FORM 6-K


                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D. C. 20549


                        Report of Foreign Private Issuer
                      Pursuant to Rule 13a-16 or 15d-16 of
                       the Securities Exchange Act of 1934

                           For the month of April 2005

                                TOP TANKERS INC.
                 (Translation of registrant's name into English)

                            109-111 Messogion Avenue
                                 Politia Centre
            Athens 115 26 GR(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 [X]      Form 40-F  [_]

         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 [_]      No [X]



INFORMATION CONTAINED IN THIS FORM 6-K REPORT

          Set forth herein as Exhibit 1 is a report containing audited financial
data of TOP Tankers Inc. for the year ended December 31, 2004.





Exhibit 1
---------

                 Selected Consolidated Financial and Other Data

          The following table sets forth selected consolidated financial data
and other operating data of TOP Tankers Inc. The selected financial data in the
table for the three years ended December 31, 2004 are derived from the audited
consolidated financial statements of TOP Tankers Inc. The following information
should be read in conjunction with "Management's Discussion and Analysis of
Financial Condition and Results of Operations" and our consolidated financial
statements, and related notes thereto.


                                                                                       Year Ended December 31,
Dollars in  thousands,  except per share  data and  average  daily results        2002          2003          2004
                                                                                  ----          ----          ----

                                                                                                     
INCOME STATEMENT DATA
Voyage revenues..................................                                 $11,426       $23,085       $93,829
Voyage expenses..................................                                   3,311         5,937        16,898
Vessel operating expenses........................                                   4,553         8,420        16,859
General and administrative expenses(1)...........                                     816         1,815         8,579
Foreign currency losses, net.....................                                      62           105            75
Gain on sale of vessels..........................                                       -             -           638
Depreciation and amortization....................                                   2,390         4,203        14,622

Total operating expenses.........................                                  11,132        20,480        56,395
Operating income.................................                                     294         2,605        37,434
Net interest expense.............................                                     987         1,335         4,720
Other income (expense), net......................                                     894           364            80

Net income.......................................                                    $201        $1,634       $32,794

Basic and diluted earnings per share(2)..........                                   $0.03         $0.27         $2.54
Weighted average basic and diluted shares outstanding(2)                        6,000,000     6,000,000    12,922,449
Dividends paid per share(2)......................                                   $0.14         $0.10         $0.39

BALANCE SHEET DATA, at end of period
Current assets, including cash...................                                    $845        $4,862      $141,051
Total assets.....................................                                  33,474        55,703       539,886
Current liabilities, including current portion of long-term debt                    4,390         9,008        42,811
Total long-term debt, including current portion..                                  22,875        34,403       194,806
Stockholders' equity.............................                                   8,772        16,319       321,809

OTHER FINANCIAL DATA
EBITDA(3)........................................                                  $3,578        $7,172       $52,136

FLEET DATA
Total number of vessels at end of period.........                                     3.0           5.0          15.0
Average number of vessels(4).....................                                     2.9           4.4           9.6
Total voyage days for fleet(5)...................                                     961         1,517         3,215
Total time charter days for fleet................                                     160           543         1,780
Total spot market days for fleet.................                                     801           974         1,435
Total calendar days for fleet(6).................                                   1,042         1,609         3,517
Fleet utilization(7).............................                                   92.2%         94.3%         91.4%

AVERAGE DAILY RESULTS
Time charter equivalent(8).......................                                  $8,444       $11,304       $23,929
Vessel operating expenses(9).....................                                   4,369         5,233         4,794
General and administrative expenses(10)..........                                     783         1,128         2,439
Total vessel operating expenses(11)..............                                   5,152         6,361         7,233


(1)  We did not pay any compensation to members of our senior management or our
     directors in the years ended December 31, 2002 and December 31, 2003.
     During 2004, we paid to the members of our senior management and to our
     directors aggregate compensation of approximately $4.4 million.

(2)  After giving effect to a stock dividend effected in May 2004 and our
     initial public offering in July 2004. All share and per share amounts have
     been restated to reflect the retroactive effect of the stock dividend.

(3)  EBITDA represents earnings before interest, taxes, depreciation and
     amortization. EBITDA does not represent and should not be considered as an
     alternative to net income or cash flow from operations, as determined by
     GAAP, and our calculation of EBITDA may not be comparable to that reported
     by other companies. EBITDA is included in this report because it is a basis
     upon which we assess our liquidity position and because we believe that it
     presents useful information to investors regarding our ability to service
     and/or incur indebtedness.

          The following table reconciles net cash from operating activities, as
     reflected in the consolidated statements of cash flows, to EBITDA:

                                                    Year Ended December 31,
                                                  2002       2003        2004
                                                  ----       ----        ----

Net Cash from Operating Activities...........   $2,409     $4,930     $28,601
Net increase in current assets...............      214      1,768      23,764
Net increase in current  liabilities,
  excluding  current portion
  of long-term debt..........................    (381)    (3,154)    (12,197)
Gain on sale of vessels......................        -          -         638
Payments for drydocking costs................      510      2,414       7,365
Net interest expense.........................      987      1,335       4,720
Amortization and write-off of
   deferred financing costs..................     (161)      (121)       (755)
                                                 -----      -----       -----

EBITDA.......................................   $3,578     $7,172    $52, 136
                                                ======     ======    ========

(4)  Average number of vessels is the number of vessels that constituted our
     fleet for the relevant period, as measured by the sum of the number of days
     each vessel was a part of our fleet during the period divided by the number
     of calendar days in that period.

(5)  Total voyage days for fleet are the total days the vessels were in our
     possession for the relevant period net of off hire days associated with
     major repairs, drydockings or special or intermediate surveys.

(6)  Calendar days are the total days the vessels were in our possession for the
     relevant period including off hire days associated with major repairs,
     drydockings or special or intermediate surveys.

(7)  Fleet utilization is the percentage of time that our vessels were available
     for revenue generating voyage days, and is determined by dividing voyage
     days by fleet calendar days for the relevant period.

(8)  Time charter equivalent, or TCE, is a measure of the average daily revenue
     performance of a vessel on a per voyage basis. Our method of calculating
     TCE is consistent with industry standards and is determined by dividing net
     voyage revenue by voyage days for the relevant time period. Net voyage
     revenues are voyage revenues minus voyage expenses. Voyage expenses
     primarily consist of port, canal and fuel costs that are unique to a
     particular voyage, which would otherwise be paid by the charterer under a
     time charter contract, as well as commissions. The following table reflects
     calculation of the TCE (all amounts are expressed in thousands of U.S.
     dollars, except for Average Daily Time Charter Equivalent amounts and Total
     Voyage Days):

                                                  Year Ended December 31,
                                             2002         2003        2004
                                             ----         ----        ----

Voyage revenues............................  $11,426      $23,085     $93,829
Less:
 Voyage expenses...........................   (3,311)      (5,937)    (16,898)
                                             -------      -------    --------

 Time charter equivalent revenue...........   $8,115      $17,148     $76,931
                                              ======      =======     =======

 Total voyage days.........................      961        1,517       3,215
 Average Daily Time Charter Equivalent.....   $8,444      $11,304     $23,929

(9)  Daily vessel operating expenses, which includes crew costs, provisions,
     deck and engine stores, lubricating oil, insurance, maintenance and repairs
     is calculated by dividing vessel operating expenses by fleet calendar days
     for the relevant time period.

(10) Daily general and administrative expenses are calculated by dividing
     general and administrative expenses by fleet calendar days for the relevant
     time period.

(11) Total vessel operating expenses, or TVOE, is a measurement of our total
     expenses associated with operating our vessels. TVOE is the sum of vessel
     operating expenses and general and administrative expenses. Daily TVOE is
     calculated by dividing TVOE by fleet calendar days for the relevant time
     period.



                     Management's Discussion and Analysis of
                  Financial Condition and Results of Operations

         The following is a discussion of our financial condition and results of
operations for the years ended December 31, 2004, 2003 and 2002. You should read
this section together with the consolidated financial statements including the
notes to those financial statements for the periods mentioned above.

         We are a provider of international seaborne transportation services,
carrying refined petroleum products and crude oil. As of December 31, 2004, our
fleet consisted of 15 vessels, comprised of 11 Product tankers and 4 Suezmax
tankers, with a total cargo carrying capacity of approximately 1.1 million
deadweight tons, or dwt.

         We actively manage the deployment of our fleet between spot market
voyage charters, which generally last from several days to several weeks, and
time charters, which can last up to several years. A spot market voyage charter
is generally a contract to carry a specific cargo from a load port to a
discharge port for an agreed upon total amount. Under spot market voyage
charters, we pay voyage expenses such as port, canal and fuel costs. A time
charter is generally a contract to charter a vessel for a fixed period of time
at a specified daily rate. Under time charters, the charterer pays voyage
expenses such as port, canal and fuel costs. Under both types of charters, we
pay for vessel operating expenses, which include crew costs, provisions, deck
and engine stores, lubricating oil, insurance, maintenance and repairs, as well
as for commissions on gross charter rates. We are also responsible for the
vessel's intermediate and special survey costs.

         Vessels operating on time charters provide more predictable cash flows,
but can yield lower profit margins than vessels operating in the spot market
during periods characterized by favorable market conditions. Vessels operating
in the spot market generate revenues that are less predictable but may enable us
to capture increased profit margins during periods of improvements in vessel
rates although we are exposed to the risk of declining vessel rates, which may
have a materially adverse impact on our financial performance. We are constantly
evaluating opportunities to increase the number of our vessels deployed on time
charters, but only expect to enter into additional time charters if we can
obtain contract terms that satisfy our criteria.

         On July 23, 2004, our common stock was listed on the Nasdaq National
Market, under the symbol "TOPT", in connection with our initial public offering.
The net proceeds of our initial public offering, approximately $124.4 million,
were primarily used to finance the acquisition of 10 vessels, comprised of 8
ice-class double-hull Handymax tankers and 2 double-hull Suezmax tankers. The
total cost of the acquisition was approximately $252 million. TOP Tanker
Management, our wholly-owned subsidiary, has subcontracted the technical
management of these 10 tankers to Unicom Management, an unaffiliated ship
management company based in Cyprus. The 8 Handymax tankers are deployed under
time charter contracts and the 2 Suezmax tankers are currently deployed in the
spot charter market.

         Developments Since Our Initial Public Offering

         On November 5, 2004 we completed a follow-on offering of our common
stock. The net proceeds of our follow-on offering, approximately $139.4 million,
were used primarily to finance the acquisition of 5 double-hull Suezmax tankers.
The total cost of the acquisition was approximately $257 million. TOP Tanker
Management, our wholly-owned subsidiary, has subcontracted the technical
management of four of these vessels to V.Ships, an unaffiliated ship management
company based in Glasgow, Scotland and the technical management of the remaining
vessel to Unicom Management, an unaffiliated ship management company based in
Cyprus. One of these vessels has been deployed on a 24 month time charter
contract with Glencore and the remaining four vessels have been deployed in the
spot charter market.

         On February 23, 2005, we entered into an agreement for the acquisition
of the M/T Topless, a 47,262 Dwt, double-hull Handymax tanker, built in 1998 by
Onomichi Dockyard Co., Ltd., of Japan. TOP Tanker Management will undertake the
technical management of this vessel. The M/T Topless is scheduled to be
delivered on or about April 25, 2005.

         On March 4, 2005 we entered into an agreement for the acquisition of 3
double-hull Handymax tankers, the 46,217 dwt M/T Taintless, the 46,168 dwt M/T
Dauntless and the 46,185 dwt M/T Soundless. The M/T Taintless and the M/T
Dauntless were delivered on March 21 and March 24, 2005, respectively. The M/T
Soundless is scheduled to be delivered on or about April 18, 2005. The vessels
are sisterships, built in 1999, by Hyundai Heavy Industries Co., Ltd., of the
Republic of Korea. TOP Tanker Management will undertake the management of the
M/T Soundless and has subcontracted the technical management of the remaining
two vessels to V.Ships. The M/T Taintless and the M/T Dauntless are deployed
under 60 month time charter contracts with Glencore. The M/T Soundless and the
M/T Topless will also be deployed under 60 month time charter contracts with
Glencore upon their delivery.

         On March 16, 2005, we agreed to sell our final remaining single-hull
vessel, the M/T Yapi, for $8.5 million. On March 29, 2005, we also entered the
vessel into a bareboat charter with the purchasers until July 31, 2005, the
vessel's delivery date. We received an advance payment of $1.0 million from the
purchasers as a security of their obligation to purchase the vessel and we will
also be paid a daily bareboat hire of $6,000 under the charter.

         Results of Operations

         For discussion and analysis purposes only, we evaluate performance
using time charter equivalent, or TCE, revenues. TCE revenues are voyage
revenues minus voyage expenses. Voyage expenses primarily consist of port, canal
and fuel costs that are unique to a particular voyage, which would otherwise be
paid by a charterer under a time charter, as well as commissions. We believe
that presenting voyage revenues, net of voyage expenses, neutralizes the
variability created by unique costs associated with particular voyages or the
deployment of vessels on time charter or on the spot market and presents a more
accurate representation of the revenues generated by our vessels.

         We calculate daily TCE rates by dividing TCE revenues by voyage days
for the relevant time period. We also generate demurrage revenue, which
represents fees charged to charterers associated with our spot market voyages
when the charterer exceeds the agreed upon time required to load or discharge a
cargo. We calculate daily direct vessel operating expenses and daily general and
administrative expenses for the relevant period by dividing the total expenses
by the aggregate number of calendar days that we owned each tanker for the
period.

         We depreciate our tankers on a straight-line basis over their estimated
useful lives determined to be 25 years from the date of their initial delivery
from the shipyard. Depreciation is based on cost less the estimated residual
value. We capitalize the total costs associated with a drydocking and amortize
these costs on a straight-line basis over the period when the next drydocking
becomes due, which is typically 30 to 60 months. Regulations and/or incidents
may change the estimated dates of next drydockings.

Year ended December 31, 2004 compared to the year ended December 31, 2003

         VOYAGE REVENUES--Voyage revenues increased by $70.7 million, or 306.1%,
to $93.8 million for 2004 compared to $23.1 million for the prior year. This
increase is due to the acquisition of 2 tankers and 10 tankers during the first
and third quarter of 2004, respectively, which contributed $66.7 million in
voyage revenues and the overall stronger spot market during 2004 which increased
the voyage revenues generated by the remaining vessels to $27.1 million in 2004
from $23.1 million in 2003.

         VOYAGE EXPENSES--Voyage expenses primarily consist of port, canal and
fuel costs that are unique to a particular voyage. These expenses, which are
paid by the charterer under a time charter contract, as well as commissions,
increased $11.0 million, or 186.4%, to $16.9 million for 2004 compared to $5.9
million for the prior year. This increase is primarily due to the increase in
the average number of tankers in our fleet during 2004 compared to the prior
year, as well as the increase in the cost of fuel to operate the tankers.

         NET VOYAGE REVENUES--

                                                  2003            2004
                                                  ----            ----

Voyage revenues............................      $23,085         $93,829
Less Voyage expenses.......................       (5,937)        (16,898)

Net voyage revenues........................       17,148          76,931
                                                  =======         ======

         Net voyage revenues, which are voyage revenues minus voyage expenses,
increased by $59.8 million, or 349.7%, to $76.9 million for 2004 compared to
$17.1 million for the prior year. This increase is the result of the increase in
the average number of tankers in our fleet and the overall stronger spot market
during 2004 compared to the prior year. The average number of tankers in our
fleet increased 118.2% to 9.6 tankers during 2004 compared to 4.4 tankers during
the prior year.

         The following describes our charter revenues for 2004 as compared to
the prior year:

         o  Average daily TCE rate increased by $12,625, or 111.7%, to $23,929
            for 2004 compared to $11,304 for the prior year.

         o  $32,138,000, or 41.7%, of net voyage revenue was generated by time
            charter contracts and $44,793,000, or 58.3%, of net voyage revenue
            was generated in the spot market during 2004, compared to
            $7,506,000, or 43.9%, of net voyage revenue generated by time
            charter contracts, and $9,642,000, or 56.1%, of net voyage revenue
            generated in the spot market during the prior year.

         o  Tankers operated an aggregate of 1,780 days, or 55.4%, on time
            charter contracts and 1,435 days, or 44.6%, in the spot market
            during 2004, compared to 543 days, or 35.8%, on time charter
            contracts and 974 days, or 64.2%, in the spot market during the
            prior year.

         o  Average daily time charter rate was $18,055 for 2004 compared to
            average daily time charter rate of $13,824 for the prior year.

         o  Average daily spot rate was $31,215 for 2004 compared to average
            daily spot rate of $9,899 for the prior year.

         VESSEL OPERATING EXPENSES -- Vessel operating expenses, which include
crew costs, provisions, deck and engine stores, lubricating oil, insurance,
maintenance and repairs, increased by $8.5 million, or 101.2%, to $16.9 million
for 2004 compared to $8.4 million for the prior year. This increase is primarily
due to the increase in the average number of tankers in our fleet, which
increased 118.2% between the periods. Daily vessel operating expenses per tanker
decreased by $439, or 8.4%, to $4,794 for 2004 compared to $5,233 for the prior
year. This decrease is the result of lower crewing and insurance expenses
associated with the economies of scale of operating a larger fleet during the
year, compared to the previous year and the subcontracting of the technical
management of our vessels to V.Ships Management Limited and Unicom Management
during the third quarter of 2004. Our vessel operating expenses depend on a
variety of factors, many of which are beyond our control and affect the entire
shipping industry.

         GENERAL AND ADMINISTRATIVE EXPENSES--General and administrative
expenses, which include all of our onshore expenses, the fees that Primal
Tankers Inc., our former management company, charged to manage our vessels, and
the fees paid to V.Ships Management Limited and Unicom Management, increased by
$6.8 million, or 377.8%, to $8.6 million for 2004 compared to $1.8 million for
the prior year. This increase is due to increased staff and additional
administrative costs in connection with the operation of our larger fleet, and
the duties typically associated with public companies and to the compensation of
our senior management and directors, which was in the aggregate amount of $4.4
million. Daily general and administrative expenses per tanker increased $1,311,
or 116.2%, to $2,439 for 2004 compared to $1,128 for the prior year.

         FOREIGN CURRENCY GAINS OR LOSSES--We incurred a $75,000 foreign
currency loss for 2004 compared to a loss of $105,000 for the prior year.

         GAIN ON SALE OF VESSELS--During the last quarter of 2004 we sold the
vessels M/T Tireless and M/T Med Prologue and we realized a total gain of
$638,000.

         DEPRECIATION AND AMORTIZATION--Depreciation and amortization, which
include depreciation of tankers, office furniture and equipment as well as
amortization of drydockings, increased by $10.4 million, or 247.6%, to $14.6
million for 2004 compared to $4.2 million for the prior year. This increase is
primarily due to the increase in the average number of tankers in our fleet, the
increase in the book value of our fleet as a result of our acquisitions of
tankers during 2004, and the amortization of capitalized expenses associated
with drydockings that occurred for the first time to vessels that are part of
our fleet.

                                                               2003      2004
                                                               ----      ----

Vessels depreciation expense..............................    $3,604   $13,073
Office furniture and equipment depreciation expense.......         0        35
Amortization of drydockings...............................      $599     1,514
                                                              ------   -------

                                                              $4,203    14,622

         Depreciation of vessels increased by $9.5 million, or 263.9%, to $13.1
million for 2004 compared to $3.6 million for the prior period. This increase is
due to the increase in the book value of our fleet as a result of our
acquisitions of tankers during 2004 compared to the prior year.

         Amortization of drydockings increased by $0.9 million, or 150.0%, to
$1.5 million for 2004 compared to $0.6 million for the prior year. This increase
includes amortization associated with $7.4 million of capitalized expenditures
relating to our tankers during 2004 compared to $2.4 million of capitalized
expenditures during the prior year. This increase is the result of the
amortization of capitalized expenses associated mainly with drydockings which
took place after September 30, 2004, all of which relate to tankers which have
capitalized drydocking expenditures for the first time since we acquired them.
We anticipate that the amortization associated with drydockings will continue to
increase in 2005 due to the increase in the average number of tankers in our
fleet, the increase in costs associated with drydockings, and that we are
currently drydocking vessels for the first time since these vessels became part
of our fleet.

         NET INTEREST EXPENSE--Net interest expense increased by $3.4 million,
or 261.5%, to $4.7 million for 2004 compared to $1.3 million for the prior year.
This increase is the result of the increase in our weighted average outstanding
debt as a result of our acquisitions of tankers. Net interest expense is
anticipated to continue to increase in 2005 as a result of the debt that we
incurred in connection with our acquisition of additional tankers.

         OTHER NET--We recognized a gain of $0.1 million during 2004 compared to
a gain of $0.4 million during the prior year. The amount relating to 2003
relates to the excess amount the Company received in connection with a claim for
damages to its vessels compared to the actual costs associated with the repairs.

         NET INCOME--Net income was $32.8 million for 2004 compared to net
income of $1.6 million for the prior year.

Year ended December 31, 2003 compared to the year ended December 31, 2002

         VOYAGE REVENUES--Voyage revenues increased by $11.7 million, or 102.6%,
to $23.1 million for 2003 compared to $11.4 million for the prior year. This
increase is due to the acquisition of Fearless and Tireless in February and June
2003, respectively, which contributed $7.6 million in voyage revenues and the
overall stronger spot market during 2003 which increased the voyage revenues
generated by the remaining vessels to $15.5 million in 2003 from $11.4 million
in 2002.

         VOYAGE EXPENSES--Voyage expenses primarily consist of port, canal and
fuel costs that are unique to a particular voyage. These expenses, which are
paid by the charterer under a time charter contract, as well as commissions,
increased $2.6 million, or 78.8%, to $5.9 million for 2003 compared to $3.3
million for the prior year. This increase is primarily due to the increase in
the average number of tankers in our fleet during 2003 compared to the prior
year, as well as the increase in the cost of fuel to operate the tankers.

         NET VOYAGE REVENUES--
                                                 2002            2003
                                                 ----            ----

Voyage revenues............................      $11,426         $23,085
Less Voyage expenses.......................       (3,311)         (5,937)
                                                 -------         -------

Net voyage revenues........................       $8,115         $17,148
                                                  ======         =======

         Net voyage revenues, which are voyage revenues minus voyage expenses,
increased by $9.0 million, or 111.1%, to $17.1 million for 2003 compared to $8.1
million for the prior year. This increase is the result of the increase in the
average number of tankers in our fleet and the overall stronger spot market
during 2003 compared to the prior year. The average number of tankers in our
fleet increased 51.7%, to 4.4 tankers compared to 2.9 tankers for 2003 compared
the prior year.

         The following describes our charter revenues for 2003 as compared to
the prior year:

         o  Average daily TCE rate increased by $2,860, or 33.9%, to $11,304 for
            2003 compared to $8,444 for the prior year.

         o  $7,506,000, or 43.9%, of net voyage revenue was generated by time
            charter contracts and $9,642,000, or 56.1%, of net voyage revenue
            was generated in the spot market during 2003, compared to
            $1,977,000, or 24.7%, of net voyage revenue generated by time
            charter contracts, and $6,137,000, or 75.3%, of net voyage revenue
            generated in the spot market during the prior year.

         o  Tankers operated an aggregate of 543 days, or 35.8%, on time charter
            contracts and 974 days, or 64.2%, in the spot market during 2003,
            compared to 160 days, or 16.6%, on time charter contracts and 801
            days, or 83.4%, in the spot market during the prior year.

         o  Average daily time charter rate was $13,824 for 2003 compared to
            average daily time charter rate of $12,359 for the prior year.

         o  Average daily spot rate was $9,899 for 2003 compared to average
            daily spot rate of $7,662 for the prior year.

         VESSEL OPERATING EXPENSES -- Vessel operating expenses, which include
crew costs, provisions, deck and engine stores, lubricating oil, insurance,
maintenance and repairs, increased by $3.9 million, or 86.7%, to $8.4 million
for 2003 compared to $4.5 million for the prior year. This increase is primarily
due to the increase in the average number of tankers in our fleet, which
increased 51.7% between the periods. The increase in vessel operating expenses
relative to the increase in the average number of tankers in our fleet and the
growth in the average size of the tankers that comprised our fleet during 2003
compared to 2002 is primarily due to the lower maintenance and repair expenses
during 2002. Daily vessel operating expenses per tanker increased by $864, or
19.8%, to $5,233 for 2003 compared to $4,369 for the prior year. This increase
is the result of the growth in the average size of the tankers in our fleet, as
larger tankers are inherently more expensive to operate, and as a result of the
low vessel operating expenses incurred during 2002 described above. The increase
in daily vessel operating expenses will be the result of the growth in the
average size of the tankers in our fleet and the percentage of Suezmax tankers
that comprise our fleet. Suezmax tankers are larger and inherently more
expensive to operate than product tankers. Our vessel operating expenses depend
on a variety of factors, many of which are beyond our control and affect the
entire shipping industry.

         GENERAL AND ADMINISTRATIVE EXPENSES--General and administrative
expenses, which is primarily the fees that Primal Tankers Inc. charged to manage
our vessels, increased by $1.0 million, or 125.0%, to $1.8 million for 2003
compared to $0.8 million for the prior year. This increase is due to an increase
in the management fee charged by Primal Tankers Inc. as a result of the increase
in the payroll expenses including the increase in the number of its personnel
arising from the increase in the average number of tankers in our fleet, which
increased 51.7%, during 2003 compared to the prior year. Daily general and
administrative expenses per tanker increased $345, or 44.1%, to $1,128 for 2003
compared to $783 for the prior year, this increase is due to an increase in the
management fee charged by Primal Tankers Inc. as a result of the increase in the
payroll expenses including the increase in the number of personnel arising from
the increase in the average number of tankers in our fleet, which increased
51.7%, during 2003 compared to the prior year. We did not pay any compensation
to the members of our senior management or our directors during the year ended
December 31, 2003.

         FOREIGN CURRENCY GAINS OR LOSSES--We incurred a $105,000 foreign
currency loss for 2003 compared to a loss of $62,000 for the prior year.

         DEPRECIATION AND AMORTIZATION--Depreciation and amortization, which
include depreciation of tankers as well as amortization of drydockings,
increased by $1.8 million, or 75.0%, to $4.2 million for 2003 compared to $2.4
million for the prior year. This increase is primarily due to the increase in
the average book value of our fleet as a result of our acquisitions of tankers
during 2003, and the amortization of capitalized expenses associated with
drydockings that occurred for the first time to vessels that are part of our
fleet.

                                                              2002      2003

Vessels depreciation expense.............................      $2,213    $3,604
Amortization of drydockings..............................        $177      $599
                                                               ------    ------
                                                               $2,390    $4,203
                                                               ======    ======

         Depreciation of vessels increased by $1.4 million, or 63.6%, to $3.6
million for 2003 compared to $2.2 million for the prior period. This increase is
due to the increase in the book value of our fleet as a result of our
acquisitions of tankers during 2003 compared to the prior year.

         Amortization of drydockings increased by $0.4 million, or 200.0%, to
$0.6 million for 2003 compared to $0.2 million for the prior year. This increase
includes amortization associated with $2.4 million of capitalized expenditures
relating to our tankers during 2003 compared to $0.5 million of capitalized
expenditures during the prior year.

         NET INTEREST EXPENSE--Net interest expense increased by $0.3 million,
or 30.0%, to $1.3 million for 2003 compared to $1.0 million for the prior year.
This increase is the result of the increase in our weighted average outstanding
debt as a result of our acquisitions of tankers during 2003. The magnitude of
the increase in net interest expense relative to the increase in our weighted
average outstanding debt was mitigated by the overall lower interest rate
environment during 2003 compared to the prior year.

         OTHER NET--We recognized a gain of $0.4 million during 2003 compared to
a gain of $0.9 million during the prior year. These gains relate to the excess
amount the Company received in connection with a claim for damages to its
vessels compared to the actual costs associated with the repairs.

         NET INCOME--Net income was $1.6 million for 2003 compared to net income
of $0.2 million for the prior year.

         Liquidity and capital resources

         Since our formation, our principal source of funds has been equity
provided by our shareholders, operating cash flows and long-term borrowings. Our
principal use of funds has been capital expenditures to establish and grow our
fleet, maintain the quality of our vessels, comply with international shipping
standards and environmental laws and regulations, fund working capital
requirements, make principal repayments on outstanding loan facilities, and pay
dividends. We expect to rely upon operating cash flows, long-term borrowings and
equity financings to implement our growth plan. We believe that our current cash
balance as well as operating cash flows will be sufficient to meet our liquidity
needs for the next year.

         Our practice has been to acquire vessels using a combination of funds
received from equity investors and bank debt secured by mortgages on our
vessels. Our business is capital intensive and its future success will depend on
our ability to maintain a high-quality fleet through the acquisition of newer
vessels and the selective sale of older vessels. These acquisitions will be
principally subject to management's expectation of future market conditions as
well as our ability to acquire vessels on favorable terms.

         We operate a fleet that is 100% double-hull. In anticipation of the
accelerated IMO phase out of single-hull tankers to 2010 that became effective
in April 2005, we sold two single-hull tankers in 2004 and our remaining
single-hull tanker in March 2005. The sale of this tanker reduced the total
deadweight tonnage of our current fleet by approximately 1.5%. We do not believe
that this reduction materially affected our operations.

         Cash increased $112.5 million to $114.8 million as of December 31, 2004
compared to $2.3 million as of December 31, 2003. That increase includes the
proceeds of our follow-on offering on November 5, 2004, which have been used
primarily to finance the acquisition of 5 Suezmax tankers. Working capital is
current assets minus current liabilities, including the current portion of
long-term debt. Working capital surplus was $98.2 million as of December 31,
2004, compared to a working capital deficit of $4.1 million as of December 31,
2003. The current portion of long-term debt, net of unamortized deferred
financing costs, included in our current liabilities was $19.5 million and $4.0
million as of December 31, 2004 and December 31, 2003, respectively.

         EBITDA, as defined in Footnote 3 to the "Selected consolidated
financial and other data" table above, increased by $44.9 million, or 623.6%, to
$52.1 million for 2004 compared to $7.2 million for the prior year. This
increase is due to the growth of our fleet and the overall stronger tanker
market during 2004 compared to the prior year, the increase was mitigated by the
increase in vessel operating expenses and general and administrative expenses
for 2004 compared to the prior year.

         EBITDA, increased by $3.6 million, or 100.0%, to $7.2 million for 2003
compared to $3.6 million for the prior year. This increase is due to the growth
of our fleet and the overall stronger tanker market during 2003 compared to the
prior year, the increase was mitigated by the increase in vessel operating
expenses and general and administrative expenses for 2003 compared to the prior
year.

         On July 23, 2004, the Company completed its initial public offering on
the Nasdaq National Market. In this respect, 12,258,570 shares of common stock
were issued at $11.00 per share. The net proceeds of the initial public offering
totaled $124.4 million of which approximately $112.1 million were used to
acquire 10 double-hull tankers, consisting of 8 Handymax and 2 Suezmax product
tankers, and approximately $12.3 million for general corporate purposes. In
addition, 20,000 shares of common stock were sold in a private transaction to
Sovereign Holdings, a company owned by our Chief Executive Officer, at the same
price as those sold to the public.

         On November 5, 2004, the Company completed a follow-on offering of its
common stock on the Nasdaq National Market. In this respect, 9,552,420 shares of
common stock were issued at $15.50 per share. The net proceeds of the follow-on
offering totaled $139.4 million of which approximately $116.7 million were used
for the acquisition of 5 double-hull Suezmax tankers, and approximately $22.7
million were used to repay a portion of our debt.

         While the Company cannot provide assurances that it will continue to do
so, and subject to the limitations discussed elsewhere in its filings with the
Securities and Exchange Commission, it currently intends to pay regular cash
dividends on a quarterly basis. On January 12, 2005, we paid the first dividend
on our common shares of $0.21 per share to shareholders of record as of December
22, 2004. On April 12, 2005, we paid the second dividend on our common shares of
$0.21 per share to shareholders of record as of March 31, 2005.

         As of December 31, 2004, the outstanding balance of our credit facility
with the Royal Bank of Scotland, which we refer to as the initial credit
facility, was $197.0 million, maturing in 2012. The interest rate for the first
$98.5 million is LIBOR, whereas with respect to the remaining $98.5 million, we
have entered into a four year swap agreement with the Royal Bank of Scotland for
a fixed interest rate of 3.61%. In addition to these interest rates, the
outstanding amount is subject to a bank spread, which will be adjusted quarterly
to 100 basis points if the ratio of the outstanding loan balance to the
aggregate market value of our vessels securing the loan is less than or equal to
60%; 112.5 basis points if this ratio is greater than 60% but less than 70%; or
125 basis points if this ratio is greater than 70%. The initial credit facility
is collateralized by mortgages on 15 of the vessels in our fleet.

         The initial credit facility contains, among other things, financial
covenants requiring us to ensure that the aggregate market value of the
mortgaged vessels at all times exceeds 130% of the aggregate outstanding
principal amount under the loan and to maintain minimum liquid funds with the
lender of not less than the greater of $10.0 million or $0.5 million per vessel
in our fleet. We are permitted to pay dividends under the loan so long as we are
not in default of a loan covenant.

         We are obligated to repay the principal amount in 16 consecutive
semi-annual installments of $10.0 million, each commencing on March 31, 2005,
together with a balloon payment of $37.0 million payable with the final
installment. Our initial credit facility allows us, subject to certain
conditions, to defer up to two non-consecutive payments of the first ten
scheduled principal payments of $10.0 million each, provided that a fee of 1%
shall be payable on any deferred installment and a maximum of $20.0 million may
be deferred at any time.

         In February 2005, we entered into a financing agreement with the Royal
Bank of Scotland, which we refer to as the new credit facility to partially
finance the acquisition of 3 of the 5 additional Suezmax tankers acquired in
connection with the follow-on offering of our common shares (the M/T Priceless,
the M/T Noiseless and the M/T Faultless), 4 Handymax tankers (the M/T Taintless,
the M/T Dauntless, the M/T Soundless and the M/T Topless) and to refinance the
then outstanding balance of our initial credit facility. The new credit facility
was for the amount of $424.8 million divided into three tranches of $197.0
million, $83.8 million and $144.0 million. The $197.0 million tranche is payable
in 16 equal consecutive semi-annual installments of $10.0 million each,
beginning on March 31, 2005, together with a balloon payment of $37.0 million
payable with the final installment. The $83.8 million tranche is payable in 14
varying semi-annual installments beginning on July 31, 2005, together with a
balloon payment of $17.0 million payable with the final installment. The $144.0
million tranche is payable in 17 semi-annual installments of $6.3 million,
beginning on November 30, 2005, together with a balloon payment of $36.9 million
payable with the final installment. Additional terms and conditions of the new
credit facility are as follows:

         The initial interest rate on the new credit facility is 100 basis
points over LIBOR. The interest rate will be adjusted quarterly to 100 basis
points over LIBOR if the ratio of the aggregate outstanding loan balance under
the new credit facility and the initial credit facility to the aggregate market
value of the mortgaged vessels under the new credit facility and the initial
credit facility is less than or equal to 60%; 112.5 basis points over LIBOR if
this ratio is greater than 60% but less than 70%; or 125 basis points over LIBOR
if this ratio is greater than 70%. The new credit facility is collateralized by
a first priority mortgage on each of the 4 Handymax tankers and 3 Suezmax
tankers mentioned above and a second priority mortgage on each of the mortgaged
vessels under the initial credit facility.

         The new credit facility contains, among other things, financial
covenants requiring us to: ensure that the aggregate market value of our fleet
at all times exceeds 130% of the aggregate outstanding principal amount under
the new credit facility and the initial credit facility; maintain minimum liquid
funds with the lender of not less than the greater of $10.0 million or $0.5
million per vessel in our fleet; ensure that our total assets minus our debt
will not at any time be less than $200.0 million and at all times exceed 35% of
our total assets; ensure that EBITDA (as defined in the new credit facility)
will at all times exceed 120% of the aggregate of interest expenses and debt due
at a particular period; and meet minimum working capital requirements. The new
credit facility also contains general covenants that require us to maintain
adequate insurance coverage and obtain the bank's consent before we incur new
indebtedness that is secured by the vessels mortgaged thereunder or the
mortgaged vessels under the initial credit facility. In addition, the new credit
facility prohibits us, without the lender's consent, from appointing a chief
executive officer other than Evangelos Pistiolis and requires that the vessels
mortgaged thereunder and the mortgaged vessels under the initial credit facility
be managed by TOP Tanker Management, which will subcontract the technical
management of the mortgaged vessels to V.Ships Management Limited, Unicom
Management and any other company acceptable to the lender. We will be permitted
to pay dividends under the new credit facility so long as we are not in default
of a loan covenant. The new credit facility also requires that the relevant
terms of the loan agreement under the initial credit facility, including the
security and interest margin provisions, be amended to take into account the new
credit facility and the vessels mortgaged thereunder. The initial credit
facility will also be cross-collateralized by second priority mortgages on the
vessels mortgaged under the new credit facility.

         We paid a fee of 1.0%, 1.0% and 0.75% of the amount of Tranche A, B and
C, respectively of the loan on the date that we signed the loan agreement, and a
commitment fee of 0.25% per annum shall accrue on the amount of the undrawn
balance from the date that we signed the offer letter which shall be payable one
month in arrears and on the date of the drawdown.

         In March 2005, we entered into a credit facility with DVB Bank, which
we refer to as the DVB credit facility, for a total of $56.5 million, to finance
the purchase of 2 Suezmax tankers, the M/T Stopless and the M/T Stainless. The
loan is payable in 28 varying quarterly installments beginning on July 29, 2005
and a balloon payment of $10.2 million, payable together with the last
installment. The interest rate on the DVB credit facility is 125 basis points
over LIBOR. Beginning on the date of the credit facility and ending on the final
drawdown date, we will pay the lender a quarterly fee of 0.25% of the average
undrawn amount of the loan for the quarter. The DVB credit facility is
collateralized by a first priority mortgage on the M/T Stopless and the M/T
Stainless.

         The DVB credit facility may be drawn down in amounts not less than $1.0
million and in multiples of $250,000. The lender's obligation to fund the
drawdowns under the loan will terminate if we do not receive delivery of the
mortgaged vessels by April 30, 2005.

         The DVB credit facility contains, among other things, financial
covenants requiring us to: ensure that the aggregate market value of the
mortgaged vessels is equal to at least 130% of the outstanding principal amount
under the loan, ensure that our total assets minus our debt will not at any time
be less than $200.0 million or 35% of our total assets, to ensure that our
EBITDA (as defined in the DVB credit facility agreement) will not at any time be
less than 120% of the aggregate of interest expenses and debt due at a
particular period, and maintain certain minimum liquid funds of not less than
the greater of $10.0 million or $0.5 million per vessel in our fleet. In
addition, the DVB credit facility prohibits us, without the lender's consent,
from appointing a chief executive officer other than Evangelos Pistiolis and
requires that the mortgaged vessels are managed by TOP Tanker Management, which
may subcontract the technical management of the mortgaged vessels to V.Ships
Management Limited, Unicom Management or any other company acceptable to the
lender.

         Long Term Financial Obligations and other Commercial Obligations: The
following table presents our long-term financial and other commercial
obligations as of December 31, 2004:


                                                                           Payments due by period


                                                                                     2-3         4-5        More than
Contractual Obligations:                                Total          1 year        years       years      5 years
-----------------------                                 -----          ------        -----       -----       -------
                                                                               (in thousands of $)
                                                                                             
Long term debt                                           197,000        20,000       40,000      40,000     97,000
Operating leases                                           3,438           622        1,244       1,244        328
Vessel Acquisitions                                      230,850       230,850            -           -          -
                                                       ---------       --------     --------     -------    -------
Total                                                    431,288       251,472       41,244      41,244     97,328
                                                       =========       ========     ========     =======    =======


         TOP Tanker Management, our wholly-owned subsidiary, is responsible for
the chartering, operational and technical management of our tanker fleet,
including crewing, maintenance, repair, capital expenditures, drydocking, vessel
taxes, maintaining insurance and other vessel operating expenses under
management agreements with our vessel owning subsidiaries. TOP Tanker Management
has undertaken the technical management of 2 of the vessels in our tanker fleet
and has subcontracted the technical management of 11 of the vessels in our
tanker fleet to Unicom Management, a ship management company based in Cyprus,
and has subcontracted the technical management of 10 of the vessels in our
tanker fleet to V.Ships Management Limited, a ship management company based in
the Isle of Man. TOP Tanker Management pays a monthly fee of $14,000 per vessel
under its agreements with Unicom Management and a monthly fee of $10,000 per
vessel under its agreements with V.Ships Management. Under the terms of these
agreements, Unicom Management and V.Ships Management may be terminated at any
time upon 3 months notice.

         In July 2004, we entered into an agreement to lease office space in
Athens, Greece from Pyramis Technical Co. SA, which is wholly owned by the
father of our Chief Executive Officer. The agreement is for a duration of six
years initially, with an option for an extension of four years. The monthly
rental is Euro 39,000 adjusted annually for inflation effective January 1, 2006.
The minimum rentals payable under this lease for each of the years ending
December 31, 2005 through December 31, 2010, before any adjustment for inflation
and translated using the exchange rate of US$/Euro on December 31, 2004, are
approximately $3.4 million.

         Other major capital expenditures include funding our maintenance
program of regularly scheduled intermediate survey or special survey drydocking
necessary to preserve the quality of our vessels as well as to comply with
international shipping standards and environmental laws and regulations.
Although we have some flexibility regarding the timing of this maintenance, the
costs are relatively predictable. Management anticipates that these vessels
which are younger than 15 years are required to undergo in-water intermediate
surveys 2.5 years after a special survey drydocking and that vessels are to be
drydocked every five years, while vessels 15 years or older are to be drydocked
for an intermediate survey every 2.5 years in which case the additional
intermediate survey drydockings take the place of in-water surveys.

         During 2004, we had 250 off hire days associated with drydockings.
During 2003 we had 83 off hire days associated with 2 drydockings. Each
intermediate survey drydocking is estimated to require approximately 25 days and
each special survey drydocking is estimated to require approximately 35 days. In
addition to the costs described above, drydockings result in off hire time for a
vessel, during which the vessel is unable to generate revenue. Off hire time
includes the actual time the vessel is in the shipyard as well as ballast time
to the shipyard from the port of last discharge. The ability to meet this
maintenance schedule will depend on our ability to generate sufficient cash
flows from operations or to secure additional financing.

         NET CASH PROVIDED BY OPERATING ACTIVITIES-increased 483.7% to $28.6
million during 2004, compared to $4.9 million during the prior year. This
increase is primarily attributable to net income of $32.8 million and
depreciation and amortization of $15.4 million for 2004, compared to net income
of $1.6 million and depreciation and amortization of $4.3 million during the
prior year.

         NET CASH USED IN INVESTING ACTIVITIES-was $344.9 million during 2004
compared to net cash used in investing activities of $19.7 million during the
prior year. During the 2004, we expended $327.6 million for the acquisition of
12 tankers, compared to expending $19.6 million for the acquisition of 2 tankers
during the prior year.

         NET CASH PROVIDED BY FINANCING ACTIVITIES--was $428.7 million during
2004 compared to net cash provided by financing activities of $17.0 million
during the prior year. The change in cash provided by financing activities
relates to the following:

         o  Net proceeds from borrowing under long-term debt were $281.9 million
            in connection with the acquisition of 4 Suezmax tankers and 8
            product tankers during 2004 compared to $25.9 million in connection
            with our acquisition of 2 product tankers during the prior year.

         o  Principal repayments of long-term debt were $119.5 million during
            2004 compared to $14.3 million during the prior year.

         o  Net issuance of common stock and capital contributions to additional
            paid in capital were $281.1 million during 2004 compared to $6.5
            million during the prior year as a result of our initial public
            offering on July 23, 2004 and our follow-on offering on November 5,
            2004.

         o  Dividends of $2.3 million during 2004 compared to $0.6 million
            during the prior year.

         NET CASH PROVIDED BY OPERATING ACTIVITIES--increased 104.2% to $4.9
million during 2003, compared to $2.4 million during the prior year. This
increase is primarily attributable to net income of $1.6 million and
depreciation and amortization of $4.3 million for 2003 compared to net income of
$0.2 million and depreciation and amortization of $2.5 million during the prior
year.

         NET CASH USED IN INVESTING ACTIVITIES--was $19.7 million during 2003
compared to net cash used in investing activities of $18.3 million during the
prior year. During 2003, we expended $19.6 million for the acquisition of two
tankers, compared to expending $18.6 million for the acquisition of one tanker
during the prior year.

         NET CASH PROVIDED BY FINANCING ACTIVITIES--was $17.0 million during
2003 compared to net cash provided by financing activities of $14.2 million
during the prior year. The change in cash provided by financing activities
relates to the following:

         o  Net proceeds from borrowing under long-term debt were $25.9 million
            in connection with the acquisition of 2 product tankers during 2003
            compared to $15.6 million in connection with our acquisition of 1
            product tanker during the prior year.

         o  Principal repayments of long-term debt were $14.3 million during
            2003 compared to $2.6 million during the prior year.

         o  Capital contributions to additional paid in capital was $6.5 million
            during 2003 compared to $2.3 million during the prior year.

         Subsequent Events

         Fleet Composition: We currently own and operate a fleet of 22 vessels,
consisting of 13 product tankers and 9 double-hull Suezmax tankers. Two of our
Handymax tankers were delivered in March 2005 and 5 of our Suezmax tankers were
purchased in connection with the proceeds of the following-on offering of our
common stock in November 2004. We also expect to take delivery of the M/T
Soundless and the M/T Topless on or about April 18 and April 25, 2005,
respectively.

         In March 2005, we agreed to sell our final remaining single-hull
tanker, the M/T Yapi, for $8.5 million. On March 29, 2005, we also entered the
vessel into a bareboat charter with the purchasers until July 31, 2005, the
vessel's delivery date. We received an advance payment of $1 million and will be
paid a daily bareboat hire of $6,000 under the charter.

         New Credit Facilities: Please see the discussion in "Liquidity and
Capital Resources".

         Interest Rate Swaps: In connection with the new credit facility
discussed above, we entered into interest rate swap agreements, effective on
March 31, 2005: (i) for the initial amount of $93.5 million and for a period of
five years, with a fixed interest rate of 4.72% plus the applicable bank margin;
(ii) for the initial amount of $27.9 million and for a period of four years,
with a fixed interest rate of 4.58% plus the applicable bank margin; and (iii)
for the initial amount of $36.5 million and for a period of four years, with a
fixed interest rate of 4.66% plus the applicable bank margin.

         Fleet Management: TOP Tanker Management is responsible for the
chartering, operational and technical management of our tanker fleet under
management agreements with us. TOP Tanker Management will undertake the
technical management of two of the vessels to be delivered in late April 2005
and has subcontracted the technical management of 11 of the vessels in our
tanker fleet to Unicom Management, an unaffiliated ship management company based
in Cyprus, and the technical management of 11 of the vessels in our tanker fleet
to V.Ships Management Limited, an unaffiliated ship management company based in
the Isle of Man. TOP Tanker Management may subcontract the technical management
of vessels acquired in the future to other third party technical management
companies.

         London Office: On February 2, 2005, TOP TANKERS (U.K) LIMITED, a newly
established wholly-owned subsidiary to be engaged in the chartering of our
vessels, entered into a lease for office space in London. The lease will end on
December 31, 2005.

         Dividends: On March 16, 2005, we declared a dividend on our common
shares of $0.21 per share that was paid on April 12, 2005, to shareholders of
record of our common shares as of March 31, 2005.

         Critical Accounting Policies

         The discussion and analysis of our financial condition and results of
operations is based upon our consolidated financial statements, which have been
prepared in accordance with accounting principles generally accepted in the
United States, or U.S. GAAP. The preparation of those financial statements
requires us to make estimates and judgments that affect the reported amount of
assets and liabilities, revenues and expenses and related disclosure of
contingent assets and liabilities at the date of our financial statements.
Actual results may differ from these estimates under different assumptions or
conditions.

         Critical accounting policies are those that reflect significant
judgments or uncertainties, and potentially result in materially different
results under different assumptions and conditions. We have described below what
we believe are our most critical accounting policies that involve a higher
degree of judgment and the methods of their application. For a description of
all of our significant accounting policies, see Note 2 to our consolidated
financial statements included herein.

         Impairment of long-lived assets. We evaluate the carrying amounts and
periods over which long-lived assets are depreciated to determine if events have
occurred which would require modification to their carrying values or useful
lives. In evaluating useful lives and carrying values of long-lived assets, we
review certain indicators of potential impairment, such as undiscounted
projected operating cash flows, vessel sales and purchases, business plans and
overall market conditions. We determine undiscounted projected net operating
cash flows for each vessel and compare it to the vessel carrying value. In the
event that impairment occurred, we would determine the fair value of the related
asset and we would record a charge to operations calculated by comparing the
asset's carrying value to the estimated fair value. We estimate fair value
primarily through the use of third party valuations performed on an individual
vessel basis.

         Depreciation. We record the value of our vessels at their cost (which
includes acquisition costs directly attributable to the vessel and expenditures
made to prepare the vessel for its initial voyage) less accumulated
depreciation. We depreciate our vessels on a straight-line basis over their
estimated useful lives, estimated to be 25 years from date of initial delivery
from the shipyard. We believe that a 25-year depreciable life is consistent with
that of other shipowners. Depreciation is based on cost less the estimated
residual scrap value. A decrease in the useful life of the vessel or in the
residual value would have the effect of increasing the annual depreciation
charge. When regulations place limitations over the ability of a vessel to trade
on a worldwide basis, the vessel's useful life is adjusted at the date such
regulations become effective.

         Deferred drydock costs. Our vessels are required to be drydocked for
major repairs and maintenance that cannot be performed while the vessels are
operating approximately every 30 to 60 months. We capitalize the costs
associated with the drydocks as they occur and amortize these costs on a
straight line basis over the period between drydocks. Costs capitalized as part
of the drydock include actual costs incurred at the drydock yard; cost of fuel
consumed between the vessel's last discharge port prior to the drydock and the
time the vessel leaves the drydock yard; cost of hiring riding crews to effect
repairs on a ship and parts used in making such repairs that are reasonably made
in anticipation of reducing the duration or cost of the drydock; cost of travel,
lodging and subsistence of our personnel sent to the drydock site to supervise;
and the cost of hiring a third party to oversee a drydock. We believe that these
criteria are consistent with GAAP guidelines and industry practice, and that our
policy of capitalization reflect the economics and market values of the vessels.

         Allowance for doubtful accounts. Revenue is based on contracted charter
parties and, although our business is with customers who we believe to be of the
highest standard, there is always the possibility of dispute over terms and
payment of freight. In such circumstances, we assess the recoverability of
amounts outstanding and we estimate a provision if there is a possibility of
non-recoverability. Although we believe our provisions to be based on fair
judgment at the time of their creation, it is possible that an amount under
dispute is not recovered and the estimated provision for doubtful recoverability
is inadequate.

         Quantitative and Qualitative Disclosure of Market Risk

         Interest Rate Fluctuation. The international tanker shipping industry
is capital intensive, requiring significant amounts of investment. Much of this
investment is provided in the form of long-term debt. Our debt usually contains
interest rates that fluctuate with LIBOR. Increasing interest rates could
adversely impact future earnings.

         Our interest expense is affected by changes in the general level of
interest rates. As an indication of the extent of our sensitivity to interest
rate changes, The following table sets forth the sensitivity of the initial
credit facility in U.S. dollars to a 100 basis points increase in LIBOR on
December 31 of each repayment year. The following table takes into account the
four year interest rate swap agreement under the initial credit facility.


Interest Expense Sensitivity to 100 Basis Point Change in LIBOR

December 31, 2004...........................................        985,000
December 31, 2005...........................................        885,000
December 31, 2006...........................................        785,000
December 31, 2007...........................................        685,000
December 31, 2008...........................................      1,170,000
December 31, 2009...........................................        970,000
December 31, 2010...........................................        770,000
December 31, 2011...........................................        570,000
December 31, 2012...........................................              0

         Foreign Exchange Rate Risk. We generate all of our revenues in U.S.
dollars but incur approximately 14% of our expenses in currencies other than
U.S. dollars. For accounting purposes, expenses incurred in Euros are translated
into U.S. dollars at the exchange rate prevailing on the date of each
transaction.

         Inflation. Although inflation has had a moderate impact on our trading
fleet's operating and voyage expenses in recent years, management does not
consider inflation to be a significant risk to operating or voyage costs in the
current economic environment. However, in the event that inflation becomes a
significant factor in the global economy, inflationary pressures would result in
increased operating, voyage and financing costs.





                                TOP TANKERS INC.
                   INDEX TO CONSOLIDATED FINANCIAL STATEMENTS


                                                                        Page
                                                                       --------
Report of Ernst & Young, Independent Registered
  Public Accounting Firm                                                  F-2

Consolidated Balance Sheets as of December 31, 2003 and 2004              F-3

Consolidated Statements of Income for the years ended
  December 31, 2002, 2003 and 2004                                        F-4

Consolidated Statements of Stockholders' Equity for
  the years ended December 31, 2002,  2003 and 2004                       F-5

Consolidated Statements of Cash Flows for the
  years ended December 31, 2002, 2003 and 2004                            F-6

Notes to Consolidated Financial Statements                                F-7





             REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM




To the Stockholders of
TOP Tankers Inc.


We have audited the accompanying consolidated balance sheets of TOP Tankers Inc.
as of  December  31, 2003 and 2004 and the related  consolidated  statements  of
income,  stockholders'  equity and cash flows for each of the three years in the
period  ended   December  31,  2004.   These   financial   statements   are  the
responsibility of the Company's management.  Our responsibility is to express an
opinion on these financial statements based on our audits.

We conducted our audits in accordance  with the standards of the Public  Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement.  We were not engaged to perform an
audit of the Company's  internal  control over  financial  reporting.  Our audit
included  consideration of internal control over financial  reporting as a basis
for designing audit  procedures that are appropriate in the  circumstances,  but
not for the  purpose  of  expressing  an  opinion  on the  effectiveness  of the
Company's internal control over financial  reporting.  Accordingly we express no
such  opinion.  An audit also  includes  examining,  on a test  basis,  evidence
supporting the amounts and  disclosures in the financial  statements,  assessing
the accounting principles used and significant estimates made by management, and
evaluating the overall  financial  statement  presentation.  We believe that our
audits provide a reasonable basis for our opinion.

In our opinion,  the financial  statements  referred to above present fairly, in
all material respects,  the consolidated  financial position of TOP Tankers Inc.
at December 31, 2003 and 2004 and the consolidated results of its operations and
its cash flows for each of the three  years in the  period  ended  December  31,
2004, in conformity with U.S. generally accepted accounting principles.


                     Ernst & Young (Hellas) Certified Auditors Accountants S.A.

Athens, Greece
March 30, 2005






TOP TANKERS INC.
CONSOLIDATED BALANCE SHEETS
DECEMBER 31, 2003 AND 2004
(Expressed in thousands of U.S. Dollars - except share and per share data)



ASSETS
                                                                             2003         2004
                                                                             ----         ----
                                                                                     

CURRENT ASSETS:

   Cash and cash equivalents                                                2,343          114,768
   Accounts receivable trade, net                                             818           19,971
   Insurance claims                                                         1,065               98
   Inventories (Note 4)                                                       509            3,221
   Due from related parties (Note 3)                                            -              219
   Prepayments and other                                                      127            2,774
                                                                         --------         --------
         Total current assets                                               4,862          141,051
                                                                         --------         --------

FIXED ASSETS:
   Advances for vessel acquisitions (Notes 5 and 18)                            -           25,650
   Vessels, net  (Notes 6 and 8)                                           48,074          355,997
   Office furniture and equipment, net (Note 3)                                 -              440
                                                                         --------         --------
         Total fixed assets                                                48,074          382,087
                                                                         --------         --------

OTHER NON CURRENT ASSETS:
   Deferred charges, net (Note 7)                                           2,148            6,748
   Due from related parties (Note 3)                                          319                -
   Restricted cash (Note 8)                                                   300           10,000
                                                                         --------         --------
         Total assets                                                      55,703          539,886
                                                                         ========         ========

LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES:
   Current portion of long-term debt (Note 8)                               4,027           19,540
   Dividends payable                                                            -            5,845
   Accounts payable                                                         3,027           10,358
   Due to related parties (Note 3)                                            105                -
   Accrued liabilities (Note 9)                                               694            3,766
   Unearned revenue                                                         1,155            3,054
   Financial instruments (Note 8)                                               -              248
                                                                         --------         --------

         Total current liabilities                                          9,008           42,811
                                                                         --------         --------

LONG-TERM DEBT, net of current portion (Note 8)                            30,376          175,266
                                                                         --------         --------

STOCKHOLDERS' EQUITY:
   Preferred  stock,  $0.01  par  value;  20,000,000  shares
   authorized; none issued (Note  11)                                           -                -
   Common stock, $0.01 par value;  50,000,000 shares authorized;
   6,000,000 and  27,830,990  shares issued and  outstanding  at
   December 31, 2003 and 2004, respectively (Note 11)
                                                                               60              278
   Additional paid-in capital (Note 11)                                    13,351          294,240
   Accumulated other comprehensive loss (Note 8)                                -            (248)
   Retained earnings                                                        2,908           27,539
                                                                         --------         --------
         Total stockholders' equity                                        16,319          321,809
                                                                         --------         --------
         Total liabilities and stockholders' equity                        55,703          539,886
                                                                         ========         ========

The accompanying notes are an integral part of these consolidated statements.








TOP TANKERS INC.
CONSOLIDATED STATEMENTS OF INCOME
FOR THE YEARS ENDED DECEMBER 31, 2002, 2003 AND 2004
(Expressed in thousands of U.S. Dollars - except share and per share data)

                                                                2002          2003           2004
                                                                ----          ----           ----
                                                                                   
REVENUES:
Voyage revenues (Note 1)                                        11,426       23,085           93,829
                                                               --------    ---------        --------


EXPENSES:

    Voyage expenses (Note 13)                                    3,311        5,937           16,898
    Vessel operating expenses (Note 13)                          4,553        8,420           16,859
    Depreciation (Note 6)                                        2,213        3,604           13,108
    Amortization of deferred charges (Note 7)                      177          599            1,514
    Management fees charged by a related party (Note 3)            673        1,686            1,120
    Sub-Manager fees (Note 1)                                        -            -              803
    General and administrative expenses                            143          129            6,656
    Foreign currency losses, net                                    62          105               75
    Gain on sale of vessels (Note 6)                                 -            -             (638)
                                                               --------    ---------        --------
    Operating income                                               294        2,605           37,434
                                                               --------    ---------        --------

OTHER INCOME (EXPENSES):
   Interest and finance costs (Notes 8 and 14)                    (993)      (1,336)          (5,201)
   Interest income                                                   6            1              481
   Other, net (Note 15)                                            894          364               80
                                                               --------    ---------        --------
   Total other income (expenses), net                              (93)        (971)          (4,640)
                                                               --------    ---------        --------

Net Income                                                         201        1,634           32,794
                                                               ========    ========         ========
Earnings per share, basic and diluted (Notes 11 and 12)           0.03         0.27             2.54
                                                               ========    ========         ========

Weighted average number of shares, basic and diluted         6,000,000    6,000,000       12,922,449
                                                             ==========   ==========      ===========

The accompanying notes are an integral part of these consolidated statements.





TOP TANKERS INC.
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
FOR THE YEARS ENDED DECEMBER 31, 2002, 2003 AND 2004
(Expressed in thousands of U.S. Dollars - except share and per share data)

                                                            Capital Stock
                                                            -------------
                                                                                               Accumulated
                                                                                  Additional     Other
                                          Comprehensive                  Par       Paid-in     Comprehensive   Retained
                                             Income      # of Shares    Value     Capital         Loss         Earnings     Total
                                             ------      -----------    -----     -------         ----         --------     -----
                                                                                                      
BALANCE, December 31, 2001                                 6.000.000      60         4,588           -         2,488        7,136

   Net income                                  201                 -       -             -           -           201          201
   Contributions to additional
   paid-in capital                               -                 -       -         2,279           -             -        2,279

   Dividends paid ($0.14 per share)              -                 -       -             -           -          (844)        (844)
                                          --------
   Comprehensive income                        201
                                          ========         ----------  -------     --------     --------     ---------    ---------

BALANCE, December 31, 2002                                 6.000.000      60         6,867           -         1,845        8,772

   Net income                                1,634                 -       -             -           -         1,634        1,634
   Contributions to additional
   paid-in capital                               -                 -       -         6,484           -             -        6,484

   Dividends paid ($0.10 per share)              -                 -       -             -           -          (571)        (571)
                                          --------
   Comprehensive income                      1,634
                                          ========         ----------  -------     --------     --------     ---------    ---------

BALANCE, December 31, 2003                                 6.000.000      60        13,351           -         2,908       16,319

   Net income                               32,794                 -       -             -           -        32,794       32,794

   Dividends paid ($0.39 per share)              -                 -       -             -           -        (2,318)      (2,318)
   Contributions  to  additional
   paid-in capital                               -                 -       -        17,077           -             -       17,077

   Issuance of common stock                      -        21.830.990     218       263,812           -             -      264,030

   Dividends declared ($0.21 per share)          -                 -       -             -           -        (5,845)      (5,845)
   Other comprehensive income

   - Unrealized loss on cash flow hedges      (248)                -       -             -        (248)            -         (248)
                                          --------
   Comprehensive income                     32,546
                                          ========         ----------  -------     --------     --------     ---------    ---------

BALANCE, December 31, 2004                                27.830.990     278       294,240        (248)       27,539      321,809
                                                          ===========  =======     ========     ========     =========    =========

                                               The accompanying notes are an integral part of these consolidated statements.





TOP TANKERS INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED DECEMBER 31, 2002, 2003 AND 2004
(Expressed in thousands of U.S. Dollars)


                                                                2002          2003         2004
                                                                ----          ----         ----
                                                                                   
Cash Flows from Operating Activities:
   Net income                                                    201          1,634         32,794
   Adjustments to reconcile net income to
   net cash provided by operating activities:

   Depreciation                                                2,213          3,604         13,108
   Amortization of dry-docking costs                             177            599          1,514

   Amortization and write off of
   deferred  financing costs                                     161            121            755
   Gain on sale of vessels                                         -              -           (638)
   (Increase) Decrease in: Accounts receivable                    87           (689)       (19,153)
     Insurance claims                                           (278)          (787)           967
     Inventories                                                 (48)          (220)        (2,712)
     Due from related parties                                      -              -           (219)
     Prepayments and other                                        25            (72)        (2,647)
   Increase (Decrease) in:
     Accounts payable                                            497          1,883          7,331
     Due to related parties                                      385           (204)          (105)
     Accrued liabilities                                         228            320          3,072
     Unearned revenue                                           (729)         1,155          1,899
   Payments for dry-docking                                     (510)        (2,414)        (7,365)
                                                             -------        --------       --------
Net Cash from Operating Activities                             2,409          4,930         28,601
                                                             -------        --------       --------

Cash Flows from (used in) Investing Activities:
     Advances for vessel acquisitions                              -              -        (25,650)
     Vessel acquisitions and improvements                    (18,547)       (19,550)      (327,629)
     Advances to related parties                                 251           (151)           319
     Net proceeds from sale of vessels                             -              -          8,536
     Expenditures for property and equipment                       -              -           (475)
                                                             -------        --------       --------
Net Cash used in Investing Activities                        (18,296)       (19,701)      (344,899)
                                                             -------        --------       --------

Cash Flows from (used in) Financing Activities:
     Proceeds from long-term debt                             15,550         25,850        281,900
     Principal payments of long-term debt                     (2,550)        (3,059)        (4,251)
     Repayment of long-term debt                                   -        (11,230)      (115,260)
     Increase in restricted cash                                   -           (300)        (9,700)
     Contributions to additional paid-in capital               2,279          6,484         17,077
     Issuance of common stock                                      -              -        264,030
     Payment of financing costs                                 (200)          (154)        (2,755)
     Dividends paid                                             (844)          (571)        (2,318)
                                                             -------        --------       --------
Net Cash from Financing Activities                            14,235         17,020        428,723
                                                             -------        --------       --------

Net increase (decrease) in cash and cash equivalents          (1,652)         2,249        112,425
Cash and cash equivalents at beginning of year                 1,746             94          2,343
                                                             -------        --------       --------
Cash and cash equivalents at end of year                          94          2,343        114,768
                                                             =======        ========       ========

SUPPLEMENTAL CASH FLOW INFORMATION
       Interest paid                                             727          1,045          3,157
                                                             =======        ========       ========

The accompanying notes are an integral part of these consolidated statements.




TOP TANKERS INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2003 AND 2004
(Expressed in thousands of United States Dollars - except share and per share
data, unless otherwise stated)

1.   Basis of Presentation and General Information:

     The accompanying  consolidated financial statements include the accounts of
     TOP  Tankers  Inc.   (formerly   Ocean   Holdings  Inc.)  ("TOP")  and  its
     wholly-owned subsidiaries (collectively the "Company"). Ocean Holdings Inc.
     was formed on January 10,  2000,  under the laws of Marshall  Islands,  was
     renamed  to TOP  Tankers  Inc.  in May 2004  and is the  sole  owner of all
     outstanding shares of the following subsidiaries:

     (a)  TOP Tanker  Management  Inc., (the  "Manager")  established on May 24,
          2004,  under the laws of Marshall  Islands,  is responsible for all of
          the chartering,  operational and technical management of the Company's
          fleet.  Up to June 30, 2004 the operations of the vessels were managed
          by Primal Tankers Inc., a related Liberian corporation which is wholly
          owned by the father of the Company's Chief Executive Officer (Note 3).
          Since  July  1,  2004  the  ship-owning  companies  have a  management
          agreement  with the  Manager,  under  which  management  services  are
          provided in exchange for a fixed  monthly fee per vessel.  The Manager
          has an office in Greece  located at 109-111,  Messogion  Avenue 115 26
          Athens Greece. The Manager  subcontracted the technical  management of
          the vessels to two  unaffiliated  ship  management  companies,  Unicom
          Management  Services Ltd and VShips Management  Limited  (collectively
          the "Sub-Manager"). The Sub-Manager provides operational and technical
          services to Company's vessels at a fixed monthly fee per vessel.  Such
          fees  for the year  ended  December  31,  2004  totaled  $ 803 and are
          separately  reflected in the accompanying 2004 consolidated  statement
          of income.  At  December  31,  2004 the amount due to the  Sub-Manager
          totaled  $  2,139  and  is  included   in  Accounts   Payable  in  the
          accompanying 2004 consolidated balance sheet.

     (b)  Helidona  Shipping Company Limited  ("Helidona"),  incorporated in the
          Marshall  Islands  in May 2003,  owner of the  29,998  DWT,  (built in
          1989),  tanker vessel "Yapi" and Helidona  Shipping  Company  Limited,
          incorporated in British Cayman Islands in August 2000, former owner of
          vessel "Yapi", which was acquired in August 2000.

     (c)  Gramos Shipping Company Inc. ("Gramos"),  incorporated in the Marshall
          Islands  in  January  2003,  owner of the  45,720 DWT (built in 1992),
          tanker vessel  "Faithful",  which was acquired in July 2003 and Vermio
          Shipping  Company  Limited,  incorporated  in the Marshall  Islands in
          December 2001, owner of vessel "Faithful" for the period from February
          2002 to July 2003.

     (d)  Rupel Shipping  Company Inc.  ("Rupel"),  incorporated in the Marshall
          Islands  in  January  2003,  owner of the  44,646  DWT (built in 1992)
          tanker vessel "Fearless", which was acquired in February 2003.

     (e)  Mytikas  Shipping  Company  Ltd.  ("Mytikas"),   incorporated  in  the
          Marshall  Islands in February 2004, owner of the 136,055 DWT (built in
          1993) tanker vessel "Limitless", which was acquired in March 2004.

     (f)  Litochoro  Shipping  Company Ltd.  ("Litochoro"),  incorporated in the
          Marshall  Islands in March  2004,  owner of the  135,915 DWT (built in
          1992) tanker vessel "Endless", which was acquired in March 2004.

     (g)  Falakro Shipping Company Ltd. ("Falakro"),  incorporated in Liberia in
          July  2004,  owner of the 47,076  DWT  (built in 1991)  tanker  vessel
          "Doubtless", which was acquired in August 2004.

     (h)  Pageon  Shipping  Company Ltd.  ("Pageon"),  incorporated in Cyprus in
          July  2004,  owner of the 47,084  DWT  (built in 1992)  tanker  vessel
          "Vanguard", which was acquired in August 2004.

     (i)  Vardousia Shipping Company Ltd. ("Vardousia"),  incorporated in Cyprus
          in July 2004,  owner of the 47,084 DWT (built in 1992)  tanker  vessel
          "Invincible", which was acquired in August 2004.

     (j)  Psiloritis  Shipping  Company  Ltd.  ("Psiloritis"),  incorporated  in
          Liberia in July 2004,  owner of the 47,084 DWT (built in 1991)  tanker
          vessel "Victorious", which was acquired in August 2004.

     (k)  Parnon  Shipping  Company Ltd.  ("Parnon"),  incorporated in Cyprus in
          July  2004,  owner of the 47,084  DWT  (built in 1992)  tanker  vessel
          "Relentless", which was acquired in August 2004.

     (l)  Menalo  Shipping  Company Ltd.  ("Menalo"),  incorporated in Cyprus in
          July  2004,  owner of the 47,084  DWT  (built in 1991)  tanker  vessel
          "Restless", which was acquired in August 2004.

     (m)  Pintos  Shipping  Company Ltd.  ("Pintos"),  incorporated in Cyprus in
          July  2004,  owner of the 47,084  DWT  (built in 1992)  tanker  vessel
          "Sovereign", which was acquired in August 2004.

     (n)  Pylio  Shipping  Company Ltd.  ("Pylio"),  incorporated  in Liberia in
          2004,  owner  of  the  154,970  DWT  (built  in  1991)  tanker  vessel
          "Flawless", which was acquired in September 2004.

     (o)  Idi Shipping  Company Ltd.  ("Idi"),  incorporated  in Liberia in July
          2004,   owner  of  the  47,094  DWT  (built  in  1991)  tanker  vessel
          "Spotless", which was acquired in September 2004.

     (p)  Taygetus Shipping Company Ltd.  ("Taygetus"),  incorporated in Liberia
          in July 2004,  owner of the 154,970 DWT (built in 1991) tanker  vessel
          "Timeless", which was acquired in September 2004.

     (q)  Kalidromo Shipping Company Limited ("Kalidromo"),  incorporated in the
          Marshall  Islands in May 2003, owner of the 31,766 DWT (built in 1980)
          tanker vessel "Tireless", which was sold in September 2004.

     (r)  Olympos  Shipping  Company  Limited  ("Olympos"),  incorporated in the
          Marshall Islands in May 2003, owner of the 29,990 DWT (built in 1985),
          tanker  vessel "Med  Prologue"  which was sold on December 6, 2004 and
          Olympos  Shipping  Company  Limited,  incorporated  in British  Cayman
          Islands in December 1999, former owner of the vessel.

     (s)  Kisavos  Shipping  Company  Limited  ("Kisavos"),  incorporated in the
          Marshall  Islands in November 2004, to be the owner of the 154,970 DWT
          (built in 1991) tanker vessel "Priceless" (Notes 5 and 18).

     (t)  Imitos  Shipping  Company  Limited  ("Imitos"),  incorporated  in  the
          Marshall  Islands in November 2004, to be the owner of the 149,554 DWT
          (built in 1992) tanker vessel "Noiseless" (Notes 5 and 18).

     (u)  Parnis  Shipping  Company  Limited  ("Parnis"),  incorporated  in  the
          Marshall  Islands in November 2004, to be the owner of the 149,599 DWT
          (built in 1992) tanker vessel "Stainless" (Notes 5 and 18).

     (v)  Parnasos  Shipping  Company  Limited  ("Parnasos"),   incorporated  in
          Liberia in November 2004, to be the owner of the 154,970 DWT (built in
          1992) tanker vessel "Faultess" (Notes 5 and 18).

     (w)  Vitsi Shipping Company Limited  ("Vitsi"),  incorporated in Liberia in
          November  2004,  to be the owner of the  154,970  DWT  (built in 1991)
          tanker vessel "Stopless" (Notes 5 and 18).

     The Company is engaged in the ocean transportation of crude oil and refined
     petroleum  cargoes  worldwide  through the  ownership  and operation of the
     tanker vessels mentioned above.

     At December 31, 2004, five vessels were operating under voyage charters and
     ten vessels under long-term time charters, with an estimated duration of 24
     months,  including  a  profit  sharing  agreement,  which is  settled  on a
     calendar  quarter basis.  During 2004, 44% of the Company's voyage revenues
     were derived from these time charter agreements. During 2002, 2003 and 2004
     four charterers  individually  accounted for more than 10% of the Company's
     voyage revenues as follows:

                  Charterer       2002      2003      2004
                  ---------       ----      ----      ----

                     A               -       31%        29%
                     B             20%       16%          -
                     C             21%         -          -
                     D             24%         -        15%

2.   Significant Accounting Policies:

     (a)  Principles of Consolidation:  The accompanying  consolidated financial
          statements  have been  prepared  in  accordance  with  U.S.  generally
          accepted  accounting  principles  ("US GAAP") and include the accounts
          and  operating  results  of Top  Tankers  Inc.  and  its  wholly-owned
          subsidiaries  referred  to in Note  1.  All  significant  intercompany
          balances and transactions have been eliminated in consolidation.

     (b)  Use of Estimates: The preparation of consolidated financial statements
          in  conformity  with U.S.  generally  accepted  accounting  principles
          requires  management to make estimates and assumptions that affect the
          reported   amounts  of  assets  and   liabilities  and  disclosure  of
          contingent  assets  and  liabilities  at the date of the  consolidated
          financial statements and the reported amounts of revenues and expenses
          during the reporting  period.  Actual  results could differ from those
          estimates.

     (c)  Other  Comprehensive  Income:  The Company  follows the  provisions of
          Statement   of   Financial    Accounting   Standards   "Statement   of
          Comprehensive Income" (SFAS 130), which requires separate presentation
          of certain transactions,  which are recorded directly as components of
          stockholders' equity.

     (d)  Foreign Currency  Translation:  The functional currency of the Company
          is  the  U.S.   Dollar  because  the  Company's   vessels  operate  in
          international  shipping  markets,  and  therefore  primarily  transact
          business  in  U.S.  Dollars.  The  Company's  books  of  accounts  are
          maintained in U.S.  Dollars.  Transactions  involving other currencies
          during the year are  converted  into U.S.  Dollars  using the exchange
          rates in effect at the time of the transactions.  At the balance sheet
          dates, monetary assets and liabilities, which are denominated in other
          currencies,  are  translated to reflect the year-end  exchange  rates.
          Resulting gains or losses are reflected separately in the accompanying
          consolidated statements of income.

     (e)  Cash  and  Cash  Equivalents:  The  Company  considers  highly  liquid
          investments  such as time deposits and certificates of deposit with an
          original maturity of three months or less to be cash equivalents.

     (f)  Accounts    Receivable--Trade:    The   amount   shown   as   Accounts
          Receivable--Trade  at each  balance  sheet  date,  includes  estimated
          recoveries from charterers for hire,  freight and demurrage  billings,
          net of a provision for doubtful accounts.  At each balance sheet date,
          all potentially  uncollectible  accounts are assessed individually for
          purposes  of  determining  the  appropriate   provision  for  doubtful
          accounts.  Provision  for  doubtful  accounts at December 31, 2003 and
          2004 totaled to $0 and $132, respectively.

     (g)  Insurance  Claims:  Insurance claims are recorded on the accrual basis
          and represent the claimable  expenses,  net of  deductibles,  incurred
          through  December 31 of each year,  which are expected to be recovered
          from insurance companies.

     (h)  Inventories: Inventories consist of bunkers, lubricants and consumable
          stores  which  are  stated  at the  lower of cost or  market.  Cost is
          determined by the first in, first out method.

     (i)  Vessel  Cost:  Vessels  are  stated  at cost,  which  consists  of the
          contract  price and any material  expenses  incurred upon  acquisition
          (initial  repairs,  improvements  and delivery  expenses).  Subsequent
          expenditures   for  conversions  and  major   improvements   are  also
          capitalized  when  they  appreciably  extend  the life,  increase  the
          earning  capacity or improve the  efficiency  or safety of the vessels
          otherwise these amounts are charged to expense as incurred.

     (j)  Impairment  of  Long-Lived   Assets:  The  Company  applies  SFAS  144
          "Accounting  for the  Impairment  or Disposal of  Long-lived  Assets",
          which addresses financial  accounting and reporting for the impairment
          or  disposal  of  long-lived   assets.  The  standard  requires  that,
          long-lived assets and certain  identifiable  intangibles held and used
          or disposed of by an entity be reviewed for impairment whenever events
          or changes in  circumstances  indicate that the carrying amount of the
          assets may not be recoverable.  When the estimate of undiscounted cash
          flows, excluding interest charges, expected to be generated by the use
          of the asset is less than its  carrying  amount,  the  Company  should
          evaluate  the  asset  for  an  impairment  loss.  Measurement  of  the
          impairment loss is based on the fair value of the asset as provided by
          third  parties.  In this  respect,  management  regularly  reviews the
          carrying  amount  of the  vessels  in  connection  with the  estimated
          recoverable amount for each of the Company's  vessels.  The review for
          impairment of each vessel's  carrying  amount as of December 31, 2002,
          2003 and 2004, did not result in an indication of an impairment loss.

     (k)  Vessel Depreciation:  Depreciation is computed using the straight-line
          method  over  the  estimated   useful  life  of  the  vessels,   after
          considering the estimated  salvage value.  Each vessel's salvage value
          is equal to the product of its lightweight tonnage and estimated scrap
          rate. With the exception of the vessel Tireless,  Management estimates
          the useful life of the Company's  vessels to be 25 years from the date
          of  initial  delivery  from the  shipyard.  Second  hand  vessels  are
          depreciated from the date of their acquisition through their remaining
          estimated  useful  life.  The useful life of the vessel  Tireless  was
          estimated to 28 years,  which coincided with the validity of the class
          certificate.  When regulations place limitations over the ability of a
          vessel to trade on a worldwide  basis,  its useful life is adjusted at
          the date such regulations become effective.

     (l)  Accounting for  Dry-Docking  Costs:  The Company  follows the deferral
          method of  accounting  for  dry-docking  costs  whereby  actual  costs
          incurred are deferred and are amortized on a straight-line  basis over
          the  period  through  the  date  the  next  dry-docking  becomes  due.
          Unamortized dry-docking costs of vessels that are sold are written off
          and included in the  calculation  of the resulting gain or loss in the
          year of the vessel's sale.

     (m)  Financing Costs:  Fees incurred for obtaining new loans or refinancing
          existing  ones  are  recorded  as a  contra  to  debt.  Such  fees are
          amortized to interest  expense over the life of the related debt using
          the  effective  interest  method.  Unamortized  fees relating to loans
          repaid or  refinanced  are  expensed  in the period the  repayment  or
          refinancing is made.

     (n)  Pension and Retirement  Benefit  Obligations  -Crew:  The  ship-owning
          companies  included  in the  consolidation,  employ the crew on board,
          under   short-term   contracts   (usually  up  to  nine   months)  and
          accordingly,  they are not liable for any  pension or post  retirement
          benefits.

     (o)  Staff leaving  Indemnities - Administrative  personnel:  The Company's
          employees  are  entitled  to  termination  payments  in the  event  of
          dismissal or retirement with the amount of payment varying in relation
          to the  employee's  compensation,  length  of  service  and  manner of
          termination  (dismissed  or  retired).  Employees  who resign,  or are
          dismissed  with cause are not entitled to  termination  payments.  The
          Company's  liability on an actuarially  determined  basis, at December
          31, 2003 and 2004 amounted to $0 and $77, respectively.

     (p)  Accounting  for Revenue and  Expenses:  Revenues  are  generated  from
          voyage and time charter agreements. Time charter revenues are recorded
          over the term of the  charter as service is  provided.  Under a voyage
          charter the revenues and  associated  voyage costs are recognized on a
          pro-rata basis over the duration of the voyage.  A voyage is deemed to
          commence  upon the  completion  of discharge of the vessel's  previous
          cargo and is deemed to end upon the  completion  of  discharge  of the
          current cargo.  Demurrage income represents  payments by the charterer
          to the vessel  owner when  loading or  discharging  time  exceeded the
          stipulated time in the voyage charter.  Vessel operating  expenses are
          accounted for on the accrual basis.  Unearned revenue  represents cash
          received  prior to year-end  related to revenue  applicable to periods
          after December 31 of each year.

     (q)  Repairs  and  Maintenance:  All repair and  maintenance  expenses  and
          underwater inspection expenses are expensed in the year incurred. Such
          costs are included in vessel  operating  expenses in the  accompanying
          consolidated statements of income.

     (r)  Earnings per Share:  Basic earnings per share are computed by dividing
          net income by the  weighted  average  number of common  shares  deemed
          outstanding during the year. Diluted earnings per share,  reflects the
          potential  dilution that could occur if securities or other  contracts
          to issue  common  stock were  exercised.  The  Company had no dilutive
          securities outstanding during the three year period ended December 31,
          2004.

     (s)  Segment  Reporting:  The Company  reports  financial  information  and
          evaluates its operations by charter  revenues and not by the length of
          ship employment for its customers,  i.e.,  spot or time charters.  The
          Company does not have discrete  financial  information to evaluate the
          operating results for each such type of charter.  Although revenue can
          be identified for these types of charters,  management cannot and does
          not identify  expenses,  profitability or other financial  information
          for these  charters.  As a  result,  management,  including  the chief
          operating decision maker,  reviews operating results solely by revenue
          per day and  operating  results of the fleet and thus the  Company has
          determined that it operates under one reportable segment. Furthermore,
          when the Company  charters a vessel to a charterer,  the  charterer is
          free to trade the vessel worldwide and, as a result, the disclosure of
          geographic information is impracticable.

     (t)  Derivatives:  SFAS No. 133, "Accounting for Derivative Instruments and
          Hedging Activities" (as amended) establishes  accounting and reporting
          standards  requiring  that  every  derivative   instrument  (including
          certain  derivative   instruments  embedded  in  other  contracts)  be
          recorded in the balance sheet as either an asset or liability measured
          at its  fair  value,  with  changes  in the  derivatives'  fair  value
          recognized  currently in earnings  unless  specific  hedge  accounting
          criteria are met.

          During 2004, the Company engaged in an interest rate swap agreement in
          order to hedge the exposure of interest rate  fluctuations  associated
          with the cash  flows  on a  portion  of the  Company's  variable  rate
          borrowings  (Note 8). This swap  agreement is designated and qualifies
          as a cash  flow  hedge.  Its  fair  value  is  included  in  financial
          instruments in the accompanying 2004  consolidated  balance sheet with
          changes  in the  effective  portion  of the  instrument's  fair  value
          recorded in accumulated  other  comprehensive  loss.  The  ineffective
          portion  of the  change  in fair  value  of the  derivative  financial
          instrument  is  immediately  recognized  in the income  statement as a
          component  of  interest  and  finance  cost.  If the hedged  item is a
          forecasted  transaction  that  later  is not  expected  to or will not
          occur, then the derivative financial instrument no longer qualifies as
          a  cash  flow  hedge.  As a  result,  fair  value  changes  that  were
          previously  recorded  in  accumulated  other  comprehensive  loss  are
          immediately  recognized  in  earnings  as  a  component  of  financial
          income/expense.  In all other instances,  when a derivative  financial
          instrument ceases to be designated or to qualify as a cash flow hedge,
          the  previously  recorded  changes in fair value remain in accumulated
          other comprehensive income until the hedged item affects earnings.  It
          is the Company's intention to hold this swap agreement to maturity.

          The off-balance sheet risk in outstanding  option agreements  involves
          the risk of a  counter  party  not  performing  under the terms of the
          contract . 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
          parties that meet stringent  qualifications  and, given the high level
          of credit quality of its derivative counterparty, the Company does not
          believe it is necessary to obtain collateral arrangements.

     (u)  Recent Accounting Pronouncements:

          FASB  Interpretation  No.  46R:  In  December  2003,  the FASB  issued
          Interpretation  No. 46R,  Consolidation of Variable Interest Entities,
          an Interpretation of ARB No. 51 (the "Interpretation"),  which revised
          Interpretation  No. 46,  issued in January  2003.  The  Interpretation
          addresses the consolidation of business enterprises (variable interest
          entities) to which the usual condition (ownership of a majority voting
          interest) of consolidation does not apply. The Interpretation  focuses
          on financial interests that indicate control. It concludes that in the
          absence  of  clear  control  through  voting  interests,  a  company's
          exposure  (variable  interest)  to the  economic  risks and  potential
          rewards from the variable  interest entity's assets and activities are
          the best  evidence  of  control.  Variable  interests  are  rights and
          obligations  that convey  economic gains or losses from changes in the
          value  of the  variable  interest  entity's  assets  and  liabilities.
          Variable  interests  may arise  from  financial  instruments,  service
          contracts,  and other arrangements.  If an enterprise holds a majority
          of the variable  interests of an entity,  it would be  considered  the
          primary  beneficiary.  The  primary  beneficiary  would be required to
          include  assets,  liabilities,  and the results of  operations  of the
          variable  interest's entity in its financial  statements.  The Company
          was required to adopt the  provisions of FIN 46R for entities  created
          prior to February  2003, in 2004.  The adoption of FIN 46R in 2004 did
          not have any impact on the Company's  consolidated financial position,
          results of operations or cash flows.

     (v)  Reclassifications  of Prior Year Balances: A reclassification has been
          made to the 2003 consolidated  financial  statements to conform to the
          presentation in the 2004 consolidated financial statements.  An amount
          of $208, concerning  unamortized deferred financing fees, which is now
          presented as a contra to current  portion of long-term  debt ($57) and
          as a contra  to  long-term  debt,  net of  current  portion  ($151) at
          December 31, 2003, was previously classified in deferred charges, net.

3.   Transactions with Related Parties:

     (a)  Primal  Tankers Inc.: As discussed in Note 1, up to June 30, 2004, the
          ship-owning  companies had a management  agreement with Primal Tankers
          Inc., under which management  services were provided in exchange for a
          fixed  monthly fee per vessel,  which was renewed  annually.  The fees
          charged by Primal Tankers Inc.  during 2002, 2003 and 2004 amounted to
          $673,  $1,686  and  $1,120,  respectively,  and  they  are  separately
          reflected in the accompanying  consolidated  statements of income.  At
          December 31, 2003 and 2004 the amounts due to and from Primal  Tankers
          Inc. totalled $105 and $219, respectively and are separately reflected
          in the accompanying  consolidated  balance sheets.  As of December 31,
          2003, the Company had advanced to Primal Tankers Inc. $319 of deposits
          as a security  for the  performance  by the  ship-owning  companies of
          their  obligations  under the  management  agreements.  Such deposits,
          following the termination of the management agreements,  were refunded
          to the  Company  free of  interest.  The amount of $319 is  separately
          reflected  under Other  Non-Current  Assets in the  accompanying  2003
          consolidated  balance  sheet.  During 2004 the Manager  acquired  from
          Primal Tankers Inc. office furniture and equipment for a consideration
          of $475. Depreciation expense for 2004 amounted to $35 and is included
          in depreciation in the  accompanying  2004  consolidated  statement of
          income.

     (b)  Pyramis  Technical Co. S.A.: On July 9, 2004 the Company  concluded an
          agreement  to  lease  office  space in  Athens,  Greece  from  Pyramis
          Technical Co. SA, which is wholly owned by the father of the Company's
          Chief  Executive  Officer.  The agreement is for duration of six years
          beginning July 2004 with an option for an extension of four years. The
          monthly rental is Euro 39,000 adjusted annually for inflation increase
          effective January 1, 2006. General and administrative expenses for the
          year ended  December  31, 2004 include $281 of rentals paid to Pyramis
          Technical Co. S.A. The minimum rentals payable under operating  leases
          for each of the years ending  December  31, 2005 through  December 31,
          2010 before any  adjustment  for  inflation and  translated  using the
          exchange rate of $/Euro at December 31, 2004 are:

         Year                                  Amount
         ----                                  ------

         2005                                       622
         2006                                       622
         2007                                       622
         2008                                       622
         2009 and thereafter                        950
                                             -----------
                                                  3,438
                                             ===========

4.   Inventories:

     The  amounts  shown in the  accompanying  consolidated  balance  sheets are
     analyzed as follows:

                                                    2003         2004
                                                    ----         ----

          Bunkers                                    242        2,096
          Lubricants                                 147          805
          Consumable stores                          120          320
                                                   -----        ------
                                                     509        3,221
                                                   =====        =======

5.   Advances for Vessel Acquisitions:

     In November 2004, Kisavos,  Imitos, Parnis, Parnasos and Vitsi entered into
     memoranda  of  agreement  to  acquire  the  vessels  Priceless,  Noiseless,
     Stainless,  Faultless and Stopless,  respectively,  for a total amount of $
     256,500. Under the terms of the agreements, the Company, as of December 31,
     2004, paid $25,650 representing a 10% deposit on the purchase price of each
     vessel.  The  acquisitions  will  be  financed  from  the  proceeds  of the
     Company's follow-on public offering discussed in Note 11 and from long-term
     bank financing.  As of December 31, 2004, remaining contracted payments for
     vessels acquisitions,  all due in 2005, amounted to $230,850.  The expected
     delivery date of the Priceless is February 2005. The expected delivery date
     of the Noiseless, Stainless, Faultless and Stopless is April 2005.

6.   Vessels, net:

     The amounts in the accompanying consolidated balance sheets are analyzed as
     follows:

                                            Vessel    Accumulated      Net
                                             Cost     Depreciation   Book Value
                                             ----     ------------   ----------

      Balance, December 31, 2002             36,396       (4,268)       32,128
      -  Acquisitions                        19,550            -        19,550
      -  Depreciation                             -       (3,604)       (3,604)
                                           --------     --------      --------

      Balance, December 31, 2003             55,946       (7,872)       48,074
      -  Acquisitions                       327,629            -       327,629
      -  Disposals (Tireless and
         Med Prologue)                      (10,024)       3,391        (6,633)
      -  Depreciation                             -      (13,073)      (13,073)
                                           --------     --------      --------
      Balance, December 31, 2004            373,551      (17,554)      355,997
                                           ========     ========      ========

     Acquisitions  during the year ended  December  31, 2004  represent  (a) the
     acquisition cost of the vessels Limitless and Endless for a total amount of
     $75,846, (b) the acquisition cost of the ten vessels discussed in Note 1(g)
     through Note 1(p) for a total amount of $251,257  and (c)  improvements  of
     $526 on the vessel Yapi.

     In  September  and  December  2004  vessels   Tireless  and  Med  Prologue,
     respectively,  were sold for $8,900.  These sales,  after the related sales
     expenses  of $364  and the  unamortized,  as of each  vessel's  sale  date,
     dry-docking and financing  costs written off of $1,265,  resulted in a gain
     of  $638,  which  is  separately   reflected  in  the   accompanying   2004
     consolidated statement of income.

     All  Company's  vessels,  having  a total  carrying  value of  $355,997  at
     December 31, 2004,  have been  provided as  collateral  to secure the loans
     discussed in Note 8.

7.   Deferred Charges, net:

     The unamortized amounts included in the accompanying consolidated balance
     sheets represent dry-docking costs and are analyzed as follows:

     Balance, December 31, 2002                                           333
     - Additions                                                        2,414
     - Write-off due to loan repayment                                      -
     - Amortization                                                      (599)
                                                                --------------
     Balance, December 31, 2003                                         2,148
     - Additions                                                        7,365
     - Write-off due to sale of vessels (Note 6)                       (1,251)
     - Write-off due to loan repayment or refinancing                       -
     - Amortization                                                    (1,514)
                                                                --------------

     Balance, December 31, 2004                                         6,748
                                                                ==============

     Write-off of deferred  charges due to vessels sale is included in gain from
     vessels sale in the accompanying 2004 consolidated statement of income.

8.   Long-term Debt:

     The amounts in the accompanying consolidated balance sheets are analyzed as
     follows:

Borrower(s)                                            2003           2004
                                                      -------       -------

(a) The Company                                              -       194,806
(b) Mytikas                                                  -             -
(c) Litochoro                                                -             -
(d) Helidona and Olympos                                10,148             -
(e) Gramos                                              11,403             -
(f) Kalidromo                                            1,800             -
(g) Rupel                                               11,052             -
                                                       -------      ---------
     Total                                              34,403       194,806

     Less - current portion                             (4,027)      (19,540)
                                                       -------      ---------
     Long - term portion                                30,376       175,266
                                                       =======      =========

     (a)  The  Company:  In late July 2004 the Company  concluded a bank loan to
          partially  finance  the  acquisition  cost of the ten  tanker  vessels
          discussed in Note 6 and to refinance  the  Company's  existing  loans,
          with the exception of the Kalidromo loan  discussed in (f) below.  The
          bank loan was for the amount of  $222,000  divided  into 2 tranches of
          $197,000 and $25,000, respectively. The $197,000 tranche is payable in
          16 consecutive  semi-annual  installments  of $10,000 each, from March
          31, 2005 to September 2012, plus a balloon payment of $ 37,000 payable
          together with the last  installment.  The $25,000  tranche,  which was
          partially  repaid  ($2,310)  from  the  sale  proceeds  of the  vessel
          Tireless,  was repaid in full, on November 15, 2004, from the proceeds
          of the Company's follow-on offering (Note 11). The loan bears interest
          at LIBOR  plus a  margin.  At  December  31,  2004 the  interest  rate
          (including the margin) was 4.60%.

     (b)  Mytikas:  Loan for an amount of $30,400,  obtained  in March 2004,  to
          partially finance the acquisition cost of vessel Limitless.  On August
          17,  2004,  the  outstanding  balance  of the loan as of that date was
          refinanced from the proceeds of the loan discussed in (a) above.

     (c)  Litochoro:  Loan for an amount of $29,500,  obtained in March 2004, to
          partially  finance the acquisition  cost of vessel Endless.  On August
          17,  2004,  the  outstanding  balance  of the loan as of that date was
          refinanced from the proceeds of the loan discussed in (a) above.

     (d)  Helidona  and  Olympos:  Loan for an amount of  $10,520,  obtained  in
          September 2003, to refinance their then outstanding loan balances.  On
          August 12, 2004, the  outstanding  balance of the loan as of that date
          was refinanced from the proceeds of the loan discussed in (a) above.

     (e)  Gramos:  Loan for an amount of  $11,750,  obtained  in July  2003,  to
          assist Gramos in financing  the  acquisition  cost of vessel  Faithful
          from Vermio. On October 15, 2004, the outstanding  balance of the loan
          as of that date was refinanced from the proceeds of the loan discussed
          in (a) above.

     (f)  Kalidromo:  Loan for an amount of $2,100,  obtained  in June 2003,  to
          partially  finance the acquisition cost of the vessel  Tireless.  Upon
          the sale of the vessel Tireless on September 24, 2004, the outstanding
          balance of the loan ($1,413) was fully repaid.

     (g)  Rupel:  Loan for an amount of $12,000,  obtained in February  2003, to
          partially  finance the  acquisition  cost of the vessel  Fearless.  On
          October 15, 2004, the outstanding  balance of the loan as of that date
          was refinanced from the proceeds of the loan discussed in (a) above.

     The  loan is secured as follows:

     o    First priority mortgages over the Company's vessels;
     o    Assignments of insurance and earnings of the mortgaged vessels;
     o    Corporate guarantee of the TOP Tankers Inc;
     o    Pledge over the earnings accounts of the vessels.

     The loan, among others,  contains financial covenants requiring the Company
     to ensure that the aggregate  market value of the mortgaged  vessels at all
     times exceed 130% of the aggregate  outstanding  principal amount under the
     loan,  to ensure that total assets minus total debt will not at any time be
     less than  $150,000  and to maintain  liquid funds which at any time be not
     less than the  higher  of  $10,000  or $500 per  vessel.  As a result,  the
     minimum liquid funds required under the loan covenants of $10,000 have been
     classified  as restricted  cash.  The Company is permitted to pay dividends
     under the loan so long as it is not in  default  of a loan  covenant  or if
     such dividend payment would not result in a default of a loan covenant.

     Interest  expense for the years ended  December  31,  2002,  2003 and 2004,
     amounted  to $797,  $1,128  and  $4,161  respectively  and is  included  in
     interest and finance costs in the accompanying  consolidated  statements of
     income  (Note 14). The weighted  average  interest  rate of the above loans
     during  the  years  2002,  2003 and  2004,  was  3.11%,  3.28%  and  3.19%,
     respectively.

     The annual principal  payments required to be made after December 31, 2004,
     are as follows:

     Year                                      Amount
     ----                                      ------

     2005                                        20,000
     2006                                        20,000
     2007                                        20,000
     2008                                        20,000
     2009                                        20,000
     2010 and thereafter                         97,000
                                             -----------
                                                197,000
     Less unamortized financing fees             (2,194)
                                             -----------
                                                194,806
                                             ===========

     In connection  with the loan discussed under (a) above, on August 26, 2004,
     the Company  entered into an interest rate swap agreement in order to hedge
     the Company's variable interest rate exposure. As of December 31, 2004, the
     swap agreement had a notional  amount of $98,500 and its fair value is in a
     loss  position  of  ($248).  The  2004  change  in fair  value  on the swap
     agreement is recorded entirely as a component of other  comprehensive  loss
     as there is no hedge  ineffectiveness.  The swap  agreement  will expire in
     September 2008.

9.   Accrued Liabilities:

     The amounts in the accompanying consolidated balance sheets are analyzed as
follows:

                                                        2003       2004
                                                      ---------  ----------

Interest on long-term debt                                 165       1,170
Vessels' operating and voyage expenses                     524       2,019
General and administrative expenses                          5         577
                                                      ---------  ----------
    Total                                                  694       3,766
                                                      =========  ==========

10.  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
     consolidated financial statements.

     The  Company  accrues  for  the  cost  of  environmental  liabilities  when
     management  becomes  aware  that a  liability  is  probable  and is able to
     reasonably  estimate the probable  exposure.  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  consolidated  financial  statements.  A  minimum  of up to $1
     billion of the liabilities  associated with the individual vessels actions,
     mainly for sea pollution, are covered by the Protection and Indemnity (P&I)
     Club insurance.

11.  Common Stock and Additional Paid-In Capital:

     The  Company's  common stock since  inception and prior to the amendment of
     its  articles  of  incorporation  in  May  2004  consisted  of  500  shares
     authorized,  issued and  outstanding,  of no par value.  The holders of the
     shares  are  entitled  to one vote on all  matters  submitted  to a vote of
     stockholders and to receive all dividends, if any.

     On May 10 and May 27, 2004 the  Company's  Articles of  Incorporation  were
     amended.  Under the  amended  articles  of  incorporation  the  Company was
     renamed to TOP Tankers Inc. and  currently,  its  authorized  capital stock
     consists of 50,000,000 registered and/or bearer shares of common stock, par
     value $0.01 per share and 20,000,000  registered  preferred shares with par
     value of  $0.01.  The  Board of  Directors  shall  have  the  authority  to
     establish  such  series of  preferred  stock  and with  such  designations,
     preferences  and relative,  participating,  optional or special  rights and
     qualifications,  limitations  or  restrictions  as shall be  stated  in the
     resolutions  providing for the issue of such preferred  stock.  In addition
     the Company  within the context of its initial  public  offering  discussed
     below,  on May 21,  2004,  cancelled  the 500  shares of Ocean  and  issued
     6,000,000  shares at par value of $0.01 each.  The share and per share data
     included in the accompanying  consolidated  financial  statements have been
     restated to reflect the issuance of the 6,000,000  shares  outstanding  for
     all periods presented.

     On July 23, 2004 the Company  completed its initial public  offering in the
     United States under the United States  Securities  Act of 1933, as amended.
     In this  respect  12,278,570  shares of common  stock at par value of $0.01
     were issued for $11.00 per share.  The net proceeds to the Company  totaled
     $124,440.

     On November 5, 2004 the  Company  completed a follow on public  offering in
     the  United  States  under the United  States  Securities  Act of 1933,  as
     amended.  In this respect  9,552,420 shares of common stock at par value of
     $0.01 were  issued for $15.50 per share.  The net  proceeds  to the Company
     totaled $139,372.

     The  amounts  shown  in  the   accompanying   consolidated   statements  of
     stockholders'  equity,  as  contributions  to additional  paid-in  capital,
     represent (a) payments made by the stockholders ($2,279, $6,484 and $17,077
     in 2002,  2003 and  2004,  respectively),  prior to the  Company's  initial
     public  offering  discussed  above,  at  various  dates to  finance  vessel
     acquisitions  in excess of the amounts of bank loans  obtained and advances
     for working  capital  purposes and (b) the  consideration  received for the
     issuance  of the shares in July and  November  2004,  discussed  above,  in
     excess of their par value.

     The Company paid dividends of $844,  $571 and $2,318 during the years ended
     December 31,  2002,  2003 and 2004,  respectively.  In December  2004,  the
     Company declared  dividends of $0.21 per share,  amounted to $5,845,  which
     were paid in January 2005.

12.  Earnings Per Common Share:

     The  components of the  calculation of basic earnings per share and diluted
     earnings per share are as follows:

                                                 2002      2003        2004
                                                 ----      ----        ----

Net Income:
  Income available to common shareholders         $ 201    $ 1,634     $ 32,794
Basic earnings per share:
  Weighted average common shares outstanding  6,000,000  6,000,000   12,922,449
Diluted earnings per share:
  Weighted average common shares--diluted     6,000,000  6,000,000   12,922,449
  Basic earnings per common share                $ 0.03     $ 0.27       $ 2.54
  Diluted earnings per common share              $ 0.03     $ 0.27       $ 2.54

13.  Voyage and Vessel Operating Expenses:

     The  amounts  in the  accompanying  consolidated  statements  of income are
     analyzed as follows:

     Voyage Expenses                        2002       2003       2004
     ---------------                        ----       ----       ----

     Port charges                            1,197      1,824       5,181
     Bunkers                                 1,667      3,367       8,588
     Commissions                               447        746       3,129
                                          ---------  ---------  ----------

           Total                             3,311      5,937      16,898
                                          =========  =========  ==========

     Vessel Operating Expenses
     -------------------------

     Crew wages and related costs            2,145      3,638       7,285
     Insurance                                 695      1,323       2,873
     Repairs and maintenance                   883      1,874       2,842
     Spares and consumable stores              818      1,559       3,804
     Taxes (Note 16)                            12         26          55
                                          ---------  ---------  ----------
           Total                             4,553      8,420      16,859
                                          =========  =========  ==========

14.  Interest and Finance Costs:

     The  amounts  in the  accompanying  consolidated  statements  of income are
     analyzed as follows:

                                                  2002         2003       2004
                                                  ----         ----       ----

     Interest on long-term debt (Note 8)           797        1,128     4,161
     Bank charges                                   35           87       285
     Amortization and write-off of
     financing fees (Note 7)                       161          121       755
                                               -------       -------   -------
           Total                                   993        1,336     5,201
                                               =======       =======   =======
15.  Other, net:

     The  amounts  in the  accompanying  consolidated  statements  of income are
     analyzed as follows:

                                                  2002       2003     2004
                                                  ----       ----     ----

Insurance claims recoveries                          886       364       -
Miscellaneous                                          8         -      80
                                                 --------   -------  ------
      Total                                          894       364      80
                                                 ========   =======  ======

     Insurance claim recoveries represent the excess amount the Company received
     in  connection  with claims for  damages to its vessels  compared to actual
     costs associated with the repairs.

16.  Income Taxes:

     Marshall  Islands,  Cyprus and Liberia do not impose a tax on international
     shipping income.  Under the laws of Marshall  Islands,  Cyprus and Liberia,
     the countries of the companies'  incorporation  and vessels'  registration,
     the companies are subject to registration and tonnage taxes which have been
     included in vessels'  operating  expenses in the accompanying  consolidated
     statements of income.

     Pursuant to the Internal  Revenue Code of the United  States (the  "Code"),
     U.S. source income from the international  operations of ships is generally
     exempt from U.S. tax if the company  operating  the ships meets both of the
     following  requirements,  (a) the Company is organized in a foreign country
     that grants an equivalent exception to corporations organized in the United
     States and (b) either (i) more than 50% of the value of the Company's stock
     is owned, directly or indirectly, by individuals who are "residents" of the
     Company's country of organization or of another foreign country that grants
     an "equivalent  exemption" to  corporations  organized in the United States
     (50%  Ownership  Test)  or (ii)  the  Company's  stock  is  "primarily  and
     regularly  traded on an  established  securities  market" in its country of
     organization,  in another country that grants an "equivalent  exemption" to
     United States corporations, or in the United States (Publicly-Traded Test).
     Under  the  regulations,  a  Company's  stock  will  be  considered  to  be
     "regularly  traded" on an established  securities market if (i) one or more
     classes of the its stock representing 50 percent or more of its outstanding
     shares, by voting power and value, is listed on the market and is traded on
     the market,  other than in minimal  quantities,  on at least 60 days during
     the taxable year;  and (ii) the aggregate  number of shares of stock traded
     during the taxable year is at least 10% of the average  number of shares of
     the stock outstanding during the taxable year.

     Treasury  regulations  under the Code  were  promulgated  in final  form in
     August 2003.  These  regulations  apply to taxable  years  beginning  after
     September 24, 2004.  As a result,  such  regulations  will be effective for
     calendar year taxpayers, like the Company, beginning with the calendar year
     2005. The Marshall Islands, Cyprus and Liberia, the jurisdictions where the
     Company  and  its  ship-owning  subsidiaries  are  incorporated,  grant  an
     "equivalent  exemption"  to  United  States  corporations.  Therefore,  the
     Company is exempt from United States federal  income  taxation with respect
     to our U.S.-source  shipping income if either the 50% Ownership Test or the
     Publicly-Traded Test is met. The Company believes that for periods prior to
     its  initial  public  offering  in July  2004,  the 50%  Ownership  Test is
     satisfied.  The Company also  believes  that for periods  subsequent to its
     initial public offering,  it satisfies the publicly traded  requirements of
     the  statute  on the basis  that more than 50% of the value of its stock is
     primarily  and  regularly   traded  on  the  Nasdaq  National  Market  and,
     therefore,  the Company and its subsidiaries are entitled to exemption from
     U.S. federal income tax, in respect of their U.S. source shipping income.

17.  Financial Instruments:

     The principal  financial  assets of the Company consist of cash on hand and
     at banks  and  accounts  receivable  due  from  charterers.  The  principal
     financial  liabilities  of the Company  consist of long-term bank loans and
     accounts payable due to suppliers.

     (a)  Interest rate risk:  The Company's  interest  rates and long-term loan
          repayment terms are described in Note 8.

     (b)  Concentration of Credit risk: Financial instruments, which potentially
          subject  the Company to  significant  concentrations  of credit  risk,
          consist principally of cash and trade accounts receivable. The Company
          places its temporary cash investments,  consisting mostly of deposits,
          with  high  credit  qualified  financial  institutions.   The  Company
          performs periodic evaluations of the relative credit standing of those
          financial  institutions  with  which  it  places  its  temporary  cash
          investments.   The  Company  limits  its  credit  risk  with  accounts
          receivable by performing  ongoing credit evaluations of its customers'
          financial  condition and generally does not require collateral for its
          accounts receivable.

     (c)  Fair value: The carrying values of cash and cash equivalents, accounts
          receivable and accounts payable are reasonable estimates of their fair
          value due to the short-term nature of these financial instruments. The
          fair  value of the  long-term  bank loan  discussed  in Note 8 bearing
          interest at variable  interest rates  approximates the recorded value.
          The  carrying  value  of the  liability  for the  interest  rate  swap
          agreement  approximates its fair value as the fair value estimates the
          amount  the  Company  would  have  paid  had the  interest  rate  swap
          agreement been terminated on the balance sheet date.

18.  Subsequent Events:

     (a)  New  Credit  Facilities:  In  February  and March  2005,  the  Company
          concluded three bank loans bearing  interest at LIBOR plus a margin as
          follows:  (i) in February  2005, a bank loan to partially  finance the
          acquisition cost of vessels  Priceless,  Noiseless and Faultless (Note
          1) and to refinance the loan  discussed in Note 8(a).  The loan is for
          the amount of $280,794  divided  into two  tranches  of  $197,000  and
          $83,794,  respectively.  The  $197,000  tranche is payable in 16 equal
          consecutive  semi-annual  instalments of $10,000 each,  from March 31,
          2005 to  September  2012,  plus a balloon  payment of $37,000  payable
          together with the last instalment. The $83,794 tranche is subject to a
          fee of 1%  payable  on draw  down and the  tranche  is  payable  in 14
          varying semi-annual instalments starting July 31, 2005, plus a balloon
          payment of $17,041 payable together with the last instalment;  (ii) in
          March 2005, a bank loan to partially  finance the acquisition  cost of
          vessels Stainless and Stopless (Note 1). The loan is for the amount of
          $56,500  divided  into  two  tranches  and is  payable  in 28  varying
          quarterly  instalments  starting July 29, 2005, plus a balloon payment
          of $10,170  payable  together  with the last  instalment.  The loan is
          subject to a fee of 1% payable on draw down.  On March 30, 2005 Parnis
          and Vitsi drew down $56,500 of the bank loan; and (iii) in March 2005,
          a bank loan to partially  finance the acquisition  cost of the vessels
          Topless, Dauntless,  Soundless and Taintless,  discussed in (c) below.
          The loan,  which is for the amount of $144,000 and will be provided as
          Tranche C of the loan discussed  under (i) above, is subject to fee of
          1%  payable  on draw  down  and is  payable  in 17  equal  consecutive
          semi-annual  instalments of $6,300 each,  starting  November 30, 2005,
          plus a balloon  payment  of  $36,900  payable  together  with the last
          instalment.  The total  loan  discussed  under (i) and (iii)  above is
          $424,794.

     (b)  Vessel's  Delivery:  On February 3, 2005, Kisavos took delivery of the
          154,970 DWT (built in 1991), tanker vessel "Priceless" for $49,450. On
          February 2, 2005,  Kisavos  drew down $27,931 as a portion of the bank
          loan discussed in (a)(i) above and the then outstanding balance of the
          vessel's  purchase  price of  $44,505  ($49,450  less the 10%  advance
          payment made in November 2004) was paid to the sellers.

     (c)  Newly Established Wholly Owned Subsidiaries and Vessels  Acquisitions:
          In February and March 2005 the Company established Agion Oros Shipping
          Company  Limited  ("Agion  Oros"),   Lefka  Shipping  Company  Limited
          ("Lefka"),  Agrafa  Shipping  Company  Limited  ("Agrafa")  and  Giona
          Shipping Company Limited  ("Giona"),  all incorporated in the Marshall
          Islands.  In late  February and early March 2005,  Agion Oros,  Lefka,
          Agrafa and Giona  entered  into  memoranda of agreement to acquire the
          vessels Topless, Dauntless, Soundless and Taintless,  respectively, at
          a  total  cost of  $163,500.  Vessels  Taintless  and  Dauntless  were
          delivered to the Company on March 21 and March 24, 2005, respectively.
          Vessels Soundless and Topless are expected to be delivered on or about
          April 18 and April 25, 2005,  respectively.  On March 21 and March 24,
          2005 Giona and Lefka  collectively  drew down $73,100 of the bank loan
          discussed in (a)(iii) above and the vessels' purchase price of $83,000
          was paid to the sellers.

     (d)  Dividends:  On March 16, 2005, the Company declared dividends of $0.21
          per share to be paid in April 2005.

     (e)  London Office: On February 2, 2005, TOP TANKERS (U.K) LIMITED, a newly
          established   subsidiary  to  be  engaged  in  chartering   activities
          involving the  Company's  vessels,  entered into a rent  agreement for
          office  space in London.  The  agreement  is for  duration of one year
          ending December 31, 2005.

     (f)  Sale of Vessel:  Based on the Memorandum of Agreement  dated March 16,
          2005,  the Company agreed to sell vessel Yapi for a  consideration  of
          $8,550.  On March 29, 2005 the vessel entered into a bareboat  charter
          with the buyers until July 31, 2005 (the vessel's delivery date), at a
          daily  bareboat  hire of $6.  According  to the terms of the  bareboat
          charter the Company  collected in advance an amount of $1,000 from the
          buyers as a security of their obligation to purchase the vessel.

     (g)  Interest Rate Swaps:  In  connection  with the loans  discussed  under
          (a)(i) and (a)(iii)  above,  the Company  entered  into the  following
          interest rate swap  agreements  with  declining  notional  balances in
          order to hedge its variable  interest rate  exposure,  with  effective
          date March 31, 2005; (i) for an initial notional amount of $93,500 and
          for a period of five years,  with a fixed  interest rate of 4.72% plus
          the applicable  bank margin;  (ii) for an initial  notional  amount of
          $27,931 and for a period of four years,  with a fixed interest rate of
          4.5775%  plus the  applicable  bank  margin;  and (iii) for an initial
          notional  amount of  $36,550  and for a period of four  years,  with a
          fixed interest rate of 4.66% plus the applicable bank margin.

     (h)  Vessels' Delivery (Unaudited): On April 1, 2005, Parnis and Vitsi took
          delivery  of the vessels  Stainless  and  Stopless.  On March 30, 2005
          Parnis  and Vitsi  drew down  $56,500  of the bank loan  discussed  in
          (a)(ii)  above  and  the  then  outstanding  balance  of the  vessels'
          purchase price of $92,677  ($102,975 less the 10% advance payment made
          in November  2004) was paid to the sellers on March 31, 2005. On April
          11, 2005, Parnasos took delivery of the vessel Faultless.  On April 8,
          2005,  Parnasos  drew down $27,931 of the $83,794  tranche of the bank
          loan  discussed  in (a)(i)  and the then  outstanding  balance  of the
          vessel's  purchase  price of  $46,485 ( $51,650  less the 10%  advance
          payment made in November 2004) was paid to the sellers.


                            Forward Looking Statement
                            -------------------------


     Matters discussed in this report 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.

     Important  factors that, in our view,  could cause actual results to differ
materially from those discussed in the  forward-looking  statements  include the
strength of world economies and currencies, general market conditions, including
changes in charterhire  rates and vessel  values,  changes in demand for oil and
petroleum products,  the effect of changes in OPEC's petroleum production levels
and worldwide  oil  consumption  and storage,  changes in demand that may affect
attitudes of time charterers to scheduled and unscheduled drydocking, changes in
TOP Tankers'  operating  expenses,  including  bunker  prices,  dry-docking  and
insurance  costs,  changes  in  governmental  rules  and  regulations  including
requirements for double-hull tankers or actions taken by regulatory authorities,
potential   liability   from   pending  or  future   litigation,   domestic  and
international political conditions,  potential disruption of shipping routes due
to accidents and political events or acts by terrorists.

     Risks and  uncertainties  are  further  described  in reports  filed by TOP
Tankers with the US Securities and Exchange Commission.





                                   SIGNATURES


     Pursuant to the  requirements  of the Securities  Exchange Act of 1934, the
registrant  has duly  caused  this  report  to be  signed  on its  behalf by the
undersigned, thereunto duly authorized.

                                TOP TANKERS INC.
                                  (registrant)



Dated: April 15, 2005
                                          By: /s/ Stamatis N. Tsantanis
                                              --------------------------
                                              Stamatis N. Tsantanis
                                              Chief Financial Officer


23116.0001 #563800v2