EMPLOYMENT AGREEMENT

THIS EMPLOYMENT AGREEMENT (the "Agreement") dated as of January 1, 1997 between
OMI Corp., a Delaware corporation (the "Company") and JACK GOLDSTEIN (the
"Employee").

                               W I T N E S S E T H

WHEREAS, the Employee has served as Chairman of the Board of Directors
("Chairman") and Chief Executive Officer ("CEO") of the Company until the date
hereof, at which time the Employee ceased to be the CEO and remains as Chairman;
and

WHEREAS, the Company desires to continue to employ the Employee; and

WHEREAS, the Employee is willing to continue to be employed by the Company, for
the period and upon the terms and conditions hereinafter set forth;

NOW THEREFORE, in consideration of the mutual covenants and conditions contained
herein, the Company and the Employee hereby agree as follows:

     1. EMPLOYMENT

     The Company shall employ the Employee, and the Employee accepts employment
by the Company, upon the terms and conditions herein, for the period commencing
as of January 1, 1997, and ending on December 31, 2001, subject to termination
as hereinafter provided (the period from January 1, 1997 through December 31,
2001, being herein referred to as the "Employment Period"). If, upon expiration
of this Agreement, the Company desires to continue to employ the Employee and
the Employee desires to continue in the employ of the Company, such employment
shall be continued on terms and conditions which the Company and the Employee
find mutually satisfactory and which are consistent with the employment policies
of the Company. The Employment Agreement dated January 1, 1995, as amended and
restated as of November 21, 1995 between the parties is hereby terminated with
no further liability or obligation to either party.

     2. DUTIES

     (a) Throughout the Employment Period, the Employee shall have the title and
perform the duties assigned and shall report as determined by the Board of
Directors (the "Board") of the Company. The Employee shall at all times comply
with Company policies as established by the Board.

     (b) During the Employment Period, the Employee shall devote such working
hours to his duties hereunder as is necessary to perform the same except during
vacation time, any periods of illness and authorized leaves of absence.

     (c) Throughout the Employment Period, the Employee shall faithfully and
diligently perform his duties under this Agreement and shall use his best
efforts to promote the interests of the Company.


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     3. COMPENSATION

     During the Employment Period, as full compensation to the Employee for his
performance of the services hereunder and for his acceptance of the
responsibilities described herein, the Company agrees to pay the Employee, and
the Employee agrees to accept, the following salary and other benefits:

     (a) Salary

     The Company shall pay the Employee a salary (the "Base Salary") at the
annual rate of $200,000, such rate to increase by $5,000 each January 1st. The
Base Salary due the Employee hereunder shall be payable in installments for the
same payment periods other employees are paid less any amounts required to be
withheld by the Company from such Base Salary pursuant to the benefit plans of
Section 3(d) and applicable laws and regulations described under Section 10(e).

     (b) Bonus

     The Employee shall be eligible to receive bonuses (each a "Bonus") at the
discretion, in the amount and at the times determined by the Board of Directors
of the Company. The Employee shall have 100,000 units under the Company's
existing Annual Executive Compensation Plan.

     (c) Intentionally Left Blank

     (d) Other Benefit Plans

     Subject to all eligibility requirements, and to the extent permitted by
law, the Employee shall be entitled to participate in any and all employee
welfare and benefit plans (including, but not limited to, retirement security,
life insurance, medical, dental, disability, and savings plans) established by
the Company from time to time for the general and overall benefit of employees
of the Company.

     The Company agrees to cause medical insurance to be provided to the
Employee with coverage substantially no less favorable than to other employees
of the Company until he reaches age 65, which agreement shall survive
termination of this Agreement.

     (e) Further Benefits

     The Employee shall be entitled to a minimum of four weeks per annum paid
vacation.

     (f) Deferred Compensation

     Notwithstanding any other provision of the Agreement, the Employee shall
have the right to request any lawful means (including, without limitation, any
deferred compensation arrangement requested by the Employee) by which he wishes
to receive any portion of his Base Salary, Bonus, or other payments, and the
Company shall reasonably cooperate with the Employee to grant such request,
provided that the granting of such request does not represent inequitable
treatment as concerns other senior employees or Employees (in the Company's sole
judgment), and does not impose additional costs on the Company other than
insignificant administrative costs.


<PAGE>

     4. REASONABLE EXPENSES

     The Company will reimburse the Employee for all reasonable business
expenses, including travel and lodging, which are properly incurred by him in
the performance of his duties hereunder, upon presentation of proper vouchers
therefor and in accordance with written policies established from time to time
by the Company for such reimbursements.

     5. EMPLOYEE COVENANTS

     The Employee acknowledges that as a result of the services to be rendered
to the Company hereunder, the Employee will be brought into close contact with
many confidential affairs of the Company, its subsidiaries and affiliates, not
readily available to the public. The Employee further acknowledges that the
services to be performed under this Agreement are of a special, unique, unusual,
extraordinary and intellectual character; that the business of the Company is
international in scope; that its services are marketed throughout the world; and
that the Company competes with other organizations that are or could be located
in nearly any part of the United States or elsewhere. In recognition of the
foregoing:

     (a) Except with the consent of or as directed by the Company, or except if
compelled by judicial or legal authorities, the Employee will keep confidential
and not divulge to any other person, during the Employment Period or thereafter,
any Confidential Information and Trade Secrets regarding the Company, its
subsidiaries and affiliates, except for information which is or becomes publicly
available other than as a result of disclosure by the Employee. For the purposes
of this Agreement "Confidential Information and Trade Secrets" means information
which is secret to the Company, its subsidiaries and affiliates. It may include,
but is not limited to, information relating to new and future concepts and
business of the Company, its subsidiaries and affiliates, in the form of
memoranda, reports, computer software and data banks, customer lists, employee
lists, books, records, financial statements, manuals, papers, contracts and
strategic plans. As a guide, the Employee is to consider information originated,
owned, controlled or possessed by the Company, its subsidiaries or affiliates
which is not disclosed in printed publications stated to be available for
distribution outside the Company, its subsidiaries and affiliates as being
secret and confidential. In instances where doubt does or should reasonably be
understood to exist in the Employee's mind as to whether information is secret
and confidential to the Company, its subsidiaries and affiliates, the Employee
agrees to request an opinion, in writing, from the Company.

     (b) All papers, books and records of every kind and description relating to
the business and affairs of the Company, its subsidiaries and affiliates,
whether or not prepared by the Employee, and all property owned by the Company,
its subsidiaries and affiliates shall be the sole and exclusive property of the
Company, and the Employee shall surrender them to the Company, at any time upon
request, during or after the Employment Period.

     (c) During the Employment Period and during any Severance Period (as
hereinafter defined), the Employee will not, without the prior written consent
of the Company, compete, directly or indirectly, with the Company, its
subsidiaries and affiliates or participate as a director, officer, employee,
agent, representative, stockholder, or partner, or have any direct or indirect
financial interest as a creditor, in any business which directly or indirectly
competes with the Company its subsidiaries and affiliates; provided, however,
that this paragraph (c) shall not restrict the Employee from holding up to 5% of
the publicly traded securities of any entity.


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     (d) During the Employment Period and during any Severance Period (as
hereinafter defined), the Employee shall not either for his or her own account
or for any person, firm or company (i) solicit any customers of the Company, its
subsidiaries and affiliates or (ii) solicit or endeavor to cause any employee of
the Company, its subsidiaries and affiliates to leave his employment or induce
or attempt to induce any such employee to breach any employment agreement with
the Company, its subsidiaries and affiliates, or otherwise interfere with the
employment of any employee by the Company, its subsidiaries and affiliates.

     (e) Without limiting any other provision of this Agreement, the Employee
hereby agrees to be bound by and to comply with any obligations known to the
Employee and imposed on the Company, its subsidiaries and affiliates, by law,
rule, regulation, ordinance, order, decree, instrument, agreement, understanding
or other restriction of any kind.

     (f) The Employee hereby agrees to provide reasonable cooperation to the
Company, its subsidiaries and affiliates during the Employment Period and any
Severance Period (as hereinafter defined) in any litigation between the Company,
its subsidiaries and affiliates, and third parties.

     (g) The parties agree that the Company shall, in addition to other remedies
provided by law, have the right and remedy to have the provisions of this
Section 5 specifically enforced by any court having equity jurisdiction, it
being acknowledged and agreed that any breach or threatened breach of the
provisions of this Section 5 will cause irreparable injury to the Company and
that money damages will not provide an adequate remedy to the Company. Nothing
contained herein shall be construed as prohibiting the Company from pursuing any
other remedies available to it for such breach or threatened breach, including
the recovery of damages from the Employee.

     (i) although the restrictions contained in Sections 5(a), (b), (c) and (d)
above are considered by the parties hereto to be fair and reasonable in the
circumstances, it is recognized that restrictions of such nature may fail for
technical reasons, and accordingly it is hereby agreed that if any of such
restrictions shall be adjudged to be void or unenforceable for whatever reason,
but would be valid if part of the wording thereof were deleted, or the period
thereof reduced or the area dealt with thereby reduced in scope, the
restrictions contained in Sections 5(a), (b), (c) and (d) shall be enforced to
the maximum extent permitted by law, and the parties consent and agree that such
scope or wording may be accordingly judicially modified in any proceeding
brought to enforce such restrictions.

     (ii) Notwithstanding that the Employee's employment hereunder may expire or
be terminated as provided in Section 1 or Section 6 hereof, this Agreement shall
continue in full force and effect insofar as is necessary to enforce the
covenants and agreements of the Employee contained in this Section 5.

     6. TERMINATION OF EMPLOYMENT PERIOD AND SEVERANCE

     (a) Termination by the Company without Cause. If for any reason other than
the provisions of Section 6(d) hereof, the Company wishes to terminate the
Employment Period and the Employee's employment hereunder, the Company shall
give a written notice to the Employee of such termination stating that a
severance period (the "Severance Period") will commence upon receipt of such
notice by the Employee. The Severance Period, if commencing prior to December
15, 1998 shall be for a period ending on December 31, 1998 and if given
thereafter shall be for the balance of the then current term of this Agreement
or twelve months, whichever is greater. Upon receipt of such notice by the
Employee, the Employment Period shall terminate (and the Employee shall have no
further duties under Section 2 hereof). During the entire Severance


<PAGE>

Period, the Employee shall continue to receive all salary, compensation,
payments and benefits under Sections 3(a) and 3(d) of this Agreement (including,
to the extent allowable under applicable law, the accrual of additional service
credits or Company contributions under pension and thrift plans, and any
benefits under the Company's long term disability and life insurance plans)
available upon the date of the commencement of the Severance Period as if the
Employment Period continued throughout the Severance Period. The Employee agrees
that the payments described in this Section 6(a) shall be full and adequate
compensation to the Employee for all damages the Employee may suffer as a result
of the termination of his employment pursuant to this Section 6(a), and hereby
waives and releases the Company from any and all obligations or liabilities to
the Employee arising from or in connection with the Employee's employment with
the Company or the termination and claims the Employee may have under federal,
state or local statutes, regulations or ordinances or under any common law
principles or breach of contract or the covenant of good faith and fair dealing,
defamation, wrongful discharge, intentional infliction of emotional distress or
promissory estoppel; provided, however, that any rights and benefits the
Employee may have under the employee benefit plans and programs of the Company
in which the Employee is a participant, shall be determined in accordance with
the terms and provisions of such plans and programs.

     (b) Death. If the Employee dies during the Employment Period, the Severance
Period or during the period when payments are being made pursuant to Section
6(c), the Employment Period shall automatically terminate and the obligations of
the parties shall terminate effective the date of death.

     (c) Disability. If the Employee becomes Disabled (as hereinafter defined)
during the Employment Period, the Company shall be entitled to terminate his or
her employment and the Employment Period upon written notice to the Employee
from the Company. In the event of such termination, the Employee shall be
released from any duties hereunder, and the Severance Period described in
Section 6(a) hereof shall immediately commence. The duties, rights, benefits and
other matters during the Severance Period shall be as set forth in Section 6(a),
and the Employee (and his or her heirs, beneficiaries and estate) shall be
entitled to all compensation, payments and benefits during the Severance Period
without any offset or reduction except by such amounts, if any, as are paid to
the Employee in lieu of compensation for services under any applicable insurance
policies of the Company (or by the Company under any self insurance plan). For
purposes of this Agreement, "Disabled" shall mean mental or physical impairment
or incapacity rendering the Employee substantially unable to perform his duties
under this Agreement for a period of longer than 180 days out of any 360-day
period during the Employment Period. A determination of whether the Employee is
Disabled shall be made by the Company in its sole discretion upon its own
initiative or upon request of the Employee or a person acting on his behalf. If
the Employee becomes Disabled during a Severance Period, he or she shall
continue to receive the compensation, payments and benefits of this Agreement
during the entire Severance Period without any offset or reduction, except by
such amounts, if any, as are paid to the Employee in lieu of compensation for
services under any applicable insurance policies of the Company (or by the
Company under any self insurance plan).

     (d) Termination by the Company for Cause. The Company by written notice to
the Employee, shall have the right to terminate the Employment Period in the
event of any of the following (which shall constitute "Cause"):

     (i)  The Employee's breach in respect of his or her duties under this
          Agreement, such breach continuing unremedied for thirty days after
          written notice thereof from the Company to the Employee specifying the
          acts constituting the breach and requesting that they be remedied; or


<PAGE>

     (ii) Any misconduct, dishonesty, insubordination or other act by the
          Employee materially detrimental to the goodwill of the Company, or
          materially damaging to the Company's, its subsidiaries' and/or
          affiliates' relationships with their customers or employees, including
          without limitation, the Employee having been convicted of a felony
          during the Employment Period, provided such conviction has resulted or
          is likely to result in substantial detriment to the Company, its
          subsidiaries and/or affiliates.

     Any termination under this Section 6(d) shall be without damages or
liability to the Company for compensation and other benefits which would have
accrued to the Employee hereunder after termination, but all compensation,
benefits and reimbursements accrued through the date of termination shall be
paid to the Employee at the times normally paid by the Company. In this event,
there shall be no Severance Period.

     (e) Voluntary Termination by the Employee. Except as provided in Section
6(g) in the event of voluntary termination of employment by the Employee, the
terms of the last paragraph of Section 6(d) shall apply.

     (f) Termination Following a Change in Control.

     For purposes of this paragraph (f), the term "Change in Control" shall mean
a Change in Control as defined in Section 3 of the OMI Corp. Separation
Allowance Program, as amended from time (the "Program") to time. Should the
Employee's employment hereunder be terminated by the Company without Cause
(other than for reason of the Employee becoming Disabled) within two years of a
Change in Control, the Company shall pay and the Employee shall receive in cash
an amount equal to the remaining amounts payable hereunder to the end of the
Employment Period (a) as Base Salary plus (b) the amount equal to the last bonus
paid to the Employee pursuant to Section 3(b) multiplied by the number of whole
years remaining in the Employment Period. The Employee shall also be eligible to
receive any and all other benefits as provided in the Program (excepting the
severance benefits of Paragraph 5(iii)B of the Program). For purposes other than
with respect to Paragraph 5(iii)B of the Program, wherever a Measuring Period
(as defined in the Program) is called for, the Measuring Period for the Employee
shall be twenty four. Upon termination under this paragraph (f), the Employee
shall no longer be bound by the provisions of Section 5 of this Agreement.

     In the event that any payment received or to be received by the Employee in
connection with a Change in Control or the termination of the Employee's
employment (whether payable pursuant to the terms of this Agreement or any other
plan, arrangement or agreement with the Company, any person whose actions result
in a Change in Control or any person affiliated with the Company or such person
(together with the payment pursuant to Section 6(f)(i), the "Total Payments"))
would not be deductible by the Company (in whole or in part) as a result of
Section 280G of the Internal Revenue Code of 1986, as amended (the "Code"), the
payment pursuant to Section 6(f)(i) shall be reduced until no portion or the
Total Payments is not deductible as a result of Section 280G of the Code, or the
payment pursuant to Section 6(f)(i) is reduced to zero. For purposes of this
limitation (A) no portion of the Total Payments the receipt or enjoyment of
which the Employee shall have effectively waived in writing prior to the date of
payment of the payment pursuant to Section 6(f)(i) shall be taken into account,
(B) no portion of the Total Payments shall be taken into account which, in the
opinion of tax counsel selected by the Company's independent auditors and
acceptable to the Employee, does not constitute a "parachute payment" within the
meaning of Section 280G(b)(2) of the Code, and (C) the value of any non-cash
benefit or any deferred payment or benefit included in the Total Payments shall
be determined or benefit included in the Total Payments shall be determined by
the Company's independent auditors servicing the


<PAGE>

Company immediately prior to the time of a Change in Control in accordance with
the principles of Sections 280G(d)(3) and (4) of the Code.

     (g) Notwithstanding anything herein to the contrary, either the Company or
the Employee may give notice to the other anytime prior to December 15, 1998
that it elects to terminate this Agreement. Commencement of the Severance Period
for any reason prior to December 15, 1998 shall also be construed as notice
given pursuant hereto. If such notice is given, the Company will pay to the
Employee between January 1, 1999 and January 10, 1999 the lump sum amount of
$215,000 and this Agreement shall be deemed to have terminated upon the making
of such payment except for those provisions which are stated to survive
termination.

     7. ASSIGNMENT

     (a) By the Employee. This Agreement, any part thereof and any rights
(including compensation) or obligation hereunder shall not be assigned, pledged,
alienated, sold, attached, charged, encumbered or transferred in any way by the
Employee and any attempt to do so shall be void except that (i) the Employee may
designate any of his beneficiaries to receive (and such beneficiaries shall
receive) any compensation, payments or other benefits payable hereunder upon his
death, (ii) any assignment by will or by laws of descent and distribution or
following the occurrence of the Employee's legal incompetence is permitted and
(iii) the Employee's executors, administrators or other legal representatives
may assign any rights hereunder to the person or persons entitled thereto.

     (b) By the Company. Provided the substance of the Employee's duties set
forth in Section 2 shall not change, and provided that the Employee's
compensation as set forth in Section 3 shall not be adversely affected, the
Company may assign or otherwise transfer this Agreement to any succeeding entity
without limitation, which entity shall assume all rights and obligations
hereunder.

     8. NOTICES

     All notices, requests, demands and other communications hereunder must be
in writing and shall be deemed to have been duly given if delivered by hand or
mailed within the continental United States by first class, registered mail,
return receipt requested, or sent by overnight mail, such as Federal Express,
postage and registry fees prepaid, to the applicable party and addressed as
follows:

     (a) if to the Company:

         President
         OMI Corp.
         90 Park Avenue
         New York, New York  10016

     (b) if to the Employee:

Addresses may be changed by notice in writing signed by the addressee.


<PAGE>

     9. MISCELLANEOUS

     (a) If any provision or portion of this Agreement shall, for any reason, be
adjudged by any court of competent jurisdiction to be invalid or unenforceable,
such judgment shall not affect, impair or invalidate the remainder of this
Agreement but shall be confined in its operation to the jurisdiction in which
made and to the provisions of this Agreement directly involved in the
controversy in which such judgment shall have been rendered.

     (b) No course of dealing and no delay on the part of any party hereto in
exercising any right, power or remedy under or relating to this Agreement shall
operate as a waiver thereof or otherwise prejudice such party's rights, powers
and remedies. No single or partial exercise of any rights, powers or remedies
under or relating to this Agreement shall preclude any other or further exercise
thereof or the exercise of any other right, power or remedy.

     (c) This Agreement may be executed by the parties hereto in counterparts,
each of which shall be deemed to be an original, but all such counterparts shall
together constitute one and the same instrument, and all signatures need not
appear on any one counterpart.

     (d) (i) Any other agreement, rule or regulation to the contrary,
notwithstanding, the parties hereby agree that any action or proceeding relating
to this Agreement or its subject matter shall be brought in a state or federal
court situated in the County of New York, State of New York and such court shall
have exclusive jurisdiction thereof; provided, however, any court with
jurisdiction over the parties may, at the election of Company, have jurisdiction
over any action brought with regard to or any action brought to enforce any
violation or claimed violation of Section 5. The parties each hereby
specifically submit to the jurisdiction of such court and further agree that
service of process may be made within or without the State of New York by giving
notice in the manner provided in Section 9. Each party further agrees to waive
and hereby waives any right to a trial by jury, and to any objection it or he
may have in any such action, based on lack of personal jurisdiction or venue, or
inconvenient forum.

     (ii) In any such action or proceeding, the prevailing party shall be
entitled to recover from the other party reasonable costs, including attorney's
fees and expenses. In any action or proceeding before a court or other tribunal
relating to this Agreement with respect to which damages are an adequate remedy,
the parties agree that no damages other than compensatory damages shall be
sought or claimed by either party and each party waives any claim, right or
entitlement to punitive, exemplary, or consequential damages, or any statutory
damages, or any other damages of any kind or nature in excess of compensatory
damages, and any court or arbitration tribunal is specifically divested of any
power to award any damages in the nature of punitive, exemplary, or
consequential damages, or any statutory damages, or any other damages of any
kind or nature in excess of compensatory damages.

     (e) All payments required to be made by the Company hereunder to the
Employee or his beneficiaries, including his estate, shall be subject to
withholding and deductions as the Company may reasonably determine it should
withhold or deduct pursuant to any applicable law or regulation. In lieu of
withholding or deducting such amounts in whole or in part, the Company may, in
its sole discretion, accept other provision for payment as permitted by law,
provided it is satisfied in its sole discretion that all requirements of law
affecting its responsibilities to withhold such taxes have been satisfied.


<PAGE>

     (f) This Agreement embodies the entire understanding, and supersedes all
other oral or written agreements or understandings, between the parties
regarding the subject matter hereof. No change, alteration or modification
hereof may be made except in writing signed by both parties hereto. The headings
in this Agreement are for convenience of reference only and shall not be
considered part of this Agreement or limit or otherwise affect the meaning
hereof. This Agreement and the rights and obligations of the parties hereunder
shall be construed in accordance with and governed by the laws of the State of
New York (disregarding any choice of law rules which might look to the laws of
any other jurisdiction).

     (g) The Employee acknowledges that the terms of this Agreement have been
fully explained to him or her, that the Employee understands the nature and
extent of the rights and obligations provided under this Agreement, and that the
Employee has been given the opportunity to be represented by legal counsel in
the negotiation and preparation of this Agreement.

     (h) Nothing herein contained shall be construed to prevent or limit any
acquisition, consolidation or merger of the Company.

     IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Agreement as of the day and year first above written. 



                                          By     /s/ JACK GOLDSTEIN
                                             ----------------------------
                                                  Jack Goldstein

                                          OMI CORP.

                                          By    /s/ FREDRIC S. LONDON
                                             ----------------------------
                                                  Fredric S. London