Exhibit 10. (iii) (aa)
September 24, 2006
Mr. Jonathan P. Whitworth
420 Riviera Drive
Tampa, Florida
33606
Dear Mr. Whitworth:
We are pleased to confirm your employment with Overseas Shipholding Group, Inc.
(the "Company") effective at, and contingent upon the occurrence of, the
Effective Time (as such term is defined in the Agreement and Plan of Merger
dated as of September 25, 2006 (the "Merger Agreement") among the Company,
Marlin Acquisition Corporation and Maritrans Inc.), as follows:
1.
TITLE AND POSITION.
AT ALL TIMES DURING THE TERM OF THIS AGREEMENT,
YOU
SHALL BE THE SENIOR VICE PRESIDENT AND THE HIGHEST RANKING OFFICER OF THE
COMPANY HAVING RESPONSIBILITIES FOR THE BUSINESSES COMPRISING OUR U.S. FLAG
STRATEGIC BUSINESS UNIT (THE "US SBU"), AS STRUCTURED FROM TIME TO TIME, AND YOU
SHALL AT ALL TIMES REPORT SOLELY TO OUR CHIEF EXECUTIVE OFFICER ("CEO").
IN
THAT CAPACITY, YOU SHALL AT ALL TIMES HAVE THOSE POWERS AND DUTIES NORMALLY
ASSOCIATED WITH THE POSITION OF
HEAD OF A STRATEGIC BUSINESS UNIT OF THE
COMPANY.
ALL INDIVIDUALS WHO ARE EMPLOYED BY OR PERFORM SERVICES FOR THE US SBU
SHALL REPORT TO YOU IN A MANNER CONSISTENT WITH OSG'S POLICIES AND PRACTICES.
YOU WILL DEVOTE SUBSTANTIALLY ALL OF YOUR BUSINESS TIME AND REASONABLE BEST
EFFORTS TO THE PERFORMANCE OF YOUR DUTIES AND SHALL DISCHARGE YOUR DUTIES
DILIGENTLY, FAITHFULLY AND IN THE BEST INTERESTS OF THE COMPANY.
YOUR PRINCIPAL
PLACE OF BUSINESS WILL BE LOCATED IN TAMPA, FLORIDA BUT YOU WILL BE REQUIRED TO
TRAVEL FREQUENTLY, ESPECIALLY TO THE COMPANY'S HEADQUARTERS IN NEW YORK CITY,
NEW YORK.
2.
COMPENSATION AND BENEFITS.
THE COMPANY WILL PAY YOU A BASE SALARY AT THE
RATE OF $550,000 ("BASE SALARY") PER YEAR AND YOU WILL BE ELIGIBLE FOR BONUSES
IN ACCORDANCE WITH OUR BONUS PLANS WHICH, FOR 2006 WILL BE PRO RATED FOR THE
PORTION OF THE YEAR YOU ARE EMPLOYED BY THE COMPANY.
THE COMPANY'S BOARD OF
DIRECTORS (THE "BOARD") MAY INCREASE THE AMOUNT OF SUCH BONUSES FOR 2006 IN ITS
SOLE DISCRETION.
YOU WILL PARTICIPATE, TO THE EXTENT ELIGIBLE, IN THE BENEFIT
PLANS AND PROGRAMS GENERALLY APPLICABLE TO SENIOR EXECUTIVES, INCLUDING, BUT NOT
LIMITED TO, THE COMPANY'S 401(K) PLAN, GROUP HEALTH PLAN, LIFE INSURANCE
BENEFITS AND DISABILITY INSURANCE BENEFITS.
SIMULTANEOUSLY WITH THE SIGNING OF THIS AGREEMENT, YOU AND THE COMPANY ARE
ENTERING INTO A CHANGE IN CONTROL AGREEMENT THAT AFFORDS THE SAME RIGHTS AND
PROTECTIONS AS ARE AFFORDED TO THE COMPANY'S OTHER SENIOR EXECUTIVES IN THE
EVENT OF A CHANGE IN CONTROL.
THE TERMS OF THE CHANGE IN CONTROL AGREEMENT WILL
SUPERSEDE THE TERMS OF THIS AGREEMENT IN CONNECTION A CHANGE IN CONTROL.
3.
INITIAL STOCK OPTION GRANT.
YOU WILL BE GRANTED OPTIONS TO ACQUIRE SUCH
NUMBER OF SHARES OF OUR COMMON STOCK AS WILL HAVE AN AGGREGATE VALUE (DETERMINED
BY THE COMPANY ON A BLACK-SCHOLES VALUATION ON THE DATE OF GRANT) OF $250,000,
VESTING IN THREE EQUAL TRANCHES ON THE FIRST, SECOND AND THIRD ANNIVERSARIES OF
THE DATE OF GRANT, PROVIDED THAT YOU ARE EMPLOYED BY THE COMPANY ON EACH