Document:

Exhibit 10.1

[FORTIS BANK LOGO]                                          [HSBC LOGO]

     To:  Arlington Tankers Limited (the "Company")
          For the attention of Art Regan

                                                         14 October 2004

Dear Sirs,

US$135,000,000 Secured Term Loan Facility (the "Facility")

We Fortis Bank (Nederland) N.V. ("Fortis Bank") and HSBC Bank plc ("HSBC")
(the "Mandated Lead Arrangers" and "Underwriters") are pleased to set out in
this letter the terms and conditions on which we are willing to arrange and
underwrite the Facility.

In this letter:

"Mandate Documents" means this letter and the term sheet attached to this
letter as an appendix (the "Term Sheet").

Unless a contrary indicator appears, a term defined in any Mandate Document has
the same meaning when used in this letter.

1.   APPOINTMENT

1.1  The Company appoints:

     (a)  the Mandated Lead Arrangers as exclusive joint arrangers of the
          Facility;

     (b)  the Underwriters as exclusive joint underwriters of the Facility;

     (c)  HSBC as exclusive bookrunner in connection with syndication of the
          Facility; and

     (d)  Fortis Bank as facility agent in connection with the Facility.

1.2  Until this mandate terminates in accordance with the terms of this letter:

     (a)  no other person shall be appointed as mandated lead arranger,
          underwriter, bookrunner or facility agent;

     (b)  no properties shall be awarded; and

     (c)  except as provided in the Mandate Documents, no other compensation
          shall be paid to any person.

     In connection with the Facility.

[FORTIS BANK LOGO]                                          [HSBC LOGO]

2.   CONDITIONS

     This offer to arrange and underwrite the Facility is made on the terms of
     the Mandate Documents and is subject to satisfaction of the following
     conditions:

     (a)  compliance by the Company and each member of the Group with all the
          terms of each Mandate Document;

     (b)  satisfaction of the conditions set out in paragraph 4 (Material
          Adverse Change);

     (c)  the representations and warranties made by the Company in paragraph 3
          (Information) being correct;

     (d)  the preparation, execution and delivery of a facility agreement and
          related documentation (based on the terms set out in the Term Sheet)
          in form and substance mutually acceptable to the parties (the
          "Facility Documents");

     (e)  completion of client identification procedures (including
          identification of directors and major shareholders of the Company) in
          compliance with applicable money laundering rules;

     (f)  the Company obtaining all relevant regulatory approvals which are
          necessary in connection with the Facility from any relevant
          authorities in any relevant jurisdictions.

3.   UNDERWRITING PROPORTIONS

3.1  The underwriting proportions of each of the Underwriters in respect of the
     Facility are as follows:

     UNDERWRITER              PROPORTION (%)            AMOUNT

     Fortis Bank              50%                       US$67.5 million

     HSBC                     50%                       US$67.5 million

     TOTAL                    100%                      US$135 MILLION

3.2  The obligations of the Underwriters under the Mandate Documents are
     several. No Underwriter is responsible for the obligations of the other
     Underwriter.

4.   MATERIAL ADVERSE CHANGE

     The obligations of the Mandated Lead Arrangers as arrangers and
     Underwriters are subject to there being, in the reasonable opinion of the
     Mandated Lead Arrangers, no material adverse change in either:

     (a)  the business or financial condition assets or prospects of any
          Obligor;

     (b)  the ability of the Company or any other Obligor to perform its
          obligations under any Mandate Document or Facility Document; or

                                      -2-

[FORTIS BANK LOGO]                                          [HSBC LOGO]

     (c)  the international or any relevant domestic syndicated loan market
          which in the Mandated Lead Arrangers' opinion could reasonably be
          expected to prejudice syndication of the Facility,

     up to the time of close of syndication of the Facility.

5.   CLEAR MARKET

5.1  During the period from the date of this letter and the date of the Facility
     Documents/close of syndication, the Company shall not and shall ensure that
     no other member of the Group shall raise or attempt to raise debt finance
     in the international or domestic loan or capital markets (including but not
     limited to any bilateral or syndicated facility, bond or note issuance or
     private placement of debt).

6.   FEES, COSTS AND EXPENSES

     All fees shall be paid as set out in the Term Sheet.

6.1  The Company shall promptly on demand pay the Mandated Lead Arrangers the
     amount of all costs and expenses (including legal fees) reasonably incurred
     by any of them in connection with:

     (a)  the negotiation, preparation, printing and execution of the Facility
          Documents and the Mandate Documents; and

     (b)  the syndication of the Facility,

     whether or not the Facility Documents are signed.

7.   PAYMENTS

     All amounts payable under the Mandate Documents:

     (a)  shall be paid in the currency of invoice and in immediately available,
          freely transferable cleared funds;

     (b)  shall be paid without any deduction or withholding for or on account
          of tax (a "Tax Deduction") unless a Tax Deduction is required by
          law. If a Tax Deduction is required by law to be made, the Company
          shall pay an amount which (after making any Tax Deduction) is equal to
          the payment which would have been due if no Tax Deduction had been
          required; and

     (c)  are exclusive of any value added tax or similar charge ("VAT"). If
          VAT is chargeable, the Company shall also and at the same time pay an
          amount equal to the amount of the VAT.

8.   SYNDICATION

8.1  The Mandated Lead Arrangers will, in consultation with the Company, manage
     all aspects of syndication of the Facility, including timing, the selection
     of potential lenders, the acceptance and allocation of commitments and the
     amount and distribution of fees to Lenders.

                                      -3-

[FORTIS BANK LOGO]                                          [HSBC LOGO]

8.2  The Company shall, and shall ensure that the other Obligors give any
     assistance which the Mandated Lead Arrangers reasonably require in relation
     to the syndication of the Facility including:

     (a)  assisting with the preparation of an information memorandum containing
          all relevant information (including projections) about the Group, the
          proposed transaction and how the proceeds of the Facility will be
          applied (the "Information Memorandum"). The Company will approve the
          Information Memorandum before the Mandated Lead Arrangers distribute
          it to potential Lenders on the Company's behalf;

     (b)  providing any information reasonably requested by the Mandated Lead
          Arrangers or potential Lenders in connection with syndication;

     (c)  making available the senior management and representatives of the
          Company and other members of the Group for the purposes of giving
          presentations to, and participating in meetings with, potential
          Lenders at such times and places as the Mandated Lead Arrangers may
          reasonably request;

     (d)  procuring the reasonable efforts of Stena AB to endsure that
          syndication of the Facility benefits from the existing lending
          relationships of Stena AB; and

     (e)  making any amendments to the Facility Documents which the Mandated
          Lead Arrangers reasonably request on behalf of potential Lenders.

9.   INFORMATION

9.1  The Company represents and warrants on the date of this letter that:

     (a)  any factual information provided or to be provided to the Mandated
          Lead Arrangers by it or any other member of the Group (including for
          the purposes of preparing the Information Memorandum) (the
          "Information") is or will be true and accurate in all material
          respects as at the date it is provided or as at the date (if any) on
          which it is stated;

     (b)  nothing has occurred or been omitted and no information has been given
          or withheld that results in the information being untrue or misleading
          in any material respect; and

     (c)  any financial projections contained in the information have been
          prepared on the basis of recent historical information and on the
          basis of reasonable assumptions.

9.2  The Company agrees to supplement the information from time to time until
     close of syndication to ensure that the representations and warranties in
     paragraph 9.1 remain correct.

10. UNDERTAKING TO PAY

10.1 (a)  Whether or not the Facility Documents are signed, the Company
          undertakes to pay to each Mandated Lead Arranger on demand an amount
          equal to any cost, loss or liability (including legal fees) incurred
          by that Mandated Lead Arranger or any Underwriter, Agent or Lender or
          any of their respective affiliates or any of their (or their
          respective affiliates) directors, officers, employees or agents
          (each a "Relevant Party") in connection with:

                                      -4-

[FORTIS BANK LOGO]                                          [HSBC LOGO]

          (i)  the syndication of the Facility;

          (ii) the use of the proceeds of the Facility;

          (iii) any Mandate Document;

          (iv) any Facility Document; and/or

          (v)  the arranging or underwriting of the Facility.

     (b)  The Company will not be liable under paragraph (a) above for any cost,
          loss or liability incurred by or awarded against a Relevant Party if
          that cost, loss or liability resulted from the gross negligence or
          willful misconduct of that Relevant Party.

10.2 The Company undertakes to pay to each Mandated Lead Arranger on demand an
     amount equal to any cost or expense (including legal fees) incurred by any
     Relevant Party in connection with the negotiation, preparation, printing,
     execution and syndication of any of the documents referred to in paragraph
     10.1 above.

10.3 No Mandated Lead Arranger shall have any duty or obligation, whether as
     fiduciary for any Relevant Party or otherwise, to recover any payment made
     under paragraph 10.1 or paragraph 10.2.

10.4 The Company agrees that no Relevant Party shall have any liability (whether
     direct or indirect, in contract or tort or otherwise) to the Company or any
     of its affiliates for or in connection with anything referred to in
     paragraph 10.1 above except, following the Company's agreement to the
     Mandate Documents, for breach of any Mandate Document or the Facility
     Documents or any such cost, loss or liability incurred by the Company that
     in each case is finally judicially determined to have resulted from the
     gross negligence or willful misconduct of that Relevant Party. No Relevant
     Party shall be responsible or have any liability to the Company or any of
     its affiliates or anyone else for consequential losses or damages.

11.  NO FRONT-RUNNING

     Each of the Mandated Lead Arrangers and Underwriters agrees and
     acknowledges that:

     (a)  until the close of primary syndication, it will not, and will procure
          that none of its Affiliates will, engage in any Prohibited Activity.

     (b)  if it or any of its Affiliates engages in any Prohibited Activity
          before the close of primary syndication, the other Mandated Lead
          Arrangers and Underwriters may suffer loss or damage and its position
          in future financings with the other Mandated Lead Arrangers and
          Underwriters and the Company may be prejudiced;

     (c)  when it signs the Facility Documents and any transfer document under
          the Facility Documents (in the case of any transfer document, only if
          signed within three months after the date of signing of the Facility
          Documents), it will, if the other Mandated Lead Arrangers and
          Underwriters so request, confirm to them in writing that neither it
          nor any of its Affiliates has breached the terms of this paragraph 11;

                                      -5-

[FORTIS BANK LOGO]                                          [HSBC LOGO]

     (d)  if it or any of its Affiliates engages in any Prohibited Activity
          before the close of primary syndication, the other Mandated Lead
          Arrangers and Underwriters retain the right not to allocate to it a
          commitment under the Facility;

     (e)  any arrangement, front-end or similar fee which may be payable to it
          in connection with the Facility is only payable on condition that
          neither it nor any of its Affiliates has breached the terms of this
          letter before the close of primary syndication. This condition is in
          addition to any other conditions agreed between us in relation to your
          entitlement to any such fee; and

     (f)  it confirms that neither it nor any of its Affiliates has engaged in
          any Prohibited Activity.

     For the purposes of this paragraph 11:

     "Affiliate" means in relation to a person, a subsidiary or holding
     company of that person, a subsidiary of any such holding company and each
     of the officers and employees of that person and any such subsidiary or
     holding company (including any sales and trading teams);

     "close of primary syndication" means the date on which the Mandated Lead
     Arrangers and Underwriters confirm the allocations of commitments relating
     to the Facility;

     a "Facility Interest" means a legal beneficial or economic interest
     acquired or to be acquired in or in relation to the Facility, whether as
     intial lender or by way of assignment, transfer, novation, subparticipation
     (whether disclosed, undisclosed, risk or funded) or any other similar
     method;

     "Prohibited Activities" means each of the following:

     (a)  entering into or continuing any discussion or other communication with
          any person which is intended to or is reasonably likely to:

          (i)  discourage any person from taking a Facility Interest as a lender
               of record in primary syndication; or

          (ii) encourage any person to take a Facility Interest except as a
               lender of record in primary syndication; or

     (b)  making a bid or offer price (whether firm or indicative) with a view
          to buying or selling a Facility Interest; or

     (c)  entering into any agreement, option or other arrangement, whether
          legally binding or not, in relation to the acquisition of any Facility
          Interest (whether on an indicative basis, a "when and if issued"
          basis or otherwise),

     but excludes any communication, offer or arrangment made with an Affiliate

12.  CONFIDENTIALITY

     The Mandate Documents and their contents are strictly confidential. The
     Company shall not, and shall ensure that no other member of the Group will,
     without the prior written consent of the Mandated Lead Arrangers, disclose
     the Mandate Documents or their contents to any other person

                                      -6-

[FORTIS BANK LOGO]                                          [HSBC LOGO]

     except as required by law or by any applicable governmental or other
     regulatory authority or by any applicable stock exchange;

13.  to the employees or professional advisers of the Company, Stena AB or
     Concordia Maritime AB for the purposes of the Facility and who have been
     made aware of and agree to be bound by the obligations under this paragraph
     or are in any event subject to confidentiality obligations as a matter of
     law or professional practice Publicity/Announcements.

13.1 All publicity in connection with the Facility shall be managed by the
     Mandated Lead Arrangers in consultation with the Company.

13.2 No announcements regarding the Facility or any roles as arranger,
     underwriter, lender or agent shall be made without the prior consent of the
     Company and the Mandated Lead Arrangers.

14.  CONFLICTS

14.1 The Company and each Mandated Lead Arranger acknowledges that the Mandated
     Lead Arrangers or their affiliates may provide debt financing, equity
     capital or other services to other persons with whom the Company or its
     affiliates may have conflicting interests in respect of the Facility or
     other transactions.

14.2 The Mandated Lead Arrangers will not use confidential information obtained
     for the purposes of the Facility from the Company or its affiliates or
     Stena AB or Concordia Maritime AB or their respective affiliates in
     connection with providing services to other persons or furnish such
     information to such other persons.

14.3 The Company acknowledges that the Mandated Lead Arrangers have no
     obligation to use any information obtained from another source for the
     purposes of the Facility or to furnish to the Company or its affiliates
     with such information.

15.  ASSIGNMENTS

     The Company shall not assign any of its rights or transfer any of its
     rights or obligations under the Mandate Documents without the prior written
     consent of the Mandated Lead Arrangers.

16.  TERMINATION

16.1 If the Company does not accept the offer in this letter before close of
     business in London on 15 October 2004, the offer to arrange and underwrite
     and the obligations of the Mandated Lead Arrangers and Underwriters under
     this letter shall terminate on that date.

16.2 Any Mandated Lead Arranger or Underwriter may terminate its obligations
     under this letter if:

     (a)  in its opinion, any of the conditions set out in paragraph 2
          (Conditions) is not satisfied or the Facility Documents are not signed
          by each of the persons expressed to be parties to them by 31 December
          2004 (or any later date agreed between the Company and the Mandated
          Lead Arrangers); or

                                      -7-

[FORTIS BANK LOGO]                                          [HSBC LOGO]

     (b)  the Company fails or has failed to disclose to the Mandated Lead
          Arrangers information which could reasonably be expected to be
          relevant to their decision to arrange or underwrite the Facility.

17.  SURVIVAL

17.1 Except for paragraphs 2 (Conditions), 3 (Underwriting Proportions) and 16
     (Termination) the terms of this letter shall survive and continue after the
     Facility Documents are signed.

17.2 Without prejudice to paragraph 17.1, paragraphs 6 (Fees, Costs and
     Expenses), 7 (Payments), 10 (Undertaking to pay), 12 (Confidentiality), 13
     (Publicity/Announcements) and 16 (Termination) to 21 (Governing Law and
     Jurisdiction) inclusive shall survive and continue after any termination of
     the agreement made in this letter by the parties to this letter.

18.  ENTIRE AGREEMENT

18.1 The Mandate Documents set out the entire agreement between the Company, the
     Mandated Lead Arrangers and the Underwriters as to arranging and
     underwriting the Facility and supersede any prior oral and/or written
     understandings or arrangements relating to the Facility.

18.2 The Mandate Documents may only be amended in writing signed by the Company
     and the Mandated Lead Arrangers.

19.  THIRD PARTY RIGHTS

     A person (other than a Relevant Person) who is not a party to this letter
     has no right under the Contracts (Rights of Third Parties) Act 1999 to
     enforce or to enjoy the benefit of any of its items.

20.  COUNTERPARTS

     This letter may be executed in any number of counterparts and this has the
     same effect as if the signatures on the counterparts were on a single copy
     of this letter.

21.  GOVERNING LAW AND JURISDICTION

21.1 This letter (including the agreement constituted by your acknowledgement of
     its terms) is governed by English law.

21.2 The parties submit to the non-exclusive jurisdiction of the English courts.

If you agree to the above, please acknowledge your agreement and acceptance of
the offer by signing and returning the enclosed copy of this letter to Nick
Hindle at HSBC and Francis Birkeland at Fortis Bank.

Yours faithfully

For and on behalf of
Fortis Bank (Nederland) N.V.

                                      -8-

[FORTIS BANK LOGO]                                          [HSBC LOGO]

For and on behalf of
HSBC Bank plc

We acknowledge and agree to the above:

For and on behalf of
Arlington Tankers Limited

                                      -9-

\Exhibit 10.2.1

Copyright: Norwegian Shipbrokers' Association, Oslo, Norway.

                                        ---------------------------------------
                                        Norwegian Shipbrokers' Association's
                                        Memorandum of Agreement for sale and
                                        purchase of ships. Adopted by The Baltic
MEMORANDUM OF AGREEMENT                 and International Maritime Council
                                        (BIMCO) in 1956.
Dated: 20 October, 2004
                                                     Code-name

                                                    SALEFORM 1993

                                        Revised 1966, 1983 and 1986/87.
                                        ---------------------------------------

Panisland Ltd., BERMUDA hereinafter called the Sellers, have agreed to sell, and

Companion Ltd., Bermuda, A WHOLLY OWNED SUBSIDIARY OF ARLINGTON TANKERS LTD,
BERMUDA, hereinafter called the Buyers, have agreed to buy

Name: M/T "STENA COMPANION"

Classification Society/Class: DNV/+1A1 Tanker for Oil, ESP NAUTICUS
(Newbuilding), E0, COAT-2, VCS-2

Built: 2004              BY: Dalian Shipyard, China

Flag: BERMUDA            Place of Registration: BERMUDA

Call Sign: ZCDI4         Grt/Nrt: 41,589/20,923

Register Number:  IMO 925 5933

hereinafter called the Vessel, on the following terms and conditions:

DEFINITIONS

"Banking days" are days on which banks are open both in the country of the
currency stipulated for the Purchase Price in Clause 1 and in the place of
closing stipulated in Clause 8.

"In writing" or "written" means a letter handed over from the Sellers to the
Buyers or vice versa, a registered letter, telex, telefax or other modern form
of written communication.

"Classification Society" or "Class" means the Society referred to in line 4.

1.   PURCHASE PRICE SEE CLAUSE 19.

2.

3.   PAYMENT

The said Purchase Price shall be paid in full free of bank charges to a bank
account to be notified by the buyers

on delivery of the Vessel, but not later than 3 banking days after the Vessel is
in every respect physically ready for delivery in accordance with the terms and
conditions of this Agreement and Notice of Readiness has been given in
accordance with Clause 5.

4.   INSPECTIONS SEE CLAUSE 20.

5.   NOTICES, TIME AND PLACE OF DELIVERY

a)   When the Vessel is at the place of delivery and in every respect physically
     ready for delivery in accordance with this Agreement, the Sellers shall
     give the Buyers a written Notice of Readiness for delivery.

b)   The Vessel shall be delivered and taken over safely afloat at a safe and
     accessible berth or anchorage or at sea.

     in the Sellers' option.

     Expected time of delivery: SIMULTANEOUS WITH THE CLOSING OF THE PUBLIC
     OFFERING DESCRIBED IN EXHIBIT 3.

     Date of cancelling (see Clause 14): December 1, 2004.

c)

d)   Should the Vessel become an actual, constructive or compromised total loss
     before delivery this Agreement shall be null and void.

6.

7.   SPARES/BUNKERS, ETC. SEE CLAUSE 22
                          -------------

The Sellers shall deliver the Vessel to the Buyers with everything belonging to
her on board and on shore. All spare parts and spare equipment including spare
tail-end shaft(s) and/or spare propeller(s)/propeller blade(s), if any belonging
to the Vessel at the time of inspection used or unused, whether on board or not
shall become the Buyers' property, but spares on order are to be excluded.
Forwarding charges, if any, shall be for the Buyers' account. The Sellers are
not required to replace spare parts including spare tail-end shaft(s) and spare
propeller(s)/propeller blade(s) which are taken out of spare and used as
replacement prior to delivery, but the replaced items shall be the property of
the Buyers. The radio installation and navigational equipment shall be included
in the sale without extra payment if they are the property of the Sellers.
Unused stores and provisions including lubricating oil shall be included in the
sale and be taken over by the Buyers without extra payment.

The Sellers have the right to take ashore crockery, plates, cutlery, linen and
other articles bearing the Sellers' flag or name, provided they replace same
with similar unmarked items. Library, forms, etc., exclusively for use in the
Sellers' vessel(s), shall be excluded without compensation. Captain's, Officers'
and Crew's personal belongings including the slop chest are to be excluded from
the sale, as well as the following additional items (including items on hire):

8.   DOCUMENTATION SEE CLAUSE 23.
                   --------------

The place of closing: Bermuda

In exchange for payment of the Purchase Price the Sellers shall furnish the
Buyers with delivery documents, namely:

a)   Legal Bill of Sale in a form recordable in Bermuda (the country in which
     the Buyers are to register the Vessel) warranting that the Vessel is free
     from all encumbrances, mortgages and maritime liens on any other debts or
     claims whatsoever, duly notarially attested and legalized by the consul of
     such country or other competent authority.

b)   Current Certificate of Ownership issued by the competent authorities of the
     flag state of the Vessel.

c)   Confirmation of Class issued within 72 house prior to delivery.

d)   Current Certificate issued by the competent authorities stating that the
     Vessel is free from registered encumbrances.

e)   Certificate of Deletion of the Vessel from the Vessel's registry or other
     official evidence of deletion appropriate to the Vessel's registry at the
     time of delivery, or, in the event that the registry does not as a matter
     of practice issue such documentation immediately, a written undertaking by
     the Sellers to effect deletion from the Vessel's registry forthwith and
     furnish a Certificate or other official evidence of deletion to the Buyers
     promptly and latest within 4 (four) weeks after the Purchase Price has been
     paid and the Vessel has been delivered.

f)   Bermuda Certificate of Permission to Transfer
     ---------------------------------------------

g)   Any such additional documents as may reasonably be required by the
     competent authorities for the purpose of registering the Vessel, provided
     the Buyers notify the Sellers of any such documents as soon as possible
     after the date of this Agreement.

At the time of delivery the Buyers and the Sellers shall sign and deliver to
each other a Protocol of Delivery and Acceptance confirming the date and time of
delivery of the Vessel from the Sellers to the Buyers.

At the time of delivery the Seller shall hand to the Buyers the classification
certificate(s) as well as all plans etc., which are on board the Vessel. Other
certificates which are on board the Vessel shall also be handed over to the
Buyers unless the Sellers are required to retain same, in which case the Buyers
to have the right to take copies. Other technical documentation which may be in
the Sellers' possession shall be promptly forwarded to the Buyers at their
expense, if they so request. The Sellers may keep the Vessel's log books but the
Buyers to have the right to take copies of same.

9.   ENCUMBRANCES

The Sellers warrant that the Vessel, at the time of delivery, is free from all
charters, encumbrances, mortgages and maritime liens or any other debts
whatsoever. The Sellers hereby undertake to indemnify the Buyers against all
consequences of claims made against the Vessel which have been incurred prior to
the time of delivery.

10.  TAXES, ETC.

Any taxes, fees and expenses in connection with the purchase and registration
under the Buyers' flag shall be for the Buyers' account, whereas similar charges
in connection with the closing of the Sellers' register shall be for the
Sellers' account.

11.  CONDITION ON DELIVERY SEE CLAUSE 24
                           -------------

The Vessel with everything belonging to her shall be at the Sellers' risk and
expense until she is delivered to the Buyers, but subject to the terms and
conditions of this Agreement she shall be delivered and taken over as she was at
the time of inspection, fair wear and tear excepted.

However, the Vessel shall be delivered operationally seaworthy and in every way
fit for intended service under the Time Charter Party and with her class
maintained without condition/recommendation*, free of average damage affecting
the Vessel's class, and with her classification certificates and national
certificates, as well as all other certificates the Vessel had at the time of
inspection, valid and unextended without condition/recommendation* by Class or
the relevant authorities at the time of delivery.

"Inspection" in this Clause 11, shall mean the Buyers' inspection according to
Clause 4 a) or 4 b), if applicable, or the Buyers' inspection prior to the
signing of this Agreement. If the Vessel is taken over without inspection, the
date of this Agreement shall be the relevant date.

*    Notes, if any, in the surveyor's report which are accepted by the
     Classification Society without condition/recommendation are not to be taken
     into account.

12.  NAME/MARKINGS SEE CLAUSE 25.
                   --------------

13.  BUYERS' DEFAULT

Should the Purchase Price not be paid in accordance with Clause 3, the Sellers
have the right to cancel the Agreement, and shall be entitled to claim
compensation for their losses and for all expenses incurred together with
interest.

14.  SELLERS' DEFAULT

Should the Sellers fail to be ready to complete a valid legal transfer by the
date stipulated in line 61 the Buyers shall have the option of cancelling this
Agreement.

Should the Sellers fail to be ready to complete a valid legal transfer as
aforesaid they shall make due compensation to the Buyers for their loss and for
all expenses together with interest if their failure is due to proven negligence
and whether or not the Buyers cancel this Agreement.

15.

16.  ARBITRATION SEE CLAUSE 26.
                 --------------

     The laws of England shall govern this Agreement.

THE ATTACHED RIDER WITH CLAUSES 17 - 26 FORMS PART OF THIS AGREEMENT.

RIDER TO MEMORANDUM OF AGREEMENT BETWEEN COMPANION LTD.
AND PANISLAND LTD., FOR THE SALE AND PURCHASE OF
M/T "STENA COMPANION"

17.           PARTICULARS OF THE VESSEL

See the attached Questionnaire 88, Exhibit 1.

18.           SALE AND CHARTER BACK

Upon delivery of the Vessel to the Buyers under this Agreement, the Vessel shall
be delivered under a Time Charter Party, attached as Exhibit 2, entered into
between the Buyers and a company affiliated with the Sellers, (the "Time
Charterers").

19.           PURCHASE PRICE

The Purchase Price for the Vessel shall consist of common shares of Arlington
Tankers Ltd. ("Arlington") and cash. Capitalized words used in this Clause 19
and not defined shall have the meaning set forth in the Arlington Registration
Statement on Form F-1 (the "Registration Statement") attached hereto as Exhibit
3.

I)            The number of Arlington common shares to be delivered to the
              Sellers (the "Total Number of Shares") shall be determined as
              follows:

              A)         Calculate the "Total Equity Amount" by multiplying the
                         price per share at which the Arlington shares are sold
                         pursuant to the initial public offering by the
                         aggregate number of shares issued to the subsidiaries
                         of Concordia and Stena and the two companies owned by
                         Stena and Fram for the purchase of the Fleet;

                                                                           2(5)
--------------------------------------------------------------------------------

              B)         Calculate the "Equity Value" by multiplying the Total
                         Equity Amount by 0.092.

              C)         Calculate the Total Number of Shares by dividing the
                         Equity Value by the price per share at which the
                         Arlington common shares are sold pursuant to the
                         initial public offering.

II)           The amount of cash Purchase Price to be received by the Sellers
              shall be determined as follows:

              A)         Calculate the "Fleet Purchase Price" by summing the
                         following: a) the Total Equity Amount; b) one hundred
                         thirty-five million dollars ($135,000,000); and c) the
                         product of the price per share at which the Arlington
                         common shares are sold pursuant to the initial public
                         offering multiplied by the aggregate number of shares
                         issued to the public (the "Gross Proceeds"); less (i)
                         the product of the Gross Proceeds multiplied by
                         0.06625, (ii) the fees paid by Arlington pursuant to
                         the $135 million secured facility agreement with Fortis
                         Bank (Nederland) N.V. and HSBC Bank plc and (iii) the
                         estimated total expenses of issuance and distribution
                         found under the caption "Expenses of Issuance and
                         Distribution" in the Registration Statement.

              B)         Calculate the "Vessel Purchase Price" by multiplying
                         the Fleet Purchase price by 0.115.

              C)         Subtract the Equity Value from the Vessel Purchase
                         Price to determine the amount of cash to be delivered
                         to the Sellers.

20.           INSPECTIONS

The Buyers have the right to inspect the Vessel and the Vessel's records prior
to delivery. As the Vessel will be chartered back as set out in Clause 18 such
inspection is not a condition for the sale which is outright and definite and
subject only to the conditions of this Agreement.

                                                                           3(5)
--------------------------------------------------------------------------------

21.           FAILURE TO CONSUMMATE PUBLIC OFFERING

In the event the public offering described in Exhibit 3 is not consummated by
December 1, 2004, both the Buyers and the Sellers shall have the option of
canceling this Agreement and neither the Buyers nor the Sellers shall be
entitled to damages or to any other compensation or reimbursement of expenses.

22.           SPARES/BUNKERS, ETC.

The Sellers may leave onboard for use under the Time Charter Party items which
Sellers are entitled to take ashore and other items excluded from the sale. Such
items shall be taken ashore by the Time Charterers at the expiry of the Time
Charter Party. Bunkers remaining on board after the time of delivery remain the
property of the Time Charterers.

23.           DOCUMENTATION

The Sellers shall provide the Buyers with draft copies of documentation no later
than ten days prior to the expected time of delivery of the Vessel.

                                                                           4(5)
--------------------------------------------------------------------------------

24.           CONDITION ON DELIVERY

Notwithstanding any provision of Clause 11, in the event the Vessel does not
comply with one or more of the requirements referred to on line 220-224 hereof,
the Sellers shall have the right to deliver the Vessel to the Buyers.

25.           REPRESENTATIONS AND WARRANTIES

None of the representations and warranties in this Agreement shall survive
following the delivery of the Vessel and the delivery documents referred to in
Clause 8.

The Sellers shall make best efforts to have any remaining warranty rights
against the shipyard and makers of equipment under the relevant Shipbuilding
Contracts assigned to the Buyers.

26.           NAME/MARKINGS

The Vessel's name and Funnel markings shall be maintained for the duration of
the Time Charter Party.

27.           GOVERNING LAW AND ARBITRATION

Any dispute arising under this Agreement shall be referred to arbitration in
London in accordance with the provisions of the Arbitration Act 1996, or any
statutory modification or re-enactment thereof for the time being in force save
to the extent necessary to give effect to the provisions of this Clause. The
arbitration shall be conducted in accordance with the London Maritime
Arbitration Association (LMAA) terms current at the time when the arbitration
proceedings are commenced.

                                                                           5(5)
--------------------------------------------------------------------------------

The reference shall be to three arbitrators; one to be appointed by each of the
parties hereto, and the third to be appointed by the two so chosen; their
decision or that of any two of them shall be final. A party wishing to refer a
dispute to arbitration shall appoint its arbitrator and send notice of such
appointment in writing to the other party requiring the other party to appoint
its own arbitrator within 14 calendar days of that notice and stating that it
will appoint its arbitrator as sole arbitrator unless the other party appoints
its own arbitrator and gives notice that it has done so within the 14 days
specified. If the other party does not appoint its own arbitrator and give
notice that it has done so within the 14 days specified the party referring a
dispute to arbitration may, without the requirement of any further prior notice
to the other party, appoint its arbitrator as sole arbitrator and shall advise
the other party accordingly. The award of a sole arbitrator shall be binding on
both parties as if he had been appointed by agreement.

Nothing herein shall prevent the parties agreeing in writing to vary these
provisions to provide for the appointment of a sole arbitrator.

In case where neither the claim nor any counterclaim exceeds the sum of
USD50,000 (or such other sum as the parties may agree) the arbitration shall be
conducted in accordance with the LMAA Small Claim Procedure current at the time
when the arbitration proceedings are commenced.

 COMPANION LTD.                     PANISLAND LTD.

/s/ Marcello Ausenda               /s/ David Astwood
-------------------------          ----------------------
    Marcello Ausenda                   David Astwood
    Director                           Director

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