Exhibit 10.6.5


 


DIRECTOR AND OFFICER INDEMNITY AGREEMENT


 


This agreement
(the “Agreement”) is made and entered into as of the 9th day
of November, 2007, by and between OSG America L.P., a Delaware limited
partnership (the “Partnership”), and Kathleen
C. Haines, (the “Indemnitee”).


 


RECITALS


 


A.            The Indemnitee is a Director of OSG America LLC, a Delaware
limited liability company and the general partner of the Partnership (the “General
Partner”).


 


B.            Both the Partnership
and the Indemnitee recognize the increased risk of litigation and other claims
being asserted against directors and officers of public entities in today’s
environment.


 


C.            Section 17-108 of
the Delaware Revised Uniform Limited Partnership Act, 6 Del. C. Section 17-101,
et seq., (the “Act”) expressly
recognizes that, subject to such standards and restrictions as may be set forth
in its partnership agreement, a limited partnership may, and shall have the
power to, indemnify and hold harmless any person from and against any and all
claims and demands whatsoever.


 


D.            Subject to the
limitations set forth therein, Section 7.07 of the Amended and Restated
Agreement of Limited Partnership of the Partnership (the “Partnership
Agreement”) requires the Partnership to indemnify and advance expenses to the
directors and officers of the General Partner to the fullest extent permitted
by law and the Indemnitee has been serving and continues to serve as a Director of the General Partner in part in
reliance on such provision.


 


E.             In recognition of the
Indemnitee’s need for substantial protection against any potential personal
liability in order to assure the Indemnitee’s continued service to the Partnership
and General Partner in an effective manner and the Indemnitee’s reliance on the
provisions of the Partnership Agreement and in part to provide the Indemnitee
with specific contractual assurance that the protection promised by the Partnership
Agreement will be available to the Indemnitee, the Partnership wishes to
provide in this Agreement for the indemnification of and the advancing of
expenses to the Indemnitee to the fullest extent (whether partial or complete)
permitted by the Partnership Agreement and as set forth in this Agreement, and,
to the extent insurance is maintained, for the continued coverage of the Indemnitee
under the Partnership’s directors’ and officers’ liability insurance policies.


 


In
consideration of the foregoing and the mutual covenants contained herein, and
other good and valuable consideration, the sufficiency and receipt of which are
hereby acknowledged, the parties hereto agree as follows:


 


1.             Certain Definitions.


 


(a)           “Affiliate” means, with respect to any
Person, any other Person that directly or indirectly through one or more
intermediaries controls, is controlled by or is under 


 

















 


common control with, such Person. As used herein, the term “control”
means the possession, direct or indirect, of the power to direct or cause the
direction of the management and policies of a Person, whether through ownership
of voting securities, by contract or otherwise.


 


(b)           “Board of
Directors”
means the Board of Directors of the General Partner.


 


(c)           “Change in Control”
means, and shall be deemed to have occurred upon one or more of the following
events: (i) any transaction resulting in the Partnership (or its successor
or survivor by way of merger, consolidation, or some other transaction, or a
parent or subsidiary thereof) ceasing to be an Affiliate of OSG (or its
successor or survivor by way of merger, consolidation, or some other
transaction, or a parent or subsidiary thereof); (ii) the limited partners
of the Partnership approve, in one transaction or a series of transactions, a
plan of complete liquidation of the Partnership; (iii) the sale or other
disposition by either the General Partner or the Partnership of all or
substantially all of its assets, or the sale or other disposition of all or
substantially all of the assets of the Partnership’s subsidiaries, in one or
more transactions to any Person other than the General Partner or an Affiliate of
the General Partner; or (iv) a transaction resulting in a Person other
than OSG (or its successor or survivor by way of merger, consolidation, or some
other transaction, or a parent or subsidiary thereof) or an Affiliate thereof
being the general partner of the Partnership (or its successor or survivor by
way of merger, consolidation, or some other transaction, or a parent or
subsidiary thereof).


 


(d)           “Expenses”
means all direct and indirect costs of any type or nature whatsoever
(including, without limitation, all attorneys’ fees and related disbursements
and other out-of- pocket costs) actually and reasonably incurred by the Indemnitee
in connection with the investigation, defense or appeal of or being a witness
in, participating in or preparing to defend a Proceeding or establishing or
enforcing a right to (i) indemnification or advancement of expenses under
this Agreement, the Partnership Agreement, the Act or otherwise or (ii) directors’
and officers’ liability insurance coverage; provided, however, that
Expenses shall not include any judgments, fines or penalties or amounts paid in
settlement of a Proceeding.  Should any
payments by the Partnership under this Agreement be determined to be subject to
any federal, state or local income or excise tax, “Expenses” shall also include
such amounts as are necessary to place the Indemnitee in the same after-tax
position (after giving effect to all applicable taxes) as the Indemnitee would
have been in had no such tax been determined to apply to such payments.


 


(e)           “Indemnifiable Event”
is any event or occurrence related to the fact that the Indemnitee is or was a
director or officer of the General Partner, or is or was serving at the request
of the General Partner as a director, officer, employee, trustee or agent of
another corporation, partnership, joint venture, trust, nonprofit entity or
other entity (including service with respect to employee benefit plans), or by
reason of anything done or not done by the Indemnitee in any such capacity.


 


(f)            “Indemnification Period” shall be such period as the Indemnitee
shall continue to serve as a director or officer of the General Partner, or
shall continue at the request of the General Partner to serve as a director,
officer, employee, trustee or agent of another corporation, partnership, joint
venture, trust, nonprofit entity or other entity, and thereafter so 


 


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long as the Indemnitee shall be subject to any possible Proceeding
arising out of the Indemnitee’s tenure in the foregoing positions.


 


(g)           “Losses” are
any judgments, fines, penalties and amounts paid in settlement (including all
interest assessments and other charges paid or payable in connection with or in
respect of such judgments, fines, penalties or amounts paid in settlement) of
any Proceeding.


 


(h)           “OSG” means Overseas Shipholding Group, Inc.,
a Delaware corporation.


 


(i)            “Person” means an individual or a
corporation, firm, limited liability company, partnership, joint venture,
trust, unincorporated organization, association, government agency or political
subdivision thereof or other entity.


 


(j)            “Proceeding” shall mean any completed, actual, pending or
threatened action, suit, claim, inquiry or proceeding, whether civil, criminal,
administrative or investigative (including an action by or in the right of the Partnership)
and whether formal or informal.


 


(k)           “Reviewing Party”
shall mean (i) the Board of Directors (provided that a majority of
directors are not parties to the Proceeding), (ii) a person or body
selected by the Board of Directors or (iii) if there has been a Change in
Control, the special independent counsel referred to in Section 5.


 


2.             Indemnification and Advancement
of Expenses.  Subject to the limitations set forth in Section 4:


 


(a)           Indemnification.  The Partnership shall indemnify and hold
harmless the Indemnitee, to the fullest extent permitted by the Partnership
Agreement, as soon as practicable after written demand is presented to the Partnership,
in the event the Indemnitee was or is made or is threatened to be made a party
to or witness in or is otherwise involved in a Proceeding by reason, in whole
or in part, of an Indemnifiable Event against all Expenses and Losses incurred
by the Indemnitee in connection with such Proceeding.  In the event of any change, after the date of
this Agreement, in any applicable law, statute or rule regarding the right
of a Delaware limited partnership to indemnify any director or officer of its
general partner, such change, to the extent it would expand the Indemnitee’s
rights under this Agreement, shall be included within the Indemnitee’s rights
and the Partnership’s obligations under this Agreement, and, to the extent it
would narrow the Indemnitee’s rights or the Partnership’s obligations under
this Agreement, shall be excluded from this Agreement; provided, however,
that any change required by applicable laws, statutes or rules to be
applied to this Agreement shall be so applied regardless of whether the effect
of such change is to narrow the Indemnitee’s rights or the Partnership’s
obligations under this Agreement.


 


(b)           Advancement of Expenses.  The Partnership shall, to the fullest extent permitted
by the Partnership Agreement, pay the Expenses incurred by the Indemnitee as
soon as practicable after written demand is presented to the Partnership in the
event the Indemnitee was or is made or is threatened to be made a party to or
witness in or is otherwise involved in a Proceeding by reason, in whole or in
part, of an Indemnifiable Event in advance of its final disposition; provided,
however, that, to the extent required by law, such payment of expenses
in 


 


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advance of the final disposition of the Proceeding shall be made only
upon receipt of an undertaking by the Indemnitee to repay all amounts advanced
if it should be ultimately determined that the Indemnitee is not entitled to be
indemnified under this Agreement, the Act or otherwise.


 


(c)           Partial Indemnity.  If the Indemnitee is entitled under any provision
of this Agreement to indemnification by the Partnership for some or a portion
of the Losses or Expenses, but not, however, for all of the total amount
thereof, the Partnership shall indemnify the Indemnitee for the portion thereof
to which the Indemnitee is entitled. 
Notwithstanding any other provision of this Agreement, to the extent
that the Indemnitee has been successful on the merits or otherwise in defense
of any issue or matter therein, including dismissal without prejudice, the Indemnitee
shall be indemnified against all Expenses incurred in connection therewith.


 


(d)           Contribution.  If the indemnification provided in Section 2(a) for
any reason is held by a court of competent jurisdiction to be unavailable to the
Indemnitee, then in respect of any Indemnifiable Event, the Partnership shall
contribute to the amount of Expenses and Losses paid in settlement actually
incurred and paid or payable by the Indemnitee in such proportion as is
appropriate to reflect (i) the relative benefits received by the Partnership
on the one hand and the Indemnitee on the other hand from the transaction from
which such Proceeding arose and (ii) the relative fault of the Partnership
on the one hand and of the Indemnitee on the other hand in connection with the
events which resulted in such Expenses and Losses, as well as any other
relevant equitable considerations.  The
relative fault of the Partnership on the one hand and of the Indemnitee on the
other hand shall be determined by reference to, among other things, the parties’
relative intent, knowledge, access to information and opportunity to correct or
prevent the circumstances resulting in such expenses, judgments, fines or
settlement amounts.  The Partnership and
the Indemnitee agree that it would not be just and equitable if contribution
pursuant to this Section 2(d) were determined by pro rata allocation
or any other method of allocation which does not take account of the foregoing
equitable considerations.


 


(e)           Enforcement.  If a claim for indemnification (following the
final disposition of such Proceeding) under Section 2(a) or
advancement of Expenses under Section 2(b) is not paid in full within
thirty days after a written claim therefor by the Indemnitee has been presented
to the Partnership, the Indemnitee may file suit against the Partnership to
recover the unpaid amount of such claim and, if successful in whole or in part,
shall be entitled to be paid the expense of prosecuting such claim.  In addition, the Indemnitee may file suit
against the Partnership to establish a right to indemnification or advancement
of Expenses arising under this Agreement, the Partnership Agreement, the Act or
otherwise.  In any such action the Partnership
shall have the burden of proving by clear and convincing evidence that the Indemnitee
is not entitled to the requested indemnification or advancement of Expenses
under applicable law.


 


3.             Notification and Defense of
Proceeding.  Promptly after receipt by the Indemnitee of
notice of the commencement of or threat of the commencement of any Proceeding, the
Indemnitee shall, if a request for indemnification in respect thereof is to be
made against the Partnership under this Agreement, notify the Partnership of
the commencement thereof; but the failure to notify the Partnership will not
relieve the Partnership from any liability which it may have to the Indemnitee
under this Agreement or otherwise unless and only to the extent that such 


 


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omission can be shown to have prejudiced the Partnership’s
ability to defend the Proceeding.  Except
as otherwise provided below, the Partnership shall be entitled to assume the
defense of such Proceeding, with counsel approved by the Indemnitee (which
approval shall not be unreasonably withheld). 
After notice from the Partnership to the Indemnitee of its election to
assume the defense thereof, the Partnership will not be liable to the Indemnitee
under this Agreement for any legal or other expenses subsequently incurred by the
Indemnitee in connection with the defense thereof other than reasonable costs
of investigation or as otherwise provided below.  The Indemnitee shall have the right to employ
its counsel in such Proceeding, but the fees and expenses of such counsel
incurred after notice from the Partnership of its assumption of the defense
thereof shall be at the expense of the Indemnitee unless (i) the
employment of counsel by the Indemnitee has been authorized by the Partnership,
(ii) the Indemnitee shall have reasonably concluded that there may be a
conflict of interest between the Partnership and the Indemnitee in the conduct
of the defense of such Proceeding or (iii) the Partnership shall not in
fact have employed counsel to assume the defense of such Proceeding, in each of
which cases the fees and expenses of counsel shall be at the expense of the Partnership.  The Partnership shall not be entitled to
assume the defense of any Proceeding brought by or on behalf of the Partnership
or as to which the Indemnitee shall have made the conclusion provided for in
clause (ii) of this Section 3. 
The Partnership shall not settle any Proceeding in any manner, which
would impose any penalty, limitation, admission, Loss or Expense on the Indemnitee
without the Indemnitee’s prior written consent. 
Neither the Partnership nor the Indemnitee will unreasonably withhold
its consent to any proposed settlement, provided that the Indemnitee may, in
the Indemnitee’s sole discretion, withhold consent to any proposed settlement
that would impose any penalty, limitation, admission, Loss or Expense on the
Indemnitee.


 


4.             Limitation on Indemnification.  Notwithstanding the terms of Section 2:


 


(a)           the obligations of the Partnership set forth in Section 2
shall be subject to the condition that the Reviewing Party shall not have
determined (based on a written opinion of outside counsel in all cases) that the
Indemnitee would not be permitted to be so indemnified under the Partnership
Agreement; provided, however, that if the Indemnitee has
commenced or thereafter commences legal proceedings in a court of competent
jurisdiction to secure a determination that the Indemnitee should be
indemnified under the Partnership Agreement, any determination made by the
Reviewing Party that the Indemnitee would not be permitted to be indemnified
under applicable law shall not be binding and the Indemnitee shall not be
required to reimburse the Partnership for any advancement of Expenses until a
final judicial determination is made with respect thereto (as to which all
rights of appeal therefrom have been exhausted or lapsed) and the Partnership
shall not be obligated to indemnify or advance to the Indemnitee any additional
amounts covered by such Reviewing Party determination (unless there has been a
determination by a court of competent jurisdiction that the Indemnitee would be
permitted to be so indemnified under applicable law);


 


(b)           the Partnership shall not be required to indemnify or
advance Expenses to the Indemnitee with respect to a Proceeding (or part
thereof) by the Indemnitee (and not by way of defense), except if the
commencement of such Proceeding (i) was authorized in the specific case by
the Board of Directors or (ii) brought to establish or enforce a right to
indemnification and/or advancement of Expenses arising under this Agreement,
the Partnership Agreement, the Act or otherwise;


 


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(c)           the Partnership shall not be obligated pursuant to the terms
of this Agreement to indemnify the Indemnitee for any amounts paid in
settlement of a Proceeding unless the Partnership consents in advance in
writing to such settlement, which consent shall not be unreasonably withheld;


 


(d)           the Partnership shall not be obligated pursuant to the terms
of this Agreement to indemnify the Indemnitee on account of any suit in which
judgment is rendered against the Indemnitee for an accounting of profits made
from the purchase or sale by the Indemnitee of securities of the Partnership
pursuant to the provisions of Section l6(b) of the Securities
Exchange Act of 1934, as amended or similar provisions of any federal, state or
local statutory law;


 


(e)           the Partnership shall not be obligated pursuant to the terms
of this Agreement to indemnify the Indemnitee if a final decision by a court
having jurisdiction in the matter shall determine that such indemnification is
not lawful; and


 


(f)            the Partnership shall not be
obligated pursuant to the terms of this Agreement to make any payment in
connection with any Proceeding to the extent the Indemnitee has otherwise
actually received payment (under any insurance policy or otherwise) of the
amounts otherwise indemnifiable under this Agreement.


 


5.             Change in Control.  The Partnership agrees that if there is a
Change in Control, then with respect to all matters thereafter arising
concerning the rights of the Indemnitee to indemnity payments and Expense
advances under this Agreement, the Partnership Agreement and any other
agreements now or hereafter in effect relating to Proceedings for Indemnifiable
Events, the Partnership shall seek legal advice only from special independent
counsel selected by the Indemnitee and approved by the Board of Directors
(which approval shall not be unreasonably withheld), and who has not otherwise
performed services for the Partnership (other than in connection with such
matters) or the Indemnitee.  Without
limiting the Board of Director’s obligation not to unreasonably withhold its approval,
in the event that the Indemnitee and the Partnership are unable to agree on the
selection of the special independent counsel, such special independent counsel
shall be selected by lot from among at least five nationally recognized law
firms each in New York City, New York, each having no less than 250
lawyers.  Such selection shall be made in
the presence of the Indemnitee (and the Indemnitee’s legal counsel or either of
them, as the Indemnitee may elect).  Such
special independent counsel, among other things, shall determine whether and to
what extent the Indemnitee would be permitted to be indemnified under applicable
law and shall render its written opinion to the Partnership and the Indemnitee
to such effect.  The Partnership agrees
to pay the reasonable fees of the special independent counsel referred to above
and to fully indemnify such counsel against any and all expenses (including
attorneys’ fees), Proceedings, liabilities and damages arising out of or
relating to this Agreement or its engagement pursuant to this Agreement.


 


6.             Subrogation.  In the event of payment to the Indemnitee
under this Agreement, the Partnership shall be subrogated to the extent of such
payment to all of the rights of recovery of the Indemnitee, who shall execute
all papers required and shall do everything that may be necessary to secure
such rights, including the execution of such documents necessary to enable the Partnership
effectively to bring suit to enforce such rights.


 


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7.             No Presumptions.  For purposes of this Agreement, the
termination of any Proceeding against the Indemnitee by judgment, order,
settlement (whether with or without court approval) or conviction, or upon a
plea of nolo contendere, or its equivalent, shall not create a presumption that
the Indemnitee did not meet any particular standard of conduct or have any
particular belief or that a court has determined that indemnification is not
permitted by applicable law.  In
addition, neither the failure of the Reviewing Party to have made a
determination as to whether the Indemnitee has met any particular standard of
conduct or had any particular belief, nor an actual determination by the
Reviewing Party that the Indemnitee has not met such standard of conduct or did
not have such belief shall be a defense to the Indemnitee’s Proceeding for
indemnification or create a presumption that the Indemnitee has not met any
particular standard of conduct or did not have any particular belief.


 


8.             Non-Exclusivity.  The rights conferred on the Indemnitee by
this Agreement shall be in addition to, and shall not be deemed exclusive of,
any other rights which the Indemnitee may have or hereafter acquire under any
statute, the certificate of limited partnership of the Partnership and the
Partnership Agreement, any other agreement, vote of unitholders or a resolution
of directors, or otherwise, and to the extent that during the Indemnification
Period such rights are more favorable than the rights currently provided under
this Agreement to the Indemnitee, the Indemnitee shall be entitled to the full
benefits of such more favorable rights to the extent permitted by law.  Other than as set forth in this Section 8,
in the case of any inconsistency between the indemnification provisions of this
Agreement and any other agreement relating to the indemnification of the
Indemnitee, the indemnification provisions of this Agreement shall control.


 


9.             Liability Insurance.  The Partnership may, to the extent that the
Board of Directors in good faith determines it to be economically reasonable,
maintain a policy of directors’ and officers’ liability insurance, on such
terms conditions as may be approved by the Board of Directors.  To the extent the Partnership maintains
directors’ and officers’ liability insurance, the Indemnitee shall be covered
by such policy in such a manner as to provide the Indemnitee the same rights
and benefits as are accorded to the most favorably insured of the General
Partner’s directors, if the Indemnitee is a director, or of the General Partner’s
officers, if the Indemnitee is not a director but is an officer.  Notice of any termination or failure to renew
such policy shall be provided to the Indemnitee promptly upon the Partnership’s
becoming aware of such termination or failure to renew.  The Partnership shall provide to the
Indemnitee copies of all such insurance policies and any endorsements thereto
whenever such documents have been provided to the Partnership.


 


10.           Amendment/Waiver.  No supplement, modification or amendment of
this Agreement shall be binding unless executed in writing by both of the
parties hereto.  No waiver of any of the
provisions of this Agreement shall be deemed or shall constitute a waiver of
any other provisions of this Agreement (whether or not similar) nor shall such
waiver constitute a continuing waiver. 
Any waiver to this Agreement shall be in writing.


 


11.           Binding Effect.  This Agreement shall be binding upon and
inure to the benefit of and be enforceable by the parties hereto and their
respective successors, including any direct or indirect successor by purchase,
merger, consolidation or otherwise to all or substantially all of 


 


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the business and/or assets of the Partnership,
assigns, spouses, heirs, and personal and legal representatives.


 


12.           Survival.  This Agreement shall continue in effect
during the Indemnification Period, regardless of whether the Indemnitee
continues to serve as an officer or director of the General Partner or of any
other enterprise at the General Partner’s request.


 


13.           Severability.  The provisions of this Agreement shall be severable
in the event that any provision of this Agreement (including any provision
within a single section, paragraph or sentence) is held by a court of competent
jurisdiction to be invalid, void or otherwise unenforceable, and the remaining
provisions shall remain enforceable to the fullest extent permitted by law.


 


14.           Period of Limitations.  No legal action shall be brought and no cause
of action shall be asserted by or in the right of the Partnership against the
Indemnitee or the Indemnitee’s estate, spouse, heirs, executors or personal or
legal representatives after the expiration of three years from the date of
accrual of such cause of action, and any claim or cause of action of the Partnership
shall be extinguished and deemed released unless asserted by the timely filing
of a legal action within such three year period; provided, however,
that if any shorter period of limitations is otherwise applicable to any such
cause of action, such shorter period shall govern.


 


15.           Counterparts.  This Agreement may be executed in
counterparts, each of which shall be deemed to be an original and all of which
together shall be deemed to be one and the same instrument, notwithstanding
that both parties are not signatories to the original or same counterpart.


 


16.           Governing Law.  This Agreement shall be governed by and
construed and enforced in accordance with the laws of the State of Delaware
applicable to contracts made and to be performed in such state without giving
effect to the principles of conflicts of laws.


 


 


	
   

  	
  OSG AMERICA L.P.,

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  OSG America LLC, its general partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By 

  	
  /s/ Myles R. Itkin

  	
   

  
	
   

  	
   

  	
  Myles R. Itkin

  
	
   

  	
   

  	
  Chief Financial Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  /s/ Kathleen C. Haines

  	
   

  
	
   

  	
  Kathleen C. Haines

  
					



 


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