Exhibit 10.7


 


EMPLOYEE MATTERS AGREEMENT


 


BY AND AMONG


 


OVERSEAS SHIPHOLDING GROUP, INC.


 


AND


 


INTERNATIONAL SEAWAYS, INC.


 


DATED AS OF      , 2016


 




     


     


    

  


Table of contents


 


	 	Article I	 
	 	 	 
	 	DEFINITIONS	 
	 	 	 
	Section 1.01.	Definitions	1
	Section 1.02.	Interpretation	8
	 	 	 
	 	Article II	 
	 	 	 
	 	GENERAL PRINCIPLES FOR ALLOCATION OF LIABILITIES	 
	 	 	 
	Section 2.01.	General Principles	8
	Section 2.02.	Service Credit	10
	Section 2.03.	Benefit Plans	10
	Section 2.04.	Individual Agreements	12
	Section 2.05.	Collective Bargaining	12
	Section 2.06.	Non-U.S. Regulatory Compliance	12
	 	 	 
	 	Article III	 
	 	 	 
	 	ASSIGNMENT OF EMPLOYEES	 
	 	 	 
	Section 3.01.	Active Employees	13
	Section 3.02.	No-Hire and Nonsolicitation	14
	 	 	 
	 	Article IV	 
	 	 	 
	 	Equity, Bonus, and Executive Compensation	 
	 	 	 
	Section 4.01.	Generally	15
	Section 4.02.	Equity Awards	15
	Section 4.03.	Bonus Plans	19
	Section 4.04.	Director Compensation	19
	 	 	 
	 	Article V	 
	 	 	 
	 	QUALIFIED RETIREMENT PLANS	 
	 	 	 
	Section 5.01.	OSG U.S.  Retirement Plans	19
	Section 5.02.	INSW Retained  Retirement Plans	20
	Section 5.03.	OSG Retained  Retirement Plans	20
	Section 5.04.	INSW Savings Plan	20
	Section 5.05.	INSW UK Pension Plan	21


 




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	 	Article VI	 
	 	 	 
	 	NONQUALIFIED DEFERRED COMPENSATION PLANS	 
	 	 	 
	Section 6.01.	INSW SERP	21
	Section 6.02.	Participation; Distributions	21
	 	 	 
	 	Article VII	 
	 	 	 
	 	WELFARE BENEFIT PLANS	 
	 	 	 
	Section 7.01.	Welfare Plans	22
	Section 7.02.	COBRA and HIPAA	23
	Section 7.03.	Vacation, Holidays and Leaves of Absence	24
	Section 7.04.	Severance and Unemployment Compensation	24
	Section 7.05.	Workers’ Compensation	24
	Section 7.06.	Insurance Contracts	24
	Section 7.07.	Third-Party Vendors	24
	 	 	 
	 	Article VIII	 
	 	 	 
	 	NON-U.S. EMPLOYEES	 
	 	 	 
	 	Article IX	 
	 	 	 
	 	MISCELLANEOUS	 
	 	 	 
	Section 9.01.	Employee Records	25
	Section 9.02.	Preservation of Rights to Amend	26
	Section 9.03.	Fiduciary Matters	26
	Section 9.04.	Further Assurances	26
	Section 9.05.	Counterparts; Entire Agreement; Corporate Power	26
	Section 9.06.	Governing Law	27
	Section 9.07.	Assignability	27
	Section 9.08.	Third-Party Beneficiaries	28
	Section 9.09.	Notices	28
	Section 9.10.	Severability	29
	Section 9.11.	Force Majeure	29
	Section 9.12.	No Set-Off	29
	Section 9.13.	Headings	29
	Section 9.14.	Survival of Covenants	30
	Section 9.15.	Waivers of Default	30
	Section 9.16.	Dispute Resolution	30
	Section 9.17.	Specific Performance	30
	Section 9.18.	Amendments	30
	Section 9.19.	Interpretation	30
	Section 9.20.	Mutual Drafting	30


 




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	Schedules	 	 
	 	 	 
	Schedule 1.01(a)	Former Employees	 
	 	 	 
	Schedule 1.01(b)	Retained Non-U.S.  Retirement Plans	 
	 	 	 
	Schedule 2.05	Collective Bargaining Agreements – U.S.	 


 




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EMPLOYEE MATTERS AGREEMENT


 


THIS EMPLOYEE MATTERS AGREEMENT, dated as of
   , 2016 (this “Agreement”), is by and among Overseas Shipholding Group, Inc., a Delaware corporation
(“OSG”), and International Seaways, Inc., a Marshall Islands corporation (“INSW”). Capitalized
terms used in this Agreement but not otherwise defined herein shall have the meanings set forth in Article I or ascribed
to them in the Separation and Distribution Agreement (as defined below).


 


RECITALS:


 


WHEREAS, the board of directors of OSG (the
“OSG Board”) has determined that it is in the best interests of OSG and its stockholders to create a new publicly
traded company that will operate the INSW Business;


 


WHEREAS, in furtherance of the foregoing, the
OSG Board has determined that it is appropriate and desirable to separate the INSW Business from the OSG Business (the “Separation”)
and, at or following the Separation, make a distribution, on a pro rata basis, to holders of OSG Common Stock on the Record Date
of all the outstanding INSW Shares (the “Distribution”);


 


WHEREAS, in order to effectuate the Separation
and the Distribution, OSG and INSW have entered into that certain Separation and Distribution Agreement, dated as of    ,
2016 (the “Separation and Distribution Agreement”); and


 


WHEREAS, in addition to the matters addressed
by the Separation and Distribution Agreement, the Parties desire to enter into this Agreement to set forth the terms and conditions
of certain employment, compensation, and benefit matters.


 


NOW, THEREFORE, in consideration of the mutual
agreements, provisions and covenants contained in this Agreement, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Parties, intending to be legally bound, hereby agree as follows:


 


Article I



DEFINITIONS


 


Section 1.01.         Definitions.
For purposes of this Agreement, the following terms shall have the meanings set forth below.


 


“Adjusted OSG Awards” shall
mean, collectively, Adjusted OSG Options, Adjusted OSG Restricted Stock Units and Adjusted OSG Performance Based Units.


 


“Adjusted OSG Option” shall
mean an OSG Option, adjusted as of the Effective Time in accordance with Section 4.02(a).


 


“Adjusted OSG Performance Based Unit”
shall mean an OSG Performance Based Unit, adjusted as of the Effective Time in accordance with Section 4.02(b).


 




     


     


    

  


“Adjusted OSG Restricted Stock Award”
shall mean an OSG Restricted Stock Award, adjusted as of the Effective Time in accordance with Section 4.02(d).


 


“Adjusted OSG Restricted Stock Unit”
shall mean an OSG Restricted Stock Unit, adjusted as of the Effective Time in accordance with Section 4.02(c).


 


“Affiliate” shall have the
meaning set forth in the Separation and Distribution Agreement.


 


“Agreement” shall have the
meaning set forth in the preamble to this Agreement and shall include all Schedules hereto and all amendments, modifications, and
changes hereto entered into pursuant to Section 9.18.


 


“Ancillary Agreement” shall
have the meaning set forth in the Separation and Distribution Agreement.


 


“Assets” shall have the meaning
set forth in the Separation and Distribution Agreement.


 


“Benefit Plan” shall mean
any contract, agreement, policy, practice, program, plan, trust, commitment, or arrangement providing for benefits, perquisites,
or compensation of any nature from an employer to any Employee, or to any family member, dependent, or beneficiary of any such
Employee, including pension plans, thrift plans, supplemental pension plans, and welfare plans, and contracts, agreements, policies,
practices, programs, plans, trusts, commitments, and arrangements providing for terms of employment, fringe benefits, severance
benefits, change in control protections or benefits, travel, life, accidental death and dismemberment, disability insurance, tuition
reimbursement, travel reimbursement, vacation, sick, personal or bereavement days, leaves of absences, and holidays; provided,
however, the term “Benefit Plan” does not include any government-sponsored benefits, such as workers’
compensation, unemployment, or any similar plans, programs, or policies.


 


“COBRA” shall mean the U.S.
Consolidated Omnibus Budget Reconciliation Act of 1985, as codified at Section 601 et seq. of ERISA and at Section 4980B
of the Code.


 


“Code” shall have the meaning
set forth in the Separation and Distribution Agreement.


 


“Delayed Transfer Date” shall
have the meaning set forth in Section 3.01(a)(ii).


 


“Delayed Transfer Employees”
shall have the meaning set forth in Section 3.01(a)(ii).


 


“Delayed Transfer Period”
shall have the meaning set forth in Section 3.01(a)(ii).


 


“Distribution” shall have
the meaning set forth in the recitals to this Agreement.


 


“Distribution Date” shall
have the meaning set forth in the Separation and Distribution Agreement.


 


“Effective Time” shall have
the meaning set forth in the Separation and Distribution Agreement.


 




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“Employee” shall mean any
OSG Group Employee or INSW Group Employee.


 


“ERISA” shall mean the U.S.
Employee Retirement Income Security Act of 1974, as amended, and the regulations promulgated thereunder.


 


“Exchange Act” shall have
the meaning set forth in the Separation and Distribution Agreement.


 


“FICA” shall have the meaning
set forth in Section 3.01(e).


 


“Force Majeure” shall have
the meaning set forth in the Separation and Distribution Agreement.


 


“Former Employees” shall
mean Former OSG Group Employees and Former INSW Group Employees.


 


“Former INSW Group Employee”
shall mean any individual who is a former employee of OSG or any of its former Subsidiaries as of the Effective Time and set
forth on Schedule 1.01(a)(i), as may be updated from time to time by mutual agreement of the Parties.


 


“Former OSG Group Employee”
shall mean any individual who is a former employee of the OSG Group as of the Effective Time and who is not a Former INSW
Group Employee.


 


“FUTA” shall have the meaning
set forth in Section 3.01(e).


 


“Governmental Authority”
shall have the meaning set forth in the Separation and Distribution Agreement.


 


“Group” shall have the meaning
set forth in the Separation and Distribution Agreement.


 


“INSW” shall have the meaning
set forth in the preamble to this Agreement.


 


“INSW Awards” shall mean,
collectively, INSW Options, INSW Restricted Stock Units, and INSW Performance Based Units.


 


“INSW Benefit Plan” shall
mean any Benefit Plan established, sponsored, maintained, or contributed to by a member of the INSW Group as of or after the Effective
Time.


 


“INSW Board” shall mean the
Board of Directors of INSW.


 


“INSW Bonus Plans” shall
mean any annual or short-term incentive compensation plan, program, or policy sponsored or maintained by INSW immediately following
the Effective Time.


 


“INSW Business” shall have
the meaning set forth in the Separation and Distribution Agreement.


 


“INSW Compensation Committee”
shall mean the Compensation Committee of the Board of Directors of INSW.


 




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“INSW Delayed Transfer Employees”
shall have the meaning set forth in Section 3.01(a)(ii).


 


“INSW Equity Plan” shall
mean the INSW Management Incentive Compensation Plan and the INSW Non-Employee Director Incentive Compensation Plan.


 


“INSW Group” shall have the
meaning set forth in the Separation and Distribution Agreement.


 


“INSW Group Employees” shall
have the meaning set forth in Section 3.01(a)(i).


 


“INSW HSA” shall have the
meaning set forth in Section 7.01(c).


 


“INSW Liabilities” shall
have the meaning set forth in the Separation and Distribution Agreement.


 


“INSW Nonqualified Plan”
shall mean the INSW SERP.


 


“INSW Option” shall mean
any stock options granted pursuant to the INSW Equity Plan in accordance with Section 4.02(a).





 


“INSW Performance Based Unit”
shall mean a performance based unit granted pursuant to the INSW Equity Plan in accordance with Section 4.02(b).


 


“INSW Price Ratio” shall
mean the quotient obtained by dividing the INSW Stock Value by the OSG Pre-Distribution Stock Value.


 


“INSW Retained  Retirement
Plans” shall mean the plans set forth in Schedule 1.01(b)(i).


 


“INSW Retirement Plans”
shall mean the INSW Retained Retirement Plans, the INSW Savings Plan, and the INSW Nonqualified Plan.


 


“INSW Savings Plan” shall
mean the    .


 


“INSW Shares” shall have
the meaning set forth in the Separation and Distribution Agreement.


 


“INSW Share Ratio” shall
mean the quotient obtained by dividing the OSG Pre-Distribution Stock Value by the INSW Stock Value.


 


“INSW Stock Value” shall
mean the simple average of the volume weighted average per share price of INSW common stock on the New York Stock Exchange during
regular trading hours for the 20 Trading Days following the Distribution Date.


 


“INSW Transferred Employee”
shall mean any INSW Group Employee (including any INSW Delayed Transfer Employee) who participates in any Benefit Plan maintained
in the U.S.


 




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“INSW Welfare Plans” shall
mean the Welfare Plans established, sponsored, maintained, or contributed to by any member of the INSW Group for the benefit of
INSW Group Employees and Former INSW Group Employees.


 


“OSG” shall have the meaning
set forth in the preamble to this Agreement.


 


“OSG Awards” shall mean,
collectively, OSG Options, OSG Performance Based Units and OSG Restricted Stock Units.


 


“OSG Benefit Plan” shall
mean any Benefit Plan established, sponsored, or maintained by OSG or any of its Subsidiaries immediately prior to the Effective
Time, excluding any INSW Benefit Plan.


 


“OSG Board” shall have the
meaning set forth in the recitals to this Agreement.


 


“OSG Bonus Plans” shall mean
any annual or short-term incentive compensation plan, program, or policy sponsored or maintained by OSG immediately prior to the
Effective Time, including the OSG Annual Incentive Plan.


 


“OSG Business” shall have
the meaning set forth in the Separation and Distribution Agreement.


 


“OSG Compensation Committee”
shall mean the Compensation Committee of the OSG Board.


 


“OSG Delayed Transfer Employees”
shall have the meaning set forth in Section 3.01(a)(ii).


 


“OSG Equity Plan” shall mean
any the OSG Management Incentive Compensation Plan and OSG Non-Employee Director Incentive Compensation Plan.


 


“OSG Group” shall have the
meaning set forth in the Separation and Distribution Agreement.


 


“OSG Group Employees” shall
have the meaning set forth in Section 3.01(a)(i).


 


“OSG HSA” shall have the
meaning set forth in Section 7.01(c).


 


“OSG Liabilities” shall have
the meaning set forth in the Separation and Distribution Agreement.


 


“OSG Multiemployer Plans”
shall mean the American Maritime Officers Pension Plan, the Seafarers Pension Plan and the Marine Engineers’ Beneficial Association
Defined Benefit Pension Plan.


 


“OSG Nonqualified Plan” shall
mean the OSG Supplemental Executive Retirement Plan.


 


“OSG Option” shall mean an
option to purchase OSG Common Stock granted pursuant to an OSG Equity Plan that is outstanding as of immediately prior to the Effective
Time.


 




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“OSG Pension Trust” shall
mean the   .


 


“OSG Performance Based Unit”
shall mean a performance based unit granted pursuant to an OSG Equity Plan that is outstanding as of immediately prior to the Effective
Time.


 


“OSG Post-Distribution Stock Value”
shall mean the simple average of the volume weighted average per share price on the New York Stock Exchange during regular trading
hours of OSG Common Stock for the 20 Trading Days following the Distribution Date.


 


“OSG Pre-Distribution Stock Value”
shall mean the simple average of the volume weighted average per share price of OSG Common Stock, trading regular way with due
bills on the New York Stock Exchange during regular trading hours for, if the Distribution Date is on a Trading Day, the 20 Trading
Days ending on the Distribution Date or, if the Distribution Date is not on a Trading Day, the 20 Trading Days ending on the
last Trading Day prior to the Distribution Date.


 


“OSG Price Ratio” shall mean
the quotient obtained by dividing the OSG Post-Distribution Stock Value by the OSG Pre-Distribution Stock Value.


 


“OSG Restricted Stock Award”
shall mean a restricted stock award granted pursuant to an OSG Equity Plan that is outstanding as of immediately prior to the Effective
Time and held by a Group non-employee director or employee.


 


“OSG Restricted Stock Unit”
shall mean a restricted stock unit granted pursuant to an OSG Equity Plan that is outstanding as of immediately prior to the Effective
Time.


 


“OSG Retained Non-U.S.
Retirement Plans” shall mean the plans set forth in Schedule 1.01(b)(ii).


 


“OSG Retained  Retirement
Plans” shall mean the OSG Retained U.S. Pension Plans and the OSG Retained Non-U.S. Pension Plans.


 


“OSG Retained U.S.  Retirement
Plans” shall mean the OSG Pension Plans.


 


“OSG Retirement Plans” shall
mean the OSG U.S. Retirement Plans, the OSG U.K. Pension Plan, the OSG Retained Retirement Plans, the OSG Savings Plan, and the
OSG Nonqualified Plan.


 


“OSG Savings Plan” shall
mean the OSG Employee Savings Plan.


 


“OSG Share Ratio” shall mean
the quotient obtained by dividing the OSG Pre-Distribution Stock Value by the OSG Post-Distribution Stock Value.


 


“OSG Common Stock” shall
have the meaning set forth in the Separation and Distribution Agreement.


 


“OSG U.K. Pension Plan” shall
mean the OSG Ship Management (UK) Ltd. Retirement Benefits Plan.


 




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“OSG U.S.  Retirement
Plans” shall mean the Maritrans Inc. Defined Benefit Retirement Plan and the OSG Multiemployer Plans.


 


“OSG Welfare Plan” shall
mean any Welfare Plan established, sponsored, maintained, or contributed to by OSG or any of its Subsidiaries for the benefit of
Employees or Former Employees, but excluding any INSW Welfare Plan.


 


“HIPAA” shall mean the U.S.
Health Insurance Portability and Accountability Act of 1996, as amended, and the regulations promulgated thereunder.


 


“Individual Agreement” shall
mean any individual (a) employment contract, (b) retention, severance, or change of control agreement, (c) expatriate
(including any international assignee) contract or agreement (including agreements and obligations regarding repatriation, relocation,
equalization of taxes, and living standards in the host country), or (d) other agreement containing restrictive covenants
(including confidentiality, noncompetition, and nonsolicitation provisions) between a member of the OSG Group and a INSW Group
Employee, as in effect immediately prior to the Effective Time.


 


“IRS” shall mean the Internal
Revenue Service.


 


“Law” shall have the meaning
set forth in the Separation and Distribution Agreement.


 


“Liabilities” shall have
the meaning set forth in the Separation and Distribution Agreement.


 


“NYSE” shall have the meaning
set forth in the Separation and Distribution Agreement.


 


“Party” shall mean a party
to this Agreement.


 


“Person” shall have the meaning
set forth in the Separation and Distribution Agreement.


 


“Providing Party” shall have
the meaning set forth in Section 2.02(b).


 


“QDRO” shall mean a qualified
domestic relations order within the meaning of Section 206(d) of ERISA and Section 414(p) of the Code.


 


“Record Date” shall have
the meaning set forth in the Separation and Distribution Agreement.


 


“Requesting Party” shall
have the meaning set forth in Section 2.02(b).


 


“Restricted Period” shall
have the meaning set forth in Section 3.02(a).


 


“Securities Act” shall mean
the U.S. Securities Act of 1933, as amended, together with the rules and regulations promulgated thereunder.


 


“Separation” shall have the
meaning set forth in the recitals to this Agreement.


 




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“Separation and Distribution Agreement”
shall have the meaning set forth in the recitals to this Agreement.


 


“Stock Plan Administrator”
shall mean     .


 


“Subsidiary” shall have the
meaning set forth in the Separation and Distribution Agreement.


 


“Trading Day” shall mean
any day on which the New York Stock Exchange is open for the buying and selling of securities.


 


“Transfer Effective Time”
shall mean    , New York City time, on    , 2016.


 


“Transferred Account Balances”
shall have the meaning set forth in Section 7.01(d).


 


“Transition Services Agreement”
shall have the meaning set forth in the Separation and Distribution Agreement.


 


“U.S.” shall mean the United
States of America.


 


“Welfare Plan” shall mean
any “welfare plan” (as defined in Section 3(1) of ERISA) or a “cafeteria plan” under Section 125
of the Code, and any benefits offered thereunder, and any other plan offering health benefits (including medical, prescription
drug, dental, vision, mental health, substance abuse, and retiree health), disability benefits, or life, accidental death and dismemberment,
and business travel insurance, pre-tax premium conversion benefits, dependent care assistance programs, employee assistance programs,
paid time-off programs, contribution funding toward a health savings account, flexible spending accounts, or cashable credits.


 


Section 1.02.         Interpretation.
Section 10.16 of the Separation and Distribution Agreement is hereby incorporated by reference.


 


Article II



GENERAL PRINCIPLES FOR ALLOCATION OF LIABILITIES


 


Section 2.01.         General
Principles.


 


(a)          Acceptance
and Assumption of INSW Liabilities. On or prior to the Transfer Effective Time, but in any case prior to the Distribution Date,
except as expressly set forth herein, INSW and the applicable INSW designees shall accept, assume, and agree to faithfully perform,
discharge, and fulfill all of the Liabilities related to or arising from the INSW Business and the employment or potential employment
of any person, in accordance with their respective terms (each of which shall be considered a INSW Liability), including with respect
to any Individual Agreement, regardless of when or where such Liabilities arose or arise, or whether the facts on which they are
based occurred prior to or subsequent to the Transfer Effective Time, regardless of where or against whom such Liabilities are
asserted or determined (including any Liabilities arising out of claims made by OSG’s or INSW’s respective directors,
officers, Employees, Former Employees, agents, Subsidiaries, or Affiliates against any member of the OSG Group or the INSW Group)
or whether asserted or determined prior to the date hereof, and regardless of whether arising from or alleged to arise from negligence,
recklessness, violation of Law, fraud, or misrepresentation by any member of the OSG Group or the INSW Group, or any of their respective
directors, officers, Employees, Former Employees, agents, Subsidiaries, or Affiliates, including the following:


 




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(i)          any
and all wages, salaries, incentive compensation (as the same may be modified by this Agreement), including equity compensation
as set forth in Section 4.02, commissions, bonuses, and any other employee compensation or benefits payable to or on behalf of
any INSW Group Employees and Former INSW Group Employees after the Transfer Effective Time, without regard to when such wages,
salaries, incentive compensation, commissions, bonuses, or other employee compensation or benefits are or may have been awarded
or earned;


 


(ii)         any
and all Liabilities whatsoever with respect to claims made by or with respect to any INSW Group Employees or Former INSW Group
Employees in connection with any Benefit Plan not retained or assumed by any member of the OSG Group pursuant to this Agreement,
the Separation and Distribution Agreement, or any Ancillary Agreement; and


 


(iii)        any
and all Liabilities expressly assumed or retained by any member of the INSW Group pursuant to this Agreement.


 


(b)          Acceptance
and Assumption of OSG Liabilities. On or prior to the Transfer Effective Time, but in any case prior to the Distribution Date,
except as expressly set forth herein, OSG and certain members of the OSG Group designated by OSG shall accept, assume, and agree
to faithfully perform, discharge, and fulfill all of the Liabilities related to or arising from the OSG Business and the employment
or potential employment of any person, in accordance with their respective terms (each of which shall be considered an OSG Liability),
regardless of when or where such Liabilities arose or arise, or whether the facts on which they are based occurred prior to or
subsequent to the Transfer Effective Time, regardless of where or against whom such Liabilities are asserted or determined (including
any Liabilities arising out of claims made by OSG’s or INSW’s respective directors, officers, Employees, Former Employees,
agents, Subsidiaries, or Affiliates against any member of the OSG Group or the INSW Group) or whether asserted or determined prior
to the date hereof, and regardless of whether arising from or alleged to arise from negligence, recklessness, violation of Law,
fraud, or misrepresentation by any member of the OSG Group or the INSW Group, or any of their respective directors, officers, Employees,
Former Employees, agents, Subsidiaries, or Affiliates, including the following:


 


(i)          any
and all wages, salaries, incentive compensation (as the same may be modified by this Agreement), equity compensation (as the same
may be modified by this Agreement), commissions, bonuses, and any other employee compensation or benefits payable to or on behalf
of any OSG Group Employees and Former OSG Group Employees after the Transfer Effective Time, without regard to when such wages,
salaries, incentive compensation, equity compensation, commissions, bonuses, or other employee compensation or benefits are or
may have been awarded or earned and equity compensation (as the same may be modified by this Agreement) granted under the OSG Equity
Plans and outstanding as of the later of the Effective Time and the Transfer Effective Time;


 




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(ii)         any
and all Liabilities whatsoever with respect to claims made by or with respect to any OSG Group Employees or Former OSG Group Employees
in connection with any Benefit Plan not retained or assumed by any member of the INSW Group pursuant to this Agreement, the Separation
and Distribution Agreement, or any Ancillary Agreement; and


 


(iii)        any
and all Liabilities expressly assumed or retained by any member of the OSG Group pursuant to this Agreement.


 


(c)          Unaddressed
Liabilities. To the extent that this Agreement does not address particular Liabilities under any Benefit Plan and the Parties
later determine that they should be allocated in connection with the Distribution, the Parties shall agree in good faith on the
allocation, taking into account the handling of comparable Liabilities under this Agreement.


 


Section 2.02.         Service
Credit.


 


(a)          Service
for Eligibility, Vesting, and Benefit Purposes. The INSW Benefit Plans shall, and INSW shall cause each member of the INSW
Group to, recognize each INSW Group Employee’s and each Former INSW Group Employee’s full service with OSG or any of
its Subsidiaries or predecessor entities at or before the Effective Time, to the same extent that such service was credited by
OSG for similar purposes prior to the Effective Time as if such full service had been performed for a member of the INSW Group,
for purposes of eligibility, vesting, and determination of level of benefits under any such INSW Benefit Plan.


 


(b)          Evidence
of Prior Service. Notwithstanding anything in this Agreement to the contrary, but subject to Section 3.02 and applicable
Law, upon reasonable request by either Party (the “Requesting Party”), the other Party (the “Providing
Party”) will provide to the Requesting Party copies of any records available to the Providing Party to document the service,
plan participation, and membership of Former Employees of the Providing Party who are then Employees of the Requesting Party, and
will, upon reasonable request, cooperate with the Requesting Party to resolve any discrepancies and use its commercially reasonable
efforts to obtain any missing data for purposes of determining benefit eligibility, participation, vesting, and calculation of
benefits with respect to any such Employee.


 


Section 2.03.         Benefit
Plans.


 


(a)          Establishment
of Plans.  INSW shall, or shall cause an applicable
member of the INSW Group to, adopt Benefit Plans (and related trusts, if applicable), with terms comparable (or such other standard
as is specified in this Agreement with respect to any particular Benefit Plan) to those of the corresponding OSG Benefit Plans
in which an INSW Group Employee or Former INSW Group Employee was eligible to participate as of immediately prior to the Effective
Time; provided, however, that INSW may limit participation in any such INSW Benefit Plan to INSW Group Employees
and Former INSW Group Employees who participated or were eligible to participate in the corresponding OSG Benefit Plan immediately
prior to the Transfer Effective Time.


 




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(b)          Information
and Operation. OSG shall use its commercially reasonable efforts to provide INSW with information describing each OSG Benefit
Plan election made by a INSW Group Employee or Former INSW Group Employee that may have application to INSW Benefit Plans from
and after the Transfer Effective Time, and INSW shall use its commercially reasonable efforts to administer the INSW Benefit Plans
using those elections. Each Party shall, upon reasonable request, provide the other Party and the other Party’s respective
Affiliates, agents, and vendors all information reasonably necessary to the other Party’s operation or administration of
its Benefit Plans.


 


(c)          No
Duplication or Acceleration of Benefits. Notwithstanding anything to the contrary in this Agreement, the Separation and Distribution
Agreement, or any Ancillary Agreement, no participant in any INSW Benefit Plan shall receive service credit or benefits to the
extent that receipt of such service credit or benefits would result in duplication of benefits provided to such participant by
the corresponding OSG Benefit Plan, or any other plan, program, or arrangement sponsored or maintained by a member of the OSG Group.
Furthermore, unless expressly provided for in this Agreement, in the Separation and Distribution Agreement, or in any Ancillary
Agreement, or required by applicable Law, no provision in this Agreement shall be construed to create any right to accelerate vesting
or entitlements under any compensation or Benefit Plan, program, or arrangement sponsored or maintained by a member of the OSG
Group or member of the INSW Group on the part of any Employee or Former Employee.


 


(d)          No
Expansion of Participation. Unless otherwise expressly provided in this Agreement, as otherwise determined or agreed to by
OSG and INSW, as required by applicable Law, or as explicitly set forth in a INSW Benefit Plan or OSG Benefit Plan, (i) a
INSW Group Employee or Former INSW Group Employee shall be entitled to participate in the INSW Benefit Plans at the Transfer Effective
Time only to the extent that such INSW Group Employee or Former INSW Group Employee was entitled to participate in the corresponding
OSG Benefit Plan as in effect immediately prior to the Transfer Effective Time (to the extent that such INSW Group Employee or
Former INSW Group Employee does not participate in the respective INSW Benefit Plan immediately prior to the Transfer Effective
Time) and (ii) an OSG Group Employee or Former OSG Group Employee shall be entitled to participate in the OSG Benefit Plans
at the Transfer Effective Time only to the extent that such OSG Group Employee or Former OSG Group Employee was entitled to participate
in the OSG Benefit Plan as in effect immediately prior to the Transfer Effective Time, it being understood that this Agreement
does not expand (a) the number of INSW Group Employees or Former INSW Group Employees entitled to participate in any INSW
Benefit Plan, (b) the number of OSG Group Employees or Former OSG Group Employees entitled to participate in any OSG Benefit
Plan, or (c) the participation rights of INSW Group Employees or Former INSW Group Employees in any INSW Benefit Plans beyond
the rights of such INSW Group Employees or Former INSW Group Employees under the corresponding OSG Benefit Plans.


 


(e)          Transition
Services. The Parties acknowledge that the OSG Group or the INSW Group may provide administrative services for certain of the
other Party’s compensation and benefit programs for a transitional period under the terms of the Transition Services Agreement.
The Parties agree to enter into a business associate agreement (if required by HIPAA or other applicable health information privacy
Laws) in connection with such Transition Services Agreement.


 




    -11- 


     


    

  


(f)          Beneficiaries.
References to OSG Group Employees, Former OSG Group Employees, INSW Group Employees, Former INSW Group Employees, and nonemployee
directors of either OSG or INSW, shall be deemed to refer to their beneficiaries, dependents, survivors, and alternate payees,
as applicable.


 


Section 2.04.         Individual
Agreements.


 


(a)          Assignment
by OSG. To the extent necessary in order to effectuate the intent of this Agreement, OSG shall assign, or cause an applicable
member of the OSG Group to assign, to INSW or another member of the INSW Group, as designated by INSW, all Individual Agreements,
with such assignment to be effective as of the Transfer Effective Time; provided, however, that to the extent that
assignment of any such Individual Agreement is not permitted by the terms of such agreement or by applicable Law, effective as
of the Transfer Effective Time, each member of the INSW Group shall be considered to be a successor to each member of the OSG Group
for purposes of, and a third-party beneficiary with respect to, such Individual Agreement, such that each member of the INSW Group
shall enjoy all of the rights and benefits under such agreement (including rights and benefits as a third-party beneficiary), with
respect to the business operations of the INSW Group; and provided, further, that in no event shall OSG be permitted
to enforce any Individual Agreement (including any agreement containing noncompetition or nonsolicitation covenants) against a
INSW Group Employee or Former INSW Group Employee for action taken in such individual’s capacity as a INSW Group Employee
or Former INSW Group Employee.


 


(b)          Assumption
by INSW. Effective as of the Transfer Effective Time, INSW shall assume and honor, or shall cause a member of the INSW Group
to assume and honor, any agreement to which any INSW Group Employee or Former INSW Group Employee is a party with any member of
the OSG Group, including any Individual Agreement.


 


Section 2.05.         [RESERVED].


 


Section 2.06.         Non-U.S.
Regulatory Compliance. OSG shall have the authority to adjust the treatment described in this Agreement and to make corresponding
equitable adjustments to the Separation and Distribution Agreement with respect to INSW Group Employees who are located outside
of the U.S. in order to ensure compliance with the applicable laws or regulations of countries outside of the U.S. or to preserve
the tax benefits provided under local tax law or regulation before the Distribution.


 




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Article III



ASSIGNMENT OF EMPLOYEES


 


Section 3.01.         Active
Employees.


 


(a)          Assignment
and Transfer of Employees.


 


(i)          Generally.
Effective no later than immediately prior to the Transfer Effective Time and except as otherwise agreed by the Parties, (a) the
applicable member of the OSG Group shall have taken such actions as are necessary to ensure that each individual who is intended
to be an employee of the INSW Group as of immediately after the Transfer Effective Time (including any such individual who is not
actively working as of the Transfer Effective Time as a result of an illness, injury, or leave of absence approved by the primary
Human Resources officer of OSG or otherwise taken in accordance with applicable Law) (collectively, and as set forth in Schedule
3.01(a), the “INSW Group Employees”) is employed by a member of the INSW Group as of immediately after the Transfer
Effective Time, and (b) the applicable member of the OSG Group shall have taken such actions as are necessary to ensure that
each individual who is intended to be an employee of the OSG Group as of immediately after the Transfer Effective Time (including
any such individual who is not actively working as of the Transfer Effective Time as a result of an illness, injury, or leave of
absence approved by the primary Human Resources officer of OSG or otherwise taken in accordance with applicable Law) and any other
individual employed by the OSG Group as of the Transfer Effective Time who is not a INSW Group Employee (collectively, the “OSG
Group Employees”) is employed by a member of the OSG Group as of immediately after the Transfer Effective Time. Each
of the Parties agrees to execute, and to seek to have the applicable Employees execute, such documentation, if any, as may be necessary
to reflect such assignment and/or transfer.


 


(ii)         Delayed
Transfer Employees. Notwithstanding (i), the Parties acknowledge and agree that there may be a limited number of
INSW Group Employees whose employment may, within the 60-day period following the Transfer Effective Time (the
“Delayed Transfer Period”), be directly transferred from the OSG Group to the INSW Group (“INSW
Delayed Transfer Employees” or the “Delayed Transfer Employees”), as mutually agreed between the
primary Human Resources officer of OSG and the primary Human Resources officer of INSW. Upon the effective
date of any such transfer of employment (a “Delayed Transfer Date”), any Delayed Transfer Employee shall
be treated, for all purposes under this Agreement as if such Delayed Transfer Employee had been a INSW Group Employee or OSG
Group Employee, respectively, as of the Transfer Effective Time, other than with respect to any OSG Awards held by any
Delayed Transfer Employee as of immediately prior to the Effective Time, which awards shall be adjusted in the manner
applicable to OSG Group Employees (in the case of INSW Delayed Transfer Employees) or INSW Group Employees (in the case of
OSG Delayed Transfer Employees) as of the Effective Time in accordance with the provisions of Section 4.02, and
shall not be required under this Agreement to be adjusted further upon the Delayed Transfer Date.


 


(b)          At-Will
Status. Nothing in this Agreement shall create any obligation on the part of any member of the OSG Group or any member of the
INSW Group to (i) continue the employment of any Employee or permit the return from a leave of absence for any period after
the date of this Agreement (except as required by applicable Law) or (ii) change the employment status of any Employee from
“at-will,” to the extent that such Employee is an “at-will” employee under applicable Law.


 


(c)          Severance.
The Parties acknowledge and agree that the Distribution and the assignment, transfer, or continuation of the employment of Employees
as contemplated by this Section 3.01 shall not be deemed an involuntary actual or constructive termination of employment
entitling any INSW Group Employee or OSG Group Employee to severance payments or benefits except as required by applicable Law.


 


(d)          No
Change of Control or Change in Control. The Parties acknowledge and agree that neither the consummation of the Distribution
nor any transaction contemplated by this Agreement, the Separation and Distribution Agreement, or any other Ancillary Agreement
shall be deemed a “change of control,” “change in control,” or term of similar import for purposes of any
Benefit Plan sponsored or maintained by any member of the OSG Group or member of the INSW Group.


 




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(e)          Payroll
and Related Taxes. With respect to any INSW Group Employee or group of INSW Group Employees, the Parties shall, or shall cause
their respective Subsidiaries to, (i) treat INSW (or the applicable member of the INSW Group) as a “successor employer”
and OSG (or the applicable member of the OSG Group) as a “predecessor,” within the meaning of Sections 3121(a)(1) and
3306(b)(1) of the Code, for purposes of taxes imposed under the U.S. Federal Insurance Contributions Act, as amended (“FICA”),
or the U.S. Federal Unemployment Tax Act, as amended (“FUTA”), (ii) cooperate with each other to avoid,
to the extent possible, the restart of FICA and FUTA upon or following the Effective Time with respect to each such INSW Group
Employee for the tax year during which the Effective Time occurs, and (iii) use commercially reasonable efforts to implement
the alternate procedure described in Section 5 of Revenue Procedure 2004-53; provided, however, that, to the
extent that INSW (or the applicable member of the INSW Group) cannot be treated as a “successor employer” to OSG (or
the applicable member of the OSG Group) within the meaning of Sections 3121(a)(1) and 3306(b)(1) of the Code with respect
to any INSW Group Employee or group of INSW Group Employees, INSW will (a) be responsible for all payroll obligations, tax
withholding, and reporting obligations regarding such INSW Group Employees for the taxable year commencing on January 1, 2017 and
(b) furnish a Form W-2 or similar earnings statement to all such INSW Group Employees for such taxable year. The Parties also
shall take, or shall cause their respective Subsidiaries to take, such reasonable actions as are necessary to minimize any adverse
social tax impact on OSG, INSW, and the Employees in jurisdictions other than the U.S., of the Separation, the Distribution, and
any change in employment relationship caused by the Separation and Distribution.


 


(f)          Immigration.
From and after the Effective Time, INSW shall, or shall cause its applicable Subsidiary to, continue to process and support green
card or similar applications that are in process in respect of INSW Group Employees identified in the schedule previously provided
to INSW by OSG.


 


Section 3.02.         No-Hire
and Nonsolicitation.


 


(a)          No-Hire.
Each Party agrees that, for a period of 18 months following the Distribution Date (the “Restricted Period”),
such Party shall not, and shall cause its Subsidiaries and Affiliates not to, without the prior written consent of the Chief Executive
Officer of the other Party, directly or indirectly hire as an employee or an independent contractor any individual who is an OSG
Group Employee, in the case of INSW, or a INSW Group Employee, in the case of OSG.


 


(b)          Nonsolicitation.
Each Party agrees that, during the Restricted Period, such Party shall not, and shall cause its Subsidiaries and Affiliates not
to, without prior written consent of the Chief Executive Officer of the other Party, either directly or indirectly and whether
on its own behalf or in service or on behalf of others, solicit, aid, induce, or encourage any individual who is an OSG Group Employee,
in the case of INSW, or a INSW Group Employee, in the case of OSG, to leave his or her employment.


 




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(c)          Limited
Exceptions. Notwithstanding (a) and (b), this Section 3.02 shall not prohibit (i) generalized
solicitations that are not directed to specific Persons or Employees of the other Party, (ii) the solicitation and hiring
of a Person whose employment was involuntarily terminated by the other Party, or (iii) the solicitation and hiring of a Person
after receipt by the soliciting Party (in advance of any solicitation or, in the case of a response to a general solicitation as
permitted under clause (i) above, in advance of any subsequent solicitation in connection with the recruiting process) of
the express written consent of the Chief Executive Officer of the Party that employs the Person who is to be solicited and/or hired.
Except as provided in clause (ii) above with respect to involuntary terminations, without regard to the use of the term “Employee”
or “employs,” the restrictions under this Section 3.02 shall be applicable to (a) OSG Group Employees
whose employment terminates after the Effective Time, and (b) INSW Group Employees whose employment terminates after the Effective
Time, in each case, until the date that is six months after such Employee’s last date of employment with OSG or INSW, as
applicable. The restrictions under this Section 3.02 shall not apply to Former OSG Group Employees or Former INSW Group
Employees whose most recent employment with OSG and its Subsidiaries was terminated prior to the Effective Time.


 


Article IV



Equity, Bonus, and Executive Compensation


 


Section 4.01.         Generally.
Each OSG Award granted that is outstanding as of immediately prior to the Effective Time shall be adjusted as described below;
provided, however, that, effective immediately prior to the Effective Time, the OSG Compensation Committee may provide
for different adjustments with respect to some or all OSG Awards to the extent that the OSG Compensation Committee deems such
adjustments necessary and appropriate. Any adjustments made by the OSG Compensation Committee pursuant to the foregoing sentence
shall be deemed incorporated by reference herein as if fully set forth below and shall be binding on the Parties and their respective
Affiliates. Before the Effective Time, the INSW Equity Plan shall be established, with such terms as are necessary to permit the
implementation of the provisions of Section 4.02.


 


Section 4.02.         Equity
Awards. 


 


(a)          Stock
Options.


 


(i)          OSG
Group Employees. Each OSG Option that is outstanding immediately prior to the Effective Time and held by an OSG Group Employee
shall remain an option to purchase OSG Common Stock (each such option, an “Adjusted OSG Option”) and shall be
subject to the same terms and conditions (including with respect to vesting and expiration) after the Effective Time as were applicable
to such OSG Option immediately prior to the Effective Time (except as otherwise provided herein, including in this Section 4.02(a)(i)
and Section 4.02(e)); provided, however, that from and after the Effective Time:


 




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(A)         the
per-share exercise price of each such Adjusted OSG Option shall be equal to the product of (A) the per-share exercise price of
the corresponding OSG Option immediately prior to the Effective Time multiplied by (B) the OSG Price Ratio, rounded up to the nearest
whole hundredth of a cent; and


 


(B)         the
number of OSG Common Stock subject to each such Adjusted OSG Option shall be equal to the product of (A) the number of OSG Common
Stock subject to the corresponding OSG Option immediately prior to the Effective Time multiplied by (B) the OSG Share Ratio, with
any fractional share rounded down to the nearest whole share.


 


(ii)         INSW
Group Employees. Each OSG Option that is outstanding immediately prior to the Effective Time and held by an INSW Group Employee
shall be converted as of the Effective Time into an INSW Option to purchase INSW Shares (each such option, an “INSW Spin
Option”) and shall be subject to the same terms and conditions (including with respect to vesting and expiration) after
the Effective Time as were applicable to the corresponding OSG Option immediately prior to the Effective Time (except as otherwise
provided herein, including in Section 4.02(e)); provided, however, that from and after the Effective
Time:


 


(A)         the
per-share exercise price of each such INSW Spin Option shall be equal to the product of (A) the per-share exercise price of the
corresponding OSG Option immediately prior to the Effective Time multiplied by (B) the INSW Price Ratio, rounded up to the nearest
whole hundredth of a cent; and


 


(B)         the
number of INSW Shares subject to each such INSW Spin Option shall be equal to the product of (A) the number of OSG Shares subject
to the corresponding OSG Option immediately prior to the Effective Time multiplied by (B) the INSW Share Ratio, with any fractional
share rounded down to the nearest whole share.


 


(iii)        Notwithstanding
anything to the contrary in this Section 4.02(a), the exercise price, the number of OSG Shares and INSW Shares subject to each
Adjusted OSG Option and INSW Spin Option, and the terms and conditions of exercise of such options shall be determined in a manner
consistent with the requirements of Section 409A of the Code.


 


(b)          Performance
Based Units.


 


(i)          Performance
Based Units Held by OSG Group Employees. Each OSG Performance Based Unit that is outstanding immediately prior to the Effective
Time and that is held by an OSG Group Employee shall be adjusted by multiplying the number of performance based units subject to
such OSG Performance Based Unit by the OSG Share Ratio (each such adjusted OSG Performance Based Unit, an “Adjusted OSG
Performance Based Unit”). If the resulting product includes a fractional performance based unit, the number of performance
based units subject to such Adjusted OSG Performance Based Unit shall be rounded down to the nearest whole performance based unit.
Each such Adjusted OSG Performance Based Unit shall be subject to the same terms and conditions after the Effective Time as were
applicable to such OSG Performance Based Unit prior to the Effective Time (except as otherwise provided herein, including in Section 4.02(e).


 


(ii)         Performance
Based Units Held by INSW Group Employees.


 




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(A)         Each
OSG Performance Based Unit that is vested and outstanding immediately prior to the Effective Time and that is held by an INSW
Group Employee shall be converted into an Adjusted OSG Performance Based Unit in accordance with Section 4.02(b)(i) above.


 


(B)         Each
OSG Performance Based Unit that is unvested and outstanding immediately prior to the Effective Time and that is held by an INSW
Group Employee shall be converted as of the Effective Time into an INSW performance based unit (each such award, an “INSW
Performance Based Unit”), with the number of performance based units subject to each such INSW Performance Based Unit
to be set at a number equal to the product of (A) the number of performance based units subject to the corresponding OSG Performance
Based Unit immediately prior to the Effective Time multiplied by (B) the INSW Share Ratio, with any fractional performance based
unit rounded down to the nearest whole performance based unit. Each INSW Performance Based Unit shall otherwise be subject to the
same terms and conditions after the Effective Time as were applicable to such OSG Performance Based Unit prior to the Effective
Time (except as otherwise provided herein, including in Section 4.02(e).


 


(c)          Restricted
Stock Units. 


 


(i)          Restricted
Stock Units Held by OSG Group Employees. Each OSG Restricted Stock Unit that is outstanding immediately prior to the Effective
Time and that is held by an OSG Group Employee shall be adjusted by multiplying the number of restricted stock units subject to
such OSG Restricted Stock Unit by the OSG Share Ratio (each such adjusted OSG Restricted Stock Unit, an “Adjusted OSG
Restricted Stock Unit”). If the resulting product includes a fractional restricted stock unit, the number of restricted
stock units subject to such Adjusted OSG Restricted Stock Unit shall be rounded down to the nearest whole restricted stock unit.
Each such Adjusted OSG Restricted Stock Unit shall be subject to the same terms and conditions after the Effective Time as were
applicable to such OSG Restricted Stock Unit prior to the Effective Time (except as otherwise provided herein, including in Section 4.02(e).


 


(ii)         Restricted
Stock Units Held by INSW Group Employees.


 


(A)         Each
OSG Restricted Stock Unit that is vested and outstanding immediately prior to the Effective Time and that is held by an INSW Group
Employee shall be converted into an Adjusted OSG Restricted Stock Unit in accordance with Section 4.02(c)(i) above.


 


(B)         Each
OSG Restricted Stock Unit that is unvested and outstanding immediately prior to the Effective Time and that is held by an INSW
Group Employee shall be converted as of the Effective Time into an INSW restricted stock unit (each such award, an “INSW
Restricted Stock Unit”), with the number of restricted stock units subject to each such INSW Restricted Stock Unit to
be set at a number equal to the product of (A) the number of restricted stock units subject to the corresponding OSG Restricted
Stock Unit immediately prior to the Effective Time multiplied by (B) the INSW Share Ratio, with any fractional restricted stock
unit rounded down to the nearest whole restricted stock unit. Each INSW Restricted Stock Unit shall otherwise be subject to the
same terms and conditions after the Effective Time as were applicable to such OSG Restricted Stock Unit prior to the Effective
Time (except as otherwise provided herein, including in Section 4.02(e).


 




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(d)          
Director Restricted Stock. Each OSG Restricted Stock Award that is outstanding immediately prior to the Record Date and
that is held by a director of OSG shall be adjusted by multiplying the number of shares underlying such OSG Restricted Stock Award
by the OSG Share Ratio into an “Adjusted OSG Restricted Stock Award”. If the resulting product includes a fractional
share of restricted stock or restricted stock unit, the number of shares underlying such Adjusted OSG Restricted Stock Award shall
be rounded down to the nearest whole share of restricted stock or unit. Each such Adjusted OSG Restricted Stock Award shall be
subject to the same terms and conditions after the Effective Time as were applicable to such OSG Restricted Stock Award prior to
the Effective Time (except as otherwise provided herein, including in Section 4.02(e). 


 


(e)          Tax
Reporting and Withholding.


 


(i)          After
the Effective Time, Adjusted OSG Awards, regardless of by whom held, shall be settled by OSG, and INSW Awards, regardless of by
whom held, shall be settled by INSW.


 


(ii)         Unless
otherwise required by applicable Laws, INSW shall be responsible for all income, payroll, fringe benefit, social insurance, payment
on account, or other taxes related to or otherwise owed on income of INSW Group Employees or Former INSW Group Employees related
to INSW Awards, and OSG shall be responsible for all income, payroll, fringe benefit, social insurance, payment on account, or
other taxes related to or otherwise owed related to Adjusted OSG Awards.


 


(f)          Registration
and Other Regulatory Requirements. INSW agrees to file an S-8 registration statement with respect to, and to cause to be registered
pursuant to the Securities Act, the INSW Shares authorized for issuance under the INSW Equity Plan, as required pursuant to the
Securities Act. The Parties shall take such additional actions as are deemed necessary or advisable to effectuate the foregoing
provisions of this Section 4.02(f), including compliance with securities Laws and other legal requirements associated
with equity compensation awards in affected non-U.S. jurisdictions.


 


Section 4.03.         Bonus
Plans.


 


(a)          Establishment
of INSW Bonus Plans. INSW shall, or shall cause another member of the INSW Group to, establish
the INSW Bonus Plans.


 


(b)          2016
Annual Bonus. Effective as of the Transfer Effective Time, the Liability in respect of bonus awards allocable to INSW Group
Employees or Former INSW Group Employees under the OSG Bonus Plans in respect of 2016 shall be assumed by the INSW Group. OSG and
INSW shall pay the amounts awarded to their respective Employees no later than March 15, 2017 (in the case of Employees located
in the U.S.) or March 31, 2017 (in the case of Employees located outside the U.S.), except as otherwise determined by the Compensation
Committee of the Board of Directors of such Employee’s employer.


 




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(c)          Allocation
of Liabilities. Except as otherwise provided in this Agreement, (i) the OSG Group shall be solely responsible for funding,
paying, and discharging all obligations relating to any annual incentive bonus awards under any OSG annual incentive plan or other
short-term compensation plan with respect to payments earned before, as of, or after the Transfer Effective Time to OSG Group Employees
or Former OSG Group Employees, and no member of the INSW Group shall have any obligations with respect thereto; and (ii) the
INSW Group shall be solely responsible for funding, paying, and discharging all obligations relating to any annual incentive bonus
awards under any INSW Group annual incentive plan or other short-term incentive compensation plan with respect to payments earned
before, as of, or after the Transfer Effective Time to INSW Group Employees or Former INSW Group Employees, and no member of the
OSG Group shall have any obligations with respect thereto.


 


Section 4.04.         Director
Compensation.


 


(a)          Establishment
of INSW Compensation Program for Nonemployee Directors. INSW shall establish the INSW compensation
program for nonemployee directors, with substantially the same terms as of immediately prior to the Effective Time as the OSG compensation
program for nonemployee directors.


 


(b)          Allocation
of Directors’ Compensation. OSG shall be responsible for the payment of any fees for service on the OSG Board that are
earned at, before, or after the Effective Time, and INSW shall not have any responsibility for any such payments. With respect
to any INSW nonemployee director, INSW shall be responsible for the payment of any fees for service on the INSW Board that are
earned at any time after the Effective Time and OSG shall not have any responsibility for any such payments. OSG Awards held by
nonemployee directors as of immediately prior to the Effective Time shall be treated as described in Section 4.02.


 


Section 4.05.         Retention
Awards. OSG and INSW have agreed to share the obligations for cash-based retention awards to which an OSG Group Employee or
OIN Group Employee may become entitled based on such employee’s relative service to OSG or INSW prior to the settlement date
of each such award (as provided in applicable award agreements) as set forth in Schedule 4.05.


 


Article V



QUALIFIED RETIREMENT PLANS


 


Section 5.01.         OSG
U.S. Retirement Plans. OSG U.S. Retirement Plans After Transfer Effective Date. From and after the Transfer
Effective Time, (i) each of the OSG U.S. Retirement Plans shall continue to be responsible for Liabilities in respect of
OSG Group Employees, Former OSG Group Employees, and Former INSW Group Employees, and (ii) no INSW Group Employees shall
accrue any benefits under the OSG U.S. Retirement Plans. Without limiting the generality of the foregoing, INSW Group
Employees shall cease to be participants in each of the OSG U.S. Retirement Plans, effective as of the Transfer
Effective Time.


 




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Section 5.02.         INSW
Retained Retirement Plans. As of the Transfer Effective Time, the INSW Group shall retain (or assume to the
extent necessary) sponsorship of the INSW Retained Retirement Plans, and, from and after the Transfer Effective Time, all
Assets and Liabilities thereunder shall be Assets and Liabilities of the INSW Group.


 


Section 5.03.         OSG
Retained Retirement Plans. As of the Transfer Effective Time, the OSG Group shall retain (or assume to the extent
necessary) sponsorship of the OSG Retained Retirement Plans, and, from and after the Transfer Effective Time, all Assets and
Liabilities thereunder shall be the Assets and Liabilities of the OSG Group.


 


Section 5.04.         INSW
Savings Plan.


 


(a)          Adoption
of Plan. INSW shall adopt the INSW Savings Plan. INSW shall provide OSG with (i) a copy of the INSW Savings Plan; (ii) confirmation that the INSW Board (or
its authorized committee or other delegate) has approved the adoption of the INSW Savings Plan and the related trust(s) and
the assumption by the INSW Savings Plan of the Liabilities described in Section 5.04(b); and
(iii) either (a) a favorable determination letter issued by the IRS with respect to the INSW Savings Plan and its
related trust or (b) an opinion of counsel, which counsel and opinion are reasonably satisfactory to OSG, with respect
to the qualified status of the INSW Savings Plan under Section 401(a) of the Code and the tax-exempt status of its
related trust under Section 501(a) of the Code.


 


(b)          Transfer
of Account Balances. Not later than March 31, 2017 (or such later time as mutually agreed by the Parties), OSG shall cause
the trustee of the OSG Savings Plan to transfer from the trust(s) that forms a part of the OSG Savings Plan to the trust(s) that
forms a part of the INSW Savings Plan the account balances of the INSW Group Employees under the OSG Savings Plan, determined as
of the date of the transfer. Such transfers shall be made in kind, including promissory notes evidencing the transfer of outstanding
loans. Any Asset and Liability transfers pursuant to this Section 5.04(b) shall comply in all respects with Sections
414(l) and 411(d)(6) of the Code.


 


(c)          INSW
Savings Plan Provisions. The INSW Savings Plan shall provide that:


 


(i)          INSW
Group Employees shall (a) be eligible to participate in the INSW Savings Plan as of the Transfer Effective Time to the extent
that they were eligible to participate in the OSG Savings Plan as of immediately prior to the Transfer Effective Time, and (b) receive
credit for all service credited for that purpose under the OSG Savings Plan as of immediately prior to the Distribution as if that
service had been rendered to INSW; and


 


(ii)         the
account balance of each INSW Group Employee under the OSG Savings Plan as of the date of the transfer of Assets from the OSG Savings
Plan (including any outstanding promissory notes) shall be credited to such individual’s account balance under the INSW Savings
Plan.


 




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(d)          OSG
Savings Plan after Transfer Effective Time. From and after the Transfer Effective Time, (i) the OSG Savings Plan shall
continue to be responsible for Liabilities in respect of OSG Group Employees, Former OSG Group Employees, and Former INSW Group
Employees, and (ii) no INSW Group Employees shall accrue any benefits under the OSG Savings Plan. Without limiting the generality
of the foregoing, INSW Group Employees shall cease to be participants in the OSG Savings Plan effective as of the Transfer Effective
Time.


 


(e)          Plan
Fiduciaries. For all periods after the Transfer Effective Time, the Parties agree that the applicable fiduciaries of each of
the OSG Savings Plan and the INSW Savings Plan, respectively, shall have the authority with respect to the OSG Savings Plan and
the INSW Savings Plan, respectively, to determine the investment alternatives, the terms and conditions with respect to those investment
alternatives, and such other matters as are within the scope of their duties under ERISA and the terms of the applicable plan documents.


 


(f)          No
Loss of Unvested Benefits; No Distributions. The transfer of any INSW Group Employee’s employment to the INSW Group will
not result in loss of that INSW Group Employee’s unvested benefits (if any) under the OSG Savings Plan, which benefit Liability
will be assumed under the INSW Savings Plan as provided herein. No INSW Group Employee shall be entitled to a distribution of his
or her benefit under the OSG Savings Plan or INSW Savings Plan as a result of such transfer of employment.


 


Section 5.05.         INSW
UK Pension Plan. INSW shall sponsor the OSG U.K. Pension Plan following the Distribution Date, and INSW Group Employees who
participated in such plan prior to the Distribution Date shall continue to participate in such plan on and after the Distribution
Date. OSG Group Employees who actively participated in the OSG U.K. Pension Plan will cease to participate in the OSG U.K. Pension
Plan on the Distribution Date.


 


Article VI



NONQUALIFIED DEFERRED COMPENSATION PLANS


 


Section 6.01.         INSW
SERP.


 


(a)          Establishment
of the INSW SERP.  INSW shall establish the INSW SERP.


 


(b)          Assumption
of Liabilities from OSG. As of the Transfer Effective Time, INSW shall, and shall cause the INSW SERP to assume all Liabilities
under the OSG SERP for the benefits of INSW Group Employees and their respective beneficiaries and/or alternate payees determined
as of immediately prior to the Transfer Effective Time, and the OSG Group and the OSG SERP shall be relieved of all Liabilities
for those benefits. OSG shall retain all Liabilities under the OSG SERP for the benefits for OSG Group Employees and Former Employees
and their respective beneficiaries and/or alternate payees. From and after the Transfer Effective Time, INSW Group Employees shall
cease to be participants in the OSG SERP.


 


Section 6.02.         Participation;
Distributions. The Parties acknowledge that none of the transactions contemplated by this Agreement, the Separation and Distribution
Agreement, or any other Ancillary Agreement will be treated as a “separation from service” or otherwise trigger a
payment or distribution of compensation under any of the OSG Nonqualified Plan or INSW Nonqualified Plan for any participant and,
consequently, that the payment or distribution of any compensation to which such participant is entitled under any of the OSG
Nonqualified Plan or INSW Nonqualified Plan will occur upon such participant’s separation from service from the INSW Group
or at such other time as provided in the applicable INSW Nonqualified Plan or participant’s deferral election.


 




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Article VII



WELFARE BENEFIT PLANS


 


Section 7.01.         Welfare
Plans.


 


(a)          Adoption
of INSW Welfare Plans. INSW shall, or shall cause the applicable member of the INSW
Group to, adopt the INSW Welfare Plans.


 


(b)          Waiver
of Conditions; Benefit Maximums. INSW shall use commercially reasonable efforts to cause the INSW Welfare Plans to:


 


(i)          with
respect to initial enrollment as of January 1, 2017, waive (a) all limitations as to preexisting conditions, exclusions, and
service conditions with respect to participation and coverage requirements applicable to any INSW Group Employee or Former INSW
Group Employee, other than limitations that were in effect with respect to the INSW Group Employee or Former INSW Group Employee
under the applicable OSG Welfare Plan as of immediately prior to the Transfer Effective Time, and (b) any waiting period limitation
or evidence of insurability requirement applicable to a INSW Group Employee or Former INSW Group Employee other than limitations
or requirements that were in effect with respect to such INSW Group Employee or Former INSW Group Employee under the applicable
OSG Welfare Plans as of immediately prior to the Transfer Effective Time; and


 


(ii)         take
into account (a) with respect to aggregate annual, lifetime, or similar maximum benefits available under the INSW Welfare
Plans, a INSW Group Employee’s or Former INSW Group Employee’s prior claim experience under the OSG Welfare Plans and
any Benefit Plan that provides leave benefits; and (b) any eligible expenses incurred by a INSW Group Employee or Former INSW
Group Employee and his or her covered dependents during the portion of the plan year of the applicable OSG Welfare Plan ending
as of the Transfer Effective Time to be taken into account under such INSW Welfare Plan for purposes of satisfying all deductible,
coinsurance, and maximum out-of-pocket requirements applicable to such INSW Group Employee or Former INSW Group Employee and his
or her covered dependents for the applicable plan year to the same extent as such expenses were taken into account by OSG for similar
purposes prior to the Transfer Effective Time as if such amounts had been paid in accordance with such INSW Welfare Plan.


 




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(c)          Health
Savings Accounts. INSW shall, or shall cause a member of the INSW Group to, establish
a INSW Welfare Plan that will provide health savings account benefits to INSW Group Employees on and after the Transfer Effective
Time (a “INSW HSA”). It is the intention of the Parties that all activity under a INSW Group Employee’s
health savings account under an OSG Welfare Plan (a “OSG HSA”) for the year in which the Transfer Effective
Time occurs be treated instead as activity under the corresponding account under the INSW HSA, such that (i) any period of
participation by a INSW Group Employee in an OSG HSA during the year in which the Transfer Effective Time occurs will be deemed
a period when such INSW Group Employee participated in the corresponding INSW HSA; (ii) all expenses incurred during such
period will be deemed incurred while such INSW Group Employee’s coverage was in effect under the corresponding INSW HSA;
and (iii) all elections and reimbursements made with respect to such period under the OSG HSA will be deemed to have been
made with respect to the corresponding INSW HSA.


 


(d)          Flexible
Spending Accounts. The Parties shall use commercially reasonable efforts to ensure that as of the Transfer Effective Time any
health or dependent care flexible spending accounts of INSW Group Employees (whether positive or negative) (the “Transferred
Account Balances”) under OSG Welfare Plans are transferred, as soon as practicable after the Transfer Effective Time,
from the OSG Welfare Plans to the corresponding INSW Welfare Plans. Such INSW Welfare Plans shall assume responsibility as of the
Transfer Effective Time for all outstanding health or dependent care claims under the corresponding OSG Welfare Plans of each INSW
Group Employee for the year in which the Transfer Effective Time occurs and shall assume and agree to perform the obligations of
the corresponding OSG Welfare Plans from and after the Transfer Effective Time. As soon as practicable after the Transfer Effective
Time, and in any event within 30 days after the amount of the Transferred Account Balances is determined or such later date as
mutually agreed upon by the Parties, OSG shall pay INSW the net aggregate amount of the Transferred Account Balances, if such amount
is positive, and INSW shall pay OSG the net aggregate amount of the Transferred Account Balances, if such amount is negative.


 


(e)          Allocation
of Welfare Assets and Liabilities. Effective as of the Transfer Effective Time, the INSW Group shall assume all Liabilities
relating to, arising out of, or resulting from health and welfare coverage or claims incurred by or on behalf of INSW Group Employees
or Former INSW Group Employees or their covered dependents under the OSG Welfare Plans or INSW Welfare Plans before, at, or after
the Transfer Effective Time. No OSG Welfare Plan shall provide coverage to any INSW Group Employee or Former INSW Group Employee
after the Transfer Effective Time.


 


Section 7.02.         COBRA
and HIPAA. The OSG Group shall continue to be responsible for complying with, and providing coverage pursuant to, the health
care continuation requirements of COBRA, the certificate of creditable coverage requirements of HIPAA, and the corresponding provisions
of the OSG Welfare Plans with respect to any OSG Group Employees and any Former OSG Group Employees (and their covered dependents)
who incur a qualifying event under COBRA before, as of or after the Transfer Effective Time. Effective as of the Transfer Effective
Time, the INSW Group shall assume responsibility for complying with, and providing coverage pursuant to, the health care continuation
requirements of COBRA, the certificate of creditable coverage requirements of HIPAA, and the corresponding provisions of the INSW
Welfare Plans with respect to any INSW Group Employees and any Former INSW Group Employees (and their covered dependents) who
incur a qualifying event or loss of coverage under the OSG Welfare Plans and/or the INSW Welfare Plans before, as of, or after
the Transfer Effective Time. The Parties agree that the consummation of the transactions contemplated by the Separation and Distribution
Agreement shall not constitute a COBRA qualifying event for any purpose of COBRA.


 




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Section 7.03.         Vacation,
Holidays and Leaves of Absence. Effective as of the Transfer Effective Time, the INSW Group shall assume all Liabilities of
the OSG Group with respect to vacation, holiday, annual leave, or other leave of absence, and required payments related thereto,
for each INSW Group Employee and Former INSW Group Employee. The OSG Group shall retain all Liabilities with respect to vacation,
holiday, annual leave or other leave of absence, and required payments related thereto, for each OSG Group Employee and Former
OSG Group Employee.


 


Section 7.04.         Severance
and Unemployment Compensation. Effective as of the Transfer Effective Time, the INSW Group shall assume any and all Liabilities
to, or relating to, INSW Group Employees and Former INSW Group Employees in respect of severance and unemployment compensation,
regardless of whether the event giving rise to the Liability occurred before, at, or after the Transfer Effective Time. The OSG
Group shall be responsible for any and all Liabilities to, or relating to, OSG Group Employees and Former OSG Group Employees
in respect of severance and unemployment compensation, regardless of whether the event giving rise to the Liability occurred before,
at or after the Transfer Effective Time.


 


Section 7.05.         Workers’
Compensation. With respect to claims for workers’ compensation in the U.S., (a) the INSW Group shall be responsible
for claims in respect of INSW Group Employees and Former INSW Group Employees, whether occurring before, at, or after the Transfer
Effective Time, and (b) the OSG Group shall be responsible for all claims in respect of OSG Group Employees and Former OSG
Group Employees, whether occurring before, at, or after the Transfer Effective Time. The treatment of workers’ compensation
claims by INSW with respect to OSG insurance policies shall be governed by Section 5.1 of the Separation and Distribution
Agreement. The Parties acknowledge that any workers’ compensation policy in effect prior to the Transfer Effective Time
shall be available, pursuant to the terms and conditions thereof, for claims in respect of INSW Group Employees and Former INSW
Group Employees occurring before the Transfer Effective Time. The obligation to pay deductibles, retrospective premium payments,
or other forms of reimbursement to the insurer shall be governed by Section 5.1 of the Separation and Distribution Agreement.


 


Section 7.06.         Insurance
Contracts. To the extent that any OSG Welfare Plan is funded through the purchase of an insurance contract or is subject to
any stop-loss contract, the Parties shall cooperate and use their commercially reasonable efforts to replicate such insurance
contracts for INSW (except to the extent that changes are required under applicable state insurance Laws or filings by the respective
insurers) and to maintain any pricing discounts or other preferential terms for both OSG and INSW for a reasonable term. Neither
Party shall be liable for failure to obtain such insurance contracts, pricing discounts, or other preferential terms for the other
Party. Each Party shall be responsible for any additional premiums, charges, or administrative fees that such Party may incur
pursuant to this Section 7.06.


 


Section 7.07.         Third-Party
Vendors. Except as provided below, to the extent that any OSG Welfare Plan is administered by a third-party vendor, the Parties
shall cooperate and use their commercially reasonable efforts to replicate any contract with such third-party vendor for INSW
and to maintain any pricing discounts or other preferential terms for both OSG and INSW for a reasonable term. Neither Party shall
be liable for failure to obtain such pricing discounts or other preferential terms for the other Party. Each Party shall be responsible
for any additional premiums, charges, or administrative fees that such Party may incur pursuant to this Section 7.07.


 




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Article VIII



NON-U.S. EMPLOYEES


 


INSW Group Employees and Former INSW Group Employees
who are residents outside of the U.S. or otherwise are subject to non-U.S. Law and their related benefits and Liabilities shall
be treated in the same manner as the INSW Group Employees and Former INSW Group Employees, respectively, who are residents of the
U.S. and are not subject to non-U.S. Law; provided, however, that, notwithstanding anything in this Agreement to
the contrary, all actions taken with respect to non-U.S. Employees or U.S. Employees working in non-U.S. jurisdictions shall be
subject to and accomplished in accordance with applicable Law in the custom of the applicable jurisdictions.


 


Article IX



MISCELLANEOUS


 


Section 9.01.         Employee
Records.


 


(a)          Sharing
of Information. Subject to any limitations imposed by applicable Law, OSG and INSW (acting directly or through members of the
OSG Group or the INSW Group, respectively) shall provide to the other and their respective authorized agents and vendors all information
necessary for the Parties to perform their respective duties under this Agreement.


 


(b)          Transfer
of Personnel Records and Authorization. Subject to any limitation imposed by applicable Law and to the extent that it has not
done so before the Transfer Effective Time, OSG shall transfer to INSW any and all employment records (including any Form I-9,
Form W-2, or other IRS forms) with respect to INSW Group Employees and Former INSW Group Employees and other records reasonably
required by INSW to enable INSW properly to carry out its obligations under this Agreement. Such transfer of records generally
shall occur as soon as administratively practicable at or after the Transfer Effective Time. Each Party will permit the other Party
reasonable access to Employee records to the extent reasonably necessary for such accessing Party to carry out its obligations
hereunder.


 


(c)          Access
to Records. To the extent not inconsistent with this Agreement, the Separation and Distribution Agreement, or any applicable
privacy protection Laws or regulations, reasonable access to Employee-related records after the Effective Time will be provided
to members of the OSG Group and members of the INSW Group pursuant to the terms and conditions of Article VI of the Separation
and Distribution Agreement.


 


(d)          Maintenance
of Records. With respect to retaining, destroying, transferring, sharing, copying, and permitting access to all Employee-related
information, OSG and INSW shall comply with all applicable Laws, regulations, and internal policies, and shall indemnify and hold
harmless each other from and against any and all Liability, claims, actions, and damages that arise from a failure (by the indemnifying
Party or its Subsidiaries or their respective agents) to so comply with all applicable Laws, regulations, and internal policies
applicable to such information.


 




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(e)          Cooperation.
Each Party shall use commercially reasonable efforts to cooperate and work together to unify, consolidate, and share (to the extent
permissible under applicable privacy/data protection or other applicable Laws) all relevant documents, resolutions, government
filings, data, payroll, employment, and benefit plan information on regular timetables and cooperate as needed with respect to
(i) any litigation with respect to any employee benefit plan, policy, or arrangement contemplated by this Agreement, (ii) efforts
to seek a determination letter, private letter ruling, or advisory opinion from the IRS or U.S. Department of Labor on behalf of
any employee benefit plan, policy, or arrangement contemplated by this Agreement, and (iii) any filings that are required
to be made or supplemented to the IRS, U.S. Pension Benefit Guaranty Corporation, U.S. Department of Labor, or any other Governmental
Authority; provided, however, that requests for cooperation must be reasonable and not interfere with daily business
operations.


 


(f)          Confidentiality.
Notwithstanding anything in this Agreement to the contrary, all confidential records and data relating to Employees to be shared
or transferred pursuant to this Agreement shall be subject to Section 6.9 of the Separation and Distribution Agreement and
the requirements of applicable Law.


 


Section 9.02.         Preservation
of Rights to Amend. The rights of each member of the OSG Group and each member of the INSW Group to amend, waive, or terminate
any plan, arrangement, agreement, program, or policy referred to herein shall not be limited in any way by this Agreement.


 


Section 9.03.         Fiduciary
Matters. OSG and INSW each acknowledges that actions required to be taken pursuant to this Agreement may be subject to fiduciary
duties or standards of conduct under ERISA or other applicable Law. Each Party shall be responsible for taking such actions as
are deemed necessary and appropriate to comply with its own fiduciary responsibilities and shall fully release and indemnify the
other Party for any Liabilities caused by the failure to satisfy any such responsibility.


 


Section 9.04.         Further
Assurances. Each Party hereto shall take, or cause to be taken, any and all reasonable actions, including the execution, acknowledgment,
filing, and delivery of any and all documents and instruments that any other Party hereto may reasonably request in order to effect
the intent and purpose of this Agreement and the transactions contemplated hereby.


 


Section 9.05.         Counterparts;
Entire Agreement; Corporate Power.


 


(a)          This
Agreement may be executed in one or more counterparts, all of which shall be considered one and the same agreement, and shall become
effective when one or more counterparts have been signed by each of the Parties and delivered to the other Party.


 




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(b)          This
Agreement, the Separation and Distribution Agreement, and the Ancillary Agreements and the Exhibits, Schedules, and appendices
hereto and thereto contain the entire agreement among the Parties with respect to the subject matter hereof, supersede all previous
agreements, negotiations, discussions, writings, understandings, commitments and conversations with respect to such subject matter,
and there are no agreements or understandings among the Parties other than those set forth or referred to herein or therein. OSG
represents on behalf of itself and each of its Subsidiaries, and INSW represents on behalf of itself and each of its Subsidiaries,
as follows:


 


(i)          each
such Person has the requisite corporate or other power and authority and has taken all corporate or other action necessary in order
to execute, deliver and perform this Agreement and to consummate the transactions contemplated hereby; and


 


(ii)         this
Agreement has been duly executed and delivered by it and constitutes a valid and binding agreement of it enforceable in accordance
with the terms hereof.


 


(c)          Each
Party acknowledges that it and the other Parties is executing this Agreement by facsimile, stamp, or mechanical signature, and
that delivery of an executed counterpart of a signature page to this Agreement (whether executed by manual, stamp, or mechanical
signature) by facsimile or by email in portable document format (PDF) shall be effective as delivery of such executed counterpart
of this Agreement. Each Party expressly adopts and confirms each such facsimile, stamp, or mechanical signature (regardless of
whether delivered in person, by mail, by courier, by facsimile, or by email in portable document format (PDF)) made in its respective
name as if it were a manual signature delivered in person, agrees that it will not assert that any such signature or delivery is
not adequate to bind such Party to the same extent as if it were signed manually and delivered in person and agrees that, at the
reasonable request of the other Parties at any time, it will as promptly as reasonably practicable cause this Agreement to be manually
executed (any such execution to be as of the date of the initial date thereof) and delivered in person, by mail, or by courier.


 


Section 9.06.         Governing
Law. This Agreement (and any claims or disputes arising out of or related hereto or to the transactions contemplated hereby
or to the inducement of any Party to enter herein, whether for breach of contract, tortious conduct, or otherwise and whether
predicated on common law, statute, or otherwise) shall be governed by and construed and interpreted in accordance with the Laws
of the State of Delaware, irrespective of the choice of laws principles of the State of Delaware, including all matters of validity,
construction, effect, enforceability, performance, and remedies.


 


Section 9.07.         Assignability.
This Agreement shall be binding upon and inure to the benefit of the Parties and their respective successors and permitted assigns;
provided, however, that none of the Parties may assign its rights or delegate its obligations under this Agreement
without the express prior written consent of the other Parties hereto. Notwithstanding the foregoing, no such consent shall be
required for the assignment of a Party’s rights and obligations under this Agreement and the Ancillary Agreements (except
as may be otherwise provided in any such Ancillary Agreement) in whole (i.e., the assignment of a Party’s rights
and obligations under this Agreement and all Ancillary Agreements all at the same time) in connection with a change of control
of a Party so long as the resulting, surviving, or transferee Person assumes all the obligations of the relevant Party thereto
by operation of Law or pursuant to an agreement in form and substance reasonably satisfactory to the other Parties. Nothing herein
is intended to, or shall be construed to, prohibit any Party or any member of its group from being party to or undertaking a change
of control.


 




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Section 9.08.         Third-Party
Beneficiaries. Except for the indemnification rights under the Separation and Distribution Agreement of any OSG Indemnitee
or INSW Indemnitee in their respective capacities as such, (a) the provisions of this Agreement, the Separation and Distribution
Agreement, and each Ancillary Agreement are solely for the benefit of the Parties and any other parties thereto, and are not intended
to confer upon any Person except the Parties (and such other parties) any rights or remedies hereunder or thereunder; and (b) there
are no third-party beneficiaries of this Agreement, the Separation and Distribution Agreement, or any Ancillary Agreement, and
neither this Agreement, the Separation and Distribution Agreement, nor any Ancillary Agreement shall provide any third person
with any remedy, claim, Liability, reimbursement, claim of action, or other right in excess of those existing without reference
to this Agreement, the Separation and Distribution Agreement, or any Ancillary Agreement. Nothing in this Agreement is intended
to amend any employee benefit plan or affect the applicable plan sponsor’s right to amend or terminate any employee benefit
plan pursuant to the terms of such plan. The provisions of this Agreement are solely for the benefit of the Parties, and no current
or former Employee, officer, director, or independent contractor or any other individual associated therewith shall be regarded
for any purpose as a third-party beneficiary of this Agreement.


 


Section 9.09.         Notices.
All notices, requests, claims, demands, or other communications under this Agreement shall be in writing and shall be given or
made (and shall be deemed to have been duly given or made upon receipt) by delivery in person or by overnight courier service
to the respective Parties at the following addresses (or at such other address for a Party as shall be specified in a notice given
in accordance with this Section 9.09):


 


If to OSG, to:


 


Overseas Shipholding Group, Inc.

302 Knights Run Avenue #1200

Tampa, Florida 33602

Attention: General Counsel


 


with a copy (which shall not constitute notice) to:


 


Cleary Gottlieb Steen & Hamilton

One Liberty Plaza

New York, New York 10006

Attention: Neil Whoriskey


 




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If to INSW, to:


 


International Seaways, Inc.


600 Third Avenue, 39th Floor


New York, New York 10016


Attention: General Counsel


with a copy (prior to the Effective Time) (which shall not
constitute notice) to:


 


Cleary Gottlieb Steen & Hamilton

One Liberty Plaza

New York, New York 10006

Attention: Neil Whoriskey


 


Any Party may, by notice to the other Parties, change the address
to which such notices are to be given.


 


Section 9.10.         Severability.
If any provision of this Agreement or the application thereof to any Person or circumstance is determined by a court of competent
jurisdiction to be invalid, void or unenforceable, the remaining provisions hereof, or the application of such provision to Persons
or circumstances or in jurisdictions other than those as to which it has been held invalid or unenforceable, shall remain in full
force and effect and shall in no way be affected, impaired or invalidated thereby. Upon such determination, the Parties shall
negotiate in good faith in an effort to agree upon such a suitable and equitable provision to effect the original intent of the
Parties.


 


Section 9.11.         Force
Majeure. No Party shall be deemed in default of this Agreement or, unless otherwise expressly provided therein, any Ancillary
Agreement for any delay or failure to fulfill any obligation (other than a payment obligation) hereunder or thereunder so long
as and to the extent to which any delay or failure in the fulfillment of such obligation is prevented, frustrated, hindered, or
delayed as a consequence of circumstances of Force Majeure. In the event of any such excused delay, the time for performance of
such obligations (other than a payment obligation) shall be extended for a period equal to the time lost by reason of the delay.
A Party claiming the benefit of this provision shall, as soon as reasonably practicable after the occurrence of any such event,
(a) provide written notice to the other Party of the nature and extent of any such Force Majeure condition, and (b) use
commercially reasonable efforts to remove any such causes and resume performance under this Agreement and the Ancillary Agreements,
as applicable, as soon as reasonably practicable.


 


Section 9.12.         No
Set-Off. Except as otherwise mutually agreed to in writing by the Parties, neither OSG nor INSW nor any member of either such
Party’s Group shall have any right of set-off or other similar rights with respect to (a) any amounts received pursuant
to this Agreement or any Ancillary Agreement or (b) any other amounts claimed to be owed to the other Party or any member
of its Group arising out of this Agreement.


 


Section 9.13.         Headings.
The article, section, and paragraph headings contained in this Agreement are for reference purposes only and shall not affect
in any way the meaning or interpretation of this Agreement.


 




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Section 9.14.         Survival
of Covenants. Except as expressly set forth in this Agreement, the covenants, representations, and warranties contained
in this Agreement, and Liability for the breach of any obligations contained herein, shall survive the Separation and the Distribution
and shall remain in full force and effect.


 


Section 9.15.         Waivers
of Default. Waiver by a Party of any default by any other Party of any provision of this Agreement shall not be deemed a waiver
by the waiving Party of any subsequent or other default, nor shall it prejudice the rights of the other Party. No failure or delay
by any Party in exercising any right, power, or privilege under this Agreement shall operate as a waiver thereof, nor shall a
single or partial exercise thereof prejudice any other or further exercise thereof or the exercise of any other right, power,
or privilege.


 


Section 9.16.         Dispute
Resolution. The dispute resolution procedures set forth in Article VII of the Separation and Distribution Agreement shall
apply to any dispute, controversy or claim arising out of or relating to this Agreement.


 


Section 9.17.         Specific
Performance. Subject to Article VII of the Separation and Distribution Agreement, in the event of any actual or threatened
default in, or breach of, any of the terms, conditions, and provisions of this Agreement, the Party that is, or is to be, thereby
aggrieved shall have the right to specific performance and injunctive or other equitable relief in respect of its rights under
this Agreement, in addition to any and all other rights and remedies at law or in equity, and all such rights and remedies shall
be cumulative. The Parties agree that the remedies at law for any breach or threatened breach, including monetary damages, are
inadequate compensation for any loss and that any defense in any action for specific performance that a remedy at law would be
adequate is waived. Any requirements for the securing or posting of any bond with such remedy are waived by each of the Parties.


 


Section 9.18.         Amendments.
No provisions of this Agreement shall be deemed waived, amended, supplemented, or modified by a Party, unless such waiver, amendment,
supplement, or modification is in writing and signed by the authorized representative of the Party against whom it is sought to
enforce such waiver, amendment, supplement, or modification.


 


Section 9.19.         Interpretation.
In this Agreement, (a) words in the singular shall be deemed to include the plural and vice versa and words of one gender
shall be deemed to include the other genders as the context requires; (b) the terms “hereof,” “herein,”
and “herewith,” and words of similar import shall, unless otherwise stated, be construed to refer to this Agreement
as a whole (including all of the Schedules, Exhibits, and Appendices hereto) and not to any particular provision of this Agreement;
(c) Article, Section, Schedule, Exhibit, and Appendix references are to the Articles, Sections, Schedules, Exhibits, and
Appendices to this Agreement unless otherwise specified; (d) unless otherwise stated, all references to any agreement shall
be deemed to include the exhibits, schedules, and annexes to such agreement; (e) the word “including” and words
of similar import when used in this Agreement shall mean “including, without limitation,” unless otherwise specified;
(f) the word “or” shall not be exclusive; (g) unless otherwise specified in a particular case, the word
“days” refers to calendar days; (h) references to “business day” shall mean any day other than a
Saturday, a Sunday, or a day on which banking institutions are generally authorized or required by law to close in the U.S. or
New York, New York; (i) references herein to this Agreement or any other agreement contemplated herein shall be deemed to
refer to this Agreement or such other agreement as of the date on which it is executed and as it may be amended, modified or supplemented
thereafter, unless otherwise specified; and (j) unless expressly stated to the contrary in this Agreement, all references
to “the date hereof,” “the date of this Agreement,” “hereby,” and “hereupon” and
words of similar import shall all be references to January 27, 2016.


  


Section 9.20.         Mutual
Drafting. This Agreement shall be deemed to be the joint work product of the Parties and any rule of construction that a document
shall be interpreted or construed against a drafter of such document shall not be applicable.


 


Remainder of page intentionally left blank


 




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IN WITNESS WHEREOF, the Parties have caused
this Agreement to be executed by their duly authorized representatives.


 


	 	OVERSEAS SHIPHOLDING GROUP, INC.
	 	 
	 	By:	 /s/
	 	 	Name:
	 	 	Title:
	 	 	 
	 	INTERNATIONAL SEAWAYS, INC.
	 	 
	 	By:	 /s/
	 	 	Name:
	 	 	Title: