prior to the engagement of the independent auditor with respect
to such services.

ITEM 16D. EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES

     Not applicable.

ITEM 16E. PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASES

     None.

     Part III

ITEM 17. FINANCIAL STATEMENTS

     See Item 18.

ITEM 18. FINANCIAL STATEMENTS

     The following financial statements, together with the report of
PricewaterhouseCoopers S.A. thereon, are filed as part of this report:
<PAGE>

================================================================================

     ARIES MARITIME TRANSPORT LIMITED

     Consolidated Financial Statements and Predecessor Combined Carve-Out
     Financial Statements for the years ended December 31, 2006, December 31,
     2005 and December 31, 2004

================================================================================
<PAGE>

INDEX TO THE CONSOLIDATED FINANCIAL STATEMENTS AND PREDECESSOR COMBINED
CARVE-OUT FINANCIAL STATEMENTS

                                                                            Page
                                                                            ----
Report of Independent Registered Public Accounting Firm                      F-3

Balance Sheets                                                               F-4

Statements of Income                                                         F-5

Statements of Stockholders' Equity                                           F-6

Statements of Cash Flows                                                     F-7

Notes to the Predecessor Combined Carve-out and Consolidated
Financial Statements                                                         F-9
<PAGE>

Report of Independent Registered Public Accounting Firm

To the Board of Directors and Stockholders of
     Aries Maritime Transport Limited

     We have audited the accompanying consolidated balance sheets of Aries
Maritime Transport Limited (the "Group") as of December 31, 2006 and December
31, 2005, and the related consolidated and predecessor combined carve-out
statements of income, stockholders' equity and cash flows for each of the three
years in the period ended December 31, 2006. These consolidated and predecessor
combined carve-out financial statements are the responsibility of the Group's
management. Our responsibility is to express an opinion on these financial
statements based on our 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 audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for our opinion.

     In our opinion, the consolidated and predecessor combined carve-out
financial statements referred to above present fairly, in all material respects,
the financial position of Aries Maritime Transport Limited at December 31, 2006
and December 31, 2005, and the results of its operations and its cash flows for
each of the three years in the period ended December 31, 2006 in conformity with
accounting principles generally accepted in the United States of America.


PricewaterhouseCoopers S.A.

April 19, 2007
Athens, Greece
<PAGE>

ARIES MARITIME TRANSPORT LIMITED
CONSOLIDATED BALANCE SHEETS
(All amounts expressed in thousands of U.S. Dollars)
--------------------------------------------------------------------------------
                                           Notes      December 31,  December 31,
                                                          2005          2006
                                                        -------       --------
ASSETS
CURRENT ASSETS
   Cash and cash equivalents                               19,248        11,612
   Restricted cash                              4              10         3,242
   Trade receivables, net                                     176         1,960
   Other receivables                                           60           172
   Derivative financial instruments             14            401           671
   Inventories                                  5             645         1,496
   Prepaid expenses                                           521           338
   Due from managing agent                                     84           444
   Due from related parties                     18          1,293         2,495
                                                          -------       -------
   Total current assets                                    22,438        22,430
                                                          -------       -------

   Vessels and other fixed assets, net          6         341,225       431,396
   Advances for vessel acquisitions                        11,363            --
   Deferred charges, net                        9           2,872         4,214
                                                          -------       -------
   Total non-current assets                               355,460       435,610
                                                          -------       -------
   Total assets                                           377,898       458,040
                                                          =======       =======

LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
   Accounts payable, trade                      7           4,598        11,828
   Accrued liabilities                          8           2,880         7,289
   Deferred income                                          3,163         1,947
   Derivative financial instruments             14             --         2,547
   Deferred revenue                             11         10,715         6,011
                                                          -------       -------
   Total current liabilities                               21,356        29,622
                                                          -------       -------

   Long-term debt                               10        183,820       284,800
   Deferred revenue                             11         17,041        11,030
                                                          -------       -------
   Total liabilities                                      222,217       325,452
                                                          -------       -------

   Commitments and contingencies                10,16          --            --

Stockholders' equity
   Preferred Stock, $0.01 par value, 30
      million shares authorized,
      none issued.

   Common Stock, $0.01 par value, 100
      million shares authorized, 28.4
      million shares issued and
      outstanding at December 31, 2006
      (2005: 28.4 million shares)                             284           284
   Additional paid-in capital                             155,397       132,304
                                                          -------       -------
   Total stockholders' equity                             155,681       132,588
                                                          -------       -------
   Total liabilities and stockholders' equity             377,898       458,040
                                                          =======       =======

The accompanying notes are an integral part of these consolidated and
predecessor combined carve-out financial statements.
<PAGE>

<TABLE>


ARIES MARITIME TRANSPORT LIMITED
CONSOLIDATED AND PREDECESSOR COMBINED CARVE-OUT STATEMENTS OF INCOME
(All amounts expressed in thousands of U.S. Dollars, except share and per share amounts)
----------------------------------------------------------------------------------------------------------
<CAPTION>

                                                                        Year ended           Year ended              Year ended
                                                  Notes              December 31, 2004    December 31, 2005        December 31, 2006
                                                  -----              -----------------    -----------------        -----------------
<S>                                               <C>                  <C>                  <C>                      <C>

REVENUES:
       Revenue from voyages                         11,13                48,269               75,905                   94,199

       Gain on disposal of vessels                                       14,724                    -                        -

EXPENSES:
       Commissions                                     18                (1,189)              (1,323)                  (1,403)
       Voyage expenses                                                     (312)                (224)                  (4,076)
       Vessel operating expenses                    17,18               (12,460)             (17,842)                 (27,091)
       General & administrative expenses               18                   (75)              (1,649)                  (4,226)
       Depreciation                                     6               (12,724)             (19,446)                 (29,431)
       Amortization of dry-docking and
        special survey expense                       6,18                (1,552)              (1,958)                  (3,568)
       Management fees                                 18                  (893)              (1,511)                  (1,999)
                                                                    -----------------    -----------------        -----------------
                                                                        (29,205)             (43,953)                 (71,794)
                                                                    -----------------    -----------------        -----------------
       Net operating income                                              33,788               31,952                   22,405

OTHER INCOME/( EXPENSES), NET:
       Interest expense                           9,10,11                (8,616)             (18,793)                 (19,135)
       Interest received                                                     58                  672                      931
       Other income (expenses), net                                          76                  (10)                    (214)
       Change in fair value of derivatives             14                   (33)                 950                   (1,788)
                                                                    -----------------    -----------------        -----------------
       Total other income/ (expenses), net                               (8,515)             (17,181)                 (20,206)
                                                                    -----------------    -----------------        -----------------

NET INCOME                                                               25,273               14,771                    2,199
                                                                    =================    =================        =================

Earnings per share:
Basic and diluted                                                         $1.56                $0.64                    $0.08
                                                                    =================    =================        =================

Weighted average number of shares:
Basic and diluted                                                    16,176,877           23,118,466               28,416,877
                                                                    =================    =================        =================

The accompanying notes are an integral part of these consolidated and predecessor combined
carve-out financial statements.
</TABLE>


<PAGE>

<TABLE>

ARIES MARITIME TRANSPORT LIMITED

CONSOLIDATED AND PREDECESSOR COMBINED CARVE-OUT STATEMENTS OF STOCKHOLDERS' EQUITY
(All amounts expressed in thousands of U.S. Dollars except as indicated)
<CAPTION>


                                               Common Stock
                                                (Number of                                Additional                    Total
                                                 Shares in      Invested     Share         Paid-in       Retained    Stockholders'
                                     Notes      Thousands)       Equity      Capital       Capital       Earnings       Equity
                                     -----      ----------       ------      -------       -------       --------       ------
<S>                                  <C>        <C>             <C>          <C>           <C>           <C>           <C>
                                                                     514                                                     514
Balance at December 31, 2003
 Net income                                                       25,273                                                  25,273
 Capital contribution                                              9,834                                                   9,834
 Distribution to stockholders                                    (18,968)                                                (18,968)
                                                                ---------                                               ---------
Balance at December 31, 2004                                      16,653                                                  16,653
 Net income                                                        3,807                                                   3,807
 Capital contribution                   12        1,200               12                                                      12
                                               ---------        ---------                                               ---------
Balance at March 17,  2005                        1,200           20,472                                                  20,472
 Reorganization adjustment                                       (20,472)       12          20,460              -              -
 Distributions                          12       14,977                -       150          (2,058)             -         (1,908)
 Net income                                                            -         -               -         10,964         10,964
 Proceeds from initial public
   offering, net                         1       12,240                -       122         140,807              -        140,929
 Dividends paid                         12                             -         -          (3,812)       (10,964)       (14,776)
                                               ---------        ---------   ---------     ---------      ---------      ---------

Balance at December 31, 2005                     28,417                -       284         155,397              -        155,681
 Net income                                                            -         -               -          2,199          2,199
 Dividends paid                         12                             -         -         (23,093)        (2,199)       (25,292)
                                               ---------        ---------   ---------     ---------      ---------      ---------
Balance at December 31, 2006                     28,417                -       284         132,304              -        132,588
                                               =========        =========   =========     =========      =========      =========

The accompanying notes are an integral part of these consolidated and predecessor combined
carve-out financial statements.
</TABLE>


<PAGE>

<TABLE>

ARIES MARITIME TRANSPORT LIMITED
CONSOLIDATED AND PREDECESSOR COMBINED CARVE-OUT STATEMENTS OF CASH FLOWS
(All amounts expressed in thousands of U.S. Dollars)
----------------------------------------------------------------------------------------------------------
<CAPTION>


                                                                           Year ended           Year ended          Year ended
                                                                Notes   December 31, 2004     December 31, 2005   December 31, 2006
                                                                -----   -----------------     -----------------   -----------------
<S>                                                              <C>        <C>                    <C>                    <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
 Net income                                                                25,273                 14,771                  2,199
 Adjustments to reconcile net income to net cash
    provided  by operating activities:
 Depreciation                                                              12,724                 19,446                 29,431
 Amortization of dry-docking and special survey                             1,552                  1,958                  3,727
 Amortization and write-off of deferred financing costs                       587                  1,598                  1,639
 Amortization of debt discount                                              1,480                  7,640                      -
 Amortization of deferred revenue                                         (9,055)                 (9,275)               (11,689)
 Unearned revenue                                                               -                    (16)                     -
 Interest expense of deferred revenue                                         294                    430                    974
 Change in fair value of derivative financial instruments                      33                   (950)                  1,788
 Gain on disposal of vessels                                             (14,724)                      -                      -
 Payments for dry-docking / special survey costs                                -                 (1,896)               (15,151)
 Proceeds for vessel's dry-docking / special survey costs                       -                      -                  5,000
 Changes in working capital                                      15         3,735                  3,268                  6,297
                                                                      -----------------     -----------------   -----------------
Net cash provided by operating activities                                  21,899                 36,974                 24,215
                                                                      -----------------     -----------------   -----------------

Cash flows from investing activities:
 Vessel acquisitions                                                     (221,115)              (103,355)              (101,765)
 Other fixed asset acquisitions                                                 -                    (96)                   (50)
 Restricted cash for dry-docking payments                                    (535)                   813                      -
 Proceeds from disposal of vessels                                         59,877                      -                      -
 Advances for vessel acquisitions                                               -                (11,363)                     -
                                                                      -----------------     -----------------   -----------------
Net cash used in investing activities                                    (161,773)              (114,001)              (101,815)
                                                                      -----------------     -----------------   -----------------

Cash flows from financing activities:
 Proceeds from issuance of long-term debt                                 246,180                183,820                100,980
 Principal repayments of long-term debt                                   (99,378)              (214,600)                     -

 Proceeds from termination of derivative
    financial instruments                                                       -                    301                    489
 Payment of participation liability                                             -                 (6,500)                     -
 Payment of financing costs                                                (1,959)                (2,824)                (2,981)
 Restricted cash for loan payments                                         (4,694)                 4,793                 (3,232)
 Proceeds from issuance of capital stock                                    4,392                140,941                      -
 Distribution                                                                   -                   (214)                     -
 Dividends paid                                                                 -                (14,776)               (25,292)
                                                                      -----------------     -----------------   -----------------
   Net cash provided by financing activities                              144,541                 90,941                 69,964
                                                                      -----------------     -----------------   -----------------
   Net increase/ (decrease) in cash and cash equivalents                    4,667                 13,914                 (7,636)
Cash and cash equivalents
Beginning of year                                                             667                  5,334                 19,248
                                                                      -----------------     -----------------   -----------------
End of year                                                                 5,334                 19,248                 11,612
                                                                      =================     =================   =================

The accompanying notes are an integral part of these consolidated and predecessor combined
carve-out financial statements.

</TABLE>

<PAGE>

<TABLE>

ARIES MARITIME TRANSPORT LIMITED
CONSOLIDATED AND PREDECESSOR COMBINED CARVE-OUT STATEMENTS OF CASH FLOWS (CONTINUED)
 (All amounts expressed in thousands of U.S. Dollars)
----------------------------------------------------------------------------------------------------------

                                                                   Year ended          Year ended            Year ended
                                                                December 31, 2004    December 31, 2005    December 31, 2006
                                                                -----------------    -----------------    -----------------
<S>                                                                    <C>               <C>                     <C>
SUPPLEMENTAL CASH FLOW INFORMATION
    Interest paid                                                      5,429             9,838                   13,466
    Issuance of capital stock                                              -               150                        -
    Vessels acquired from issuance of long-term debt                   5,000                 -                        -
    Vessels acquired from stockholder contributions                    6,141                 -                        -
    Proceeds receivable from disposal of vessels                       2,000                 -                        -
    Long-term debt transferred to group                               19,767                 -                        -
    Proceeds from disposal of vessels paid to stockholders             3,000                 -                        -
    Liability assumed in connection with vessel acquisitions          22,638            28,387                        -
    Distribution                                                           -             1,694                        -


The accompanying notes are an integral part of these consolidated and predecessor combined
carve-out financial statements.
</TABLE>


ARIES MARITIME TRANSPORT LIMITED

(All amounts in tables expressed in thousands of U.S. Dollars)
--------------------------------------------------------------------------------
Notes to the Predecessor Combined Carve-out and Consolidated Financial
Statements

1.    Organization and Basis of Presentation

     The principal business of Aries Maritime Transport Limited (the "Company"
     or "Aries Maritime") is the ownership and chartering of ocean-going vessels
     world-wide. The Company conducts its operations through its subsidiaries.
     The vessel-owning subsidiaries own products tankers and container vessels
     that transport a variety of refined petroleum products and containers
     world-wide. Aries Maritime was incorporated on January 12, 2005 for the
     purpose of being the ultimate holding company of 100% of certain of the
     companies listed below (companies 1 through to 12):

<TABLE>

Company Name                          Country of Incorporation      Vessel Name                       Date of Vessel Acquisition
------------                          ------------------------      -----------                       --------------------------
<S>                                   <C>                           <C>                               <C>
1. Mote Shipping Ltd.                  Malta                         **                                -
2. Statesman Shipping Ltd.             Malta                         **                                -
3. Trans Continent Navigation Ltd.     Malta                         **                                -
4. Trans State Navigation Ltd.         Malta                         **                                -
5. Rivonia Marine Limited              Cyprus                        *                                 -
6. Robin Marine Limited                Cyprus                        *                                 -
7. Olympic Galaxy Shipping Ltd.        Marshall Islands              M/V Energy 1 ex CMA CGM Energy    April 28, 2004
8. Bora Limited                        British Virgin Islands        **                                -
9. Dynamic Maritime Co.                Marshall Islands              M/V SCI Tej ex CMA CGM Force      June 1, 2004
10. Jubilee Shipholding S.A.           Marshall Islands              M/V Ocean Hope                    July 26, 2004
11. Vintage Marine S.A.                Marshall Islands              M/T Arius ex Citius               August 5, 2004
12. Ermina Marine Ltd.                 Marshall Islands              M/T Nordanvind                    December 9, 2004
13. AMT Management Ltd.                Marshall Islands              -                                 -
14. Land Marine S.A.                   Marshall Islands              M/T High Land**                   March 7, 2003
15. Rider Marine S.A.                  Marshall Islands              M/T High Rider**                  March 18, 2003
16. Altius Marine S.A.                 Marshall Islands              M/T Altius**                      June 24, 2004
17. Seine Marine Ltd.                  Marshall Islands              M/V CMA CGM Seine                 June 24, 2005
18. Makassar Marine Ltd.               Marshall Islands              M/V CMA CGM Makassar              July 15, 2005
19. Fortius Marine S.A.                Marshall Islands              M/T Fortius**                     August 2, 2004
20. Chinook Waves Corporation          Marshall Islands              M/T Chinook                       November 30, 2005
21. Santa Ana Waves Corporation        Marshall Islands              ***                               -
22. Compassion Overseas Ltd.           Bermuda                       M/T Stena Compassion              June 16, 2006
23. Compass Overseas Ltd.              Bermuda                       M/T Stena Compass                 February 14, 2006
24. Ostria Waves Ltd.                  Marshall Islands              M/T Ostria ex Bora**/***          May 25, 2004
</TABLE>

----------
*    These companies were transferred out of the Aries Maritime group of
     companies on March 24, 2005.

**   These vessels were transferred from Trans Continent Navigation Ltd, Mote
     Shipping Ltd, Statesman Shipping Ltd, Trans State Navigation Ltd and Bora
     Limited to Altius Marine S.A., Land Marine S.A., Rider Marine S.A., Fortius
     Marine S.A. and Ostria Waves Ltd in November, July, August, November 2005
     and January 2007 respectively. The original acquisitions for these vessels
     were made on June 24, 2004, on March 7, 2003, on March 18, 2003, on August
     2, 2004 and on May 25, 2004 respectively.

***  Santa Ana Waves Corporation was incorporated on March 23, 2006. Ostria
     Waves Ltd was incorporated on November 27, 2006.

     Up to March 17, 2005, the predecessor combined carve-out financial
     statements of Aries Maritime had been prepared to reflect the combination
     of certain of the vessel-owning companies listed above. The companies
     reflected in the predecessor combined carve-out financial statements were
     not a separate legal group prior to the re-organization, therefore reserves
     were represented by 'Invested Equity'.

     In a group re-organization effective March 17, 2005 the stockholders of
     certain of the vessel-owning companies listed above contributed their
     interest in the individual vessel owning-companies in exchange for an
     equivalent shareholding in Aries Maritime. Aries Maritime's ownership
     percentages in the vessel-owning companies are identical to the ownership
     percentages that the previous stockholders held in each of the
     vessel-owning companies before the group reorganization. Accordingly the
     group reorganization has been accounted for as an exchange of equity
     interests at historical cost.

     After March 17, 2005, the financial statements reflect the consolidated
     results of Aries Maritime.

     On June 8, 2005 Aries Maritime closed its initial public offering of
     12,240,000 common shares at an offering price of $12.50 per share. The net
     proceeds of the offering after expenses were $140.8 million.

     Hereinafter, Aries Maritime and its subsidiaries listed above will be
     referred to as "the Group".

2.   Summary of Significant Accounting Policies

     Principles of Combination and Consolidation:

     The predecessor combined carve-out and consolidated financial statements
     are prepared in accordance with accounting principles generally accepted in
     the United States of America. All intercompany balances and transactions
     have been eliminated upon combination and consolidation.

     Use of Estimates:

     The preparation of financial statements in conformity with generally
     accepted accounting principles requires management to make estimates and
     assumptions that affect the reported amounts of assets and liabilities,
     revenues and expenses and the disclosure of contingent assets and
     liabilities in the financial statements and accompanying notes. Actual
     results could differ from those estimates.

     Foreign Currency Translation:

     The functional currency of the Group is the U.S. Dollar because the Group's
     vessels operate in international shipping markets, which typically utilize
     the U.S. Dollar as the functional currency. The accounting records of the
     companies comprising the Group are maintained in U.S. Dollars. Transactions
     involving other currencies during a period are converted into U.S. Dollars
     using the exchange rates in effect at the time of the transactions. At the
     balance sheet dates, monetary assets and liabilities, which are denominated
     in other currencies, are translated to reflect the period-end exchange
     rates. Resulting gains or losses are reflected in the accompanying
     consolidated statements of income.

     Cash and Cash Equivalents:

     The Group considers highly liquid investments, such as time deposits and
     certificates of deposit, with an original maturity of three months or less
     to be cash equivalents.

     Restricted Cash:

     Various restricted cash accounts held by the Group, consisting mainly of
     retention and debt reserve accounts, are restricted for use as general
     working capital unless such balances exceed the next quarter's loan
     payments due to the vessel-owning companies' lenders. The Group considers
     such accounts to be restricted cash and classifies them separately from
     cash and cash equivalents within current assets. Dry-docking accounts are
     also restricted for use by the vessel-owning companies until such time as
     dry-docking costs are incurred. These restricted cash accounts are
     classified as non-current assets.

     Trade Receivables:

     The amount shown as trade receivables includes estimated recoveries from
     charterers for hire, freight and demurrage billings, net of provision for
     doubtful accounts. An estimate is made for the provision for doubtful
     accounts based on a review of all outstanding trade receivables at year
     end. Bad debts are written off in the period in which they are identified.
     No provision for doubtful debts has been made for the years ended December
     31, 2006, December 31, 2005 and December 31, 2004 and the Group has not
     written off any trade receivables during these periods.

     Inventories:

     Inventories which comprise of bunkers, lubricants, provisions and stores
     remaining on board the vessels at period end, are valued at the lower of
     cost and market value. Cost is determined by the first in, first out
     method.

     Vessels and Other Fixed Assets:

     Vessels are stated at cost, which consists of the contract price, delivery
     and acquisition expenses, interest cost while under construction, and,
     where applicable, initial improvements. Subsequent expenditures for
     conversions and major improvements are also capitalized when they
     appreciably extend the life, increase the earning capacity or improve the
     efficiency or safety of a vessel; otherwise, these amounts are charged to
     expenses as incurred.

     The component of each new vessels' initial capitalized cost that relates to
     dry-docking and special survey calculated by reference to the related
     estimated economic benefits to be derived until the next scheduled
     dry-docking and special survey, is treated as a separate component of the
     vessels' cost and is accounted for in accordance with the accounting policy
     for dry-docking and special survey costs.

     Where the Group identifies any intangible assets or liabilities associated
     with the acquisition of a vessel, the Group records all identified tangible
     and intangible assets or liabilities at fair value. Fair value is
     determined by reference to market data and the discounted amount of
     expected future cash flows. In addition, the portion of the vessels'
     capitalized costs that relates to dry-docking and special survey is treated
     as a separate component of the vessels' costs and is accounted for in
     accordance with the accounting policy for special survey and dry-docking
     costs.

     Fixed assets are stated at cost and are depreciated utilizing the
     straight-line method at rates equivalent to their estimated economic useful
     lives. The cost and related accumulated depreciation of fixed assets sold
     or retired are removed from the accounts at the time of sale or retirement
     and any gain or loss is included in the accompanying statement of income.

     Accounting for Special Survey and Dry-docking Costs:

     The Group follows the deferral method of accounting for special survey and
     dry-docking expenses whereby actual costs incurred are deferred and are
     amortized over a period of five and two and a half years, respectively. If
     a special survey and or dry-docking is performed prior to the scheduled
     date, the remaining unamortized balances are immediately written-off.

     The amortization periods for the special survey and dry-docking expenses
     reflect the periods between each legally required special survey and
     dry-docking.

     Debt Finance:

     Where a secured loan includes the right for the lender to participate in
     future appreciation of the underlying vessels under lien, the Group
     establishes a participation liability at the inception of the loan equal to
     the fair value of the participation feature. At the end of each reporting
     period, the balance of the participation liability is adjusted to be equal
     to the current fair value of the participation. The corresponding amount of
     the adjustment is reflected as an adjustment to the debt discount. As of
     December 31, 2006 and 2005 there is no such participation liability.

     Debt discount is amortized using the effective interest method over the
     term of the related loan. Any adjustment to the debt discount is amortized
     prospectively. The cost is included in interest expense.

     Deferred Revenue:

     The Group values any liability arising from the below market value bareboat
     and time charters assumed when a vessel is acquired. The liability, being
     the difference between the market charter rate and assumed charter rate is
     discounted using the Group's weighted average cost of capital and is
     recorded as deferred revenue and amortized to revenue over the remaining
     period of the time charter.

     Impairment of Long-lived Assets:

     Long-lived assets and certain identifiable intangibles held and used or
     disposed of by the Group are reviewed for impairment whenever events or
     changes in circumstances indicate that the carrying amount of the assets
     may not be recoverable. An impairment loss for an asset held for use should
     be recognized when the estimate of undiscounted cash flows, excluding
     interest charges, expected to be generated by the use of the asset is less
     than its carrying amount.

     Measurement of the impairment loss is based on the fair value of the asset
     as provided by third parties as compared to its carrying amount. In this
     respect, management regularly reviews the carrying amount of each vessel in
     connection with the estimated recoverable amount for such vessel.
     Impairment losses on assets to be disposed of, if any, are based on the
     estimated proceeds to be received, less costs of disposal. The review of
     the carrying amount in connection with the estimated recoverable amount for
     each of the Group's vessels indicated that no impairment loss has occurred
     in any of the periods presented.

     Depreciation of Vessels and Other Fixed Assets:

     Depreciation is computed using the straight-line method over the estimated
     useful life of the vessels, after considering the estimated salvage value
     of the vessels. Each vessel's salvage value is equal to the product of its
     lightweight tonnage and estimated scrap value per lightweight ton.
     Management estimates the useful life of the Group's vessels to be 25 years
     from the date of its initial delivery from the shipyard. However, when
     regulations place limitations over the ability of a vessel to trade, its
     useful life is adjusted to end at the date such regulations become
     effective. Currently, there are no regulations which affect the vessels'
     useful lives.

     Depreciation of fixed assets is computed using the straight-line method.
     Annual depreciation rates, which approximate the useful life of the assets,
     are:

         Furniture, fixtures and equipment:          5 years
         Computer equipment and software:            5 years

     Financing Costs:

     Fees incurred for obtaining new loans or refinancing existing loans are
     deferred and amortized over the life of the related debt, using the
     effective interest rate method. Any unamortized balance of costs relating
     to loans repaid or refinanced is expensed in the period the repayment or
     refinancing is made.

     Fees incurred in a refinancing of existing loans continue to be amortized
     over the remaining term of the new loan where there is a modification of
     the loan. Fees incurred in a refinancing of existing loans where there is
     an extinguishment of the old loan are written off and included in the debt
     extinguishment gain or loss.

     Interest Expense:

     Interest costs are expensed as incurred and include interest on loans,
     financing costs and amortization. Interest costs incurred while a vessel is
     being constructed are capitalized.

     Accounting for Revenue and Expenses:

     Revenues are generated from bareboat, time and voyage charters. Bareboat,
     time and voyage charter revenues are recorded over the term of the charter
     as the service is provided. Any profit sharing additional hires generated
     are recorded over the term of the charter as the service is provided.
     Deferred income represents revenue applicable to periods after the balance
     sheet date.

     Vessel operating expenses are accounted for on an accrual basis.

     Repairs and Maintenance:

     Expenditure for routine repairs and maintenance of the vessels is charged
     against income in the period in which the expenditure is incurred. Major
     vessel improvements and upgrades are capitalized to the cost of vessel.

     Derivative Instruments:

     Derivative financial instruments are recognized in the balance sheets at
     their fair values as either assets or liabilities. Changes in the fair
     value of derivatives that are designated and qualify as cash flow hedges,
     and that are highly effective, are recognized in other comprehensive
     income. If derivative transactions do not meet the criteria to qualify for
     hedge accounting, any unrealized changes in fair value are recognized
     immediately in the income statement.

     Amounts receivable or payable arising on the termination of interest rate
     swap agreements qualifying as hedging instruments are deferred and
     amortized over the shorter of the life of the hedged debt or the hedge
     instrument.

     During 2004, 2005 and 2006, the Group entered into interest rate swap
     agreements that did not qualify for hedge accounting. As such, the fair
     value of these agreements and changes therein are recognized in the balance
     sheets and statements of income, respectively

     Segment Reporting:

     The Group reports financial information and evaluates its operations by
     charter revenues and not by the type of vessel, length of vessel
     employment, customer or type of charter. Management, including the chief
     operating decision makers, reviews operating results solely by revenue per
     day and operating results of the fleet and, as such, the Group has
     determined that it operates under one reportable segment.

     Earnings Per Share:

     The Group has presented earnings per share for all periods presented based
     on the common shares outstanding of Aries Maritime. The common shares
     issued as a result of the initial public offering have been included in the
     weighted average calculation prospectively from the date of such offering
     for purposes of disclosure of earnings per share. There are no dilutive or
     potentially dilutive securities; accordingly there is no difference between
     basic and diluted earnings per share.

     Cash Flow Statement:

     The consolidated statements of cash flows for all periods presented have
     been reclassified to reflect dry-docking and special survey costs as
     operating activities instead of investing activities to conform to the
     presentation adopted by the Group starting January 1, 2006. This
     reclassification resulted in the decrease of net cash used in investing
     activities in the amount of $1.9 million in the year ended December 31,
     2005 (2004: $NIL). This reclassification had no impact on our Consolidated
     and Predecessor Combined Carve-out Balance Sheets, Statements of Income or
     Statements of Stockholders' Equity.

     Certain balances in prior fiscal years have been reclassified to conform to
     the presentation adopted in the current year.

3.   Recent Accounting Pronouncements

     In September 2006, the Financial Accounting Standard Board issued Statement
     of Financial Accounting Standards No. 157 (SFAS 157) "Fair Value
     Measurement". SFAS 157 defines fair value, establishes a framework for
     measuring fair value in generally accepted accounting principles (GAAP) and
     expands disclosures about fair value measurements. SFAS 157 is effective
     for financial statements issued for fiscal years beginning after November
     15, 2007, and interim periods within those fiscal years. The provisions of
     SFAS 157 should be applied prospectively as of the beginning of the fiscal
     year in which it is initially applied. The Group does not expect the
     adoption of this Accounting Standard to have an effect on its financial
     statements. SFAS 157 will be effective for the Group for the year beginning
     on January 1, 2008.

     In February, 2007, the FASB issued SFAS No. 159 "The Fair Value Option for
     Financial Assets and Financial Liabilities" (SFAS No. 159). SFAS No. 159
     permits entities to choose to measure many financial assets and financial
     liabilities at fair value. Unrealized gains and losses on items for which
     the fair value option has been elected are reported in earnings. SFAS No.
     159 is effective for fiscal years beginning after November 15, 2007. The
     Group is currently assessing the impact of SFAS No. 159 on its consolidated
     financial position and results of operations.

4.   Restricted Cash

                                  December 31, 2005      December 31, 2006
                                  -----------------      -----------------

     Retention account                    -                    3,232
     Restricted account                  10                       10
                                     ---------               ---------
                                         10                    3,242

     Cash deposited in the retention account was made available for loan
     interest payments within three months of being deposited.

5.   Inventories

                                  December 31, 2005      December 31, 2006
                                  -----------------      -----------------

     Lubricants                         581                      750
     Bunkers                              -                      699
     Provisions (Stores)                 64                       47
                                     ---------               ---------
                                        645                    1,496

6.   Vessels and Other Fixed Assets

<TABLE>

     Details are as follows:

                                                   Other fixed        Cost            Special
                                                     assets          of vessel         survey           Dry-docking        Total
                                                     ------          ---------         ------           -----------        -----
<S>                                                  <C>              <C>               <C>               <C>              <C>
     Cost

     Balance at December 31, 2003                        -             30,572             967                700            32,239
     Additions                                           -            263,938           2,834              1,967           268,739
     Disposals                                           -            (59,177)          (474)               (438)          (60,089)
                                                  ----------        ----------      ----------          ----------       ----------
     Balance at December 31, 2004                        -            235,333           3,327              2,229           240,889
     Additions                                          96            131,079           1,528              1,031           133,734
                                                  ----------        ----------      ----------          ----------       ----------
     Balance at December 31, 2005                       96            366,412           4,855              3,260           374,623
     Additions                                          50            112,361           1,562             14,356           128,329
     Proceeds received                                   -                  -               -             (5,000)           (5,000)
                                                  ----------        ----------      ----------          ----------       ----------
     Balance at December 31, 2006                      146            478,773           6,417             12,616           497,952
                                                  ----------        ----------      ----------          ----------       ----------

     Accumulated Depreciation and Amortization

     Balance at December 31, 2003                        -             (1,721)           (157)              (114)           (1,992)
     Charge for the year                                 -            (12,724)           (773)              (779)          (14,276)
     Disposals                                           -              4,127              77                 70             4,274
                                                  ----------        ----------      ----------          ----------       ----------
     Balance at December 31, 2004                        -            (10,318)           (853)              (823)          (11,994)
     Charge for the year                                (9)           (19,437)           (920)            (1,038)          (21,404)
                                                  ----------        ----------      ----------          ----------       ----------
     Balance at December 31, 2005                       (9)           (29,755)         (1,773)            (1,861)          (33,398)
     Charge for the year                               (26)           (29,405)         (1,290)            (2,437)          (33,158)
                                                  ----------        ----------      ----------          ----------       ----------
     Balance at December 31, 2006                      (35)           (59,160)         (3,063)            (4,298)          (66,556)
                                                  ----------        ----------      ----------          ----------       ----------

     Net book value - December 31, 2004                  -            225,015           2,474              1,406           228,895
                                                  ----------        ----------      ----------          ----------       ----------
     Net book value - December 31, 2005                 87            336,657           3,082              1,399           341,225
                                                  ----------        ----------      ----------          ----------       ----------
     Net book value - December 31, 2006                111            419,613           3,354              8,318           431,396
                                                  ----------        ----------      ----------          ----------       ----------
</TABLE>

     During the year ended December 31, 2006, the Group acquired two vessels,
     none of which included the assumption of bareboat charters which had rates
     of hire below the market value at the delivery date. In 2005, three vessels
     were acquired and in 2004, five vessels were acquired with rates of hire
     below market value. The cost of these vessels in 2005 and 2004 totalled
     $103.2 million and $107.4 million respectively. The fair value of the
     liability associated with the time charters was $28.3 million in 2005 and
     $22.6 million in 2004.

     During the year ended December 31, 2006, the Group received $158,000 (2005:
     $NIL) from Magnus Carriers for special survey and dry-docking amortization,
     pursuant to the excess cost sharing arrangement contained in the management
     agreements (refer to note 16). The amount was received in respect of the
     difference between the amortization of actual dry-docking and special
     survey expenses and the budgeted amounts and has been recognized as a
     reduction in these expenses (refer to note 18).

     Under the ship management agreements with Magnus Carriers, the Group
     received $5 million during the year ended December 31, 2006, by way of a
     one-time accelerated payment in respect of the dry-docking costs of the M/T
     Arius. This $5 million has been recognized as a reduction in the
     capitalized costs (refer to note 18).

7.   Accounts Payable

                                  December 31, 2005      December 31, 2006
                                  -----------------      -----------------


     Suppliers                      2,106                      8,002
     Agents                           626                        615
     Trade Creditors                1,866                      3,211
                                     ---------               ---------
                                    4,598                     11,828

8.   Accrued Liabilities

                                  December 31, 2005      December 31, 2006
                                  -----------------      -----------------


     Accrued interest                   7                      4,613
     Other accrued expenses           617                      1,870
     Crew payroll                     422                        484
     Claims                         1,834                        322
                                     ---------               ---------
                                    2,880                      7,289

9.   Deferred Charges

                                                             Financing Costs
                                                             ---------------

     Net Book Value at December 31, 2003                            274
     Additions                                                    1,959
     Amortization                                                  (321)
     Deferred charges written-off                                  (266)

     Net Book Value at December 31, 2004                          1,646
     Additions                                                    2,824
     Amortization                                                 (837)
     Deferred charges written-off                                 (761)

     Net Book Value at December 31, 2005                          2,872
     Additions                                                    2,981
     Amortization                                                  (877)
     Deferred charges written-off                                  (762)

     Net Book Value at December 31, 2006                          4,214

10.  Long-Term Debt

                                                                Balance as of
     VESSEL                                                   December 31, 2006


     M/T Altius                                                     17,333
     M/V CMA CGM Seine                                              13,565
     M/T Ostria ex Bora                                             11,220
     M/T Nordanvind                                                 11,890
     M/T High Land                                                   9,043
     M/T High Rider                                                  8,708
     M/T Arius ex Citius                                             7,201
     M/V Ocean Hope                                                  8,373
     M/V Energy 1 ex CMA CGM Energy                                 10,885
     M/V SCI Tej ex CMA CGM Force                                   10,885
     M/V CMA CGM Makassar                                           13,565
     M/T Fortius                                                    17,332
     M/T Chinook                                                    32,600
     M/T Stena Compass                                              56,100
     M/T Stena Compassion                                           56,100
                                                                  ----------
                                         Total                     284,800
                                                                  ----------
                                         Short term                      -
                                         Long term                 284,800
                                                                  ----------
                                                                   284,800
                                                                  ----------

     Senior secured credit agreement

     Effective April 3, 2006 the Company entered into a new $360 million
     revolving credit facility. The $360 million facility, which has a term of
     five years, was used to replace the previous $140 million term loan
     facility and $150 million revolving credit facility. The $360 million
     facility is in the name of Aries Maritime as borrower and guaranteed by the
     vessel-owning subsidiaries collateralised by first preferred mortgages over
     their vessels which have a net book value of $419.6 million at December 31,
     2006 (2005: $336.7 million), excluding capitalized dry-docking and special
     survey costs. The $360 million commitment contained in the revolving credit
     facility is subject to an $11 million reduction every six months from April
     3, 2006, with the remaining commitment, after the nine equal semi-annual
     reductions, of $261 million to be reduced to zero or repaid in full in one
     instalment in April, 2011.

     The debt agreement also contains various covenants, which the Company is
     required to meet quarterly, including (a) restriction as to changes in
     management and ownership of the vessels, (b) limitation on incurring
     additional indebtedness, (c) mortgaging of vessels, (d) minimum requirement
     regarding hull cover ratios, (e) minimum liquidity requirement, (f)
     maintenance of operating accounts and retention account and (g) minimum
     insurance values. In addition, Magnus Carriers is required to maintain a
     credit balance in an account with the lender of at least $1 million (See
     also Note 18). The debt agreement also requires the Group's two principal
     beneficial equity holders to maintain a beneficial ownership of no less
     than 10% each in the issued stock of the Company.

     As at December 31, 2006 repayments of the long-term debt under the new
     credit facility are due as follows:

                                        2009                    1,800
                                        2010                   22,000
                                        2011                  261,000
                                                             ---------
                                        Total amount          284,800
                                                             =========

     Interest on the new credit facility is charged at LIBOR plus a margin equal
     to 1.125% if the total liabilities divided by the total assets, adjusting
     the book value of the fleet to its market value, is less than 50%; and
     1.25% if equal to or greater than 50% but less than 60%; and 1.375% if
     equal to or greater than 60% but less than 65%; and 1.5% if equal to or
     greater than 65%. The effective interest rate at December 31, 2006 was
     6.62% p.a. for the revolving credit facility.

     Primarily due to vessel out-of-service time during the year ended December
     31, 2006, the interest coverage ratio financial covenant contained in the
     debt agreement would not be met and the lender granted a relaxation from
     3.00 to 1.00 to 2.50 to 1.00 for the periods ending December 31, 2006,
     March 31, 2007 and June 30, 2007. For subsequent periods the relaxation
     will not apply and the ratio reverts back to 3.00 to 1.00. With effect from
     January 3, 2007 and until the relaxation of this covenant no longer
     applies, the Company will pay an increased margin of 1.75%.

     Settlement of fee agreement with bank

     Certain loans with an aggregate outstanding amount of $135.7 million at
     December 31, 2004 contained additional participation arrangements with the
     Bank of Scotland. With $6.5 million of the proceeds of the Company's
     initial public offering, these obligations were settled in full on June 17,
     2005.

11.  Deferred Revenue

                                                            Deferred revenue
     December 31, 2003                                               -
     Additions                                                  22,638
     Amortization                                               (9,055)
     Interest                                                      293
     Deferred revenue written-off on disposal of vessels        (5,662)
                                                            -----------
     December 31, 2004                                           8,214
     Additions                                                  28,387
     Amortization                                               (9,275)
     Interest                                                      430
                                                            -----------
     December 31, 2005                                          27,756
     Amortization                                              (11,689)
     Interest                                                      974
                                                            -----------
     December 31, 2006                                          17,041
                                                            ===========

     Short term                                                  6,011
     Long term                                                  11,030
                                                            -----------
                                                                17,041
                                                            ===========

12.  Stockholders' Equity

     (a) On incorporation of the Company on January 12, 2005, 12,000 shares were
     issued with a par value of $1 per share resulting in net proceeds of
     $12,000. On January 17, 2005, the Company proceeded with a stock split
     resulting in 1,200,000 shares of $0.01 each.

     (b) In April 2005, the Company paid a dividend to existing stockholders of
     $1.9 million. $214,000 of the dividend was paid in cash and the balance of
     $1.7 million was settled by the transfer of two Group companies to existing
     stockholders. In June 2005, the Company paid a dividend of $150,000, which
     the Company settled by the issuance of 14,976,877 shares.

     (c) On November 28, 2005, the Company paid a dividend of $14.7 million to
     existing stockholders.

     (d) During the year ended December 31, 2006, the Company paid dividends
     totalling $25.2 million to existing stockholders.

13.  Revenue From Voyages

     The Group operates on a worldwide basis in one operating segment - the
     shipping transportation market. The geographical analysis of revenue from
     voyages, based on point of destination, is presented as follows:

                                 December 31,    December 31,    December 31,
                                     2004            2005            2006
                                     ----            ----            ----

     North America                       -               -           5,962
     Australia                           -               -           5,609
     Europe                         12,302          27,413          25,406
     Asia                           21,846          30,896          34,710
     Africa                         10,571           4,186           9,169
     South America                   3,550          13,410          13,343
                                  ---------       ---------       ---------
                                    48,269          75,905          94,199

     During the year ended December 31, 2006, the Group received 65% of its
     income from four charterers (31%, 13%, 11% and 10%, respectively).

     During the year ended December 31, 2005, the Group received 91% of its
     income from five charterers (33%, 16%, 15%, 14% and 13%, respectively).

     During the year ended December 31, 2004, the Group received 79% of its
     income from three charterers (43%, 23% and 13%, respectively).

14.  Financial Instruments

     Fair Values

     The carrying amounts of the following financial instruments approximate
     their fair values; cash and cash equivalents and restricted cash account,
     trade and other receivables, due from managing agent, due from related
     parties, derivative financial instruments and trade and other payables. The
     fair values of long-term loans approximate the recorded values, generally,
     due to their variable interest rates. Credit Risk

     The Group believes that no significant credit risk exists with respect to
     the Group's cash due to the spread of this risk among various different
     banks and the high credit status of these counterparties. The Group is also
     exposed to credit risk in the event of non-performance by counterparties to
     derivative instruments. However, the Group limits this exposure by entering
     into transactions with counterparties that have high credit ratings. Credit
     risk with respect to trade accounts receivable is reduced by the Group by
     chartering its vessels to established international charterers (refer to
     note 13).

     Interest Rate Swaps

     Outstanding swap agreements involve both the risk of a counterparty not
     performing under the terms of the contract and the risk associated with
     changes in market value. The Group monitors its positions, the credit
     ratings of counterparties and the level of contracts it enters into with
     any one party. The counterparties to these contracts are major financial
     institutions. The Group has a policy of entering into contracts with
     counterparties that meet stringent qualifications and, given the high level
     of credit quality of its derivative counter parties, the Group does not
     believe it is necessary to obtain collateral arrangements.

     The Group has entered into interest rate swap agreements detailed as
     follows:

<TABLE>

                                                         Notional      Maximum
                                                          Amount      fixed rate
                          Value        Termination        Dec. 31,      Dec. 31,                      Fair value       Fair value
Counterparty               Date           Date           2006/2005     2006/2005     Floating Rate   Dec. 31, 2005   Dec. 31, 2006
------------               ----           ----           ---------     ---------     -------------   -------------   -------------
<S>                       <C>            <C>              <C>          <C>           <C>              <C>             <C>
SMBC Bank                 03/07/06       04/04/11          20,000        5.63%       3-month LIBOR         -             (505)
Bank of Ireland           03/07/06       04/04/11          20,000        5.63%       3-month LIBOR         -             (504)
HSH Nordbank              03/07/06       04/04/11          20,000        5.63%       3-month LIBOR         -             (502)
Nordea Bank               03/07/06       04/04/11          20,000        5.63%       3-month LIBOR         -             (506)
Bank of Scotland          03/07/06       04/04/11          20,000        5.63%       3-month LIBOR         -             (530)
                                                                                                      ---------       ---------
                                                                                                           -           (2,547)
                                                                                                      ---------       ---------
Fortis Bank               03/01/06       03/06/09          46,667        4.885%      3-month LIBOR       127                -
Nordea Bank               03/01/06       03/06/09          46,667        4.885%      3-month LIBOR       121              340
Bank of Scotland          03/01/06       03/06/09          46,667        4.885%      3-month LIBOR       153              331
                                                                                                      ---------       ---------
                                                                                                         401              671
                                                                                                      ---------       ---------

</TABLE>

     These interest rate swaps are used to hedge the interest expense arising
     from the Group's long-term borrowings detailed in Note 10. The interest
     rate swaps allow the Group to raise long-term borrowings at floating rates
     and swap them into effectively fixed rates. Under the interest rate swaps,
     the Group agrees with the counterparty to exchange, at specified intervals,
     the difference between a fixed rate and floating rate interest amount
     calculated by reference to the agreed notional amount.

     The total fair value change of the interest rate swaps indicated above is
     shown in the income statement. These amounts were a loss of $1.8 million
     for the year ended December 31, 2006, a gain of $950,000 for the year ended
     December 31, 2005 and a loss of $33,000 for the year ended December 31,
     2004. These fair values are based upon valuations received from the
     relevant financial institutions. The related asset or liability is shown
     under derivative financial instruments in the balance sheet.

15.  Changes in Working Capital

                                   December 31,     December 31,   December 31,
                                      2004             2005           2006
                                      ----             ----           ----

     (Increase) decrease in
     Trade receivables                 (302)             120         (1,784)
     Other receivables                 (114)              54           (112)
     Inventories                       (352)            (210)          (851)
     Prepaid expenses and other        (299)            (192)            183
     Due from managing agent              -              (84)          (360)
     Due from related parties        (1,582)            (152)        (1,202)
     Increase (decrease) in
     Accounts payable, trade          3,518              936          7,230
     Accrued liabilities              1,061            1,684          4,409
     Deferred income                  1,805            1,112         (1,216)
                                    --------         --------       --------
                                      3,735            3,268          6,297


16.  Commitments and Contingent Liabilities

     (a)  Commitments

     Management agreements

     From June 8, 2005, certain of the vessel-owning subsidiaries commenced
     operating under new ten-year ship management agreements with Magnus
     Carriers Corporation ("Magnus Carriers"), a related party with common
     ultimate beneficial stockholders. These ship management agreements are
     cancellable by the vessel-owning subsidiaries with two months notice, while
     Magnus Carriers has no such option. Under these agreements, Magnus Carriers
     provides both technical and commercial management services for the
     vessel-owning subsidiaries. Each of the vessel-owning subsidiaries pays
     vessel operating expenses to Magnus Carriers based on the jointly
     established budget per vessel, which will increase by 3% annually and be
     subject to adjustment every three years. If actual vessel operating
     expenses exceed or are below the budgeted amounts, the relevant subsidiary
     and Magnus Carriers will bear the excess expenditures or benefit from the
     savings equally. Expenses that relate to any improvement, structural
     changes or installation of new equipment required by law or regulation will
     be paid solely by the relevant subsidiary. Also, each of these agreements
     provides for the payment to Magnus Carriers of an initial management fee of
     $146,000 per annum for technical management services.

     From November 30, 2005, Chinook Waves Corporation commenced operating the
     vessel M/T Chinook under a ship management agreement with Ernst Jacob
     Shipmanagement GmbH ("Ernst Jacob"). Under this agreement, Ernst Jacob
     provides technical management services for the vessel-owning subsidiary and
     received an initial annual management fee of Euro 128,000.

     Rental agreement

     On November 21, 2005 AMT Management Ltd entered into an office rental
     agreement with a related party, a company with common ultimate beneficial
     stockholders, with effect from December 1, 2005 for ten years at a monthly
     rental of Euro 4,000 plus stamp duty ($5,000) (Note 18).

     The following table sets out long-term commercial obligations for rent and
     management fees, outstanding as of December 31, 2006:

                2007                                       1,968
                2008                                       1,963
                2009                                       2,023
                2010                                       2,085
                2011 and thereafter                       11,420
                                                       -----------
                                                          19,459
                                                       ===========

     (b)  Contingencies

     Legal proceedings

     There are no material legal proceedings to which the Group is a party other
     than routine litigation incidental to the Group's business. In the opinion
     of management, the disposition of these lawsuits should not have a material
     impact on the Group's results of operations, financial position or cash
     flows.

17.  Taxation

     The Group is not subject to tax on international shipping income in its
     respective jurisdictions of incorporation or in the jurisdictions in which
     their respective vessels are registered. However, the vessel-owning
     companies' vessels are subject to tonnage taxes, which have been included
     in the vessel operating expenses in the accompanying statements of income.

18.  Transactions Involving Related Parties

     (a)  Management fees

     The vessel-owning companies included in the Group receive technical and
     commercial management services from Magnus Carriers, a company with common
     ultimate beneficial stockholders, pursuant to ship management agreements.
     Under these agreements, the Group paid management fees of $1.8 million for
     the year ended December 31, 2006, $1.5 million for the year ended December
     31, 2005 and $0.9 million for the year ended December 31, 2004 which is
     separately reflected in the statements of income.

     (b)  Commissions

     Magnus Carriers and Trampocean S.A., related companies with common ultimate
     beneficial stockholders, provide chartering services to the vessel-owning
     companies included in the Group at a commission of 1.25% of hires and
     freights earned by the vessels. The Group paid these companies fees for
     chartering services of $34,000 for the year ended December 31, 2006,
     $50,000 for the year ended December 31, 2005 and $368,000 for the year
     ended December 31, 2004. These commissions relate to agreements between
     Magnus Carriers and the vessel-owning subsidiaries. From the effective date
     of the new ship management agreements Magnus Carriers may only receive
     commissions on new charters. Under the new ship management agreements,
     Magnus Carriers will be paid 1% of the sale or purchase price in connection
     with a vessel sale or purchase that Magnus Carriers brokers for the Group.

     (c)  Rental agreement

     During 2005, the Group entered into a rental agreement with a related
     party, a company with common ultimate beneficial stockholders (see note
     16). The Group paid $62,000 to the related party during the year ended
     December 31, 2006 (2005 $4,000 and 2004 $NIL).

     (d)  Amounts due from/to related parties

     Amounts due from related parties were $2.5 million at December 31, 2006 and
     $1.2 million at December 31, 2005. These amounts represent payments less
     receipts made by the Group on behalf of (i) other vessel-owning companies
     with common ultimate beneficial stockholders with the Group, consisting of
     $27,000 (due from) at December 31, 2006 and $392,000 (due from) at December
     31, 2005 and (ii) Magnus Carriers Corporation, consisting of $2.5 million
     (due from) at December 31, 2006 and $901,000 (due from) at December 31,
     2005. There are no terms of settlement for these amounts, as of December
     31, 2006.

     (e)  Crewing

     Some crewing for the Group is undertaken by Magnus Carriers through a
     related entity, Poseidon Marine Agency. The Group paid manning fees of
     $288,000 for the year ended December 31, 2006, $310,000 for the year ended
     December 31, 2005 and $278,000 for the year ended December 31, 2004.

     (f)  General and administrative expenses

     During the year ended December 31, 2006 the Group paid directors' fees of
     $619,000 (2005 $467,000 and 2004 $NIL). Such fees are included in general
     and administrative expenses in the accompanying consolidated statements of
     income.

     (g)  Contributions under management agreements

     During the year ended December 31, 2006 the Group received $5 million in
     full and final settlement by Magnus Carriers of the dry-docking expenses
     incurred by M/T Arius. This amount has been deducted from the vessel's
     dry-docking expenses (refer to note 6). During the year ended December 31,
     2006 the Group received an additional $6.5 million (2005 $812,000) from
     Magnus Carriers under the ship-management cost-sharing agreements for
     vessel operating expenses. These amounts are reflected in the operating
     expenses of the vessels in the income statement. Also received during the
     year ended December 31, 2006 was an amount of $159,000 (2005 $NIL) for
     special survey and dry-docking amortization. This amount is reflected in
     the amortization and dry-docking expense in the income statement.

     (h)  Vessel purchase

     Aries Maritime exercised its right to acquire the M/T Chinook under the
     Right of First Refusal Agreement with Magnus Carriers in October 2005. The
     acquisition was offered to Aries Maritime by Magnus Carriers on either of
     two bases; (a) with retention of the five year head charter dated June 16,
     2003 between the sellers and Pacific Breeze Tankers Ltd. (a joint venture
     company, 50% of which is ultimately owned between Mons Bolin, President and
     Chief Executive Officer of Aries Maritime and Gabriel Petridis equally) as
     charterers, at a rate of $13,000 per day, in which case the purchase
     consideration would be $30.6 million or, (b) without the head charter, in
     which case the purchase consideration would be $32.6 million. Aries
     Maritime exercised its right on basis (b). The total purchase consideration
     of $32.6 million for the M/T Chinook, paid on November 30, 2005, comprised
     purchase consideration under the terms of a Memorandum of Agreement dated
     October 25, 2006 of $30.6 million and a $2 million additional purchase
     consideration to the sellers under the terms of a separate agreement
     relating to the termination of the head charter.

     Pursuant to an agreement dated December 28, 2004 Aries Maritime exercised
     its right to acquire CMA CGM Seine and CMA CGM Makassar in June, 2005 and
     took delivery of these vessels on June 24, 2005 and July 15, 2005
     respectively. Both vessels were purchased from International Container
     Ships KS (a Norwegian limited partnership, of which Mons Bolin, President
     and Chief Executive Officer of Aries Maritime and Gabriel Petridis equally
     together, ultimately owned 25%). The purchase price paid for the CMA CGM
     Seine was $35.4 million and for the CMA CGM Makassar was $35.3 million.

     (i)  Minimum liquidity

     Under the Group's new credit facility, Magnus Carriers is required to
     maintain at least $1 million in an account with the lenders (See Note 10).

19.  Post Balance Sheet Events

     Dividend

     On March 9, 2007 the Directors of Aries Maritime declared a dividend of
     $0.07 per share in respect of the fourth quarter of 2006. The dividend was
     paid on March 30, 2007 to stockholders on record as of March 19, 2007.

<PAGE>

ITEM 19. EXHIBITS

      Number                          Description of Exhibits

      1.1      ____ Articles of Incorporation of Aries Maritime Transport
                    Limited (1)

      1.2      ____ Bye-laws of the Company (2)

      4.1      ____ Credit Agreement, dated April 3, 2006 by and among the
                    Company and The Bank of Scotland and Nordea Bank Finland as
                    joint lead arrangers. (3)

      4.2      ____ First Supplemental Agreement, dated August 24, 2006 by and
                    between the Company and The Bank of Scotland relating to the
                    Credit Agreement.

      4.3      ____ Second Supplemental Agreement, dated January 22, 2007 by and
                    among the Company, certain subsidiaries, The Bank of
                    Scotland and Magnus Carriers Corporation relating to the
                    Credit Agreement.

      4.4      ____ Third Supplemental Agreement, dated March 2, 2007 by and
                    among the Company, certain subsidiaries, The Bank of
                    Scotland and Magnus Carriers Corporation relating to the
                    Credit Agreement.

      8.1      ____ List of Subsidiaries

      12.1     ____ Rule 13a-14(a)/15d-14(a) Certification of the Company's
                    Chief Executive Officer.

      12.2     ____ Rule 13a-14(a)/15d-14(a) Certification of the Company's
                    Chief Financial Officer.

      13.1     ____ Certification of the Company's Chief Executive Officer
                    pursuant to 18 U.S.C. Section 1350, as adopted pursuant to
                    Section 906 of the Sarbanes-Oxley Act of 2002.

      13.2     ____ Certification of the Company's Chief Financial Officer
                    pursuant to 18 U.S.C. Section 1350, as adopted pursuant to
                    Section 906 of the Sarbanes-Oxley Act of 2002.

----------
(1)  Incorporated by reference to Exhibit 3.1 to the Company's registration
     statement on Form F-1 (Registration No. 333-124952).

(2)  Incorporated by reference to Exhibit 3.2 to the Company's registration
     statement on Form F-1 (Registration No. 333-124952).

(3)  Incorporated by reference to Exhibit 4.1 to the Company's Annual Report on
     Form 20-F/A Fiscal year ended December 31, 2005 filed on April 18, 2007.

<PAGE>

                                   SIGNATURES

The registrant 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 registration statement on its behalf.


                                           ARIES MARITIME TRANSPORT LIMITED

                                           By: /s/ Mons S. Bolin
                                               --------------------------
                                               Name:  Mons S. Bolin
                                               Title: Chief Executive Officer



April 19, 2007

SK 23248 0002 766101