**Exhibit 10.12**

 

GENERAL MARITIME CORPORATION CHANGE OF CONTROL SEVERANCE PROGRAM FORU.S. EMPLOYEES

 

(effective as of December 16, 2008)

 

TheBoard of Directors of General Maritime Corporation (“General Maritime”)recognizes that the possibility of a Change of Control and the uncertainty itcreates may result in the inability to recruit qualified employees or the lossor distraction of qualified employees of the Company to the detriment ofGeneral Maritime and its shareholders.

 

TheBoard considers the avoidance of such inability, loss and distraction to beessential to protecting and enhancing the best interests of General Maritimeand its shareholders.  The Board alsobelieves that when a Change of Control is perceived as imminent, or isoccurring, the Board should be able to receive and rely on disinterestedservice from employees regarding the best interests of General Maritime and itsshareholders without risk that employees might be distracted or concerned bythe personal uncertainties created by the perception of an imminent oroccurring Change of Control.

 

Inaddition, the Board believes that it is consistent with the Company’semployment practices and policies and in the best interests of General Maritimeand its shareholders to treat fairly its employees whose employment terminatesin connection with or following a Change of Control.

 

Accordingly,the Board has determined that appropriate steps should be taken to assure theCompany of the continued employment and attention and dedication to duty of itsemployees and to seek to ensure the availability of their continued service,notwithstanding the possibility or occurrence of a Change of Control.

 

Therefore,in order to fulfill the above purposes, the following plan has been developedand is hereby adopted.

 

1.              **Establishment of Plan.** As of the Effective Date, the General Maritime Change of ControlSeverance Program for U.S. Employees (the “Plan”) is hereby established as setforth in this document.

 

2.              **Definitions**.  As usedherein the following words and phrases shall have the following respectivemeanings:

 

(a)     “Associate” means anyregular, full-time, shore-based employee of the Company based in an office inthe United States.

 

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(b)    “Base Salary” means theamount a Participant is entitled to receive as salary on an annualized basis,******excluding all bonus, overtime andincentive compensation, payable by the Company as consideration for theParticipant’s services.

 

(c)     “Board” means the Board ofDirectors of General Maritime.

 

(d)    “Bonus Amount” means thecash bonus on an annualized basis earned by the Participant in the fiscal yearimmediately preceding the year in which his or her employment was terminated,including any amounts which are deferred.

 

(e)     “Cause”means any termination of a Participant’s employment because of any of thefollowing events:

 

(i)                                     any act orfailure to act by the Participant involving fraud, theft or embezzlement;

 

(ii)                                  the willful andcontinued failure of the Participant to (A) perform substantially theParticipant’s duties with the Company (other than any such failure resultingfrom incapacity due to physical or mental illness) or (B) the Participant’sfailure to follow the directions of an officer of the Company to whom suchParticipant reports or of the Board of Directors;

 

(iii)                               the willfulengagement by the Participant in illegal conduct or gross misconduct which ismaterially and demonstrably injurious to the Company; or

 

(iv)                              the Participant’sconviction of (or a plea of nolocontendere to) a crime thatconstitutes a felony or other crime involving moral turpitude, in either casewithin the meaning of applicable law.

 

(f)     “Change of Control” meansthe first to occur of any of the following events:

 

### (i)                                     any “person”(as such term is used in Sections 3(a)(9) and 13(d) of the SecuritiesExchange Act of 1934, as amended (the “Exchange Act”)) or “group” (within themeaning of Section 13(d)(3) of the Exchange Act), other than Peter C.Georgiopoulos or entities which he directly or indirectly controls (as definedin Rule 12b-2 under the Exchange Act), acquiring “beneficial ownership”(as defined in Rule 13d-3 under the Exchange Act), directly or indirectly,of thirty percent (30%) or more of the Voting Stock of General Maritime;

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### (ii)                                  the sale of allor substantially all of General Maritime’s assets in one or more relatedtransactions to a “person” (as such term is used in Sections 3(a)(9) and13(d) of the Exchange Act) other than such a sale (x) to a subsidiaryof General Maritime which does not involve a change in the equity holdings ofGeneral Maritime or (y) 

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### toPeter C. Georgiopoulos or entities which he directly or indirectly controls;

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### (iii)                               any merger,consolidation, reorganization or similar event of General Maritime, as a resultof which the holders of the Voting Stock of General Maritime immediately priorto such merger, consolidation, reorganization or similar event do not directlyor indirectly hold at least fifty-one percent (51%) of the Voting Stock of thesurviving entity;

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### (iv)                              a majority ofthe members of the Board of Directors are no longer Continuing Directors; asused herein, a “Continuing Director” means any member of the Board of Directorswho was a member of such Board of Directors as of the Effective Date; providedthat any person becoming a director subsequent to such date whose election ornomination for election was supported by a majority of the directors who thencomprised the Continuing Directors shall be considered to be a ContinuingDirector; or

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### (v)                                 GeneralMaritime adopts any plan of liquidation or dissolution providing for thedistribution of all or substantially all of its assets.

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### For purposes of the Change of Control definition, “General Maritime”shall include any entity that succeeds to all or substantially all of thebusiness of General Maritime and “Voting Stock” shall mean capital stock of anyclass or classes having general voting power, in the absence of specifiedcontingencies, to elect the directors of a corporation.

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(g)        “Code” means the InternalRevenue Code of 1986, as amended.

 

(h)        “Committee” means,subject to Section 13, the Compensation Committee of the Board.

 

(i)          “Company” meansGeneral Maritime and its direct and indirect subsidiaries and their respectivesuccessor entities.

 

(j)          “Date of Termination”shall have the meaning given in Section 4(b).

 

(k)         “Disability” means, inconnection with any termination of a Participant’s employment, a disabilityentitling him or her to long-term disability benefits under any applicablelong-term disability plan of the Company, or in the absence of any such plan,the Participant’s inability to perform his or her duties and responsibilitiescustomary for an employee in the Participant’s position for such period orperiods as the Committee may determine, whether or not continuous, due tophysical or mental incapacity or impairment as reasonably determined by aqualified physician.

 

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(l)          “Effective Date”means the date on which the Effective Time as defined in the Agreement and Planof Merger and Amalgamation, dated as of August 5, 2008, by and among theCompany, Arlington Tankers Ltd., Archer Amalgamation Limited, Galileo MergerCorporation and General Maritime Subsidiary Corporation (formerly General MaritimeCorporation) occurs.

 

(m)        “Good Reason” means,with respect to any Participant, the occurrence of any of the following eventsafter a Change of Control, without the Participant’s prior written consent: (i) areduction in the Participant’s Base Salary; (ii) a material diminution inthe Participant’s responsibilities, duties or authorities in comparison to theresponsibilities, duties or authorities of the Participant immediately prior tothe Change of Control; (iii) a material diminution in the responsibilities,duties or authorities of the individual or body to whom the Participantreports, (iv) an assignment of the Participant to an office more thanfifty (50) miles from the location where the Participant was based andperformed services immediately prior to the Change of Control, provided thatsuch change is a material change in the geographic location of the Participant’soffice, or (v) a material breach by the Company of the Participant’semployment agreement or any other agreement under which the Participantprovides services.

 

(n)        “Participant” means anAssociate who meets the eligibility requirements of Section 3.

 

(o)        “Plan” means theGeneral Maritime Corporation Change of Control Severance Program for U.S.Employees.

 

(p)        “Qualifying Termination”means a termination of a Participant’s employment within two (2) yearsfollowing a Change of Control, in the case of Tier 1 Participants and, withinone (1) year following a Change of Control, in the case of Tier 2Participants, (i) by the Company other than for Cause, death or Disabilityor (ii) by the Participant for Good Reason.

 

(q)        “Release” shall havethe meaning given in Section 4(h).

 

(r)         “Severance Benefit”shall have the meaning given in Section 4(b).

 

(s)         “Tier 1 Participants”means the Associates designated on Schedule I attached hereto.

 

(t)         “Tier 2 Participants”means all Associates other than (i) Tier 1 Participants and (ii) Associateswho have entered into a written employment agreement with the Company as of thedate of a Change of Control which provides for Associate compensation in theevent of any termination of the Associate’s employment following a change ofcontrol by the Company without cause or by the Associate for good reason, eachas defined in such agreement.

 

(u)        “Year of Service” meansa twelve (12) month continuous period of employment or a portion of suchperiod, including periods of authorized vacation, authorized leave of absenceand short-term disability leave, with the Company or its predecessors orsuccessors rounded up to the nearest whole number.

 

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3.              **Eligibility**.  Unlessotherwise determined by the Committee, each Associate (other than Associateswho have entered into a written employment agreement with the Company as of thedate of a Change of Control which provides for Associate compensation in theevent of any termination of the Associate’s employment following a change ofcontrol by the Company without cause or by the Associate for good reason, eachas defined in such agreement) who is an Associate on the date of a Change ofControl shall be a Participant in the Plan.

 

**4.              SeveranceBenefits.**

 

(a)         *Right toSeverance Benefit*.  AParticipant shall be entitled to receive from the Company a Severance Benefitin the amount provided in Section 4(b) if a Participant’s employmentis terminated due to a Qualifying Termination.

 

(b)        *SeveranceBenefits*.  In the event that aParticipant’s employment is terminated due to a Qualifying Termination, theCompany shall pay such Participant, within fifteen (15) days of the date suchtermination takes effect (the “Date of Termination”) or, if later, on the datethe Participant’s Release ceases to be revocable, a lump sum in cash (the “SeveranceBenefit”) equal to (i) the sum of such Participant’s then current BaseSalary and Bonus Amount multiplied by (ii) 2 for Tier 1 Participants and 1for Tier 2 Participants.  For purposes ofthis Section 4(b), the then current Base Salary shall be determinedimmediately prior to the Qualifying Termination (without regard to anyreductions therein which constitute Good Reason for termination by suchParticipant).

 

(c)         *MaximumSeverance Benefit*. Notwithstanding Section 4(b) above, the maximum amount payableunder Sections 4(b) and (c) shall be the amount required in order forthe Plan to comply with Section 2510.3-2(b)(1)(ii) of the Departmentof Labor Regulations.

 

(d)        *OtherBenefits Payable*.  Nothing inthe Plan shall prevent or limit a Participant’s continuing or futureparticipation in any benefit, bonus, incentive or other plan, program,arrangement or policy provided by the Company for which a Participant and/or aParticipant’s dependents may qualify. Amounts that are vested benefits or that a Participant and/or aParticipant’s dependents are otherwise entitled to receive under any plan,program, arrangement, or policy of the Company shall be payable in accordancewith such plan, program, arrangement or policy. The Severance Benefit provided pursuant to Section 4(b) aboveshall be provided in addition to, and not in lieu of, all other accrued orvested or earned but deferred compensation, rights, options or other benefitswhich may be owed to a Participant upon or following termination, including butnot limited to accrued vacation or sick pay, amounts or benefits payable underany bonus or other compensation plans, stock incentive plans, life insuranceplans, health plans, disability plans or similar or successor plans.

 

(e)         *CertainReduction of Payments by the Company*.

 

(i)              Forpurposes of this Section 4(g): (i) a “Payment” shall mean any paymentor distribution in the nature of compensation to or for the benefit of aParticipant, whether paid or payable pursuant to the Plan or otherwise; (ii) “SeverancePayment” shall mean 

 

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aPayment paid or payable pursuant to the Plan (disregarding this Section 4(g));(iii) “Present Value” shall mean such value determined in accordance withSections 280G(b)(2)(A)(ii) and 280G(d)(4) of the Code; and (iv) “ReducedAmount” shall mean an amount expressed in Present Value that maximizes theaggregate Present Value of Severance Payments without causing any Payment to benondeductible because of Section 280G of the Code.

 

(ii)             TheCommittee shall select, in its discretion, a nationally recognized accountingfirm (the “Accounting Firm”) to make the determinations contemplated by this Section 4(g).  Anything in the Plan to the contrarynotwithstanding, in the event that the Accounting Firm determines that receiptof all Payments would subject a Participant to tax under Section 4999 ofthe Code, the aggregate Severance Payments to the Participant shall be reduced(but not below zero) to meet the definition of Reduced Amount.

 

(iii)            Ifthe Accounting Firm determines that aggregate Severance Payments to theParticipant should be reduced to the Reduced Amount, the Company shall promptlygive the Participant notice to that effect and a copy of the detailedcalculation thereof, and the Participant may then elect, in his or her sole discretion,which and how much of the Severance Payments shall be eliminated or reduced (aslong as after such election the Present Value of the aggregate SeverancePayments equals the Reduced Amount), and shall advise the Company in writing ofhis or her election within fifteen (15) days of his or her receipt ofnotice.  If no such election is made bythe Participant within such fifteen (15)-day period, the Company may electwhich of such Severance Payments shall be eliminated or reduced (as long asafter such election the Present Value of the aggregate Severance Paymentsequals the Reduced Amount) and shall notify the Participant promptly of suchelection.  All determinations made by theAccounting Firm under this Section 4(g) shall be binding upon the Companyand the Participant and shall be made within 60 days of a termination ofemployment of the Participant.  Aspromptly as practicable following such determination, the Company shall pay toor distribute for the benefit of the Participant such Severance Payments as arethen due to the Participant under the Plan and shall promptly pay to ordistribute for the benefit of the Participant in the future such SeverancePayments as become due to the Participant under the Plan.

 

(iv)           Asa result of the uncertainty in the application of Section 4999 of the Codeat the time of the initial determination by the Accounting Firm hereunder, itis possible that amounts will have been paid or distributed by the Company toor for the benefit of a Participant pursuant to the Plan which should not havebeen so paid or distributed (“Overpayment”) or that additional amounts whichwill have not been paid or distributed by the Company to or for the benefit ofa Participant pursuant to the Plan could have been so paid or distributed (“Underpayment”),in each case, consistent with the calculation of the Reduced Amounthereunder.  In the event that theAccounting Firm, based upon the assertion of a deficiency by the InternalRevenue Service against either the Company or the Participant which theAccounting Firm believes has a high probability of success determines that anOverpayment has been made, any such Overpayment paid or distributed by theCompany to or for the benefit of a Participant shall be repaid to the Companytogether with interest at the applicable federal rate provided for in Section 7872(f)(2) ofthe Code; provided, however, that no such amount shall be payable by aParticipant to the Company if and to the extent such repayment would not eitherreduce the amount on which the Participant is subject to tax under Section 1and Section 

 

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4999of the Code or result in a refund of such taxes.  In the event that the Accounting Firm, basedupon controlling precedent or substantial authority, determines that anUnderpayment has occurred, any such Underpayment shall be promptly paid by theCompany to or for the benefit of the Participant together with interest at theapplicable federal rate provided for in Section 7872(f)(2) of the Code.

 

(v)            Allfees and expenses of the Accounting Firm in implementing the provisions of thisSection 4(g) shall be borne by the Company.

 

(f)         *Release andWaiver.*  Notwithstanding anyother provision of the Plan, the right of a Participant to receive severancebenefits hereunder shall be subject to the execution and non-revocation by theParticipant of a release and waiver substantially in the form attached heretoas Exhibit A (a “Release”) within twenty-one (21) days or, ifapplicable, forty-five (45) days after receipt of such Release from theCompany.

 

5.              **Full Settlement**. Subject to Section 4(g), the Company’s obligation to make thepayments provided for in the Plan and otherwise to perform its obligationshereunder shall be absolute and unconditional and shall not be affected by anyset-off, counterclaim, recoupment, defense or other claim, right or actionwhich the Company may have against a Participant or others.  In no event shall a Participant be obligatedto seek other employment or take any other action by way of mitigation of theamounts payable to such Participant under any of the provisions of thePlan.  The Company shall pay as incurred(within fifteen (15) days following the Company’s receipt of an invoice from aParticipant), to the full extent permitted by law, all legal fees and expensesthat the Participant may reasonably incur as a result of any contest by theCompany, the Participant or others of the validity or enforceability of, orliability under, any provision of the Plan or any guarantee of performancethereof (including as a result of any contest by the Participant about theamount of any payment pursuant to the Plan), plus, in each case, interest onany delayed payment at the applicable federal rate provided for in Section 7872(f)(2)(A) ofthe Code; provided, that the Company shall not be obligated to reimburse aParticipant for legal fees and expenses incurred in connection with a claim****that is frivolous or maintained in bad faith and in suchevent the Company shall be entitled to recoup any such fees and expenses whichit has already paid on behalf of the Participant.

 

6.              **Controlling Law**.  ThePlan shall be governed by the laws of the State of New York, without referenceto the principles of conflicts of law.

 

7.              **Amendments; Termination**. General Maritime and the Board reserve the right to amend, modify,suspend or terminate the Plan at any time; provided that no such amendment,modification, suspension or termination after the occurrence of a Change ofControl that has the effect of reducing or diminishing the right of anyAssociate, shall be effective without the written consent of the Associate.

 

8.              **Assignment**.  GeneralMaritime shall require any corporation, entity, individual or other person whois the successor (whether direct or indirect by purchase, merger,consolidation, reorganization or otherwise) to all or substantially all thebusiness and/or assets of General Maritime to expressly assume and agree toperform, by a written agreement in form and in 

 

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substancesatisfactory to General Maritime, all of the obligations of General Maritimeunder the Plan.  It is a condition of thePlan, and all rights of each person eligible to receive benefits under the Planshall be subject hereto, that no right or interest of any such person in thePlan shall be assignable or transferable in whole or in part, except byoperation of law, including, but not by way of limitation, lawful execution,levy, garnishment, attachment, pledge, bankruptcy, alimony, child support orqualified domestic relations order.

 

9.              **Withholding**.  TheCompany may withhold from any amount payable or benefit provided under the Plansuch federal, state, local, foreign and other taxes as are required to bewithheld pursuant to any applicable law or regulation.

 

10.            **Gender and Plurals**. Wherever used in the Plan document, words in the masculine gender shallinclude masculine or feminine gender, and, unless the context otherwiserequires, words in the singular shall include the plural, and words in theplural shall include the singular.

 

11.            **Plan Controls**.  In theevent of any inconsistency between the Plan document and any othercommunication regarding the Plan, the Plan document controls.

 

12.            **Terms of Employment**. Until the occurrence of a Change of Control, neither the establishmentof the Plan, nor any modification thereof, nor the creation of any fund, trustor account, nor the payment of any benefits shall be construed as giving anyAssociate, or any person whomsoever, the right to be retained in the service ofthe Company, and all Associates shall remain subject to discharge to the sameextent as if the Plan had never been adopted.

 

13.            **Post-Change of Control Committee**.  The Plan shall be administered by theCommittee, provided that in the event of an impending Change of Control, theCommittee may appoint a person independent of the Company or persons operatingunder its control or on its behalf to be the Committee effective upon theoccurrence of a Change of Control and such Committee shall not be removedfollowing a Change of Control.  Thedecision of the Committee upon all matters within the scope of its authorityshall be conclusive and binding on all parties.

 

14.            **Benefits Claims and Appeals**. The Committee shall establish a claims and appeals procedure.  The Committee shall have full discretionaryauthority to determine the amount and timing of any benefit to be paid underthe Plan.  Unless otherwise required byapplicable law, such procedures will provide that the Participant has not lessthan sixty (60) days following receipt of any adverse benefit determinationwithin which to appeal the determination in writing with the Committee, andthat the Committee must respond in writing within sixty (60) days of receiving theappeal, specifically identifying those Plan provisions on which the benefitdenial was based and indicating what, if any, information the Participant mustsupply in order to perfect a claim for benefits.

 

15.            **Indemnification**.  Tothe extent permitted by law, the Company shall indemnify the Committee from allclaims for liability, loss, or damage (including the payment of expenses inconnection with defense against such claims) arising from any act or failure toact in connection with the Plan.

 

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16.            **Joint and Several Liability**. General Maritime and each of its direct and indirect subsidiaries shallbe jointly and severally liable for all obligations of the Company under thePlan.

 

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GENERAL MARITIME CORPORATION CHANGE OF CONTROL SEVERANCE PROGRAM FORU.S. EMPLOYEES

 

Schedule I

 

Tier 1 Participants

 

1.                                       Milton Gonzalez

2.                                       John N.Mortsakis

3.                                       Kevin Coyne

4.                                       Brian D. Kerr

5.                                       Constantine D.Hatziemanuel

6.                                       Steinar Ropeid

7.                                       Peter J.Briscoe

8.                                       Peter S. Bell

9.                                       LeonidasVrondissis

10.                                 Dean Scaglione

 

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