Arlington Tankers Enters Loan Agreement
Tuesday, December 13, 2005
Arlington Tankers
Ltd. (announced that it has entered into a $229.5
million loan agreement with The Royal Bank of Scotland plc. The loan
agreement provides for a five-year term loan facility. Arlington intends to
use the proceeds of the facility to refinance the Company's existing $135
million debt facility with a group of banks for which Fortis Bank (Nederland)
N.V. is acting as agent, as well as to fund the purchase price and transaction
costs for the Company's previously announced acquisition of two Product
tankers from the Stena Group. Arlington expects to complete the refinancing
of its existing debt in December 2005 and to complete the vessel acquisitions
in January 2006.
The term loan facility will mature on the fifth anniversary of the final
drawdown. In connection with the Loan Agreement, Arlington has entered into
an interest rate swap agreement with the Royal Bank of Scotland. As a result
of this swap, together with the benefits that Arlington expects to receive
from the termination of its existing swap with Fortis Bank, Arlington expects
that the interest rate under the new Loan Agreement will be effectively fixed
at approximately 5.38%.