TOPT Top Tankers Inc. (MM)

ATHENS, Greece, May 29 /PRNewswire-FirstCall/ -- TOP Tankers Inc (NASDAQ:TOPT), announced today that it has entered into an agreement to re-acquire four suezmax tankers that it sold in 2006 in a sale and lease-back transaction, and to terminate the respective operating leases. The four suezmax tankers are Limitless (DWT 136,055 built 1993), Endless (DWT 135,915 built 1992), Noiseless (DWT 149,554 built 1992) and Stainless (DWT 149,599 built 1992). The acquisition will be financed 70% by bank debt, already secured with a leading shipping lender, 10% by the early redemption of the seller's credit associated with the 2006 sales and lease back transactions and 20% by existing cash balances. The deal is expected to close early June 2007. In addition, the Company announced today that it has entered into an agreement to terminate its bare-boat charter for the Handymax tanker Invincible (DWT 47,084 built 1992), after sale of the vessel from its Lessors to a third party. The deferred gain from the original sale of approximately $2.4 million will be recognized in the second quarter of 2007. Subject to the accounting treatment relating to the acquisition cost, the Company expects the re-acquisition and the termination of the five bare-boat contracts to have an accretive effect on both its cash flow from operations and earnings per share. The accretion will result primarily from the following factors related to the re-acquisition of the vessels and removal of related lease payments associated with the five vessels: -- The expected decrease of approximately $22.5 million of lease payments for 2007 and approximately $38.5 million for 2008 and thereafter per year until the initial expiration of the leases in April 2013; -- The amortization of lease gain is expected to decrease by approximately $1.6 million for 2007 and by approximately $3.1 million for 2008 and thereafter per year until the initial expiration of the leases; -- The Company expects depreciation expense to increase by approximately $9.1 million for 2007 and by approximately $15.6 million for 2008 and thereafter per year until the initial expiration of the leases; -- The Company also expects interest expense to increase by approximately $5.3 million for 2007 and by approximately $7.1 million for 2008 and thereafter per year until the initial expiration of the leases. By re-acquiring the four Suezmaxes, the Company expects to improve the daily breakeven rates of its Suezmax fleet. The addition of the four vessels will increase the Company's owned fleet from five to nine vessels. About TOP Tankers Inc TOP Tankers Inc is an international provider of worldwide seaborne crude oil and petroleum products transportation services. The Company will operate a fleet of 22 tankers, consisting of 12 double-hull Suezmax tankers and 10 double-hull Handymax tankers, with a total carrying capacity of approximately 2.3 million dwt, of which 87% are sister ships. Fifteen of the Company's 22 tankers will be on time charter contracts with an average term of over three years with all but four of the time charters including profit sharing agreements. Forward Looking Statement Matters discussed in this release may constitute forward-looking statements. Forward-looking statements reflect our current views with respect to future events and financial performance and may include statements concerning plans, objectives, goals, strategies, future events or performance, and underlying assumptions and other statements, which are other than statements of historical facts. The forward-looking statements in this release are based upon various assumptions, many of which are based, in turn, upon further assumptions, including without limitation, management's examination of historical operating trends, data contained in our records and other data available from third parties. Although TOP Tankers 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, TOP Tankers cannot assure you that it will achieve or accomplish these expectations, beliefs or projections. Contact: Michael Mason (investors) Stamatis Tsantanis, CFO Allen & Caron Inc TOP Tankers Inc 212 691 8087 011 30 210 812 8199 DATASOURCE: TOP Tankers Inc CONTACT: Michael Mason, investors, of Allen & Caron Inc, +1-212-691-8087, , for TOP Tankers Inc; or Stamatis Tsantanis, CFO of TOP Tankers Inc, 011 30 210 812 8199, Web site: http://www.toptankers.com/

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