EXHIBIT 10.27


 


Settlement, Release, and Indemnity Agreement


 


This settlement, release, and indemnity agreement
(this “Agreement”) is entered into as of February 3, 2015 (the “Execution Date”), by and
between Overseas Shipholding Group, Inc. (“OSG”), OSG Ship Management, Inc. (“OSM”), OSG
Bulk Ships, Inc. (“OBS”), and OSG International, Inc. (“OIN” and together with OSG, OSM,
and OBS, the “OSG Parties”) and James I. Edelson (“Edelson” and together with the OSG Parties,
the “Parties”) and shall become effective without further action of the Parties on the date that the order of
the United States Bankruptcy Court for the District of Delaware (the “Bankruptcy Court”) approving this Agreement
and authorizing the OSG Parties’ performance hereunder (the “Approval Order”) becomes a Final Order (such
date, the “Effective Date”).1


 


WHEREAS on November 14, 2012, OSG and 180 of
its affiliates (collectively, prior to the effective date of the Plan (defined below) the “Debtors,” and, thereafter,
the “Reorganized Debtors”), filed voluntary petitions for relief under Chapter 11 of the Bankruptcy Code (collectively,
the “Chapter 11 Cases”) in the Bankruptcy Court; and


 


WHEREAS Edelson subsequently filed five proofs
of claim, assigned claim numbers 498, 1093, 1105, 1676, and 1678 (together, the “Edelson Claims”), in the Chapter
11 Cases, asserting various claims arising from or related to his employment as general counsel of OSG; and


 


WHEREAS, on July 18, 2014, the Bankruptcy Court
entered its Findings of Fact, Conclusions of Law, and Order Confirming First Amended Joint Plan of Reorganization of Overseas
Shipholding Group, Inc., Et Al., Under Chapter 11 of the Bankruptcy Code (D.I. 3683) (the “Confirmation Order”),
confirming the First Amended Joint Plan of Reorganization of Overseas Shipholding Group, Inc. et al., Under Chapter 11 of
the Bankruptcy Code (D.I. 3701) (the “Plan”); and


 


WHEREAS the Plan designated the Edelson Claims
as Disputed Claims; and


 


WHEREAS the Plan authorized the Reorganized
Debtors and the Administrative and Disputed Claims Agent to resolve all Disputed Claims; and


 


WHEREAS, following a series of good-faith, arm’s-length
negotiations, conducted with the assistance of counsel, the Parties desire to settle all potential claims, including any and all
alleged liabilities asserted against the Debtors in the Edelson Claims, subject to entry of the Approval Order on the terms and
conditions set forth herein;


 


NOW THEREFORE, in consideration of the premises
and the mutual agreements set forth herein, the sufficiency of which is hereby acknowledged, and intending to be legally bound
hereby, the Parties agree as follows:


 








 



1
Unless otherwise noted, all capitalized terms used but not defined herein shall have the meaning ascribed to them in the Plan.


 








    	 



    	 



    

 


1.          Settlement
Sum. No later than ten (10) business days after the Effective Date, the OSG Parties shall pay Edelson seven hundred eighty-two
thousand and thirty-seven United States dollars ($782,037.00), inclusive of interests and costs, and subject to the withholding
of all federal, state, city or other taxes that the OSG Parties may reasonably determine are required to be withheld pursuant to
any applicable law or regulation (it being understood that Edelson shall be responsible for payment of all taxes in respect of
the payments and benefits provided herein) (the “Settlement Sum”).


 


2.          Edelson
Release: Edelson, for himself, his successors, agents, assigns or those acting through or on his behalf (collectively, “Edelson
Related Persons”), hereby releases and forever discharges the OSG Parties, the Debtors, the Reorganized Debtors, their
parents, subsidiaries, divisions, and affiliates, and each of their respective officers, directors, agents, representatives, employees,
predecessors, successors, insurers, attorneys, and assigns, from any and all claims, demands, debts, damages, liabilities, injuries,
actions, or rights of action of any nature whatsoever, whether known or unknown, in law or admiralty or equity, which he or any
Edelson Related Persons had, now have, or claim to have, for or by reason of any fact, cause, or thing whatsoever from the beginning
of the world to the Effective Date, other than the Preserved Obligations (collectively, the “Edelson Released Claims”).


 


3.          The
OSG Parties Release: In consideration of the foregoing release, and as of the Effective Date, the OSG Parties, each for itself
and its parents, subsidiaries, divisions and affiliates, and their respective officers, directors, administrators, predecessors,
successors, agents, employees, attorneys, assigns or those acting through or on behalf of any of the OSG Parties (collectively,
“OSG Related Persons”) hereby releases and forever discharges Edelson and each of the Edelson Related Persons
from any and all claims, demands, debts, damages, liabilities, injuries, actions, or rights of action of any nature whatsoever,
whether known or unknown, in law or admiralty or equity, which they or any OSG Related Persons had, now have, or claim to have,
for or by reason of any fact, cause, or thing whatsoever from the beginning of the world to the Effective Date, other than the
Preserved Obligations (the “OSG Released Claims” and together with the Edelson released Claims, the “Released
Claims”).


 


4.          Preserved
Obligations. Notwithstanding anything to the contrary herein, nothing in this Agreement shall impact, and the Released Claims
shall not extend to:


 





		a.	any insurance policies, or claims asserted thereunder against parties other than OSG Related Persons, in connection with Edelson’s
employment by any of the OSG Parties;



 


		b.	the right of Edelson, if any, in the event judgment is obtained against him in any action or proceeding commenced by any party
other than the OSG Parties (whether now pending or hereafter commenced), to seek a judgment credit in such litigation in accordance
with applicable non-bankruptcy law;



 


		c.	any claims or causes of action for contribution or proportionate fault that any party, other than the OSG Parties, who is a
named defendant in an action or proceeding may have against any person other than the OSG Parties that arises from or is related
to the claims asserted against them in such action;



 




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		d.	any obligations arising on or after January 1, 2015 from or in (i) the ordinary course of Edelson’s employment with the
OSG Parties, including without limitation any bonus due to Edelson with respect to 2014, (ii) any agreements between the OSG Parties
or Edelson, dated on or after January 1, 2015, and (iii) any retention payments due to Edelson pursuant to any Board approved retention
plans for which Edelson is eligible, in the event of which such plans shall govern such rights and obligations;



 


		e.	any claims arising from any supplemental employee retirement plan arising from Edelson’s employment by any of the OSG
Parties, as provided for in the Plan; or



 


		f.	any obligations under this Agreement (collectively, the “Preserved Obligations”).





 


5.          Preservation
of Insurance. For the avoidance of doubt, notwithstanding anything herein to the contrary, nothing in this Agreement, including
any releases set forth above, shall diminish, reduce, limit, impact or impair the enforceability of any insurance policies or other
policies of insurance that may cover claims against Edelson, including, without limitation, any claims of Edelson for insurance
coverage or claims of Edelson under any policies of insurance solely as to parties other than the OSG Parties, the Debtors, the
Reorganized Debtors, or the Administrative and Disputed Claims Agent.


 


6.          Unknown
Claims. Each of the Parties represents that it is familiar with the provisions of California Civil Code Section 1542, agrees
to expressly waive any rights that may exist thereunder, as well as under any other statute or common law principles of similar
effect. California Civil Code Section 1542 provides as follows: A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR
DOES NOT KNOW OR SUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM MUST HAVE MATERIALLY
AFFECTED HIS SETTLEMENT WITH THE DEBTOR.


 


7.          Expungement
of the Edelson Claims: Upon the Effective Date, the Edelson Claims shall be deemed expunged with prejudice, and the Reorganized
Debtors’ Claims Agent shall be authorized to reflect such expungement on the Reorganized Debtors’ claims register.


 


8.          Indemnity.


 


		a.	Edelson hereby indemnifies and shall keep indemnified, each of the OSG Parties, the Debtors, the Reorganized Debtors, their
parents, subsidiaries, divisions, and affiliates, and each of their respective officers, directors, agents, representatives, employees,
predecessors, successors, insurers, attorneys, and assigns against all costs and damages (including legal expenses) incurred in
any future actions Edelson or any Edelson Related Persons may bring in respect of any of the Edelson Released Claims.





 


		b.	The OSG Parties hereby indemnify and shall keep indemnified, Edelson, his successors and assigns, against all costs and damages
(including legal expenses) incurred in any future actions the OSG Parties may bring in respect of any of the OSG Released Claims.





 






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9.          Miscellaneous.


 


a.           Bankruptcy
Court Approval.


 


		i.	This Agreement, and the OSG Parties’ obligations hereunder, are at all times subject to and conditional upon entry of
the Approval Order.



 


		ii.	As soon as is reasonably practicable after the Execution Date, the OSG Parties shall move the Bankruptcy Court for entry of
the Approval Order. All Parties shall use commercially reasonable efforts and work cooperatively in good faith (including by executing
and delivering such additional instruments, notices, certificates, assurances and other documents and taking such further actions
as may be reasonably necessary or desirable) in order to obtain entry of the Approval Order.



 


		iii.	In the event that the Bankruptcy Court declines to enter the Approval Order this Agreement shall be deemed null and void and
of no force or effect.





 


b.           Entire
Agreement. This Agreement constitutes the entire agreement of the Parties with respect to the subject matter hereof. This Agreement
supersedes all prior negotiations, agreements and understandings of the Parties of any nature, whether oral or written, relating
thereto.


 


c.           Amendments.
This Agreement may be amended only by a written agreement between the Parties hereto.


 


d.           Governing
Law. This Agreement is governed by and shall be construed in all respects in accordance with the laws of the State of New York
without regard to its conflict of laws principles.


 


e.           Severability.
If in any proceedings a court will refuse to enforce any provision of this Agreement, then such unenforceable provision will be
deemed eliminated from this Agreement for the purpose of such proceedings to the extent necessary to permit the remaining provisions
to be enforced. To the full extent, however, that the provisions of any applicable law may be waived, they are hereby waived to
the end that this Agreement be deemed to be valid and a binding agreement enforceable in accordance with its terms, and in the
event that any provision hereof will be found to be invalid or unenforceable, such provision will be construed by limiting it so
as to be valid and enforceable to the maximum extent consistent with and possible under applicable law.


 


f.            Counterparts.
This Agreement may be executed by facsimile or portable document format (pdf) transmission and by counsel for each of the Parties,
in separate counterparts, each of which when so executed will be deemed to be an original and all of which together will constitute
one and the same agreement.


 




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IN WITNESS WHEREOF, the Parties have duly executed
this agreement as of the Execution Date set forth above.


 


	
        For the OSG Parties:
	 	For Edelson:
	 	 	 
	/s/Ian T. Blackley	 	/s/James I. Edelson
	Name: Capt. Ian T. Blackley	 	 
	Title:   Chief Executive Officer	 	 
	Date:   February 3, 2015	 	 
	 	 	 
	For  the Administrative and	 	 
	Disputed Claims Agent:	 	 
	 	 	 
	/s/ Kathryn Schultea	 	 
	Name: Kathryn Schultea	 	 
	Title:   Managing Director	 	 
	Date:   February 3, 2015	 	 


 






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