SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 6-K

REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16 OF THE
SECURITIES EXCHANGE ACT OF 1934

Dated: September 15, 2010

Commission File No. 001-34104

NAVIOS MARITIME ACQUISITION CORPORATION

85 Akti Miaouli Street, Piraeus, Greece 185 38

(Address of Principal Executive Offices)

Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F:

Form 20-F þ Form 40-F o

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by
Regulation S-T Rule 101(b)(1):

Yes o No þ

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by
Regulation S-T Rule 101(b)(7):

Yes o No þ

Indicate by check mark whether the registrant by furnishing the information contained in this Form
is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under
the Securities Exchange Act of 1934.

Yes o No þ

If “Yes” is marked, indicate below the file number assigned to the registrant in connection with
Rule 12g3-2(b):

N/A

 

 

     This Report on Form 6-K is hereby incorporated by reference into the Navios Maritime Acquisition Corporation Registration Statement on Form F-3, File No. 333-151707.

Acquisition of VLCC Tanker Vessels

     On September 10, 2010, Navios Maritime Acquisition Corporation (referred to herein as “we”, “us” or “Navios Acquisition”) consummated its previously announced acquisition of a fleet of seven very large crude carrier (“VLCC”) tankers for an aggregate purchase price of $587.0 million, pursuant to a Securities Purchase Agreement, dated as of July 19, 2010, by and between Navios Acquisition and Vanship Holdings Limited (the “Seller”), by and between Navios Acquisition and Seller (as amended, the “Purchase Agreement”). The Purchase Agreement contemplated the purchase of the seven vessel owning subsidiaries (“Vessel Owning Subsidiaries”) that own each of the vessels.

     The $587.0 million consideration was financed as follows: (a) $411.0 million of bank debt, incurred at closing; (b) $113.8 million of cash paid at closing ($133.8 million cash payment net of $20.0 million working capital adjustments); (c) $11.0 million through the issuance of 1,894,918 Navios Acquisition shares of common stock at closing; and (d) $51.2 million due to shipyard in 2011 for the new build scheduled for delivery in June 2011 (of which $36.3 million will be drawn down from existing debt facilities entered into in connection with the acquisition).

     Of the 1,894,918 shares of our common stock issued at closing, 1,378,122 shares of common stock, having an aggregate value of approximately $8.0 million, were deposited into a one-year escrow to provide for indemnity or other claims under the Purchase Agreement, and the balance of 516,796 shares of common stock, having an aggregate value of approximately $3.0 million, were delivered to the Seller. The $411.0 million of debt consists of six credit facilities with a consortium of banks and has a weighted average margin of 2.94%. The cash portion of the consideration paid at closing was financed with: (i) $32.2 million cash from the balance sheet of the Vessel Owning Subsidiaries; (ii) $40.0 million in short term financing from Navios Maritime Holdings Inc. (“Navios Holdings”); and (iii) existing cash resources of Navios Acquisition. The $40.0 million facility with Navios Holdings has a margin of LIBOR plus 300 bps and a term of 18 months, maturing on April 1, 2012.

     The terms of the Purchase Agreement were previously disclosed in a Report on Form 6-K filed with the Securities and Exchange Commission (“SEC”) on July 26, 2010 (“Acquisition 6-K”), which is incorporated herein by reference.

     After giving effect to the acquisition of the VLCC tankers, Navios Acquisition’s consolidated fleet consists of the following:

Vessel

Type

DWT

Built/ Delivery Date

Net Charter Rate

Expiration Date

Profit Share

($ per day)

Owned Vessels

Colin Jacob

LR 1

74,671

2007

17,000

June 2013

50% above $17,000

Ariadne Jacob

LR 1

74,671

2007

17,000

July 2013

50% above $17,000

Shinyo Splendor

VLCC

306,474

1993

38,019

5/18/2014

None

Shinyo Navigator

VLCC

300,549

1996

42,705

12/18/2016

None

C. Dream

VLCC

298,570

2000

29,625

(1)

3/15/2019

50% above $30,000

40% above $40,000

Shinyo Ocean

VLCC

281,395

2001

38,400

1/10/2017

50% above $43,500

Shinyo Kannika

VLCC

281,474

2001

38,025

2/17/2017

50% above $44,000

Shinyo Saowalak

VLCC

298,000

2010

48,153

6/15/2025

35% above $54,388

40% above $59,388

50% above $69,388

Vessels to be delivered

Nave Cosmos

Chemical Tanker

25,000

Q4 2010

TBN

Chemical Tanker

25,000

Q4 2010

Shinyo Kieran

VLCC

298,000

Q2 2011

48,153

6/15/2026

35% above $54,388

40% above $59,388

50% above $69,388

TBN

LR 1

75,000

Q4 2011

TBN

LR 1

75,000

Q4 2011

Vessel

Type

DWT

Built/ Delivery Date

Net Charter Rate

Expiration Date

Profit Share

($ per day)

TBN

MR 2

50,000

Q1 2012

TBN

MR 2

50,000

Q2 2012

TBN

MR 2

50,000

Q3 2012

TBN

MR 2

50,000

Q3 2012

TBN

MR 2

50,000

Q4 2012

TBN

MR 2

50,000

Q4 2012

TBN

MR 2

50,000

Q4 2012

^{1. Vessel sub-chartered at $34,843/day over the next two years.}

     Navios Acquisition has previously filed the audited combined financial statement of the Vessel Owning Subsidiaries for the years ended December 31, 2009, 2008 and 2007 in the Acquisition 6-K and the unaudited combined financial statements for the three month periods ended March 31, 2010 and 2009 in a Report on Form 6-K filed with the SEC on August 6, 2010. This Report on Form 6-K contains the unaudited combined financial statements for the six month periods ended June 30, 2010 and 2009 of the Vessel Owning Subsidiaries. In addition, this Report contains the unaudited condensed combined pro forma financial statements of Navios Acquisition as of and for the six month period ended June 30, 2010 to give effect to the acquisition of the Vessel Owning Subsidiaries. Such financial statements may not be indicative of the future operations or post-closing financial position of such companies.

     With respect to the historical financial statements, the revenues of the Vessel Owning Subsidiaries for the first six month period ended June 30, 2010 was approximately $3.3 million higher than for the comparable 2009 period. However, net income for the first six months was down from approximately $14.3 million in 2009 to approximately $2.7 million in 2010. Based on information from the Seller, such decrease was due mainly to a loss of $4.9 million in 2010 compared to a gain of $10.7 million in 2009 on the mark-to-market value of certain interest rate swap agreements and a write-off of deferred loan costs of approximately $1.2 million, partially offset by lower interest expense. Such derivative financial instruments were extinguished in connection with the closing of the acquisition, and the Purchase Agreement required the Seller to take a number of other actions that will impact the post-closing financial statements including, but not limited to, extinguishing the shareholders loans, settlement of accrued tax liabilities, prepayment in full of the loan facility dated August 20, 2008 on the Shinyo Kieran and the related interest rate swap agreements. Accordingly, the unaudited condensed combined balance sheet, statements of income and cash flows contained herein may not be indicative of the continued operations of the Vessel Owning Subsidiaries following their acquisition.

     This Report contains forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward looking statements are based on Navios Acquisition’s current expectations and observations. Actual results may differ materially from those expressed or implied by such forward-looking statements. Factors that could cause actual results to differ materially include, but are not limited to changes in the demand for product and chemical tankers, fluctuation of charter rates, competitive factors in the market in which Navios Acquisition operates; risks associated with operations outside the United States; and other factors listed from time to time in the Navios Acquisition’s filings with the SEC.

INDEX TO UNAUDITED CONDENSED COMBINED FINANCIAL STATEMENTS

Unaudited Condensed Combined Financial Statements of the Vessel Owning Subsidiaries:
Unaudited Condensed Combined Balance Sheets as of December 31, 2009 and June 30, 2010		C-2
Unaudited Condensed Combined Statements of Income for the six month periods ended June 30, 2009 and 2010		C-3
Unaudited Condensed Combined Statements of Shareholder’s Equity for the six month periods ended June 30, 2009 and 2010		C-4
Unaudited Condensed Combined Statements of Cash Flows for the six month periods ended June 30, 2009 and 2010		C-5 - C-6
Notes to the Unaudited Condensed Combined Financial Statements		C-7 - C-23

Vessel Owning Subsidiaries

Unaudited Condensed Combined Balance Sheets

as of December 31, 2009 and June 30, 2010

(expressed in US$)

		Note				December 31, 2009				June 30, 2010
Assets
Current assets
Cash							18,217,569				13,619,655
Restricted cash							2,639,807				2,497,163
Trade accounts receivable							—				858,807
Prepayments and other receivables							2,104,359				1,861,504
Amounts due from related parties			9	(b)			883,654				1,112,422
Supplies							416,205				1,414,120
Total current assets							24,261,594				21,363,671
Restricted cash							6,500,000				14,500,000
Loan to a related party			9	(b)			8,882,533				8,882,533
Deferred loan costs							3,200,992				2,216,573
Vessels, net			4				359,334,424				490,727,007
Vessels under construction			5				174,901,072				89,543,922
Total assets							577,080,615				627,233,706
Liabilities
Current liabilities
Current portion of long-term bank loans			6				51,979,567				40,223,988
Amounts due to related parties			9	(b)			13,788,975				16,584,296
Accrued liabilities and other payables							10,358,065				8,257,729
Total current liabilities							76,126,607				65,066,013
Long-term bank loans			6				344,910,681				376,850,067
Loans from a related party			9	(b)			131,459,170				156,385,888
Derivative financial instruments			7				9,729,403				11,354,087
Total liabilities							562,225,861				609,656,055
Commitments and contingencies			10
Shareholder’s equity
Paid-in capital							15				15
Retained earnings							14,854,739				17,577,636
Total shareholder’s equity							14,854,754				17,577,651
Total liabilities and shareholder’s equity							577,080,615				627,233,706

See accompanying notes to the unaudited condensed combined financial statements.

Vessel Owning Subsidiaries

Unaudited Condensed Combined Statements of Income

for the six month periods ended June 30, 2009 and 2010

(expressed in US$)

		Note				2009				2010
Operating revenue
Revenue			8				31,825,564				35,173,743
Operating expense (a)
Vessel operating expenses							8,679,973				8,514,394
Depreciation expenses							10,938,752				11,465,923
Management fee			9	(a)			300,000				330,050
Commission							621,237				728,265
Administrative expenses							76,019				178,898
Total operating expense							20,615,981				21,217,530
Operating income							11,209,583				13,956,213
Other income/(expense) (a)
Interest income							207,624				153,558
Interest expense							(7,843,283	)			(5,100,899	)
Write off of deferred loan costs			6	(f)			—				(1,206,915	)
Changes in fair value of derivative financial instruments			7				10,777,913				(4,899,212	)
Others, net							(12,490	)			(179,848	)
Total other income/(expense)							3,129,764				(11,233,316	)
Income before income taxes							14,339,347				2,722,897
Income taxes							—				—
Net income							14,339,347				2,722,897

		2009				2010
Vessel operating expenses
Agency fee			600,000				600,000
Management fee			300,000				330,050
Interest income			184,912				126,046
Interest expense, net of amounts capitalized			1,537,400				1,579,552

See accompanying notes to the unaudited condensed combined financial statements.

Vessel Owning Subsidiaries

Unaudited Condensed Combined Statements of Shareholder’s Equity

for the six month periods ended June 30, 2009 and 2010

(expressed in US$)

										Total
		Paid-in				Retained				shareholder’s
		capital				earnings				equity
Balance as of January 1, 2009			15				(3,820,639	)			(3,820,624	)
Net income			—				14,339,347				14,339,347
Dividend paid			—				(4,000,000	)			(4,000,000	)
Balance as of June 30, 2009			15				6,518,708				6,518,723
Balance as of January 1, 2010			15				14,854,739				14,854,754
Net income			—				2,722,897				2,722,897
Balance as of June 30, 2010			15				17,577,636				17,577,651

See accompanying notes to the unaudited condensed combined financial statements.

Vessel Owning Subsidiaries

Unaudited Condensed Combined Statements of Cash Flows

for the six month periods ended June 30, 2009 and 2010

(expressed in US$)

		2009				2010
Cash flows from operating activities
Net income			14,339,347				2,722,897
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation expenses			10,938,752				11,465,923
Amortization of deferred loan costs			148,436				112,445
Amortization of loan premium			(36,993	)			(36,993	)
Expenditure relating to drydocking			(5,001,428	)			—
Amortization of deferred revenue			(1,232,948	)			—
Write off of deferred loan costs			—				1,206,915
Change in fair value of derivative financial instruments (net of cash
settlement payment of $3,274,528 in 2010)			(10,777,913	)			1,624,684
Changes in operating assets and liabilities:
Trade accounts receivable			869,424				(858,807	)
Prepayments and other receivables			(2,648,978	)			242,855
Amounts due from related parties			1,267,853				(228,768	)
Supplies			(81,988	)			(997,915	)
Accrued liabilities and other payables			3,411,514				(2,100,336	)
Amounts due to related parties			4,528,035				2,795,321
Net cash provided by operating activities			15,723,113				15,948,221
Cash flows from investing activities:
Capital expenditure on vessels under construction			(4,729,758	)			(57,501,356	)
Increase in restricted cash			(554,136	)			(7,857,356	)
Net cash used in investing activities			(5,283,894	)			(65,358,712	)
Cash flows from financing activities:
Proceeds from long-term bank loans			—				90,000,000
Repayment of long-term bank loans			(18,625,000	)			(69,779,200	)
Proceeds from loans from a related party			3,835,714				24,926,718
Dividend paid			(4,000,000	)			—
Payment of loan costs			(189,068	)			(334,941	)
Net cash (used in)/provided by financing activities			(18,987,354	)			44,812,577
Net decrease in cash			(8,539,135	)			(4,597,914	)
Cash:
At beginning of period			22,476,300				18,217,569
At end of period			13,937,165				13,619,655

Supplemental Disclosure of Cash Flow Information:

		2009				2010
Cash paid during the period for:
Interest, net of amounts capitalized			7,192,521				4,154,521

See accompanying notes to the unaudited condensed combined financial statements.

Vessel Owning Subsidiaries
Notes to the Unaudited Condensed Combined Financial Statements
for the six month periods ended June 30, 2009 and 2010
(expressed in US$)

(1) Description of Business

The combined Vessel Owning Subsidiaries (the “Company”) are entities under common control and include Shinyo Loyalty Limited, Shinyo Kannika Limited, Shinyo Navigator Limited, Shinyo Ocean Limited, Shinyo Dream Limited, Shinyo Saowalak Limited and Shinyo Kieran Limited, all of which were wholly-owned subsidiaries of Vanship Holdings Limited (the “Parent”) prior to the Parent’s disposal of these entities to Navios Maritime Acquisition Corporation (“NMAC”) on September 10, 2010. (see Note 14).

Details of the Vessel Owning Subsidiaries are set out below:

Company		Country of incorporation		Date of incorporation		Vessel name
Shinyo Loyalty Limited		Hong Kong		September 8, 2003		Shinyo Splendor
Shinyo Kannika Limited		Hong Kong		September 27, 2004		Shinyo Kannika
Shinyo Navigator Limited		Hong Kong		September 21, 2006		Shinyo Navigator
Shinyo Ocean Limited		Hong Kong		December 28, 2006		Shinyo Ocean
Shinyo Dream Limited		Hong Kong		July 20, 2007		C Dream
Shinyo Saowalak Limited		British Virgin Islands		April 3, 2008		Shinyo Saowalak
Shinyo Kieran Limited		British Virgin Islands		April 3, 2008		Shinyo Kieran (1)

The Company engages in the business of ocean transportation of crude oil worldwide. The principal activity of the Company is the ownership and chartering of double-hulled very large crude oil carriers with capacity over 281,000 deadweight tonnage each.

The Company has outsourced substantially all its day-to-day operations to its related party, Belindtha Marine Limited (“Belindtha”), a company controlled by a shareholder of the Parent. Belindtha then sub-contracted its obligations under the outsourcing arrangement to Univan Ship Management Limited (“Univan”) which assists in providing technical management services to the Company. Univan is controlled by a director of the Vessel Owning Subsidiaries. All expenses incurred by Univan on behalf of the Company are charged to the Company based on the actual expenditures incurred on its behalf.

Vessel Owning Subsidiaries
Notes to the Unaudited Condensed Combined Financial Statements (Continued)
for the six month periods ended June 30, 2009 and 2010
(expressed in US$)

     The Company received time charter revenue pursuant to time charter agreements with charterers and details are set out below:

Company		Charterer		Daily charter rate				Period
Shinyo Loyalty Limited		Blue Light Chartering Inc.		$	39,500			May 18, 2007 to May 17, 2014
Shinyo Kannika Limited		Dalian Ocean Shipping Company		$	39,000			February 17, 2007 to February 16, 2017
Shinyo Navigator Limited		Dalian Ocean Shipping Company		$	43,800			December 18, 2006 to December 17, 2016
Shinyo Ocean Limited		Formosa Petrochemical Corporation		$	38,500			January 10, 2007 to January 9, 2017
Shinyo Dream Limited		Sanko Steamship Co., Ltd		$	28,900			September 7, 2007 to April 19, 2009
		SK Shipping Company Limited		$	30,000			April 19, 2009 to April 18, 2019
Shinyo Saowalak Limited		Dalian Ocean Shipping Company		$	49,388			June 20, 2010 to June 19, 2025
Shinyo Kieran Limited		Dalian Ocean Shipping Company		$	49,388			15 years from date of delivery of the vessel

(2) Principles of Combination and Basis of Presentation

The accompanying unaudited condensed combined financial statements as of June 30, 2010 and for the six-month periods ended June 30, 2009 and 2010 include the assets, liabilities, revenues, and expenses of the Vessel Owning Subsidiaries for the periods presented. All intercompany transactions and balances among the combined entities have been eliminated. The Vessel Owning Subsidiaries have been under the common control of the Parent since the respective dates of incorporation of these entities. As further described in Note 14, on September 10, 2010, NMAC consummated the acquisition of all of the equity interests in the Vessel Owning Subsidiaries. The accompanying unaudited condensed combined financial statements include the accounts of the seven entities as set out in Note 1 and do not reflect any adjustments to the Company’s assets and liabilities that might subsequently be necessary as a result of the acquisition.

In the opinion of the management, all adjustments (which include normal accruals) necessary to present a fair statement of the financial position of the Company as of June 30, 2010, and the results of its operations and cash flows for the six-month periods ended June 30, 2009 and 2010, in conformity with U.S. generally accepted accounting principles (“US GAAP”), have been made. The unaudited condensed combined statements of income for the six month periods ended June 30, 2009 and 2010 are not necessarily indicative of the operating results to be expected for the full fiscal year or any future periods. The accompanying unaudited condensed combined financial statements should be read in conjunction with the combined financial statements and related notes as of and for the year ended December 31, 2009.

Certain financial information that is normally included in annual financial statements prepared in accordance with US GAAP, but is not required for interim reporting purposes, has been condensed or omitted.

The basis of accounting differs in certain material respects from that used in the preparation of the books of account of the Company, which are prepared in accordance with the accounting principles of the country of their domicile. The accompanying unaudited condensed combined financial statements reflect necessary adjustments to present them in conformity with US GAAP.

(3) Summary of Significant Accounting Policies

(a) Liquidity

As of June 30, 2010, the Company had a working capital deficit of $43,702,342. These financial statements have been prepared assuming that each of the Vessel Owning Subsidiaries will continue as a going concern. The Parent had confirmed its intention to provide continuing and unlimited financial support to each of the Vessel Owning Subsidiaries, so long as these entities were owned by and under the control of the Parent, to meet its financial obligations as and when they become due. Upon the consummation of the acquisition of the Vessel Owning Subsidiaries on September 10, 2010, NMAC has confirmed its intention to provide such financial support to the Vessel Owning Subsidiaries.

Vessel Owning Subsidiaries
Notes to the Unaudited Condensed Combined Financial Statements (Continued)
for the six month periods ended June 30, 2009 and 2010
(expressed in US$)

(3) Summary of Significant Accounting Policies (continued)

(b) Use of Estimates

The preparation of the financial statements requires management of the Company to make a number of estimates and assumptions relating to the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of financial statements and the reported amounts of revenues and expenses during the reporting period. Significant items subject to such estimates and assumptions include the estimated useful lives of the vessels (including drydocking costs), residual values and recovery of the carrying amounts of the vessels. Actual results could differ from those estimates.

(c) Contingencies

In the normal course of business, the Company is subject to loss contingencies, such as legal proceedings and claims arising out of its business. An accrual for a loss contingency is recognized when it is probable that a liability has been incurred and the amount of the loss can be reasonably estimated.

(d) Income and Other Taxes

Under the laws of the countries of incorporation of the Vessel Owning Subsidiaries and/or the registration of their vessels, the Company is not subject to tax on international shipping income. However, it is subject to registration and tonnage taxes, which are charged by the country where the vessel is registered at a fixed rate based on the tonnage of the vessel. Registration and tonnage taxes have been included in vessel operating expenses in the accompanying statements of income.

The Company follows the provisions on accounting for uncertainty in income taxes prescribed by ASC 740, Income Taxes. This standard prescribes a threshold of more-likely-than-not for recognition of tax benefits of uncertain tax positions taken or expected to be taken in a tax return. For the periods ended June 30, 2009 and 2010, the Company has no unrecognized tax benefit which would favorably affect the effective income tax rate in future periods and does not believe there will be any significant increases or decreases within the next twelve months. The Company has elected to classify interest and penalties related to unrecognized tax benefits, if and when required, as part of income tax expenses in the statements of income.

(4) Vessels, net

		December 31,				June 30,
		2009				2010
Vessels
Cost			439,426,618				582,285,124
Accumulated depreciation			(80,092,194	)			(91,558,117	)
Vessels, net			359,334,424				490,727,007

The vessels are mortgaged as described in Note 6.

Drydocking costs of $5,001,428 and $nil were capitalized during the six month periods ended June 30, 2009 and 2010, respectively. As of December 31, 2009 and June 30, 2010, the undepreciated carrying amount of the drydocking costs was $5,523,401 and $4,778,839, respectively.

For the six month periods ended June 30, 2009 and 2010, $400,061 and $744,562 of drydocking costs were expensed as depreciation, respectively.

The Company has agreed to a mutual sale provision with the charterer of Shinyo Ocean whereby either party can request the sale of the vessel provided that a price can be obtained that is at least $3,000,000 greater than the agreed depreciated value of the vessel as set forth in the charter agreement.

Vessel Owning Subsidiaries
Notes to the Unaudited Condensed Combined Financial Statements (Continued)
for the six month periods ended June 30, 2009 and 2010
(expressed in US$)

(5) Vessels Under Construction

		June 30, 2009				June 30, 2010
At beginning of the period			165,421,969				174,901,072
Additions for the period			—				53,679,200
Capitalization of interest and financing costs during the period			4,729,758				3,822,156
Transfer to vessels, net			—				(142,858,506	)
At end of the period			170,151,727				89,543,922

On April 7, 2008, the Company entered into two shipbuilding contracts with a constructor to build Shinyo Saowalak and Shinyo Kieran at a contract price of $134,198,000 and $134,198,000, respectively. Progress payments are scheduled based on the estimated stage of completion of the construction. The Company does not become obligated, nor does it obtain ownership before scheduled milestones are met. Shinyo Saowalak was delivered on June 17, 2010 and Shinyo Kieran is under construction and scheduled to be delivered on June 30, 2011.

(6) Long-term Bank Loans

Lender/period						December 31,				June 30,
		Note				2009				2010
HSH Nordbank AG
- December 13, 2006 to December 12, 2016 (1)			a				60,375,000				56,125,000
DVB Group Merchant Bank (Asia) Ltd, BNP Paribas, Credit Suisse and Deutsche Schiffsbank AG
- September 7, 2007 to September 6, 2017			b				57,400,000				55,600,000
DVB Group Merchant Bank (Asia) Ltd, Credit Suisse and Deutsche Schiffsbank AG
- January 8, 2007 to January 7, 2017			c				63,782,000				60,482,000
- January 8, 2007 to November 15, 2016			d				63,434,000				60,334,000
- May 21, 2007 to May 20, 2014			e				44,540,848				40,853,855
BNP Paribas, The Bank of Nova Scotia Asia Limited, Deutsche Schiffsbank AG, DVB Group Merchant Bank (Asia) Ltd and Scotiabank (Hong Kong) Limited
- August 20, 2008 to September 30, 2020 (1)			f				53,679,200				—
China Merchant Bank Co., Ltd
- March 26, 2010 to June 21, 2020			g				—				90,000,000
BNP Paribas, The Bank of Nova Scotia Asia Limited, Deutsche Schiffsbank AG, DVB Group Merchant Bank (Asia) Ltd and Scotiabank (Hong Kong) Limited
- August 20, 2008 to September 30, 2021 (1)			h				53,679,200				53,679,200
							396,890,248				417,074,055
Representing:
Current portion							51,979,567				40,223,988
Non-current portion							344,910,681				376,850,067
							396,890,248				417,074,055

(1)

The Company has entered into interest rate swap arrangements to mitigate the interest rate risk related to these bank loans (see Note 7).

Vessel Owning Subsidiaries
Notes to the Unaudited Condensed Combined Financial Statements (Continued)
for the six month periods ended June 30, 2009 and 2010
(expressed in US$)

	(a)		On December 13, 2006, a loan of $82,875,000 was obtained from HSH Nordbank AG. The loan is secured by Shinyo Navigator and is repayable by forty quarterly installments. Interest is charged at LIBOR plus 1.00% per annum. The Company has entered into an interest rate swap arrangement to mitigate the interest rate risk related to this bank loan (see Note 7). The annual interest rate, after taking into account of the interest rate swap, as of December 31, 2009 and June 30, 2010 was 5.95% and 5.95%, respectively.
	(b)		On September 7, 2007, a syndicated loan of $65,000,000 was obtained from DVB Group Merchant Bank (Asia) Ltd, BNP Paribas, Credit Suisse and Deutsche Schiffsbank AG. The loan is secured by C Dream and is repayable by thirty-nine quarterly installments and a balloon payment to be paid together with the thirty-ninth installment. Interest is charged at LIBOR plus 0.95% per annum (effective interest rates of 1.35% and 1.69% as of December 31, 2009 and June 30, 2010, respectively).
	(c)		On January 8, 2007, a syndicated loan of $86,800,000 was obtained from DVB Group Merchant Bank (Asia) Ltd, Credit Suisse and Deutsche Schiffsbank AG. The loan is secured by Shinyo Ocean and is repayable by forty quarterly installments and a balloon payment to be paid together with the fortieth installment. Interest is charged at LIBOR plus 0.98% per annum (effective interest rates of 1.48% and 1.47% as of December 31, 2009 and June 30, 2010, respectively).
	(d)		On January 8, 2007, a bank loan obtained in previous years was repaid with a portion of the proceeds of a new bank loan in the amount of $86,800,000 obtained from DVB Group Merchant Bank (Asia) Ltd, Credit Suisse and Deutsche Schiffsbank AG. The loan is secured by Shinyo Kannika and is repayable by forty quarterly installments and a balloon payment to be paid together with the fortieth installment. The loan carries interest at LIBOR plus 0.98% per annum (effective interest rates of 1.43% and 1.63% as of December 31, 2009 and June 30, 2010, respectively).
	(e)		On May 21, 2007, a bank loan obtained in previous years was repaid with a portion of the proceeds of a new bank loan in the amount of $62,000,000 obtained from DVB Group Merchant Bank (Asia) Ltd, Credit Suisse and Deutsche Schiffsbank AG. In connection with the refinancing of the bank loan, a cash rebate of $383,333 was received by the Company. The cash rebate is accounted for as a loan premium and is amortized to interest expenses over the period of the bank loan using effective interest method. As of December 31, 2009 and June 30, 2010, unamortized loan premium was $190,848 and $153,855, respectively.
			The loan is secured by Shinyo Splendor and is repayable by twenty-eight quarterly installments. Of the total bank loan amount of $62,000,000, $50,000,000 and $12,000,000 carries interest at LIBOR plus 0.8% per annum and LIBOR plus 1.62% per annum, respectively (weighted average interest rate as of December 31, 2009 and June 30, 2010 was 1.37% and 1.63%, respectively).
	(f)		On August 20, 2008, a loan facility of $107,400,000 was obtained from BNP Paribas, The Bank of Nova Scotia Asia Limited, Deutsche Schiffsbank AG, DVB Group Merchant Bank (Asia) Ltd and Scotiabank (Hong Kong) Limited to finance the construction of Shinyo Saowalak. The draw-down balance of the loan facility as of December 31, 2009 was $53,679,200. The loan was early repaid in full on March 31, 2010. The carrying amount of unamortized deferred loan cost of $1,206,915 was written-off during the period ended June 30, 2010.
			The loan was secured by Shinyo Saowalak and is repayable by forty quarterly installments together with a balloon payment in the fortieth installment and the first repayment installment shall be made on the date falling three months after the actual delivery date of the vessel under construction. Interest was charged at LIBOR plus 1.80% per annum (3.91% as of December 31, 2009).

Vessel Owning Subsidiaries

Notes to the Unaudited Condensed Combined Financial Statements (Continued)
for the six month periods ended June 30, 2009 and 2010
(expressed in US$)

(6) Long-term Bank Loans (continued)

(f)

(continued)

The Company has entered into interest rate swap arrangements to mitigate the interest rate risk related to this bank loan (see Note 7). The annual interest rate, after taking into account of the interest rate swaps as of December 31, 2009 was 5.96%. The interest rate swap agreements were terminated on March 29, 2010 and March 31, 2010.

(g)

On March 26, 2010, a loan facility of $90,000,000 was obtained from China Merchant Bank Co., Ltd to finance the construction of Shinyo Saowalak. The Company repaid the loan from BNP Paribas, The Bank of Nova Scotia Asia Limited, Deutsche Schiffsbank AG, DVB Group Merchant Bank (Asia) Ltd and Scotiabank (Hong Kong) Limited (Note 6(f)) with a portion of the proceeds of this bank loan. The draw-down balance of the loan facility as of June 30, 2010 was $90,000,000.

The loan is secured by Shinyo Saowalak and is repayable by forty quarterly installments and the first repayment installment shall be made on September 21, 2010. Interest is charged at LIBOR plus 2.00% per annum (effective interest rate of 2.54% as of June 30, 2010).

(h)

On August 20, 2008, a loan facility of $107,400,000 was obtained from BNP Paribas, The Bank of Nova Scotia Asia Limited, Deutsche Schiffsbank AG, DVB Group Merchant Bank (Asia) Ltd and Scotiabank (Hong Kong) Limited to finance the construction of Shinyo Kieran. The balance of the loan facility as of December 31, 2009 and June 30, 2010 was $53,679,200 and $53,679,200, respectively.

The loan is secured by Shinyo Kieran, a vessel under construction and is repayable by forty quarterly installments together with a balloon payment in the fortieth installment and the first repayment installment shall be made on the date falling 3 months after the actual delivery date of Shinyo Kieran. Interest is charged at LIBOR plus 1.80% per annum (3.94% and 3.66% as of December 31, 2009 and June 30, 2010, respectively).

The Company entered into interest rate swap arrangements to mitigate the interest rate risk related to this bank loan (see Note 7). The annual interest rate, after taking into account for the interest rate swaps, as of December 31, 2009 and June 30, 2010 was 5.99% and 5.99%, respectively.

     As of December 31, 2009 and June 30, 2010, bank loans were secured as follows:

		December 31,				June 30,
		2009				2010
Secured by:
Restricted cash			9,139,807				16,997,163
Vessels			359,334,424				490,727,007
Vessels under construction			174,901,072				89,543,922
			543,375,303				597,268,092

     All of the bank loans are also guaranteed by the Parent as of December 31, 2009 and June 30, 2010.

Vessel Owning Subsidiaries
Notes to the Unaudited Condensed Combined Financial Statements (Continued)
for the six month periods ended June 30, 2009 and 2010
(expressed in US$)

(6) Long-term Bank Loans (continued)

The Company’s bank facilities are subject to the fulfillment of covenants which require the fair value of the Company’s vessels to exceed a certain percentage of the outstanding loan balance. Should there be any shortfall, the banks have the right to require the Company to either prepay to the banks a portion of the outstanding loan balance which amounts to such shortfall or to provide additional security in the form of restricted cash deposits which amount to the shortfall.

As of December 31, 2009, the Company had breached the covenant of a bank loan amounting to $60,375,000, which required the fair value of Shinyo Navigator to be higher than 110% of the outstanding loan balance. The shortfall of $18,662,550 as of December 31, 2009 has to be prepaid by the Company or secured by additional restricted cash upon the request from the bank. The shortfall of $18,662,550 as of December 31, 2009 was classified as current liabilities in the combined balance sheet as the Company did not have an unconditional right at the balance sheet date to defer settlement for at least the next twelve months as a result of the breach of that covenant.

In March 2010, the Company deposited $8,000,000 with the bank as additional security for the loan to obtain a waiver from compliance with the covenant through March 31, 2010. In July 2010, the Company obtained a waiver from compliance with the covenant up to the next scheduled covenant measurement date on December 31, 2010. As the Company has obtained a waiver for complying with the covenant prior to the issue of the unaudited condensed combined financial statements for the six months ended June 30, 2010, the breach of the covenant as of the balance sheet date has not resulted in the classification as current liabilities of amount payable in over 12 months from the balance sheet date under the terms of the bank facilities.

(7) Interest Rate Swap Arrangements

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 Company monitors its positions, the credit ratings of counterparties and the level of contracts it enters into with any one party. The Company has a policy of entering into contracts with counterparties that meet stringent qualifications.

Vessel Owning Subsidiaries
Notes to the Unaudited Condensed Combined Financial Statements (Continued)
for the six month periods ended June 30, 2009 and 2010
(expressed in US$)

(7) Interest Rate Swap Arrangements (continued)

As of December 31, 2009 and June 30, 2010, the Company had outstanding interest rate swap arrangements with financial institutions as follows:

																Fair value of swap
																(assets/(liabilities))
Counterparty		Start date		Maturity date		Notional				Pay fixed rate				Receive floating rate		December 31,				June 30,
						Amount				per annum				per annum		2009				2010
HSH Nordbank AG		January 10, 2007		December 13, 2016			82,875,000				4.95	%		3-month LIBOR			(4,952,189	)			(5,805,075	)
BNP Paribas		September 18, 2008		December 30, 2018 (Terminated on March 29, 2010)			20,129,700				4.16	%		3-month LIBOR			(872,367	)			—
The Bank of Nova Scotia		September 18, 2008		September 28, 2018 (Terminated on March 31, 2010)			20,129,700				4.16	%		3-month LIBOR			(876,254	)			—
DVB Bank S.E.		September 22, 2008		September 28, 2018 (Terminated on March 29, 2010)			13,419,800				4.16	%		3-month LIBOR			(599,909	)			—
BNP Paribas		September 18, 2008		December 30, 2018			20,129,700				4.19	%		3-month LIBOR			(900,670	)			(2,090,080	)
The Bank of Nova Scotia		September 18, 2008		September 28, 2018			20,129,700				4.19	%		3-month LIBOR			(905,109	)			(2,081,929	)
DVB Bank S.E.		September 18, 2008		September 28, 2018			13,419,800				4.19	%		3-month LIBOR			(622,905	)			(1,377,003	)
														Total			(9,729,403	)			(11,354,087	)

Vessel Owning Subsidiaries
Notes to the Unaudited Condensed Combined Financial Statements (Continued)
for the six month periods ended June 30, 2009 and 2010
(expressed in US$)

(7) Interest Rate Swap Arrangements (continued)

The interest rate swaps are used to manage the interest rate risks arising from the Company’s long-term bank loans detailed in Note 6. The fair value changes of $10,777,913 (gain) and $4,899,212 (loss) from the interest rate swap arrangements during the periods ended June 30, 2009 and 2010, respectively, are recognized in the statements of income and the related liabilities are shown under derivative financial instruments in the balance sheets. The fair values of the interest rate swaps are determined using pricing models developed based on the LIBOR swap rate and other observable market data.

The interest rate swap agreements with BNP Paribas, The Bank of Nova Scotia and DVB Bank S.E. in respect of the loan facility for the financing of Shinyo Saowalak as further described in note 6(f) were terminated on March 29, 2010, March 31, 2010 and March 29, 2010, respectively, in connection with the early repayments of the loan. In connection with the termination of the interest rate swap agreements, the Company paid $3,274,528 to the counterparties which represented the fair value of the interest rate swap agreements upon termination.

(8) Revenue

The Company generates its revenue from time charter agreements. The Company’s revenue during the periods ended June 30, 2009 and 2010 can be analyzed as follows:

		2009				2010
Time charter			31,825,564				34,064,003
Profit-sharing arising from time charter			—				1,109,740
			31,825,564				35,173,743

(9) Related Party Transactions

Name of party		Relationship
Vanship Holdings Limited (“Vanship”)		The Parent of the Vessel Owning Subsidiaries
Belindtha Marine Limited (“Belindtha”)		A company controlled by a shareholder of Vanship
China Sea Maritime Ltd. (“China Sea”)		A company controlled by a director of the Vessel Owning Subsidiaries
Shinyo Maritime Corporation (“Shinyo Maritime”)		A company controlled by a director of the Vessel Owning Subsidiaries
Univan Ship Management Limited (“Univan”)		A company controlled by a director of the Vessel Owning Subsidiaries

Vessel Owning Subsidiaries
Notes to the Unaudited Condensed Combined Financial Statements (Continued)
for the six month periods ended June 30, 2009 and 2010
(expressed in US$)

(9) Related Party Transactions (continued)

(a)

The principal related party transactions during the periods ended June 30, 2009 and 2010 were as follows:

		Note		2009				2010
Management fee to Belindtha		(i)			300,000				330,050
Agency fee to China Sea		(ii)			300,000				300,000
Agency fee to Shinyo Maritime		(ii)			300,000				300,000
Loan interest income from the Parent		(iii)			184,912				126,046
Loan interest expense to the Parent		(iv)			2,820,396				2,647,689

Notes:

(i)

The Company has outsourced substantially all its day-to-day operations to Belindtha. The service fee is payable to Belindtha at a pre-determined amount in accordance with the terms mutually agreed by Belindtha and the Company.

(ii)

China Sea and Shinyo Maritime have provided agency services to the Company. The agency fee is payable to China Sea and Shinyo Maritime based on contractual agreements with the Company.

(iii)

The balance represents interest income on a loan to the Parent by the Company. Terms of the loans are set out in Note 9(b)(v) below.

(iv)

The balance represents interest expense on loans from the Parent. Terms of the loans are set out in Note 9(b)(vi) below.

(b)

Amounts due from and due to related parties as of December 31, 2009 and June 30, 2010 were as follows:

				December 31,				June 30,
		Note		2009				2010
Amounts due from related parties:
Amount due from Univan		(i)			248,049				986,377
Amount due from the Parent		(ii)			635,605				126,045
					883,654				1,112,422
Amounts due to related parties:
Amount due to Univan		(iii)			4,997,850				5,781,087
Amount due to the Parent		(iv)			8,791,125				10,803,209
					13,788,975				16,584,296
Loan to a related party:
The Parent		(v)			8,882,533				8,882,533
Loans from a related party:
The Parent		(vi)			131,459,170				156,385,888

Vessel Owning Subsidiaries
Notes to the Unaudited Condensed Combined Financial Statements (Continued)
for the six month periods ended June 30, 2009 and 2010
(expressed in US$)

(9) Related Party Transactions (continued)

(b)

Amounts due from and due to related parties as of December 31, 2009 and June 30, 2010 were as follows (continued):

Notes:

(i)

The balance represents advance payments for expenses to be paid by Univan on behalf of the Company. The balance is unsecured, non-interest bearing and with no fixed terms of repayment.

(ii)

The balance represents interest receivable from the Parent on a loan set out in (v) below.

(iii)

The balance represents payable to Univan for expenses paid on behalf of the Company. The balance is unsecured, non-interest bearing and with no fixed terms of repayment.

(iv)

The balance represents interest payable on loans from the Parent. Terms of the loans are set out in (vi) below.

(v)

The balance represents a loan to the Parent, which carries interest at LIBOR plus 1.35% per annum with final maturity on October 1, 2019.

(vi)

The balance represents various loans from the Parent. The loans carry interest at rates ranging from six-month LIBOR plus 2.39% to 3.98% per annum (weighted average effective interest rate of 4.36% and 3.45% as of December 31, 2009 and June 30, 2010, respectively) or at fixed rates ranging from 5% to 6.5% per annum with maturities between January 13, 2012 and June 30, 2022.

The interest expense for the periods ended June 30, 2009 and 2010, including amounts capitalized, was $2,820,396 and $2,647,689, respectively. During the periods ended June 30, 2009 and 2010, interest expenses of $1,282,996 and $1,068,137 were capitalized as part of the costs of vessels under construction, respectively.

Interest expense of $nil and $635,605 was paid during the periods ended June 30, 2009 and 2010, respectively.

(c)

The Parent provided a letter of support to each of the combined entities of the Company to confirm its intention to provide continuing and unlimited financial support to the Vessel Owing Subsidiaries so as to enable each of the Vessel Owning Subsidiaries to meet its liabilities when they become due, so long as these entities were owned by and under the control of the Parent. Upon the consummation of the acquisition of the Vessel Owning Subsidiaries by NMAC on September 10, 2010, NMAC provided a letter of support for each of the combined entities of the Company to confirm its intention to provide such financial support.

(d)

As of December 31, 2009 and June 30, 2010, all of the long-term bank loans as set out in Note 6 were guaranteed by the Parent.

(10) Commitments and Contingencies

(a)

Capital commitments

Capital commitments for the vessels under construction as of December 31, 2009 and June 30, 2010 were $107,358,400 and $53,679,200, respectively.

(b)

Contingencies

Various claims, suits, and complaints, including those involving government regulations and product liability, arise in the ordinary course of the shipping business. In addition, losses may arise from disputes with charterers, agents, insurance and other claims with suppliers relating to the operations of the Company’s vessels. Currently, management is not aware of any such claims or contingent liabilities, which should be disclosed, or for which a provision should be established in the accompanying financial statements.

(11) Fair Value Measurement

(a)

Fair value of financial instruments

The carrying amount of cash and amounts due from/to related parties approximates their fair values because of the short maturity of these instruments.

Vessel Owning Subsidiaries
Notes to the Unaudited Condensed Combined Financial Statements (Continued)
for the six month periods ended June 30, 2009 and 2010
(expressed in US$)

The carrying value of long-term bank loans and loans from a related party approximates their fair values based on the borrowing rates currently available to the Company for bank loans with similar terms and average maturities.

(b)

Fair value hierarchy

The following table presents assets and liabilities that were measured at fair value on a recurring basis (including items that are required to be measured at fair value) as of December 31, 2009 and June 30, 2010:

Fair value measurements at

reporting date using

Quoted price

in active

Significant

market for

other

Significant

identical

observable

unobservable

Carrying

assets

inputs

inputs

amount

(Level 1)

(Level 2)

(Level 3)

At December 31, 2009

Interest rate swaps

9,729,403

—

9,729,403

—

At June 30, 2010

Interest rate swaps

11,354,087

—

11,354,087

—

(12)

Business and Credit Concentrations

The Company operates in the shipping industry which historically has been cyclical with corresponding volatility in profitability. The Company seeks to mitigate volatilities in its business by obtaining long-term charter contracts. The Company has obtained long-term time charter contracts which will expire in four to sixteen years from June 30, 2010.

The Company outsourced the technical management services to Belindtha which is controlled by a person related to a director of the Vessel-Owning Subsidiaries. Belindtha then sub-contracted its obligations under the outsourcing arrangement to Univan which assists Belindtha in providing technical management services to the Company. Univan is controlled by a director of the Vessel-Owning Subsidiaries. All expenses incurred by Univan on behalf of the Company are charged to the Company based on the actual expenditures incurred on its behalf. During the periods ended June 30, 2009 and 2010, the Company paid service fee of $300,000 and $330,050, respectively, to Belindtha. Any failure in providing the services by Univan to the Company may adversely affect the Company’s results and operations.

The Company is engaged in the business of ocean transportation of crude oil industry which is extremely competitive and dependent on the world’s demand for crude oil. Competition depends on price, location, size, age, condition and the acceptability of the vessels to the charterers. Any increase in competition and changes in demand for crude oil could result in lower revenue achieved for the vessels.

The following sets out revenues from each individual customer that comprised 10% or more of gross combined revenue (before deferred revenue adjustment) during the periods ended June 30, 2009 and 2010:

		2009								2010
							%								%
Formosa Petrochemical Corporation			6,968,500				23				7,947,614				23
Dalian Ocean Shipping Company			13,960,190				46				15,297,167				43
Blue Light Chartering Inc.			4,353,560				14				7,149,500				20
SK Shipping Company Limited			—				—				4,779,462				14
Sanko Steamship Co., Ltd			5,310,366				17				—				—

Vessel Owning Subsidiaries
Notes to the Unaudited Condensed Combined Financial Statements (Continued)
for the six month periods ended June 30, 2009 and 2010
(expressed in US$)

(12)

Business and Credit Concentrations (continued)

The gross accounts receivable due from each individual customer that represents more than 10% of the outstanding combined accounts receivable was as follows:

		December 31, 2009								June 30, 2010
						%								%
Formosa Petrochemical Corporation			—				—				234,175				27
Dalian Ocean Shipping Company			—				—				494,006				58
SK Shipping Company Limited			—				—				130,626				15

(13)

Combining Entities

As of June 30, 2010, the Company had six vessels with substantive operating activities which represented each of the seven Vessel Owning Subsidiaries except for one entity with a vessel that was under construction. The operating vessels are chartered to different charterers and are managed separately. The Company’s senior management reviews internal management reports for each of the Vessel Owning Subsidiaries on a monthly basis.

(a)

Results and assets of operating vessels

The Company’s senior management monitors the results and assets attributable to each operating vessel on the following bases:

•

Vessel assets include all assets of the entity including tangible assets and current assets.

•

Vessel revenues represent revenue generated from time charter agreements by each operating vessel.

•

Vessel results represent income or loss before income taxes.

Vessel Owning Subsidiaries
Notes to the Unaudited Condensed Combined Financial Statements (Continued)
for the six month periods ended June 30, 2009 and 2010
(expressed in US$)

(13) Combining Entities (continued)

(a)

Results and assets of operating vessels (continued)

		Shinyo				Shinyo				Shinyo				Shinyo				Shinyo				Shinyo
		Loyalty				Kannika				Navigator				Ocean				Dream				Saowalak
		Limited				Limited				Limited				Limited				Limited				Limited				Total
Period ended June 30, 2009
Revenue from external customers			4,353,560				6,032,390				7,927,800				6,968,500				6,543,314				—				31,825,564
Vessel (loss)/income			(251,215	)			761,519				3,068,690				1,044,996				1,431,214				—				6,055,204
Interest income			13,426				475,163				286				—				—				—				488,875
Interest expense			605,577				1,274,970				2,665,741				1,832,918				1,745,362				—				8,124,568
Depreciation			1,839,868				1,974,619				2,875,743				2,508,679				1,739,843				—				10,938,752
Period ended June 30, 2010
Revenue from external customers			7,149,500				7,022,438				7,774,470				7,947,614				4,779,462				500,259				35,173,743
Vessel income/(loss)			2,673,263				2,755,971				(598,694	)			3,298,788				173,105				(2,457,658	)			5,844,775
Interest income			1,523				311,486				22,877				757				866				214				337,723
Interest expense			367,260				725,027				2,673,141				644,343				734,419				140,894				5,285,084
Depreciation			2,184,928				1,974,619				2,875,743				2,508,679				1,739,284				182,670				11,465,923

(b)

Reconciliation of total income attributable to operating vessels to combined income before income taxes

		2009				2010
Total income attributable to operating vessels			6,055,204				5,844,775
Expenses for entities which have not yet commenced operations
- changes in fair value of derivative financial instruments			8,287,433				(3,120,328	)
- other expenses			(3,290	)			(1,550	)
Combined income before income taxes			14,339,347				2,722,897

(c)

Reconciliation of total interest income to combined total interest income

		2009				2010
Total interest income			488,875				337,723
Interest income for entities which have not yet commenced operations			34				20
Elimination of inter-company interest income			(281,285	)			(184,185	)
Combined total interest income			207,624				153,558

Vessel Owning Subsidiaries
Notes to the Unaudited Condensed Combined Financial Statements (Continued)
for the six month periods ended June 30, 2009 and 2010
(expressed in US$)

(d)

Reconciliation of total interest expense to combined total interest expense

		2009				2010
Total interest expense			8,124,568				5,285,084
Elimination of inter-company interest expense			(281,285	)			(184,185	)
Combined total interest expense			7,843,283				5,100,899

Pursuant to a definitive agreement dated July 19, 2010 entered into between Vanship and NMAC, a company listed on the New York Stock Exchange, Vanship agreed to sell all its of equity interests in the Vessel Owning Subsidiaries to NMAC for an aggregate consideration of $587,000,000, consisting of $576,000,000 in cash (subject to closing adjustments) and $11,000,000 in shares of common stock of NMAC (based on the closing trading price averaged over the 15 trading days immediately prior to closing, that resulted in the issuance at closing of 1,894,918 shares of common stock). The acquisition was consummated on September 10, 2010. At closing on September 10, 2010, the following transactions took place: (i) all intercompany balances of the Company, including loans from and to related parties, were waived; (ii) prepayment in full of the loan facility dated August 20, 2008 on the Shinyo Kieran; (iii) the Company’s interest rate swap arrangements were terminated; and (iv) all of the Company’s bank loan agreements were amended to include, among other things, changes in margin, financial and other covenants.

Unaudited Pro Forma Combined Financial Statements of Navios Acquisition

     The following unaudited pro forma financial information of Navios Maritime Acquisition Corporation (the “Company” or “Navios Acquisition”) has been prepared to show the acquisition of the seven vessel-owning subsidiaries (“Vessel Owning Subsidiaries”) from Vanship Holdings Limited (the “Seller”) and the effect of the exercise of 13,865,950 of the Company’s warrants for cash and 19,321,056 of the Company’s warrants exercised on a cashless basis (for the aggregate issuance of 18,412,053 shares of common stock) on September 1, 2010.

     The unaudited pro forma financial statements for the year ended December 31, 2009 have been previously filed on a Form 6-K dated July 18, 2010, and filed on July 26, 2010. The unaudited pro forma condensed combined statement of income for the six month period ended June 30, 2010 assumes the acquisition was consummated on January 1, 2009 and includes pro forma adjustments that are directly attributable to the acquisition and are expected to have a continuing impact on our results of operations.

     The historical balance sheet as at June 30, 2010 and the historical statement of operations for the six month period ended June 30, 2010 of the Company have been derived from the unaudited condensed consolidated financial statements as of June 30, 2010 and for the six month period then ended.

     The historical balance sheet as of June 30, 2010 and the historical statement of operations for the six month period ended June 30, 2010 presented are based on the combined financial statements of the Vessel Owning Subsidiaries of the Seller as of June 30, 2010 and for the six month period then ended. The unaudited pro forma consolidated financial information included herein is based on the above-referenced historical financial statements of the Company and the Vessel Owning Subsidiaries and on certain assumptions which the Company believes to be reasonable, which are described in the notes to the statements below.

     The Company has not performed a complete and thorough valuation analysis necessary to determine the fair values of all of the Seller’s assets to be acquired and liabilities to be assumed and accordingly as described in Note 2 below the unaudited pro forma consolidated financial statements include a preliminary allocation of the purchase price to reflect the fair value of those assets and liabilities. Once the valuation analysis is completed, this unaudited pro forma consolidated information will be adjusted. These adjustments may be material.

INDEX TO UNAUDITED PRO FORMA FINANCIAL STATEMENTS

Unaudited Pro Forma Financial Statements of Navios Maritime Acquisition Corporation:
Unaudited Pro Forma Condensed Combined Balance Sheet as of June 30, 2010		P-2 - P-4
Unaudited Pro Forma Condensed Combined Statement of Operations for the six month period ended June 30, 2010		P-5 - P-6
Pro Forma Adjustments		P-6 - P-7

NAVIOS MARITIME ACQUISITION CORPORATION

																		Additional
																		Pro Forma
						Pro forma				Combined				Vessel Owning				Adjustments				Combined after
		Navios Acquisition				Adjustments				(After proceeds				Subsidiaries as of				(acquisition of				acquisition of
		As of June 30,				Proceeds from				of Warrant				June 30,				Vessel Owning				Vessel Owning
		2010				Warrant Program				Program)				2010				Subsidiaries)				Subsidiaries
ASSETS
Current assets
Cash		$	51,948			$	76,776	(1)		$	128,724			$	13,620			$				$	142,344
			—				—				—				—				40,000	(2)			40,000
			—				—				—				—				(4,699)	(4)			(4,699	)
			—				—				—				—				(133,995)	(3)			(133,995	)
Cash			51,948				76,776				128,724				13,620				(98,694	)		$	43,650
Restricted cash, current portion			6,104				—				6,104				2,497				—				8,601
Trade accounts receivable, prepayments and other receivables			64				—				64				2,720				—				2,784
Amounts due from related parties			—				—				—				1,112				(1,112)	(8)			—
Supplies			—				—				—				1,414				—				1,414
Total current assets		$	58,116			$	76,776			$	134,892			$	21,363			$	(99,806	)		$	56,449
Other assets
Vessels			43,727				—				43,727				490,727				(71,227)	(5)			463,227
Deposits for vessel acquisitions			172,071				—				172,071				89,544				(26,944)	(6)			234,671
Restricted cash, long term portion			29,492				—				29,492				14,500								43,992
Intangible -purchase options			3,158				—				3,158				—								3,158
Back log asset			—				—				—				—				66,473	(7)			66,473
Loan to a related party			—				—				—				8,883				(8,883)	(8)			—
Deferred finance costs			2,233				—				2,233				2,217				(2,217)	(8)			—
			—				—				—				—				4,699	(4)			6,932
Total other assets			250,681				—				250,681				605,871				(38,099	)			818,453
Total assets		$	308,797			$	76,776			$	385,573			$	627,234			$	(137,905	)		$	874,902