`                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    FORM 20-F

(Mark One)

[_]       REGISTRATION STATEMENT PURSUANT TO SECTION 12(l.c) OR (l.c)
                     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, 2005

                                       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
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            (Exact name of Registrant as specified in its charter)

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


                       Aries Maritime Transport Limited
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                 18 Zerva Nap., Glyfada, Athens 166 75, Greece
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                   (Address of principal executive offices)

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


                                      NONE
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Securities registered or to be registered pursuant to section 12(g) of the Act.

                     Common Stock par value $0.01 per share


Securities for which there is a reporting  obligation  pursuant to Section 15(d)
of the Act.

                                      NONE
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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 |

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 |_|  Non-accelerated filer |X|

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...........2

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

   ITEM 3.   Key Information.................................................2

   ITEM 4.   Information On The Company.....................................17

   ITEM 4A.  Unresolved Staff Comments .....................................32

   ITEM 5.   Operating And Financial Review And Prospects...................32

   ITEM 6.   Directors, Senior Management And Employees...................  48

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

   ITEM 8.   Financial Information. ........................................53

   ITEM 9.   The Offer And Listing..........................................53

   ITEM 10.  Additional Information.........................................53

   ITEM 11.  Quantitative And Qualitative Disclosures About Market Risk.....65

   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...............................67

   ITEM 16B. Code Of Ethics ................................................67

   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 .....................................................68

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

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

   ITEM 19.  Exhibits......................................................104

<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:

        o       future operating or financial results;

        o       statements  about  planned,   pending  or  recent  acquisitions,
                business strategy, future dividend payments and expected capital
                spending  or  operating  expenses,   including   drydocking  and
                insurance costs;

        o       statements  about  trends in the  container  vessel and products
                tanker  shipping  markets,  including  charter rates and factors
                affecting supply and demand;

        o       our ability to obtain additional financing;

        o       expectations  regarding the availability of vessel acquisitions;

        o       completion  of  repairs,  length  of off hire,  availability  of
                charters;  and

        o       anticipated developments with respect to any pending litigation.

        The  forward-looking  statements  in this report 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 report.

        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, changes in demand for oil and oil products,  the effect of changes in
OPEC's petroleum production levels, worldwide crude 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 report, 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," 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 data
set forth below as of December 31, 2005, 2004 and 2003 and for the periods ended
December 31, 2005, 2004 and 2003 have been derived from our audited consolidated
and predecessor audited combined carve-out financial statements included in this
document.  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  included  elsewhere in this
Annual Report. 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."

                                    December 31,    December 31,    December 31,
                                       2003           2004            2005
                                         (Dollars in thousands except per
                                                    share data)

Income Statement Data (for
  period ending)

Revenue from voyages             $      7,316   $      48,269    $      75,905

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

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

Voyage expenses                           (24)           (312)            (224)

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

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

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

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

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

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

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

Other income (expenses), net               11             134              662

Change in fair value of
  derivatives                            (215)            (33)             950

Net income                                514          25,273           14,771

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

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


Balance Sheet Data (at period
  end)

Cash and cash equivalents        $        667   $       5,334    $      19,248

Restricted cash                           109           4,803               10

Total current assets                      890          12,371           22,438

Total assets                           45,534         245,725          377,898

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

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

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

Total liabilities                      45,020         229,072          222,217

Total stockholders' equity                514          16,653          155,681


Other Financial Data (for period
  ending)

Net cash provided by operating
  activities                     $      4,426   $      21,899     $     38,870

Net cash used in investing
  activities                          (41,612)       (161,773)        (115,897)

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

Net increase in cash and cash
  equivalents                             667           4,667           13,914

Fleet Data (at period end)

Number of products tankers owned            2               7                8

Number of container vessels owned          --               3                5


                                   ADJUSTED EBITDA
                                      Period
                                       from
                                     inception
   (All amounts in thousands          through       Year ended     Year ended
   of  U.S. dollars, unless         December 31,   December 31,   December 31,
   otherwise stated)                  2003            2004           2005

ADJUSTED EBITDA(1)

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

        (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.

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 are at  historically
high  levels and 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.  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.

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 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,  which are  currently  at high  levels,  may
decline, which could lead to a default under our loan agreements 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  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 and 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 and  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.  We conduct our
operations  outside  of  the  United  States,  and  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 senior  secured  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 credit  agreement 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 payment, 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 are a newly formed company with 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 and seven products  tankers and five
container  vessels  during the year ended  December  31, 2004.  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 a few  significant  charterers  for a large part 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  2005,  all of our revenue was derived from
seven  charterers,  PDVSA Petroleo,  S. A., d'Amico  Societa di Navigazione,  ST
Shipping and Transportation  Inc., Deiulemar Compagnia di Navigazione S.p.A, CMA
CGM S.A.,  China  Shipping  Container  Lines  (Asia) Co.  Ltd.  and  Navigazione
Montanari  S.p.A.  During  April 2006,  the  charters  with  d'Amico  Societa di
Navigazione  were  terminated  and the  respective  vessels  were  chartered  to
Trafigura Beheer B.V. In addition,  we took delivery of two newbuilding  vessels
which we bareboat chartered to companies of the Stena Group, thus increasing the
number of our charterers to nine. 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,  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       we must  maintain free cash and cash  equivalents  of no less than 5% of
        interest bearing debt;

o       our current liabilities,  excluding deferred revenue, may not exceed our
        current assets;

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; 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 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;

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 credit  facility  and could  result in a
default  under the  credit  facility.  If a  default  occurs  under  our  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),  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 and 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  and  affiliates  may  acquire  or  charter  additional
products  tankers and  container  vessels in the  future,  subject to a right of
first refusal that Magnus  Carriers,  its principals  and  affiliates  under its
control have granted to us. 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  and 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, 2005, the value
of the U.S.  dollar  increased  by  approximately  13%  against  the  Euro.  Our
operating results could suffer as a result.

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 or
will be  non-residents  of the U.S.,  and all or a  substantial  portion  of the
assets of these  non-residents  are or will be  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  proposed  method of  operation,  we do not believe that we
will be a PFIC. In this regard, we intend to treat the gross income we derive or
are deemed to derive from our time  chartering  activities  as services  income,
rather than rental income. Accordingly, we believe that our income from our time
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 proposed  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 will 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. Holder may be able to
make certain tax elections with 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.

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 National 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 product 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. 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 product 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 5.9 years. All our products tankers are
currently  employed  under time  charters  with  remaining  terms  ranging  from
approximately a few months,  with the exception of the Bora, to four years.  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
two companies of the Stena Group (Panvictory Ltd. and Panvision Ltd.).

        Our five container vessels  (including the two vessels that we exercised
the option to  purchase)  range in capacity  from 1,799 to 2,917 TEU and have an
average age of 15.6 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
are currently  employed  under time charters with  remaining  terms ranging from
approximately  two to five  years.  One of our  container  vessels is  currently
chartered with a member of the China Shipping Group, and our remaining container
vessels are currently chartered with CMA CGM S.A.

        After our time charters expire, we may employ our vessels under new time
charters or in the spot voyage market,  between time charters,  depending on the
prevailing market conditions at that time.

<TABLE>
<CAPTION>
                                                                                                Net Daily
                                          Year                              Charter             Charterhire
Vessel Name                 Size         Built         Charterer           Expiration              Rate              Flag State
Product Tankers
<S>                      <C>              <C>       <C>                   <C>                    <C>              <C>
Altius                   73,400 dwt       2004      Deiulemar/Enel         June 2009             $14,860          Marshall Islands
Fortius                  73,400 dwt       2004      Deiulemar/Enel        August 2009            $14,860          Marshall Islands
Nordanvind               38,701 dwt       2001           PDVSA            October 2008           $19,988           Venezuela/ MI
Bora                     38,701 dwt       2000                                                                    Marshall Islands
High Land                41,450 dwt       1992         Trafigura           April 2008            $16,575          Marshall Islands
High Rider               41,502 dwt       1991         Trafigura           April 2008            $16,575          Marshall Islands
Arius ex Citius          83,970 dwt       1986        ST Shipping         August 2006           $18,330(1)        Marshall Islands
Stena Compass            72,750 dwt       2006        Stena Group         August 2008           $18,700(2)            Bermuda
Stena Compassion         72,750 dwt       2006        Stena Group        December 2008          $18,700(2)            Bermuda
Chinook                  38,701 dwt       2001        Navigazione         January 2007           $13,186          Marshall Islands
                                                       Montanari
Container Vessels
CMA CGM Makassar          2,917 TEU       1990          CMA CGM             May 2010             $20,400          Marshall Islands
CMA CGM Seine             2,917 TEU       1990          CMA CGM          September 2010          $20,400          Marshall Islands
ANL Energy (ex CMA        2,438 TEU       1989          CMA CGM            April 2007            $21,954          Marshall Islands
CGM Energy)
CMA CGM Force             2,438 TEU       1989          CMA CGM            June 2007             $21,954          Marshall Islands
Ocean Hope                1,799 TEU       1989      China Shipping         June 2007             $13,956          Marshall Islands
                                                    Container Lines

</TABLE>


(1)  Plus  50% of  profits  of over  and  above  $18,800  under  profit  sharing
     provisions of our charter agreement with ST Shipping.

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

Vessel Charters

        Our product tankers and container vessels are currently  committed under
long-term  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.
Magnus  Carriers  performs  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,  commencing 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,  PDVSA is  required  to pay a daily  charter  rate of  $19,988,  net of
commissions,  until October 2008, subject to the typical  adjustments  discussed
above.  In June 2006,  we withdrew our vessel "Bora" from its charter with PDVSA
and began marketing the vessel for a new charter.

        Two of our  vessels,  "High  Land" and "High  Rider,"  which are  sister
ships,  are  employed  under time  charters to  Trafigura  Beheer B.V., 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") is employed  under a time charter 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 $18,330  per day,  net of  commissions.  The
charterer is also required to pay us additional hire equaling 50% of any trading
income (revenue less voyage-related  expenses) in excess of $18,800 per day. The
charter period to ST Shipping is scheduled to expire in August 2006,  subject to
the typical  adjustments  discussed  above.  The "Arius" has been out of service
since December 3, 2005 and has undergone  drydocking  repairs which we expect to
be completed in July 2006.

        Our vessel  "Chinook"  is  employed  under time  charter to  Navigazione
Montanari  S.p.A.,  an Italian  charterer.  Under the terms of the time charter,
Navigazione  Montanari is required to pay us a daily charter rate of $13,186 net
of commissions. The charter expires in January 2007.

        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 $15,405 per vessel,
net of commissions. CMA CGM has agreed to extend the terms of these charters for
an  additional  five years  commencing  May and  September  2005,  respectively,
subject to the typical adjustments discussed above, both at a daily charter rate
of $20,400, net of commissions.

        Two of our  vessels,  "CMA CGM Energy"  and "CMA CGM  Force,"  which are
sister  ships,  are also employed  under time  charters with CMA CGM.  Under the
terms of the time  charters,  CMA CGM is required to pay a daily charter rate of
$21,954  per  vessel,  net of  commissions.  The  time  charters  to CMA CGM are
scheduled to expire in April and June 2007, respectively, subject to the typical
adjustments discussed above.

        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 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  $18,466  net of  commissions.  In  addition,  the Stena  Group
companies  are required to pay an  additional  hire equal to 30% of the weighted
average  hire for each  quarter  after  deduction  of the  basic  rate and daily
running cost at $5,500. 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, there are no off-hire days under the bareboat charters.

        For the periods  ended  December 31, 2005,  2004 and 2003,  our revenues
from  product  tankers  were  $39.20  million,  $20  million  and $7.32  million
respectively.  For the periods  ended  December 31, 2005 and 2004,  our revenues
from container vessels were $27.40 million and $19.20 million respectively.  Our
2005 and 2004 revenues  exclude  Deferred Revenue (for which please refer to the
Notes  of the  Company's  Financial  Statements).  Our  fleet  did not  have any
container vessels in 2003.

Fleet Management

        Each of our vessel-owning  subsidiaries has entered into a ten-year ship
management  agreement  with Magnus  Carriers,  which is  cancelable by us on two
months' prior notice. We expect to cause any subsidiaries  owning any vessels we
may  acquire in the  future to enter into a  management  agreement  with  Magnus
Carriers on substantially  similar terms as our existing management  agreements.
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  vessel  operating  expenses will
increase by 3% annually,  and are subject to adjustment  every three years.  The
initial  annual  management  fee has been set at $146,000  per vessel.  The ship
management  agreements  provide that, if actual 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  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,  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 our fleet  manager,  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 37 land-based  administrative  employees and
employ more than 400 seafarers on approximately 18 vessels.

Crewing and Employees

      As of December 31, 2005 our wholly-owned subsidiary,  AMT Management Ltd.,
employed 2 employees,  all of whom are shore-based.  Magnus Carriers Corporation
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  Corporation  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", 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 will be 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.

        In April  2001,  the IMO  accelerated  its  existing  timetable  for the
phase-out of single hull oil tankers which became  effective in September  2002.
These regulations  require 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 a 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 deliver 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 the 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.

        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
system that Magnus Carriers has 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 has all material requisite  documents of compliance
for its offices and safety management  certificates for vessels in our fleet for
which the certificates are required by the IMO. Magnus Carriers 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  $6.7 million plus $942 for each additional  gross ton
over 5,000. For vessels of over 140,000 gross tons, liability will be limited to
approximately $134 million. As the convention calculates liability in terms of a
basket of currencies, these figures are based on currency exchange rates on June
4, 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).  Under  recently
proposed legislation,  OPA liability limits would be increased to the greater of
$1,900 per gross ton or $16.0  million  per 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 willful 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.  Under those  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  has  arranged  insurance  for each of 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 Magnus Carriers'
business, which could impair Magnus Carriers' 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 agreement, Magnus Carriers will be
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, as a result of a recent U.S. federal court
decision,  vessel owners and operators may be required to obtain CWA permits for
the discharge of ballast  water,  or they will face  penalties for failing to do
so. Although the EPA is likely to appeal this decision,  we do not know how this
matter  is  likely  to be  resolved  and 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,  the "High Land," the "High Rider" and the "Citius" can trade in European
and U.S. waters only until June 2015, July 2015 and June 2014, respectively.

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, American Bureau of Shipping and Rina S.p.A., 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 arrange our time 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

        We are party,  as plaintiff or  defendant,  to a variety of lawsuits for
damages arising  principally from personal injury and property  casualty claims.
Most claims are  covered by  insurance,  subject to  customary  deductibles.  We
believe that these claims will not,  either  individually  or in the  aggregate,
have a material  adverse  effect on us, our  financial  condition  or results of
operations.  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 lease  agreement  with the
landowner of 6 years'  duration.  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 two products  tankers during the period from March 2003 to December
31, 2003 and 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  during the
period ended December 31, 2003 and 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 at December 31, 2005.

        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
                $183.8 million at December 31, 2005; 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  "Charterhire"  are fixed  rates and all  detailed
vessels are employed,  or in the case of the Stena  Compassion  contracted to be
employed,  under period charters.  Revenues from period charters are stable over
the duration of the charter,  provided there are no unexpected  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.  All our vessels are employed,
or contracted to be 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  charters  on our fleet was 2.5 years as of
December  31,  2005  with  fixed  charterhire  rates.  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.

        At the net rates of charterhire  detailed in the table under "Our Fleet"
in "Item 4.  Information  on the  Company",  the total daily net  revenue  under
existing charter  agreements was $224,975 as of December 31, 2005. The daily net
revenue under our existing  charter  agreements is augmented by the amortization
of the  deferred  revenue  associated  with  our  assumption  of  charters  when
acquiring  certain  vessels.  The total daily deferred  revenue  amortization in
respect of the  relevant  vessels  was  $43,112 as of  December  31,  2005.  The
recognition  of deferred  revenue  will only  continue  for the  duration of the
charters assumed with the acquisitions of the relevant vessels.

        Vessels  typically  operate  for 360  days  per  year,  which is a level
commonly  used as an  industry  average,  and is in line  with our past  average
number of operating days. 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 $66.6 million in the year ended  December 31, 2005. An average 1.4%
decrease in charterhire  income for the vessels then  comprising our fleet would
have resulted in a decrease of revenues by $0.9 million to $65.7 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  Corporation,  or Magnus  Carriers,  for the twelve vessels  managed by
Magnus  Carriers  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 will be 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"  represent  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 the period from its delivery on
November 30, 2005 to December 31, 2005,  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 on February 14, 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 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 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,  at the inception of our management  arrangements,  is $57,400 for the
first twelve months of the management agreements.

        In the  period  from the date the  management  agreements  on the twelve
ships under Magnus  Carriers  management  became  effective,  until December 31,
2005, we incurred vessel  operating  expenses and management fees totaling $12.5
million.  Under the  management  agreements  with Magnus  Carriers,  the initial
vessel operating  expenses and management fees for the same period were expected
to total $10.8 million.  The "Vessel operating expenses" in our consolidated and
combined  financial  statements  for the year ended  December 31, 2005 have been
adjusted to reflect the variance  sharing  contribution due from Magnus Carriers
of $0.8 million under the terms of the  management  agreements.  The  management
agreements  with  Magnus  Carriers on the twelve  ships  under their  management
became  effective from June 8, 2005, with the exception of CMA CGM Seine and CMA
CGM  Makassar,   which  became  effective  June  24,  2005  and  July  15,  2005
respectively.

Revenues

        At December  31,  2005,  all our  revenues  were derived from the period
charters of our eight products tankers and five container  vessels.  Our vessels
are currently  chartered to reputable  charterers with remaining periods ranging
from  approximately  five months to 4.5 years,  with an average of approximately
2.5 years as of December 31, 2005.  Our vessels  have been  employed  with these
charterers for periods  ranging from 1.5 years to 3.9 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,  2005  reflect  the
operation of seven products  tankers and three container  vessels for the entire
year.  During  the  year  ended  December  31,  2005,  we took  delivery  of one
additional  products  tanker and two  container  vessels,  which  increased  our
revenues for that period in relation to the same period during the prior year.

        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 3.75%, with an average of 2.75%.

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  forward 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 range from $4,400 to $5,100 per vessel
per day initially.  The budgeted total vessel operating expenses,  which include
the  management  fees paid to Magnus  Carriers of $146,000 per annum per vessel,
will  increase  by 3%  annually  and will be 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.

Results of Operations

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 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.

Year Ended December 31, 2004 Compared to the Period Ended December 31, 2003

Revenues

        Total revenues  increased by approximately  560% to $48.3 million in the
year ended  December  31,  2004  compared  to $7.3  million in the period  ended
December  31, 2003.  This  increase is  attributable  to the growth in our fleet
during the year ended  December  31, 2004.  The High Land and High Rider,  which
were  acquired in March 2003,  were the only two vessels in our fleet  operating
during the period ended December 31, 2003 and the entire year ended December 31,
2004. The charterhire  rate earned by High Rider and High Land during the period
ended December 31, 2003 and the year ended  December 31, 2004 was unchanged,  at
$12,838 net daily.

        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.  Revenue from the ten vessels delivered during the year ended December
31, 2004 was $30.1  million  and  revenue  from the High Land and High Rider was
$9.1 million.

        Of the  total  revenue  earned  by our  vessels  during  the year  ended
December  31,  2004,  51% was  earned  by our  products  tankers  and 49% by our
container vessels.

        We have recognized $9.1 million of revenue as a result of the assumption
of charters  associated  with certain  vessel  acquisitions  during 2004.  These
assumed  charters  had charter  rates,  which were less than market rates at the
date of the vessels' acquisition.

Gain on Disposal of Vessels

        In December  2004,  Aries Energy  completed the sale of the Makassar and
Seine to International  Container Ships KS, an affiliate of Aries Energy, for an
amount of $32.5  million  each.  The  proceeds  consisted of cash of $30 million
each, an amount of $1.5 million each paid directly to shareholders  and deferred
consideration of $1 million each. The deferred consideration was due and payable
in one balloon payment on December 21, 2010, the final maturity date of the loan
advanced to the buyers or upon sale or total loss of the vessel and interest was
charged on the  balance at 3.5% per annum.  The  vessels had a net book value of
$55.8 million in total and a related  deferred revenue of $5.7 million in total.
A total gain on sale of $14.7  million was recorded.  In a separate  transaction
and  subsequent  to the  sale  we  entered  into an  option,  or  obligation  on
successful  completion of the initial public offering, to purchase both vessels.
We subsequently re-acquired both vessels. In the period ended December 31, 2003,
there were no disposals of vessels.

Commissions

        Chartering  commissions  increased by approximately 700% to $1.2 million
in the year ended  December  31, 2004,  compared to $0.15  million in the period
ended  December 31, 2003.  This  increase is  attributable  to the growth in our
fleet during the year ended December 31, 2004.

Vessel operating expenses

        Total vessel operating expenses increased by approximately 363% to $12.5
million during the year ended December 31, 2004, compared to $2.7 million during
the period ended December 31, 2003.  This increase is also  attributable  to the
growth in our fleet during the year ended  December  31,  2004,  during which we
took  delivery  of ten  vessels.  Vessel  operating  expenses  of the High  Land
increased  from $1.5 million to $1.6 million from the period ended  December 31,
2003 to the year ended December 31, 2004. Vessel operating  expenses of the High
Rider increased from $1.4 million to $1.6 million from the period ended December
31, 2003 to the year ended  December 31, 2004.  This increase was  substantially
due to the  different  period of ownership  in the  respective  periods.  Vessel
operating  expenses for the ten vessels delivered during the year ended December
31, 2004 were $9.4 million.

        Of the total vessel  operating  expenses  during the year ended December
31,  2004,  54% was incurred by our  products  tankers and 46% by our  container
vessels.

General & Administrative Expenses

        General  and  administrative  expenses  were  $75,000  in the year ended
December 31, 2004.  This  comprises  only  general and  administrative  expenses
incurred by the vessel owning  subsidiaries.  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 647% to $12.7 million during the
year ended  December 31, 2004  compared to $1.7 million  during the period ended
December  31,  2003.  Amortization  of  dry-docking  and  special  survey  costs
increased by 400% to $1.5 million in the year ended December 31, 2004,  compared
to $0.3 million in the period  ended  December 31,  2003.  These  increases  are
attributable to the growth in our fleet during the year ended December 31, 2004.

Management Fees to Related Party

        Management  fees  paid  to  Magnus  Carriers  increased  by 350% to $0.9
million in the year ended  December  31, 2004  compared  to $0.2  million of the
period ended December 31, 2003.  This increase is  attributable to the growth in
our fleet during the year ended December 31, 2004.

Interest Expense

        Total interest expense  increased by approximately  473% to $8.6 million
during the year ended  December  31, 2004,  compared to $1.5 million  during the
period ended  December 31, 2003,  due to the increase in term loans  incurred to
finance  the  acquisition  of the ten  vessels  added  to our  fleet  and due to
interest expense incurred from discounting the deferred revenue in 2004.

Interest Rate Swaps

        The  marking to market of our four  interest  rate swaps in effect as at
December  31,  2004  resulted  in a total  charge to  income  of $0.03  million,
compared  with a total charge to income as at December 31, 2003 of $0.2 million,
due to the change in fair value over the period.  Interest  rates were higher at
the end of 2004, compared with the end of 2003.

Net Income

        Net  income  was $25.3  million in the year  ended  December  31,  2004,
compared to $0.5 million in the period ended  December 31, 2003,  an increase of
4,960%. This increase is attributable to the growth in our fleet during the year
ended December 31, 2004.

B.      Liquidity and Capital Resources

Overview

        We  operate  in a capital  intensive  industry.  During  the year  ended
December 31, 2005 we refinanced our debt obligations existing at the time of the
initial  public  offering  in June 2005,  took  delivery  of the two  additional
container vessels,  which we had an option to acquire at the time of the initial
public offering, paid deposits on two products tanker purchase contracts for the
Stena  Compass and Stena  Compassion  and took  delivery  of a further  products
tanker,  all from the net proceeds of the initial public offering and borrowings
under our senior secured credit facility, which we entered into in June 2005 and
which we refer to as our existing credit  facility.  As of December 31, 2005 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 existing credit facility agreement,
(5)  maintenance of cash reserves to provide for  contingencies,  (6) payment of
dividends and (7) completion of the purchase contracts for the 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
existing 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.

        We refinanced all our indebtedness under our existing credit facility on
April 27, 2006 with a new fully revolving credit facility of $360 million, which
we refer to as our new credit  facility and provides for the long term financing
of  the  three  products   tanker   acquisitions   made  in  2005  and  provides
approximately  $75 million of undrawn  commitment to enable future growth of the
Company  through  further  vessel   acquisitions.   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, "Our New Fully Revolving Credit Facility" below.

Cash flows

        As of December  31, 2005 and  December  31,  2004,  we had cash of $19.3
million and $10.1  million,  respectively.  In the year ended December 31, 2005,
our net cash provided by operating  activities was $38.9 million,  compared with
$21.9 million during the year ended December 31, 2004.  This is primarily due to
the growth of the Company's fleet and associated increase in operating days.

        As of December  31, 2004 and  December  31,  2003,  we had cash of $10.1
million and $0.8 million, respectively. In the year ended December 31, 2004, our
net cash provided by operating activities was $21.9 million,  compared with $4.4
million during the period ended December 31, 2003. This is primarily a result of
the increase in net income of $24.8 million and increase in  depreciation of $11
million.

        In the year ended  December  31,  2005,  our net cash used in  investing
activities  was $115.9  million,  compared with $161.8 million in the year ended
December 31, 2004. In each of these years,  our investing  activities  primarily
related  to  funding  our  investments  in our  vessels.  During  the year ended
December  31,  2005,  we purchased  five  vessels  compared  with the year ended
December 31, 2004, during which we purchased eight vessels.

        In the year ended  December  31,  2004,  our net cash used in  investing
activities was $161.8  million,  compared with $41.6 million in the period ended
December 31, 2003. In each of these periods, our investing activities related to
funding  our  investments  in our  vessels:  two of our  products  tankers  were
acquired in March 2003, and five additional  products tankers and five container
vessels were  delivered at various times in 2004. In 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.  The net cash  provided  by  financing  activities  related
primarily to the net proceeds of the initial public offering and drawings of new
debt under our existing  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, our net cash provided by financing
activities  was  $144.5  million,  compared  to $37.9  million in the year ended
December 31, 2003.  The net cash  provided by  financing  activities  related to
funding our investments in our vessels.

Indebtedness

        We had  long-term  debt  outstanding  of $183.8  million at December 31,
2005,  compared with $214.6  million at December 31, 2004. Our long-term debt at
December  31,  2005  represents  amounts  borrowed  under  our  existing  credit
facility,  which  is  comprised  of a  term  loan  and a  revolving  acquisition
facility. As of December 31, 2005, borrowings under our existing credit facility
bore annual  interest  rates,  excluding the margin,  of 4.25% for the term loan
facility and 4.35% for the revolving acquisition facility.

        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--Interest Rate Exposure," below.

        We entered into our existing  credit facility in June 2005. The facility
consists of a $140 million drawn term loan facility and a $150 million revolving
acquisition facility, which was drawn to the extent of $43.8 million at December
31, 2005.

        Borrowings under the revolving  acquisition  facility could only 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 met the following requirements:

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

        o       each  vessel  must be no older  than 12 years old 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

        o       each vessel  must  maintain a flag and class  acceptable  to the
                lead arrangers and satisfy certain other conditions.

        Revolving  loans under the  acquisition  facility could be incurred from
time to time prior to June 3, 2007.

        If the total amount  borrowed under the  facilities  exceeded 55% of the
fair  market  value of the  collateral  vessels,  we would be  unable  to borrow
further amounts under the  acquisition  facility until we either prepaid some of
the debt or the fair market value of the collateral vessels increases.  We would
be able to borrow further amounts under the acquisition  facility again once the
total amount  borrowed under the  facilities no longer  exceeded 55% of the fair
market value of the  collateral  vessels.  If a vessel became a total loss or is
sold, no further  amounts could be borrowed until we had prepaid an amount equal
to  the  aggregate   principal  amount  outstanding  under  the  term  loan  and
acquisition  facility  by a fraction of which the  numerator  is the fair market
value of the vessel lost or sold and the denominator is the fair market value of
our fleet.

        Our  obligations  under the existing  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 existing  credit  facility  were also
guaranteed  by all  subsidiaries  that had an  ownership  interest in any of our
vessels.

        The term  loan  was  payable  in full in one  instalment  in June  2009.
Borrowings under the 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.

        We were prohibited from declaring  dividends if any event of default, as
defined in the  existing  credit  facility,  occurred or would  result from such
declaration.  Each of the following  would  constitute an event of default under
the existing 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 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.

        We had long-term  debt,  stated gross of debt  discount,  outstanding of
$214.6  million at December 31, 2004,  compared with $43 million at December 31,
2003.  Our long-term  debt  represented  amounts  borrowed by our  vessel-owning
subsidiaries  to  acquire  the  vessels we owned at  December  31,  2004.  As of
December 31, 2004,  borrowings  under the various  loan  agreements  bore annual
interest  rates ranging  between 3.29% and 4.02% and were repayable over various
periods ranging from one year to seven years.

        In addition,  in connection  with certain debt  agreements  entered into
during  the  year  ended  December  31,  2004,   certain  of  our  vessel-owning
subsidiaries agreed to pay the lender 50% of the difference between: (a) the sum
of their  aggregate  cumulative  earnings  net of  expenses  plus any  insurance
proceeds  and proceeds  from vessel  sales,  and (b) the sum of their  aggregate
indebtedness plus $9 million. Under this agreement,  as amended,  certain of our
vessel-owning  subsidiaries had an option, exercisable within three years of the
date  of the  agreement,  to pay  $6.5  million  in  full  settlement  of  their
obligations under this agreement.

Our New Fully Revolving Credit Facility

        On April 3, 2006 we  entered  into a new $360  million  fully  revolving
credit  facility with Bank of Scotland and Nordea Bank Finland as lead arrangers
("the  new  credit  facility").  We have  used the new  credit  facility  to (i)
refinance our existing $140 million drawn term loan; (ii) refinance our existing
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) was
further  drawn in June 2006 in the amount of $50.5 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

        o       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 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 $360 million commitment contained in the credit agreement is subject
to a $11 million reduction every six months from the April 3, 2006 closing date,
with the remaining  commitment,  after nine 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.

        Indebtedness  under the new credit  facility  will bear  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 will pay a one-time  arrangement fee of approximately $2.3 million at
the initial draw down of the facility expected in April 2006 and incur an annual
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 new credit  facility 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       we must maintain free cash and cash  equivalents of no less than
                5% of interest bearing debt;

        o       our current  liabilities,  excluding  deferred revenue,  may not
                exceed our current assets;

        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; 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 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;

        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.

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, 2005 significant existing contractual obligations and
contingencies consisted of our obligations as borrower under our existing credit
facility and agreements  entered into to purchase vessels.  In addition,  we had
contractual  obligations  under interest rate swap contracts and ship management
agreements.

 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, 2005 (all figures in thousands of
U.S. Dollars):

Payment Due by Period

<TABLE>
<CAPTION>
                                                           Less than                                  More than
Contractual Obligations                         Total        1 year       1-3 years     3-5 years      5 years
-----------------------                         -----        ------       ---------     ---------      -------
<S>                                           <C>            <C>           <C>           <C>            <C>
Long-term debt obligation(1)                  183,820              -            -             -         183,820

Interest payments(2)                           65,147         10,147       20,294        34,706               -

Vessel operating expenses(3)                  223,821         19,524       40,823        43,309         120,165

Management fees(4)                             20,669          1,992        3,759         3,952          10,966

Rental agreement (5)                              393             59          127           139              68

Purchase contracts (6)                        100,980        100,980            -             -               -

TOTAL                                         594,830        132,702       65,003        82,106         315,019
</TABLE>


----------
Notes:

(1)  Refers to our  obligations  to repay  the  indebtedness  outstanding  as of
     December 31, 2005.

(2)  Refers to our expected  interest payments over the term of the indebtedness
     outstanding as of December 31, 2005,  assuming a weighted  average interest
     rate of 5.52% 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.

(6)  Refers to  our agreement to  pay the balance of  the purchase price  of the
     Stena Compass and Stena Compassion.


Quantitative and Qualitative Disclosures About Market Risk

Interest Rate Exposure

        Our debt obligations under our existing credit facility bear interest at
LIBOR plus a margin  ranging  from 1.25% to 1.375%.  Increasing  interest  rates
could adversely affect our future profitability.  We entered into three interest
swap  transactions  with three banks during 2005. Under these swap agreements we
have  limited  the  interest  rate we pay on our term loan of $140  million to a
maximum of 4.885% per annum,  excluding the margin,  with effect from January 3,
2006 and until the swap agreements mature in June 2009.

        A 100 basis point  increase in LIBOR would have  resulted in an increase
of  approximately  $1.8  million  in our  interest  expense  for the year  ended
December 31, 2005.

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  forward in anticipation of our future  requirements in
an effort to manage foreign exchange risk. As of December 31, 2005, a 1% adverse
movement in U.S. dollar exchange rates would have increased our vessel operating
expenses by approximately $58,000.

 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, 2005, a one year reduction in useful life
would increase our total depreciation charge by $2.0 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  approximately  every 30 to 36
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 time 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.

        Charter revenues are recorded over the term of the charter as service is
provided.  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.

Recent Accounting Developments

        In November  2004,  the Financial  Accounting  Standards  Board ("FASB")
issued Statement of Financial  Accounting  Standard ("SFAS") No. 151, "Inventory
Costs - an amendment of ARB No. 43,  Chapter 4" ("SFAS  151"),  which  clarifies
that abnormal  amounts of idle facility  expense,  freight,  handling  costs and
wasted material  (spoilage) should be recognized as a current period expense. In
addition,  SFAS 151 requires that allocation of fixed production overhead to the
costs  of  conversion  be  based  on  the  normal  capacity  of  the  production
facilities.  SFAS 151 is  effective  for fiscal years  beginning  after June 15,
2005.  Management does not believe that the implementation of SFAS 151 will have
a material impact on the Group's (defined in note 1 to the predecessor  combined
carve-out and consolidated financial statements) financial position,  results of
operations or cash flows.

        In  December  2004,  the  FASB  issued  SFAS  No.  153,   "Exchanges  of
Non-Monetary  Assets  -  An  Amendment  to  APB  29"  ("SFAS  153").  Accounting
Principles  Board  Opinion  No. 29 ("APB 29") had stated that all  exchanges  of
non-monetary  assets  should be  recorded  at fair  value  except in a number of
situations,  including where the exchange is in relation to similarly productive
assets.  SFAS 153 amends APB 29 to  eliminate  the  exception  for  non-monetary
exchanges of similar  productive assets and replaces it with a general exception
for exchanges of non-monetary  assets that do not have commercial  substance.  A
non-monetary transaction has commercial substance where the future cash flows of
the  business  will be  expected  to  change  significantly  as a result  of the
exchange.  The  provisions  of SFAS  153  will  be  effective  for  non-monetary
exchanges occurring in fiscal periods beginning after June 15, 2005.  Management
does not believe that the implementation of SFAS 153 will have a material impact
on the Group's financial position, results of operations or cash flows.

        In March 2005, the Financial Accounting Standards Board issued Statement
No. 154, Accounting Changes and Error Corrections,  a replacement of APB Opinion
No. 20 and FASB Statement No. 3. The Statement  applies to all voluntary changes
in accounting  principle,  and changes the  requirements  for accounting for and
reporting  of a change in  accounting  principle.  Statement  No.  154  requires
retrospective applications to prior periods' financial statements of a voluntary
change in accounting principle unless it is impracticable. Opinion 20 previously
required that most  voluntary  change in  accounting  principle be recognized by
including  in net income of the period of the  change the  cumulative  effect of
changing to the new accounting  principle.  Statement No. 154 improves financial
reporting  because  its  requirements   enhance  the  consistency  of  financial
information  between  periods.  The Group cannot determine what effect Statement
No. 154 will have with regard to any future accounting  changes.  This statement
is effective for the Group for the fiscal year beginning on January 1, 2006.

        On November 3, 2005,  the Financial  Accounting  Standards  Board issued
Financial  Staff Position (FSP) numbers 115-1 and 124-1  providing  guidance for
the application of FAS 115. This FSP addresses the  determination  as to when an
investment  is  considered  impaired,  whether  that  impairment  is other  than
temporary,  and the  measurement  of an  impairment  loss.  It also  states that
impairment of investments in debt  securities  must be assessed on an individual
basis.  Adoption of this  interpretation  is not expected to have a  significant
effect on the Group's statement of financial  position or results of operations.
This statement will be effective for the Group for fiscal years  beginning after
December 15, 2005.

Subsequent Events

Credit facility

        With  effect  from  March 1,  2006 the  Group  voluntarily  reduced  its
existing $150 million revolving credit facility to $145 million.

        The Group entered into a new $360 million  revolving  credit facility on
April 3, 2006. The $360 million facility,  which has a term of five years, is to
be used to replace the current $140 million term loan  facility and $150 million
revolving credit facility.

Dividend

        On February 13, 2006 the Directors of Aries Maritime declared a dividend
of $0.35 per share in respect of the fourth  quarter of 2005.  The  dividend was
paid on March 9, 2006 to shareholders on record as of February 23, 2006.

        Further,  on May 8, 2006 the  Directors  of Aries  Maritime  declared  a
dividend  of $0.14  per  share in  respect  of the first  quarter  of 2006.  The
dividend was paid on May 31, 2006 to shareholdes on record as of May 19, 2006.

New Acquisitions

        The Company took delivery of two newbuilding  tanker vessels,  the Stena
Compass and the Stena Compassion in February and June 2006 respectively.

Interest Rate Swap

        On April 7, 2006 the interest rate swap with Fortis Bank was  terminated
and the settlement proceeds amounted to $490,000 in favor of Aries Maritime.

ITEM 6.     DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES

A.      Directors and Senior Management

        Set forth below are the names,  ages (as of June 30, 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      52      Class II Director and Chairman
Henry S. Marcus       62      Class II Director
Panagiotis Skiadas    35      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 Capital  Shipbrokers  Ltd. Since September 2005, he has been responsible
for the formation of a new marine finance company in Oslo, Norway,  Union Marine
Finance AS. 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  also serves as a
resident 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 25 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.  Mr.  Marcus has been a Professor  of
Marine  Systems  in  the  Ocean  Engineering  Department  of  the  Massachusetts
Institute of Technology for over ten years.  Mr. 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.  Mr. 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 joing VIOHALCO in April 2006, Mr. Skiadas
served 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

        We did not pay any  compensation to members of our senior  management or
our  directors in the years ended  December 31, 2003 and 2004.  During 2005,  we
paid to the  members of our senior  management  and to our  directors  aggregate
compensation of approximately  $408,362 and $45,500  respectively.  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.

Equity Incentive Plan

        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 a 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).

        o       In lieu of holding  regular  meetings at which only  independent
                directors are present, our entire board of directors, a majority
                of  whom  are  independent,  may  hold  regular  meetings  as is
                consistent with the laws of Bermuda.

        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  senior
managers 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.

A.      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
June 30, 2006.

<TABLE>
<CAPTION>
------------------------------- ---------------------------- ---------------------------- ----------------------------
Title of Class                  Identity of Person or Group  Amount Owned                 Percent of Class
------------------------------- ---------------------------- ---------------------------- ----------------------------
<S>                             <C>                          <C>                          <C>
Common stock,  par value $0.01  Rocket Marine Inc. (1)       14,766,877                   52%
per share
------------------------------- ---------------------------- ---------------------------- ----------------------------
                                Mons Bolin (1)               14,766,877                   52%
------------------------------- ---------------------------- ---------------------------- ----------------------------
                                Captain Gabriel Petridis     14,766,877                   52%
                                (1)
------------------------------- ---------------------------- ---------------------------- ----------------------------
                                Richard Coxall               *                            *
------------------------------- ---------------------------- ---------------------------- ----------------------------
                                Directors and Executive      14,776,877                     52%
                                Officers as a Group
------------------------------- ---------------------------- ---------------------------- ----------------------------
                                Wellington Management        2,350,710                    8.27%
                                Company, LLP (2)
------------------------------- ---------------------------- ---------------------------- ----------------------------
                                Transamerica Investment      2,084,560                    7.90%
                                Management, LLC(3)
------------------------------- ---------------------------- ---------------------------- ----------------------------
</TABLE>

----------
* 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, LLP on February 14, 2006.

(3) According to Schedule 13G filed with the Securities and Exchange  Commission
by Transamerica Investment Management, LLC on July 18, 2005.

B.      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.

Capital Contribution

        In March 2005, we acquired the  vessel-owning  subsidiaries that own the
first ten vessels in our fleet from subsidiaries of Aries Energy in exchange for
shares  in  our  company.  In  connection  with  that  transaction,  we  assumed
approximately $214 million of debt, which these subsidiaries incurred to acquire
the  vessels  they now own.  Based on the initial  offering  price of $12.50 per
share,  the value of the shares  acquired by these  subsidiaries of Aries Energy
was  approximately  $3,750.  Please read "Item 4.  Information  on the Company -
History and Development of the Company."

Management fees

        The vessel-owning  companies included in the Group receive technical and
commercial  management  services  from Magnus  Carriers,  a company under common
control,  pursuant to ship management  agreements.  Under these agreements,  the
Group paid  management  fees of $1.498  million for the year ended  December 31,
2005,  $893,000 for the year ended December 31, 2004 and $199,000 for the period
ended  December  31, 2003 which is  separately  reflected in the  statements  of
income.

Commissions

        Each  of  our  subsidiary   vessel-owning  companies  has  entered  into
management  agreements  with Magnus  Carriers.  From the effective date of these
management  agreements,  Magnus Carriers may receive commission on new charters.
Under the 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,  one of our  subsidiaries  entered into a rental  agreement
with a related party, Domina Petridou O.E., which is owned by Mons S. Bolin, our
President and Chief Executive Officer and Domina Petridou. The Group (defined in
note  1  to  our  consolidated  and  predecessor  combined  carve-out  financial
statements)  paid $4,693 to the related party during the year ended December 31,
2005 (2004 and 2003 $NIL).

Crewing

        Crewing for the Group is undertaken by Magnus Carriers through a related
entity,  Poseidon Marine Agency. The Group paid manning fees of $310,000 for the
year ended December 31, 2005,  $278,000 for the year ended December 31, 2004 and
$58,000 for the period ended December 31, 2003.

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, 2005 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.

General and administrative expenses

        During the year ended  December 31, 2005,  we paid to the members of our
senior management and to our directors  aggregate  compensation of approximately
$408,362 and $45,500,  respectively (2004 and 2003 $NIL). Such fees are included
in  general  and  administrative  expenses  in  the  accompanying   consolidated
statements of income.

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  February,  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  National  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  National  Market.  The high and low closing prices for our common
stock for the periods indicated were as follows:

                                                      High     Low
                                                     ------   ------
For the Fiscal Year Ended December 31, 2005          $15.99   $12.50
(beginning June 3, 2005)
For the Quarter Ended
June 30, 2005                                         13.60    12.50
September 30, 2005                                    15.99    12.50
December 31, 2005                                     15.63    12.63
March 31, 2006                                        14.47    12.43

For the Month
January 2006                                          13.72    12.43
February 2006                                         14.12    12.55
March 2006                                            14.47    13.86
April 2006                                            13.97    13.23
May 2006                                              13.73    10.52
June 2006 (through June 29, 2006)                     11.75    10.69


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,  2005 we had long term debt  obligations  under our
existing 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. 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 your
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 be
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 National 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  National  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 53% 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,  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  National  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. In 2005, legislation was introduced in the U.S. Senate which,
if enacted in its present form, would preclude our dividends from qualifying for
such preferential rates prospectively from the date of enactment.

        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 my 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 are not, and have not been in arrears or
have 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

Evaluation of disclosure controls and procedures.

        On the date of this report, the Company carried out an evaluation, under
the  supervision  and  with  the  participation  of  the  Company's  management,
including the Company's Chief Executive Officer and Chief Financial Officer,  of
the  effectiveness  of the  design and  operation  of the  Company's  disclosure
controls and procedures  pursuant to Rule 13a-14 of the Securities  Exchange Act
of 1934, as amended. We evaluated the effectiveness of the Company's  disclosure
controls and procedures as of December 31, 2005. Based on that  evaluation,  the
Chief  Executive  Officer and the Chief  Financial  Officer  concluded  that 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, as amended,
is  recorded,  processed,  summarized  and  reported  within  the  time  periods
specified in the SEC's rules and forms.  The Company  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.

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 National
Market. The members of the audit committee are Messrs.  Per Olav Karlsen,  Henry
S. Marcus and Panagiotis Skiadas.  The Company is exempt from the requirement to
have an audit committee financial expert. However, the Company believes that its
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
National 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 attention of
Mr. Richard Coxall.

ITEM 16C.   PRINCIPAL ACCOUNTANT FEES AND SERVICES

        Our  principal  accountants  for the year ended  December  31, 2005 were
PricewaterhouseCoopers  S.A.  For the 2005  audit  they  billed us audit fees of
$78,000.  There were no tax and audit  related  fees  billed in 2004.  For their
services in connection with our initial public  offering and follow-on  offering
PricewaterhouseCoopers S.A. billed us $471,643.91

        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.
<PAGE>

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>

    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 predecessor combined carve-out and consolidated
balance sheets of Aries Maritime  Transport  Limited and its  subsidiaries as of
December 31, 2005 and December 31, 2004,  and the related  predecessor  combined
carve-out and consolidated  statements of income,  stockholders' equity and cash
flows for the years  ended  December  31,  2005 and 2004 and for the period from
inception (March 7, 2003) through December 31, 2003. These predecessor  combined
carve-out and consolidated  financial  statements are the  responsibility of the
Company'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 predecessor  combined carve-out and consolidated  financial
statements  referred to above  present  fairly,  in all material  respects,  the
financial  position of Aries Maritime  Transport Limited and its subsidiaries at
December 31, 2005 and December 31, 2004,  and the results of its  operations and
its cash flows for the years ended December 31, 2005 and 2004 and for the period
from  inception  (March 7, 2003) through  December 31, 2003 in  conformity  with
accounting principles generally accepted in the United States of America.



PricewaterhouseCoopers S.A.




April 26, 2006
Piraeus, Greece
<PAGE>

<TABLE>
<CAPTION>
ARIES MARITIME TRANSPORT LIMITED
CONSOLIDATED AND PREDECESSOR COMBINED CARVE-OUT BALANCE SHEETS
 (All amounts expressed in thousands of U.S. Dollars)
---------------------------------------------------------------------------------------

                                                Notes   December 31,       December 31,
                                                               2004             2005
<S>                                             <C>         <C>              <C>
ASSETS
Current assets
      Cash and cash equivalents                               5,334           19,248
      Restricted cash                           4             4,803               10
      Trade receivables, net                                    303              176
      Other receivables                                         114               60
      Derivative financial instruments          15                -              401
      Inventories                               5               435              645
      Prepaid expenses and other                                329              521
      Due from managing agent                                     -               84
      Due from related parties                  19            1,053            1,293
                                                        ------------    -------------
      Total current assets                                   12,371           22,438
                                                        ------------    -------------

      Restricted cash                           4               813                -
      Receivables from disposal of vessels                    2,000                -
      Vessels and other fixed assets, net       6, 19       228,895          341,225
      Advances for vessel acquisitions          7                 -           11,363
      Deferred charges, net                     10            1,646            2,872
                                                        ------------    -------------
      Total non-current assets                              233,354          355,460
                                                        ------------    -------------
      Total assets                                          245,725          377,898
                                                        ============    =============

LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
      Current portion of long-term debt        11            21,910                -
      Accounts payable, trade                  8              3,829            4,598
      Accrued liabilities                      9              1,270            2,880
      Deferred income                                         2,051            3,163
      Derivative financial instruments         15               248                -
      Deferred revenue                         12             5,358           10,715
                                                        ------------    -------------
      Total current liabilities                              34,666           21,356
                                                        ------------    -------------
                                                        ------------    -------------

      Long-term debt, net of current portion   11           185,050          183,820
      Fair value of participation liability    11             6,500                -
      Deferred revenue                         12             2,856           17,041
                                                        ------------    -------------
      Total liabilities                                     229,072          222,217
                                                        ------------    -------------

      Commitments and contingencies            11,17              -                -

Stockholders' equity
      Invested equity                                        16,653                -
      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,  2005  (2004:   16.2
      million shares)                                             -              284
      Additional paid-in capital                                  -          155,397
                                                        ------------    -------------
      Total stockholders'equity                              16,653          155,681
                                                        ------------    -------------
      Total liabilities and stockholders' equity            245,725          377,898
                                                        ============    =============
</TABLE>

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

<TABLE>
<CAPTION>
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)
---------------------------------------------------------------------------------------------------------------------------

                                                         From inception
                                                         (March 7, 2003) to      Year ended            Year ended
                                               Notes     December 31, 2003       December 31, 2004     December 31, 2005
                                                         ---------------------   -------------------   --------------------
<S>                                            <C>                 <C>                   <C>                    <C>

REVENUES:
      Revenue from voyages                     12,14                    7,316                48,269                 75,905

      Gain on disposal of vessels                                           -                14,724                      -

EXPENSES:
      Commissions                              19                        (150)               (1,189)                (1,323)
      Voyage expenses                                                     (24)                 (312)                  (224)
      Vessel operating expenses                18                      (2,660)              (12,460)               (17,842)
      General & administrative expenses        19                         (34)                  (75)                (1,649)
      Depreciation                             6                       (1,721)              (12,724)               (19,446)
      Amortization of dry-docking and special
      survey expense                           6                         (271)               (1,552)                (1,958)
      Management fees                          19                        (199)                 (893)                (1,511)
                                                         ---------------------   -------------------   --------------------
                                                                       (5,059)              (29,205)               (43,953)
                                                         ---------------------   -------------------   --------------------
      Net operating income                                              2,257                33,788                 31,952

OTHER EXPENSES:
      Interest expense                         10,11,12                (1,539)               (8,616)               (18,793)
      Other income (expenses), net                                         11                   134                    662
      Change in fair value of derivatives      15                        (215)                  (33)                   950
                                                         ---------------------   -------------------   --------------------
      Total other expenses, net                                        (1,743)               (8,515)               (17,181)
                                                         ---------------------   -------------------   --------------------


                                                         ---------------------   -------------------   --------------------
NET INCOME                                                                514                25,273                 14,771
                                                         =====================   ===================   ====================

Earnings per share:
Basic and diluted                                                       $0.03                 $1.56                  $0.64
                                                         =====================   ===================   ====================

Weighted average number of shares:
Basic and diluted                                                  16,176,877            16,176,877             23,118,466
                                                         =====================   ===================   ====================
</TABLE>

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

<TABLE>
<CAPTION>
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)
-----------------------------------------------------------------------------------------------------------------------------------

                                           Common Stock
                                           (Number of                                                                Total
                                           Shares in       Invested    Share        Additional        Retained       Stockholders'
                                  Notes    Thousands)      Equity      Capital      Paid-in Capital   Earnings       Equity
                                  -------  --------------  ----------  ------------ ----------------  -------------- --------------
<S>                               <C>      <C>             <C>         <C>          <C>               <C>            <C>
Balance at March 7, 2003                                           -                                                             -
Net income                                                       514                                                           514
Capital contribution                                               3                                                             3
Distribution to stockholders                                      (3)                                                           (3)
                                                           ----------                                                --------------
Balance at December 31, 2003                                     514                                                           514
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              13               1,200          12                                                            12
                                           --------------  ----------                                                --------------
Balance at March 17,  2005                         1,200      20,472                                                        20,472
Reorganization adjustment                                    (20,472)           12           20,460               -              -
Distributions                     13              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                    13                               -             -           (3,812)        (10,964)       (14,776)
                                           --------------  ----------  ------------ ----------------  -------------- --------------
Balance at December 31, 2005                      28,417           -           284          155,397               -        155,681
                                           ==============  ==========  ============ ================  ============== ==============
</TABLE>

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

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

                                                                       From inception        Year ended         Year ended
                                                                       (March 7, 2003) to    December 31,       December 31,
                                                            Notes      December 31, 2003     2004               2005
                                                            ---------  --------------------  -----------------  ----------------
<S>                                                         <C>        <C>                   <C>                <C>
Cash flows from operating activities:
   Net income                                                                          514             25,273            14,771
   Adjustments to reconcile net income to net cash
   provided by operating activities:
   Depreciation                                                                      1,721             12,724            19,446
   Amortization of dry-docking and special survey                                      271              1,552             1,958
   Amortization and write-off of deferred financing costs                               44                587             1,598
   Amortization of debt discount                                                       480              1,480             7,640
   Amortization of deferred revenue                                                      -             (9,055)           (9,275)
   Unearned revenue                                                                      -                  -              (16)
   Interest expense of deferred revenue                                                  -                294               430
   Change in fair value of derivative financial instruments                            215                 33             (950)
   Gain on disposal of vessels                                                           -            (14,724)                -
   Changes in working capital                               16                       1,181              3,735             3,268
                                                                       --------------------  -----------------  ----------------
Net cash provided by operating activities                                            4,426             21,899            38,870
                                                                       --------------------  -----------------  ----------------

Cash flows from investing activities:
   Vessel acquisitions                                                             (27,489)          (221,115)         (102,692)
   Other fixed asset acquisitions                                                        -                  -               (96)
   Restricted cash for dry-docking payments                                           (278)              (535)              813
   Proceeds from disposal of vessels                                                     -             59,877                 -
   Advances for vessels under construction                                         (13,845)                 -                 -
   Advances for vessel acquisitions                                                      -                  -           (11,363)
   Vessels' dry-docking / special survey costs                                           -                  -            (2,559)
                                                                       --------------------  -----------------  ----------------
Net cash used in investing activities                                              (41,612)          (161,773)         (115,897)
                                                                       --------------------  -----------------  ----------------

Cash flows from financing activities:
  Proceeds from issuance of long-term debt                                          41,130            246,180           183,820
  Principal repayments of long-term debt                                            (2,850)           (99,378)         (214,600)
  Proceeds from termination of derivative
  financial instruments                                                                  -                  -               301
  Payment of participation liability                                                     -                  -            (6,500)
  Payment of financing costs                                                          (318)            (1,959)           (2,824)
  Restricted cash for loan payments                                                   (109)            (4,694)            4,793
  Proceeds from issuance of capital stock                                                -              4,392           140,941
  Distribution                                                                           -                  -              (214)
  Dividends paid                                                                         -                  -           (14,776)
                                                                       --------------------  -----------------  ----------------
        Net cash provided by financing activities                                   37,853            144,541            90,941
                                                                       --------------------  -----------------  ----------------
        Net increase in cash and cash equivalents                                      667              4,667            13,914
Cash and cash equivalents
Beginning of year                                                                        -                667             5,334
                                                                       --------------------  -----------------  ----------------
End of year                                                                            667              5,334            19,248
                                                                       ====================  =================  ================
</TABLE>

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

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

                                                                       From inception                           Year ended
                                                                       (March 7, 2003) to  Year ended           December 31,
                                                             Notes     December 31, 2003   December 31, 2004    2005
                                                            ---------  ------------------- -------------------  -----------------
<S>                                                         <C>        <C>                 <C>                  <C>
SUPPLEMENTAL CASH FLOW INFORMATION
   Interest paid                                                                      941               5,429              9,838
                                                                       =================== ===================  =================

   Issuance of capital stock                                                            -                   -                150
                                                                       =================== ===================  =================

   Vessels acquired from issuance of long-term debt                                 4,750               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 shareholders                               -               3,000                  -
                                                                       =================== ===================  =================

   Liability assumed in connection with vessel acquisitions                             -              22,638             28,387
                                                                       =================== ===================  =================

   Distribution                                             13                          -                   -              1,694
                                                                       =================== ===================  =================
</TABLE>

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

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 the companies listed below:

<TABLE>
<CAPTION>
Company  Name                     Country of              Vessel Name            Date of Vessel
                                  Incorporation                                  Acquisition
-------------------------------   ---------------------   --------------------   -------------------
<S>                               <C>                     <C>                    <C>
Mote Shipping Ltd.                Malta                   **                     -

Statesman Shipping Ltd.           Malta                   **                     -

Trans Continent Navigation Ltd.   Malta                   **                     -

Trans State Navigation Ltd.       Malta                   **                     -

Rivonia Marine Limited            Cyprus                  *                      -

Robin Marine Limited              Cyprus                  *                      -

AMT Management Ltd.               Marshall Islands        -                      -

Olympic Galaxy Shipping Ltd.      Marshall Islands        M/V CMA CGM Energy     April 28, 2004

Bora Limited                      British Virgin Islands  M/T Bora               May 25, 2004

Dynamic Maritime Co.              Marshall Islands        M/V CMA CGM Force      June 1, 2004

Jubilee Shipholding S.A.          Marshall Islands        M/V Ocean Hope         July 26, 2004

Vintage Marine S.A.               Marshall Islands        M/T Citius             August 5, 2004

Ermina Marine Ltd.                Marshall Islands        M/T Nordanvind         December 9, 2004

Land Marine S.A.                  Marshall Islands        M/T High Land**        March 7, 2003

Rider Marine S.A.                 Marshall Islands        M/T High Rider**       March 18, 2003

Altius Marine S.A.                Marshall Islands        M/T Altius**           June 24, 2004

Seine Marine Ltd.                 Marshall Islands        M/V CMA CGM Seine      June 24, 2005

Makassar Marine Ltd.              Marshall Islands        M/V CMA CGM Makassar   July 15, 2005

Fortius Marine S.A.               Marshall Islands        M/T Fortius**          August 2, 2004

Chinook Waves Corporation         Marshall Islands        M/T Chinook            November 30, 2005

Compassion Overseas Ltd.          Bermuda                 ***                    -

Compass Overseas Ltd.             Bermuda                 ***                    -
</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 and Trans State Navigation Ltd to
        Altius  Marine  S.A.,  Land Marine  S.A.,  Rider Marine S.A. and Fortius
        Marine S.A. in November,  July,  August and November 2005  respectively.
        The original  acquisitions for these vessels were made on June 24, 2004,
        on March 7, 2003, on March 18, 2003 and on August 2, 2004 respectively.

***     M/T Stena  Compass  was  delivered  on  February  14, 2006 and M/T Stena
        Compassion was delivered in June, 2006.


Up to March 17, 2005, the predecessor combined carve-out financial statements of
Aries  Maritime have 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 are 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
shareholders  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  instalment  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, 2005 and December
31,  2004 and for the  period  ended  December  31,  2003 and the  Group has not
written off any trade receivables during these periods.

Inventories:

Inventories  which  comprise of 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.

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,  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 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 time charters.  Time charter  revenues 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 2003, 2004 and 2005, 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.  Accordingly  16,176,877 common
shares have been  disclosed as being  outstanding  for the periods  prior to the
initial  public  offering.  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.

3.      Recent Accounting Pronouncements

In November  2004, the Financial  Accounting  Standards  Board  ("FASB")  issued
Statement of Financial  Accounting Standard ("SFAS") No. 151, "Inventory Costs -
an  amendment  of ARB No. 43,  Chapter 4" ("SFAS  151"),  which  clarifies  that
abnormal amounts of idle facility  expense,  freight,  handling costs and wasted
material  (spoilage)  should be  recognized  as a  current  period  expense.  In
addition,  SFAS 151 requires that allocation of fixed production overhead to the
costs  of  conversion  be  based  on  the  normal  capacity  of  the  production
facilities.  SFAS 151 is  effective  for fiscal years  beginning  after June 15,
2005.  Management does not believe that the implementation of SFAS 151 will have
a material impact on the Group's  financial  position,  results of operations or
cash flows.

In December  2004,  the FASB issued SFAS No.  153,  "Exchanges  of  Non-Monetary
Assets - An  Amendment  to APB 29" ("SFAS  153").  Accounting  Principles  Board
Opinion No. 29 (<<APB 29) had stated that all exchanges of  non-monetary  assets
should be recorded  at fair value  except in a number of  situations,  including
where the  exchange is in  relation to  similarly  productive  assets.  SFAS 153
amends APB 29 to eliminate the exception for  non-monetary  exchanges of similar
productive  assets and  replaces it with a general  exception  for  exchanges of
non-monetary assets that do not have commercial substance.

A non-monetary  transaction has commercial substance where the future cash flows
of the  business  will be  expected to change  significantly  as a result of the
exchange.  The  provisions  of SFAS  153  will  be  effective  for  non-monetary
exchanges occurring in fiscal periods beginning after June 15, 2005.  Management
does not believe that the implementation of SFAS 153 will have a material impact
on the Group's financial position, results of operations or cash flows.

In March 2005,  the  Financial  Accounting  Standards  Board issued FIN 47 as an
interpretation  of FASB  Statement  No.  143,  Accounting  for Asset  Retirement
Obligations  (FASB  No.  143).  This  interpretation  clarifies  that  the  term
conditional  asset  retirement  obligation  as used in FASB  Statement  No. 143,
refers to a legal  obligation to perform an asset  retirement  activity in which
the timing and/or method of settlement  are  conditional  on a future event that
may or may not be within the control of the entity.  The  obligation  to perform
the asset retirement  activity is unconditional  even though  uncertainty exists
about the timing and/or method of settlement. Accordingly, an entity is required
to recognize a liability  for the fair value of a conditional  asset  retirement
obligation if the fair value of the liability can be reasonably estimated.  This
interpretation  also clarifies when an entity would have sufficient  information
to reasonably estimate the fair value of an asset retirement obligation.  FIN 47
is effective  no later than the end of fiscal  years  ending after  December 15,
2005. The adoption of this  interpretation did not have an effect on the Group's
statement of financial position or results of operations.

In March 2005, the Financial  Accounting  Standards  Board issued  Statement No.
154, Accounting Changes and Error Corrections,  a replacement of APB Opinion No.
20 and FASB Statement No. 3. The Statement  applies to all voluntary  changes in
accounting  principle,  and  changes the  requirements  for  accounting  for and
reporting  of a change in  accounting  principle.  Statement  No.  154  requires
retrospective applications to prior periods' financial statements of a voluntary
change in accounting principle unless it is impracticable. Opinion 20 previously
required that most  voluntary  changes in accounting  principle be recognized by
including  in net income of the period of the changes the  cumulative  effect of
changing to the new accounting  principle.  Statement No. 154 improves financial
reporting  because  its  requirements   enhance  the  consistency  of  financial
information  between  periods.  The Group cannot determine what effect Statement
No. 154 will have with regard to any future accounting  changes.  This statement
is effective for the Group for the fiscal year beginning on January 1, 2006.

On November 3, 2005, the Financial  Accounting  Standards Board issued Financial
Staff  Position  (FSP)  numbers  115-1  and  124-1  providing  guidance  for the
application  of FAS 115.  This FSP  addresses  the  determination  as to when an
investment  is  considered  impaired,  whether  that  impairment  is other  than
temporary,  and the  measurement  of an  impairment  loss.  It also  states that
impairment of investments in debt  securities  must be assessed on an individual
basis.  Adoption of this  interpretation  is not expected to have a  significant
effect on the Group's statement of financial  position or results of operations.
This statement will be effective for the Group for fiscal years  beginning after
December 15, 2005.


4.      Restricted Cash

                                             December 31,         December 31,
                                                     2004                 2005
                                         -----------------    -----------------
Current
Retention and debt reserve accounts                 4,803                    -
Other restricted accounts                               -                   10
Non-current
Dry-docking accounts                                  813                    -
                                         -----------------    -----------------
                                                    5,616                   10
                                         =================    =================


Cash  deposited in retention  and debt reserve  accounts was made  available for
loan  repayments  within three months after being  deposited.  Cash deposited in
dry-docking  accounts  was  restricted  for use and  could  only be used for the
purpose of paying for  dry-docking  or special survey  expenses.  Maintenance of
such accounts was no longer  required when existing loans were  refinanced  (see
note 11).


5.      Inventories

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

Lubricants                            387                 581
Provisions (Stores)                    48                  64
                        ------------------   -----------------
                                      435                 645
                        ==================   =================


6.      Vessels and Other Fixed Assets

Details are as follows:
<TABLE>
<CAPTION>
                                                  Other fixed   Cost of         Special
                                                  assets        vessel          survey        Dry-docking     Total
                                                  ------------- --------------  ------------  --------------  --------------
<S>                                               <C>           <C>             <C>           <C>             <C>
Cost

Balance at March 7, 2003                                     -              -             -               -               -
Additions                                                    -         30,572           967             700          32,239
                                                  ------------- --------------  ------------  --------------  --------------
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                                                    -        131,079         1,528           1,031         133,638
Additions                                                   96              -             -               -              96
                                                  ------------- --------------  ------------  --------------  --------------
Balance at December 31, 2005                                96        366,412         4,855           3,260         374,623
                                                  ------------- --------------  ------------  --------------  --------------

Accumulated Depreciation and Amortization

Balance at March 7, 2003                                     -              -             -               -               -
Charge for the period                                        -         (1,721)         (157)           (114)         (1,992)
                                                  ------------- --------------  ------------  --------------  --------------
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)
                                                  ------------- --------------  ------------  --------------  --------------

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
                                                  ============= ==============  ============  ==============  ==============
</TABLE>

During the year ended December 31, 2005, the Group acquired three vessels (2004:
five) which  included the  assumption of time  charters  which had rates of hire
below the market value at the delivery  date.  The cost of the vessels  totalled
$103.2  million  (2004:  $107.4  million).  The  fair  value  of  the  liability
associated with the time charters was $28.3 million (2004: $22.6 million).  This
has been  reflected  in the vessels cost and recorded as a liability in deferred
revenue (see note 12 and note 19).


7.      Advances For Vessel Acquisitions

At December 31, 2005, the Group had advanced  progress  payments  totaling $11.2
million for the acquisition of two vessels, M/T Stena Compass ($5.6 million) and
M/T Stena  Compassion ($5.6 million).  The total amount of capitalized  interest
and other costs relating to these vessels amounted to $0.1 million.


8.      Accounts Payable

                                   December 31,         December 31,
                                           2004                 2005
                               -----------------   ------------------
Suppliers                                 3,496                2,106
Agents                                      182                  626
Trade Creditors                             151                1,866
                               -----------------   ------------------
                                          3,829                4,598
                               =================   ==================


9.      Accrued Liabilities

                                   December 31,         December 31,
                                           2004                 2005
                               -----------------   ------------------
Accrued interest                            768                    7
Other accrued expenses                      273                  617
Crew payroll                                229                  422
Claims                                        -                1,834
                               -----------------   ------------------
                                          1,270                2,880
                               =================   ------------------

The above amount for claims of $1.8 million  represents speed claims of $604,000
and off-hire due to customers of $1.23 million.


10.     Deferred Charges

                                                 Financing Costs
                                                 ---------------
Net Book Value at January 1, 2004                          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
                                                    ===========


11.  Long-Term Debt


                                                          Balance as of
    Vessel                                                December 31, 2005
    -----------------------------------------------------------------------
A) Term loan facility
   ------------------
    M/T Altius                                                   17,333
    M/V CMA CGM Seine                                            13,565
    M/T Bora                                                     11,220
    M/T Nordanvind                                               11,890
    M/T High Land                                                 9,043
    M/T High Rider                                                8,708
    M/T Citius                                                    7,201
    M/V Ocean Hope                                                8,373
    M/V CMA CGM Energy                                           10,885
    M/V CMA CGM Force                                            10,885
    M/V CMA CGM Makassar                                         13,565
    M/T Fortius                                                  17,332
                                                          --------------
                             Total                              140,000
                                                          --------------
                             Short term                               -
                             Long term                          140,000
                                                          --------------
                                                                140,000
                                                          --------------
B) Revolving loan facility
   -----------------------
    M/T Chinook                                                  32,600
    M/T Stena Compass                                             5,610
    M/T Stena Compassion                                          5,610
                                                          --------------
                              Total                               43,820
                                                          --------------
                             Short term                               -
                             Long term                           43,820
                                                          --------------
                                                                 43,820
                                                          --------------
                             Total amount                       183,820
                                                          ==============

Senior secured credit agreement

Simultaneously  with the Company's initial public offering,  the Company entered
into a senior secured credit agreement ("the credit  facility") with a syndicate
of banks led by Fortis  Bank,  Bank of  Scotland  and Nordea Bank  Finland.  The
credit  facility is for a total of $290 million and comprises of a  delayed-draw
term loan  facility  of $140  million and a  revolving  credit  facility of $150
million.  During the year ended December 31, 2005, twelve of the Group's vessels
(as listed above) repaid their  existing  loans with a combination of the credit
facility and the proceeds of the Company's initial public offering. As a result,
the Group wrote off $761,000 of  financing  costs  associated  with the previous
debt.  The  $150  million  revolving  credit  facility  for the  acquisition  of
additional  vessels was drawn in November  2005 for the  purchase of M/T Chinook
($32.6  million)  and in October  2005 for deposits on the purchase of M/T Stena
Compass ($5.6 million) and M/T Stena Compassion ($5.6 million).  The rest of the
revolving  credit  facility was undrawn as at December 31, 2005 and is available
for two years until June 3, 2007.

The credit  facility of $290 million,  including  the $140 million  delayed-draw
term loan facility and the $150 million revolving credit facility is in the name
of Aries Maritime as borrower and guaranteed by the  vessel-owning  subsidiaries
supported by first preferred mortgages over their vessels.

The debt agreement also contains various covenants, including (a) restriction as
to changes in  management  and  ownership  of the  vessels,  (b)  limitation  on
incurring additional indebtedness,  (c) mortgaging of vessels and restriction on
payment of dividends,  (d) minimum requirement  regarding hull cover ratios, (e)
minimum  liquidity  requirement,  (f) maintenance of operating  accounts and (g)
minimum insurance values.

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, is
to be used to replace the  current  $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
supported by first preferred mortgages over their vessels.

As at December 31, 2005  repayments of the  long-term  debt under the new credit
facility are due as follows (see also note 20):

                                            000's
                                   ---------------
                    2006-2010                   -
                    2011                  183,820
                                   ---------------
                    Total amount          183,820
                                   ===============

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%.

Interest  on the  existing  credit  facility  was  charged at LIBOR plus a 1.25%
margin when the corporate  leverage  ratio was less than 60% and at LIBOR plus a
1.375%  margin when the  corporate  leverage  ratio was equal to or greater than
60%.   Corporate  leverage  was  defined  as  the  ratio  of  outstanding  total
liabilities divided by the total assets, adjusted for the difference between the
fair  market  value and book  value of the  collateral  vessels.  The  effective
interest  rate at  December  31,  2005 was 4.91%  p.a.  and 5.42%  p.a.  for the
delayed-draw term loan facility and the revolving credit facility respectively.

Settlement of fee agreement with bank

Certain  loans  with an  aggregate  outstanding  amount of  $135.75  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.


12.     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
                                                       ==============

Short term                                                    10,715
Long term                                                     17,041
                                                       --------------
                                                              27,756
                                                       ==============


13.     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 $1.69
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 $14.78  million to
existing stockholders.


14.     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,
                                          2003            2004          2005

Europe                                       -          12,302        27,413
Asia                                     3,658          21,846        30,896
Africa                                   3,658          10,571         4,186
South America (Venezuela)                    -           3,550        13,410
                                  -------------  -------------- -------------
                                         7,316          48,269        75,905
                                  =============  ============== =============


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).


15.     Financial Instruments

Fair Values

The carrying amounts of the following  financial  instruments  approximate their
fair values;  cash and cash equivalents and restricted cash accounts,  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 14).

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>
<CAPTION>
                                              Notional      Maximum
                                               Amount     fixed rate               Fair value  Fair value  Fair value
                     Value     Termination    Dec. 31,     Dec. 31,     Floating    Dec. 31,    Dec. 31,    Dec. 31,
Counterparty          Date         Date       2005/2004   2005/2004     Rate        2003        2004        2005
----------------   ----------  ------------   ---------   ---------     ---------  ----------  ----------  -----------
<S>                <C>         <C>            <C>         <C>           <C>        <C>         <C>         <C>
                                                                        3-month
Fortis Bank          03/01/06    03/06/09       46,667       4.885%       LIBOR           -           -        127
                                                                        3-month
Nordea Bank          03/01/06    03/06/09       46,667       4.885%       LIBOR           -           -        121
                                                                        3-month
Bank of Scotland     03/01/06    03/06/09       46,667       4.885%       LIBOR           -           -        153
                                                                        3-month
Bank of Scotland     04/06/04    01/06/07       22,500       3.365%       LIBOR           -           3          -
                                                                        3-month
Bank of Scotland     18/01/01    30/06/05       12,500         5.5%       LIBOR           -        (247)         -
                                                                        3-month
Bank of Scotland     09/06/04    05/05/09       22,063         3.9%       LIBOR           -        (171)         -
                                                                        3-month
Bank of Scotland     19/03/03    13/03/06       25,750       2.535%       LIBOR        (215)        167          -
                                                                                   -----------------------------------
                                                                                       (215)        (248)      401
                                                                                   ===================================
</TABLE>

These  interest rate swaps are used to hedge the interest  expense  arising from
the Group's  long-term  borrowings  detailed in Note 11. 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 gain of $950,000 as of December
31, 2005, a loss of $33,000 as of December 31, 2004 and a loss of $215,000 as of
December 31, 2003. 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.


16.     Changes in Working Capital

                               December 31,     December 31,      December 31,
                                       2003             2004              2005
                             ---------------  --------------- -----------------
(Increase) decrease in
Trade receivables                       (1)            (302)               120
Other receivables                         -            (114)                54
Inventories                            (83)            (352)             (210)
Prepaid expenses and other             (30)            (299)             (192)
Due from managing agent                   -                -              (84)
Due from related parties                  -          (1,582)             (152)
Increase (decrease) in
Accounts payable, trade                 311            3,518               936
Accrued liabilities                     209            1,061             1,684
Deferred income                         246            1,805             1,112
Due to related parties                  529                -                 -
                             ---------------  --------------- -----------------
                                      1,181            3,735             3,268
                             ===============  =============== =================


17.     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 under common control. 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 a management fee
of $146,000 per annum for technical management  services,  plus $1,000 per month
for office space and administrative support (refer to note 19). With effect from
January 1, 2006 this $1,000 per vessel, per month fee no longer exists.

From  November 30, 2005,  Chinook  Waves  Corporation  commenced  operating  its
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 receives an
annual management fee of Euro 128,000.

Purchase of vessels

In October  2005,  contracts  were entered into for the purchase of two products
tankers; two 72,750 (approximately) dwt vessels (M/T Stena Compass and M/T Stena
Compassion)  costing $56.1 million each.  The M/T Stena Compass was delivered on
February 14, 2006. The M/T Stena Compassion is due to be delivered in May 2006.

Rental agreement

On November 21, 2005 AMT Management Ltd entered into an office rental  agreement
with a related party, a company under common control,  with effect from December
1, 2005 for six years at a monthly rental of Euro 4,000 plus stamp duty ($4,890)
(refer to note 19).

The  following  table sets out  long-term  commercial  obligations  for rent and
management fees, outstanding as of December 31, 2005:

                                      000's
                               -----------------
           2006                           2,051
           2007                           1,931
           2008                           1,955
           2009                           2,015
           2010 and thereafter           13,110
                               -----------------
           TOTAL                         21,062
                               =================


(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.


18.     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.


19.     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 under common
control,  pursuant to ship management  agreements.  Under these agreements,  the
Group paid  management  fees of $1.498  million for the year ended  December 31,
2005,  $893,000 for the year ended December 31, 2004 and $199,000 for the period
ended  December  31, 2003 which is  separately  reflected in the  statements  of
income.

(b) 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 for chartering  services of $50,000 for the year ended
December 31, 2005 $368,000 for the year ended  December 31, 2004 and $73,000 for
the period ended December 31, 2003. These commissions relate to agreements which
are superseded by the new ship management agreements between Magnus Carriers and
the  vessel-owning  subsidiaries.  From  the  effective  date  of the  new  ship
management  agreements  Magnus  Carriers  may  only  receive  commission  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  controlled  by  directors  (see note 17).  The Group paid $4,693 to the
related party during the year ended December 31, 2005 (2004 and 2003 $NIL).

(d) Amounts due from/to related parties

Amounts due from related  parties  were $1.293  million at December 31, 2005 and
$1.053  million at  December  31,  2004.  Amounts  due to related  parties  were
$529,000 at December 31, 2003.  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 $392,000 (due from) at December 31, 2005,
$138,000  (due from) at December 31, 2004 and $NIL at December 31, 2003 and (ii)
Magnus Carriers  Corporation,  consisting of $901,000 (due from) at December 31,
2005, $915,000 (due from) at December 31, 2004 and $529,000 (due to) at December
31, 2003. There are no terms of settlement for these amounts, as of December 31,
2005.

(e) Crewing

Crewing for the Group is undertaken by Magnus Carriers through a related entity,
Poseidon  Marine  Agency.  The Group paid  manning fees of $310,000 for the year
ended  December  31,  2005,  $278,000  for the year ended  December 31, 2004 and
$58,000 for the period ended December 31, 2003.


(f) 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, 2005 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.

(g) General and administrative expenses

During the year  ended  December  31,  2005 the Group  paid  directors'  fees of
$467,000  (2004  and  2003  $NIL).   Such  fees  are  included  in  general  and
administrative expenses in the accompanying consolidated statements of income.


20.     Post Balance Sheet Events

a) Credit facility

With effect from March 1, 2006 the Group  voluntarily  reduced its existing $150
million revolving credit facility to $145 million.  The Group entered into a new
$360  million  revolving  credit  facility  on April 3, 2006.  The $360  million
facility,  which has a term of five years,  is to be used to replace the current
$140 million term loan facility and $150 million revolving credit facility.

b) Dividend

On February  13, 2006 the  Directors  of Aries  Maritime  declared a dividend of
$0.35 per share in respect of the fourth  quarter of 2005. The dividend was paid
on March 9, 2006 to shareholders on record as of February 23, 2006.

c) Interest rate swap

On April 7, 2006 the interest rate swap with Fortis Bank was  terminated and the
settlement proceeds amounted to $490,000 in favor of Aries Maritime.

Unaudited post balance sheet events

a) On May 8, 2006 the Directors of Aries Maritime  Transport  Limited declared a
dividend  of $0.14  per  share in  respect  of the first  quarter  of 2006.  The
dividend was paid on May 31, 2006 to shareholders on record as of May 19, 2006.

b) The Company took delivery of the vessel Stena Compassion in June 2006.

<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 by and between the Company and The Bank
                        of  Scotland  and  Nordea  Bank  Finland  as joint  lead
                        arrangers. (3)

     8.1      ____      List of Subsidiaries (4)

    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)  To be filed by amendment.

(4)  Incorporated  by reference to Exhibit  21.1 to the  Company's  registration
statement on Form F-1 (Registration No. 333-124952).

<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/ Mon S. Bolin
                                            ----------------------------------
                                            Name:  Mons S. Bolin
                                            Title: Chief Executive Officer

June 30, 2006