- Filing of certain prospectuses and communications in connection with business combination transactions (425)
October 30 2008 - 4:45PM
Edgar (US Regulatory)
Filed by General Maritime Corporation
pursuant to Rule 425
under the Securities Act of 1933
and deemed filed pursuant to
Rule 14a-12 under the Securities Exchange Act of 1934
Subject Company: Arlington Tankers Ltd.
(Commission File Number: 001-32343)
Subject Company: General Maritime Corporation
(Commission File Number: 001-16531)
On October 30, 2008, General Maritime Corporation (General Maritime or the Company) made the
following slide presentation available on its website located at
www.generalmaritimecorp.com
in connection with the announcement of its 2008 third quarter
financial results.
Important Additional Information will be filed with the SEC
In connection with the proposed transaction with Arlington Tankers Ltd. (Arlington), Galileo
Holding Corporation has filed a Registration Statement on Form S-4 (as well as amendments thereto)
with the SEC, which includes a definitive Joint Proxy Statement/Prospectus. General Maritime and
Arlington are first mailing to their respective shareholders the definitive Joint Proxy
Statement/Prospectus in connection with the proposed transaction on or about November 5, 2008.
Investors and security holders are urged to read the Joint Proxy Statement/Prospectus regarding the
proposed transaction carefully because it contains important information about the Company,
Arlington, the proposed transaction and related matters. You may obtain a free copy of the Joint
Proxy Statement/Prospectus and other related documents filed by the Company, Arlington and Galileo
Holding with the SEC at the SECs website at
www.sec.gov
. The Joint Proxy
Statement/Prospectus and the other documents may also be obtained for free by accessing General
Maritimes website at
www.generalmaritimecorp.com
or by accessing Arlingtons website at
www.arlingtontankers.com
.
The Company and Arlington, and their respective directors and executive officers, may be deemed to
be participants in the solicitation of proxies in respect of the transactions contemplated by the
merger agreement. Information regarding the Companys directors and executive officers is contained
in the Companys Annual Report on Form 10-K for the fiscal year ended December 31, 2007 and its
proxy statement dated April 11, 2008, which are filed with the SEC. Information regarding
Arlingtons directors and executive officer is contained in Arlingtons Annual Report on Form 10-K
for the fiscal year ended December 31, 2007 and its proxy statement dated April 23, 2008, which are
filed with the SEC. In addition, Peter C. Georgiopoulos, currently the Chairman, President and
Chief Executive Officer of the Company, will receive benefits from the Company in connection with
the executive transition discussed in the Joint Proxy Statement/Prospectus, and the Company is
discussing with Edward Terino, currently the Chief Executive Officer, President, and Chief
Financial Officer of Arlington, a consulting arrangement for assistance in the post-closing
transition period. Upon the consummation of the proposed transaction, Mr. Terino will be entitled
to receive a lump sum cash payment of $1,250,000. A more complete description of any such
arrangements is available in the Registration Statement and the Joint Proxy Statement/Prospectus.
Third Quarter 2008 Earnings Call
October 30, 2008
General Maritime Corporation
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Today's presentation and discussion will contain forward-looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995. These forward-looking statements are based on management's current expectations and
observations. Included among the factors that, in the Company's view, could cause actual results to differ materially from the
forward looking statements contained in this press release are the following: the ability to obtain the approval of the proposed
transaction with Arlington Tankers Ltd. by the Company's and Arlington's shareholders; the ability to satisfy conditions to the
proposed transaction with Arlington on the proposed terms and timeframe; changes in demand; a material decline or
prolonged weakness in rates in the tanker market; changes in production of or demand for oil and petroleum products,
generally or in particular regions; greater than anticipated levels of tanker newbuilding orders or lower than anticipated rates
of tanker scrapping; changes in rules and regulations applicable to the tanker industry, including, without limitation, legislation
adopted by international organizations such as the International Maritime Organization and the European Union or by
individual countries; actions taken by regulatory authorities; changes in trading patterns significantly impacting overall tanker
tonnage requirements; changes in the typical seasonal variations in tanker charter rates; changes in the cost of other modes
of oil transportation; changes in oil transportation technology; increases in costs including without limitation: crew wages,
insurance, provisions, repairs and maintenance; changes in general domestic and international political conditions; changes in
the condition of the Company's vessels or applicable maintenance or regulatory standards (which may affect, among other
things, the Company's anticipated drydocking or maintenance and repair costs); changes in the itineraries of the Company's
vessels; the fulfillment of the closing conditions under, or the execution of customary additional documentation for, the
Company's agreements to acquire vessels and other factors listed from time to time in the Company's filings with the Securities
and Exchange Commission, including, without limitation, its Annual Report on Form 10-K for the year ended December 31,
2007 and its subsequent reports on Form 10-Q and Form 8-K. For further information, please refer to such filings with the
Securities and Exchange Commission including the Company's Current Report on Form 8-K dated October 29, 2008. The
Company's ability to pay dividends in any period will depend upon factors including applicable provisions of Marshall Islands
law and the final determination by the Board of Directors each quarter after its review of the Company's financial performance.
The timing and amount of dividends, if any, could also be affected by factors affecting cash flows, results of operations,
required capital expenditures, or reserves. As a result, the amount of dividends actually paid may vary from the amounts
currently estimated. Share repurchases may be made from time to time for cash in open market transactions at prevailing
market prices or in privately negotiated transactions. The timing and amount of purchases under the Company's share
repurchase program will be determined by management based upon market conditions and other factors. Purchases may be
made pursuant to a program adopted under Rule 10b5-1 under the Securities Exchange Act. The program does not require the
Company to purchase any specific number or amount of shares and may be suspended or reinstated at any time in the
Company's discretion and without notice. Repurchases will be subject to the restrictions under the Company's credit facility.
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Important Additional Information will be Filed with the SEC
In connection with the Company's proposed transaction with Arlington, Galileo Holding Corporation has filed a
Registration Statement on Form S-4 (as well as amendments thereto) with the SEC, which includes a definitive Joint
Proxy Statement/Prospectus. General Maritime and Arlington are first mailing to their respective shareholders the
definitive Joint Proxy Statement/Prospectus in connection with the proposed transaction on or about November 5, 2008.
Investors and security holders are urged to read the Joint Proxy Statement/Prospectus regarding the proposed
transaction carefully because it contains important information about the Company, Arlington, the proposed transaction
and related matters. You may obtain a free copy of the Joint Proxy Statement/Prospectus and other related documents
filed by the Company, Arlington and Galileo Holding with the SEC at the SEC's website at www.sec.gov
<http://www.sec.gov/> . The Joint Proxy Statement/Prospectus and the other documents may also be obtained for free
by accessing General Maritime's website at www.generalmaritimecorp.com <http://www.generalmaritimecorp.com/> or
by accessing Arlington's website at www.arlingtontankers.com <http://www.arlingtontankers.com/> . The Company and
Arlington, and their respective directors and executive officers, may be deemed to be participants in the solicitation of
proxies in respect of the transactions contemplated by the merger agreement. Information regarding the Company's
directors and executive officers is contained in the Company's Annual Report on Form 10-K for the fiscal year ended
December 31, 2007 and its proxy statement dated April 11, 2008, which are filed with the SEC. Information regarding
Arlington's directors and executive officer is contained in Arlington's Annual Report on Form 10-K for the fiscal year
ended December 31, 2007 and its proxy statement dated April 23, 2008, which are filed with the SEC. In addition, Peter
C. Georgiopoulos, currently the Chairman, President and Chief Executive Officer of the Company, will receive benefits
from the Company in connection with the executive transition discussed in the Joint Proxy Statement/Prospectus, and
the Company is discussing with Edward Terino, currently the Chief Executive Officer, President, and Chief Financial
Officer of Arlington, a consulting arrangement for assistance in the post-closing transition period. Upon the
consummation of the proposed transaction, Mr. Terino will be entitled to receive a lump sum cash payment of
$1,250,000. A more complete description of any such arrangements is available in the Registration Statement and the
Joint Proxy Statement/Prospectus
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Agenda
Third Quarter 2008 Highlights
Financial Review
Company Outlook & Industry Overview
Questions
|
Third Quarter 2008 Highlights
Q3 2008
Net Income of $23.5 million
EPS of $0.81 basic and $0.79 diluted
EPS of $0.76 basic and $0.74 diluted excluding Other Income
T/C coverage currently at 68%
16 vessels or vessel equivalents fixed on time charter
15 vessels under time charter
1 synthetic time charter
contracted revenue for 2009 expected to be $184 million
EBITDA represents net income plus net interest expense and depreciation and amortization. EBITDA is included because it is used by
management and certain investors as a measure of operating performance. EBITDA is used by analysts in the shipping industry as a
common performance measure to compare results across peers. Management of the Company uses EBITDA as a performance measure in
consolidating monthly internal financial statements and is presented for review at our board meetings. The Company believes that
EBITDA is useful to investors as the shipping industry is capital intensive which often brings significant cost of financing. EBITDA is not
an item recognized by GAAP, and should not be considered as an alternative to net income, operating income or any other indicator of a
company's operating performance required by GAAP. The definition of EBITDA used here may not be comparable to that used by other
companies.
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Third Quarter 2008 Highlights Cont'd
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Merger Agreement with Arlington Tankers
On August 6, 2008 General Maritime entered into an agreement to merge
with Arlington Tankers in a stock transaction.
The combination is expected to create the largest publicly traded tanker
company targeting a high-dividend payout including the following key
highlights:
A young diverse fleet that operates in the crude and product tanker
sectors;
A stronger and flexible balance sheet that provides a platform for growth;
A partial payout dividend policy that focuses on distributing an attractive
fixed dividend target while retaining capital for growth;
A balanced chartering strategy that provides $450 million of revenues
contracted through 2013; and
A management team with a strong reputation for operating shipping
companies and which has experience with consolidations
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Agenda
Third Quarter 2008 Highlights
Financial Review
Company Outlook & Industry Overview
Questions
|
Third Quarter 2008 Financial Results
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Third Quarter 2008 Financial Results, cont'd
Q3 2008 Q3 2007
Aframax Spot $39,224 $28,781
Aframax T/C $33,325 $27,836
Suezmax Spot $62,903 $18,335
Suezmax T/C $37,274 $37,277
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September 30, 2008 Balance Sheet
BALANCE SHEET DATA
, at end of period
September-08
December-07
(Dollars in thousands)
Cash
61,790
$
44,526
$
Current assets, including cash
100,920
82,494
Total assets
875,715
835,035
Current liabilities, including current portion of long-term debt
42,573
35,502
Current portion of long-term debt
-
-
Total long-term debt, including current portion
611,000
565,000
Shareholders' equity
218,313
228,657
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Third Quarter 2008 Highlights, Expense Analysis
Direct Vessel Operating Expenses
Quarter Ended September 30, 2008
Full Fleet up 14.0% from September 30, 2007
Aframax up 10.0%
Suezmax up 18.3%
Primary factors are crewing and M&R
General & Administrative Expenses
For the quarter ended September 30, 2008 G&A was up 4.0% vs
September 30, 2007
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Q4 2008 Outlook
Estimated Q4 General & Administrative Expenses (1)
$11.5 million of estimated remaining G&A
Includes $2.8 million of non-cash restricted stock compensation expense
Estimated Q4 Daily Direct Vessel Operating Expenses (2)
Aframax - $8,000
Suezmax - $8,100
Estimated Q4 Depreciation and Amortization (3)
Approximately $14 million
Estimated Q4 Drydock (4)
Two vessels scheduled for drydock in 2008
1 Aframax vessels completed Q1 2008
1 Aframax entered drydock in 3rd quarter and completed in the 4th quarter
8 estimated remaining offhire days for Q4
Estimated Cost of $10.0 million for full year 2008 which also includes capital
improvements
$6.5 million for drydocking
$3.5 million for capital improvements
(The amounts shown will vary based on actual results)
Estimated General & Administrative Expenses are based on a budget and may vary, including as a result of actual
incentive compensation. Estimated Restricted Stock Compensation Expense is based on grants made through
December 2007 and excludes any grants for 2008.
Estimated Daily Vessel Operating Expenses are based on management's estimates and budgets submitted by our
technical management.
Estimated Depreciation and Amortization are based on the acquisition value of the current fleet and depreciation
of estimated drydocking costs.
Estimated Drydocking represents budgeted drydocking expenditure based on management estimates.
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Overview of GMR Dividend Policy
$2.00 per share annual fixed dividend target is intended to create visible
and consistent dividend stream, which management believes the market
welcomes
The Company expects to declare dividends on a quarterly basis in
February, May, August and November. The target dividend is currently
fixed at $0.50 per quarter or $2.00 annually
Additional long term T/C coverage helps support the dividend and
reduces volatility in the event of a declining market
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GMR Strategy - Dividends
Dividends declared to date
2005 - $4.86
2006 - $3.42
2007 - $17.00 (includes $15.00 special dividend)
Q1 2008 - $0.50
Q2 2008 - $0.50
Q3 2008 - $0.50
Total Dividends Declared $26.78
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Agenda
Second Quarter 2008 Highlights
Financial Review
Company Outlook & Industry Overview
Questions
|
Company Outlook
Will continue to seek the right acquisition opportunities
With an additional $100 million remaining for share repurchases,
subject to the terms of our credit facility, we will seek to act
opportunistically when we believe our stock is undervalued
We intend to continue to return value to shareholders through
dividends
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Current Market Conditions
For Q4 2008
47% of available Aframax days booked at approximately $33,000 per
day
44% of available Suezmax days booked at approximately $54,000 per
day
Current Market Rates (1)
Aframax TCE estimated to be $23,000 per day
Suezmax TCE estimated to be $60,000 per day
(1) Based on industry sources and aggregated Company data from Chartering department
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Industry Outlook
Q3 2008 Market Performance
Spot Crude transportation rates maintained strength in Q3
Positive factors included hurricanes Gustav and Igor, and decreased fleet
size due to conversions to offshore applications and dry bulk
Negative factors were continued softness in demand in the US from
weaker economic conditions and high gasoline prices, as well as low
refining margins
Outlook for Remainder of 2008
The IEA has gradually revised downward its global oil demand growth
forecast to 0.5% from 2.3% at the beginning of the year.
OPEC announced 1.5 MMB/D of cuts going into effect on November 1
which could affect tanker demand and rates later in Q4 2008 and
going forward into 2009
However, not withstanding lower demand forecasts, the tanker
market has been balanced in 2008 to date and management expects
it is likely to remain so in the fourth quarter with normal seasonal
increases in demand.
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Industry Outlook Continued
Outlook for 2009
Demand growth in 2009 is expected by most forecasts to be
below 1%
On the supply side 2009 is the peak of the delivery cycle for
the tanker orderbook, and fleet growth is expected to increase
significantly
The combination of the above factors indicates that a base
case 2009 rate environment is expected to be lower than in
2008
Wild card will be scrapping as owners of single hull vessels
prepare for a looming 2010 deadline
Source: PIRA
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Agenda
Third Quarter 2008 Highlights
Financial Review
Company Outlook & Industry Overview
Questions
|
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