Document:

EXHIBIT 10(iii)(b)

                        OVERSEAS SHIPHOLDING GROUP, INC.

                     SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN

                                      PLUS

              Amended and Restated Effective as of January 1, 2002

                  This Plan was established effective as of January 1, 1997 and
was amended and restated effective as of January 1, 1999. The Plan is again
amended and restated in the form set forth herein as of January 1, 2002 to
reflect changes made in the Qualified Plan and the spin off from the Qualified
Plan of the qualified defined benefit plans of certain previously participating
employers therein.

            Maritime Overseas Corporation ("MOC") initially established a
supplemental executive retirement plan in 1984 (the "1984 Plan") and established
a subsequent supplemental executive retirement plan in 1988 (the "1988 Plan"),
both primarily for the purpose of providing supplementary retirement benefits
for a select group of management and highly compensated employees of MOC and
certain participating employers. Overseas Shipholding Group, Inc. (the
"Company") was a participating employer in the 1984 Plan and 1988 Plan. The
provisions of the 1984 Plan and the 1988 Plan were merged and restated,
effective January 1, 1995, in one plan, as they applied to Participants who were
Employees of the Company on January 1, 1995 (the "Prior Plan"). The Prior Plan
was divided into two parts as of January 1, 1997 - this Plan and the Basic
Supplemental Executive Retirement Plan (the "Basic SERP").

            OSG Ship Management, Inc. ("OSGM") established the OSG Ship
Management, Inc. Supplemental Executive Retirement Plan Plus (the "OSGM SERP
Plus"), effective as of October 30, 1998 as a successor to the Maritime Overseas
Corporation Supplemental Executive Retirement Plan Plus (the "MOC SERP Plus").
Because OSGM assumed the obligations of MOC with regard to the MOC SERP Plus,
the OSGM SERP Plus applied to participants in the MOC SERP Plus who were not in
pay status under the MOC SERP Plus on October 30, 1998. Effective as of January
1, 2002, the OSGM SERP Plus is merged into this Plan and this Plan is amended
and restated effective as of January 1, 2002.

1. Definitions. For purposes of this Plan, the following definitions apply:

      (a) "Actuarial Equivalent" means an amount equal in value on an actuarial
basis, as determined by an actuary selected by the Committee, based upon the
mortality and interest rates set forth in the Qualified Plan, as amended from
time to time. Determination of the Actuarial Equivalent in the Plan shall be
subject to Exhibit C hereto.

      (b) "Affiliated Group" means the group of corporations and/or
unincorporated trades or businesses consisting of an Employer and all its
Affiliated Companies. For this purpose, an Affiliated Company includes (i) the
Employer, (ii) a member of a controlled group

<PAGE>

of corporations of which the Employer is a member as determined in accordance
with Section 414(b) of the Code, (iii) an unincorporated trade or business which
is under common control with the Employer as determined in accordance with
Section 414(c) of the Code, or (iv) a member of an affiliated service group with
the Employer, as defined in Section 414(m) or (o) of the Code.

      (c) "Basic Plan" means the Overseas Shipholding Group, Inc. Basic
Supplemental Executive Retirement Plan.

      (d) "Board" means the Board of Directors of the Company.

      (e) "Change of Control" means a change of control as provided in Exhibit A
hereto.

      (f) "Code" means the Internal Revenue Code of 1986, as amended.

      (g) "Committee" means the Compensation Committee of the Board.

      (h) "Company" means Overseas Shipholding Group, Inc. or any successor
thereto as a result of a merger or consolidation.

      (i) "Employee" means any person employed by an Employer.

      (j) "Employer" means the Company and OSG Ship Management, Inc.

      (k) "ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.

      (l) "Initial Payment Date" means, except as otherwise provided herein, the
first day of the month coinciding with or next following the latest of (i) three
(3) months after the date on which the Participant incurs a Termination of
Employment, (ii) the Participant's fifty- fifth (55th) birthday, or (iii) such
later date as the Participant elects in a writing filed with the Committee at
least one (1) year prior to the Employee's Termination of Employment, provided
that such election is approved by the Committee in its sole discretion. Such an
election may be revoked by the Participant by written notice filed with the
Committee at least one (1) year prior to Termination of Employment. Any election
made under the Prior Plan shall be deemed to be an election made under this
Plan.

      (m) "MOC" means Maritime Overseas Corporation or any successor thereto as
a result of a merger or consolidation.

      (n) "Normal Retirement Date" means the first day of the month in which a
Participant attains age 65.

      (o) "Participant" means the persons set forth on Exhibit B hereto and any
other Employee of an Employer who is designated as a Participant in this Plan by
the Committee.

      (p) "Plan" means this Overseas Shipholding Group, Inc. Supplemental
Executive Retirement Plan Plus, as amended from time to time.

                                       2
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      (q) "Qualified Plan" means the Pension Plan for Employees of OSG Ship
Management, Inc., as it is amended from time to time (formerly, the Pension Plan
for Employees of Maritime Overseas Corporation).

      (r) "Standard Form" means a straight life annuity with no contingent
benefit and no period certain.

      (s) "Supplemental Plus Benefit" means the lump sum benefit payable under
this Plan.

      (t) "Termination of Employment" means termination of employment as an
Employee of the Company and all members of the Company's Affiliated Group for
any reason whatsoever, including but not limited to death, retirement,
resignation or firing (with or without cause).

2. Supplemental Plus Benefit.

      (a) The Supplemental Plus Benefit shall be equal to the Actuarial
Equivalent lump sum of the (i) hypothetical vested monthly accrued benefit
(based on the provisions of the Qualified Plan) in the Standard Form the
Participant would have received under the Qualified Plan (based solely on the
Participant's compensation and service recognized under the Qualified Plan), on
the Initial Payment Date if the limitations of Code Sections 401(a)(17) and 415
(as applied under the Qualified Plan) did not apply and the Participant was
credited with such additional service and compensation that the Board, in its
sole discretion, recognizes for purposes of the Supplemental Plus Benefit as
provided pursuant to Section 2(c), less (ii) the Actuarial Equivalent monthly
benefit on the Initial Payment Date of the Participant's actual monthly benefit
in the Standard Form being received (or, if not then being received, assuming
benefits under the Qualified Plan and Basic Plan had then commenced) under the
Qualified Plan and the Basic Plan, as adjusted by (iii) the applicable amount,
if any, set forth on Table A hereto.

      (b) The Company shall be liable for payment of a Participant's
Supplemental Plus Benefit hereunder. Notwithstanding the foregoing, the Company
may, in its sole discretion, if it determines it to be equitable based on a
Participant's compensation and service, allocate responsibility for any or all
of such Participant's Supplemental Plus Benefit to another Employer hereunder.

      (c) The Committee, in its sole discretion, may increase a Participant's
Supplemental Plus Benefit, his recognized service or his recognized compensation
and may establish such conditions on such increase as it deems appropriate. Such
increases shall be recognized as provided in Exhibit C hereto.

      (d) Notwithstanding subsection (a) above and in lieu of any other amounts
due hereunder, with respect to each Participant listed on Exhibit D hereto, the
Supplemental Plus Benefit as of January 1, 2002 shall be the fixed monthly
amount set forth on Exhibit D hereto with respect to such Participant, with
interest accruing after such date at the rate of 5.12% per annum.

                                       3
<PAGE>

3. Payment.

      (a) Basic Form of Benefit. Subject to (b) below, a Participant's
Supplemental Plus Benefit shall be paid in the form of a lump sum benefit,
payable as soon as administratively feasible after the Initial Payment Date.

      (b) Optional Form of Benefit. The Participant shall have the right, in a
writing filed with the Committee, to elect a form of benefit other than that
specified in (a) above, provided, however, that such optional form of benefit is
available under the Qualified Plan on the Initial Payment Date and that such
election is made and filed at least one (1) year prior to the Participant's
Termination of Employment and is approved by the Committee in its sole
discretion. Such an election may be revoked by the Participant by written notice
filed with the Committee at least one (1) year prior to Termination of
Employment. Any election made under the Prior Plan shall be deemed to be an
election made under this Plan.

      (c) Right to Accelerate Payment. Notwithstanding anything else herein, the
Company shall have the right, in its sole and absolute discretion, to accelerate
the payment of any Supplemental Plus Benefit payable hereunder; provided, that
any accelerated payment(s) shall be equal to the Actuarial Equivalent of the
Participant's Supplemental Plus Benefit assuming that the acceleration date is
the Initial Payment Date and that the Participant has commenced to receive his
benefits under the Qualified Plan and Basic Plan on the date of such payment.

      (d) Change of Control. Notwithstanding the above, upon the occurrence of a
Change of Control, the Actuarial Equivalent of each Participant's then accrued
Supplemental Plus Benefit (calculated based on the assumption that the
Participant has commenced to receive his benefits under the Qualified Plan and
Basic Plan on the date of such payment) shall be promptly paid in a lump sum to
such Participant and, the Actuarial Equivalent of such payment shall be offset
from the Supplemental Plus Benefit due the Participant on the Initial Payment
Date.

      (e) Forfeiture. A Participant shall, in the sole discretion of the
Committee, forfeit his Supplemental Plus Benefit in the event that within three
(3) years after his Termination of Employment he engages, without the prior
written consent of the Committee, in any activity which the Committee, in its
sole discretion, believes to be competitive with the activities of the Company
or any member of the Affiliated Group. Such forfeiture shall be equal to the
greater of (i) the unpaid portion of his Supplemental Plus Benefit and (ii) the
portion of his Supplemental Plus Benefit, whether theretofore paid or not paid,
which in the Standard Form would be attributable to the period after which he
commences to compete. To the extent any forfeited amounts shall have theretofore
been paid to the Participant, upon demand, he shall promptly refund such amounts
to the Company. If he fails to promptly do so, he shall be liable to the Company
for its costs of collection, including reasonable attorneys' fees and
disbursements. This Section 3(e) shall not be applicable to any Participants
whose Termination of Employment is less than ninety (90) days before or less
than two (2) years after a Change of Control.

                                       4
<PAGE>

4. Death of Participant.

      (a) Death Prior to Initial Payment Date. In the event of the death of a
Participant who has accrued a Supplemental Plus Benefit prior to his Initial
Payment Date, his spouse and/or beneficiary shall receive a benefit calculated
in the same manner as in the Qualified Plan (based on the Participant's
compensation and service with an Employer that the Board, in its discretion,
recognizes for purposes of the Supplemental Plus Benefit but without regard to
Code Sections 401(a)(17) and 415) to the extent such benefit would be receivable
under the terms of the Qualified Plan upon his death prior to commencement of
benefits if the benefit was payable from the Qualified Plan less the benefits
payable from the Qualified Plan and Basic Plan. His spouse and/or beneficiary
shall be the same persons or entities as designated or determined under the
Qualified Plan. The benefit payable hereunder, however, shall be paid in an
Actuarial Equivalent lump sum as soon as administratively feasible after the
Participant's death.

      (b) Death After Initial Payment Date. If a Participant dies on or after
the Initial Payment Date, no death benefits will be payable hereunder upon the
death of the Participant unless the Participant is receiving a form of benefit
with a survivor benefit pursuant to Section 3(b) above. If a Participant is
receiving a form of benefit with a survivor benefit, any benefits becoming due
will, subject to Section 3(c) above, be paid in accordance with such form of
benefit.

5. Reemployment.

            If a Participant is reemployed by the Company or any member of the
Company's Affiliated Group after commencing to receive a Supplemental Plus
Benefit hereunder but does not again become a Participant, the Committee shall
have the right at its election to suspend benefits payable hereunder during such
period of employment with an appropriate Actuarial Equivalent adjustment in his
benefits when they recommence. If the former Participant again becomes a
Participant accruing benefits under the Plan, he shall cease to receive
Supplemental Plus Benefits, his prior election as to his form of benefit shall
be deemed cancelled, he shall have his benefits recalculated based on his entire
service for Employers offset by the Actuarial Equivalent of the previously
received Supplemental Plus Benefit, and benefits shall be payable in accordance
with Sections 3 and 4 above. In no event shall the combined Supplemental Plus
Benefit (as actuarially adjusted to reflect Actuarial Equivalents) be greater
than the Supplemental Plus Benefit the Participant would have received if his
service had been continuous.

6. Claims Procedure.

      (a) The Committee shall be responsible for determining all claims for
benefits under this Plan by the Participants or their beneficiaries. Within
ninety (90) days after receiving a claim (or within up to one hundred eighty
(180) days, if the claimant is so notified, including notification of the reason
for the delay), the Committee shall notify the Participant or beneficiary of its
decision in writing, giving the reasons for its decision if adverse to the
claim. If the decision is adverse to the claimant, the Committee shall advise
him of the Plan provisions involved, of any additional information which he must
provide to perfect his claim and why, and of his right to request a review of
the decision.

                                       5
<PAGE>

      (b) A claimant may request a review of an adverse decision by written
request to the Committee made within sixty (60) days after receipt of the
decision. The claimant, or his duly authorized representative, may review
pertinent documents and submit written issues and comments.

      (c) Within sixty (60) days after receiving a request for review, the
Committee shall notify the claimant in writing of (i) its decision, (ii) the
reasons therefore, and (iii) the Plan provisions upon which it is based.

      (d) The Committee may at any time alter the claims procedure set forth
above, so long as the revised claims procedure complies with ERISA, and the
regulations issued thereunder.

      (e) The Committee shall have the full power and authority to interpret,
construe and administer this Plan in its sole discretion based on the provisions
of the Plan and to decide any questions and settle all controversies that may
arise in connection with the Plan. Both the Committee's and the Board's
interpretations and construction thereof, and actions thereunder, made in the
sole discretion of the Committee and the Board, including any valuation of the
Supplemental Plus Benefit, any determination under this Section 6, or the amount
of the payment to be made hereunder, shall be final, binding and conclusive on
all persons for all persons. No member of the Board or Committee shall be liable
to any person for any action taken or omitted in connection with the
interpretation and administration of this Plan.

      (f) The Committee shall determine, subject to the provisions of this Plan:
(i) the additional Employees who shall participate in the Plan from time to
time; and (ii) when an Employee shall cease to be a Participant.

7. Construction of Plan.

            Nothing contained in this Plan and no action taken pursuant to the
provisions of this Plan shall create or be construed to create a trust of any
kind, or a fiduciary relationship between any Employer and the Participants,
their designated beneficiaries or any other person. Any funds which may be
invested under the provisions of this Plan shall continue for all purposes to be
part of the general funds of the Company or the Employer, as the case may be,
and no person other than the Company or the Employer, as the case may be, shall
by virtue of the provisions of this Plan have any interest in such funds. To the
extent that any person acquires a right to receive payments from the Company or
an Employer under this Plan, such right shall be no greater than the right of
any unsecured general creditor of the Company or such Employer, as the case may
be.

8. Minors and Incompetents.

            If the Committee shall find that any person to whom payment is
payable under this Plan is unable to care for his affairs because of illness or
accident, or is a minor, any payment due (unless a prior claim therefore shall
have been made by a duly appointed guardian, committee or other legal
representative) may be paid to the spouse, a child, parent, or brother or
sister, or to any person deemed by the Committee to have incurred expense for
such person otherwise entitled to payment, in such manner and proportions as the
Committee may determine

                                       6
<PAGE>

it its sole discretion. Any such payment shall be a complete discharge of the
liabilities of the Employers under this Plan.

9. Limitation of Rights.

            Nothing contained herein shall be construed as conferring upon an
Employee the right to continue in the employ of the Employers or any member of
the Affiliated Group as an executive or in any other capacity or to interfere
with any Employer's right to discharge him at any time for any reason
whatsoever.

10. Payment Not Salary.

            Any Supplemental Plus Benefit payable under this Plan shall not be
deemed salary or other compensation to the Employee for the purposes of
computing benefits to which he may be entitled under any pension plan or other
arrangement of any Employer or any member of the Affiliated Group for the
benefit of its employees.

11. Severability.

            In case any provision of this Plan shall be illegal or invalid for
any reason, said illegality or invalidity shall not affect the remaining parts
hereof, but this Plan shall be construed and enforced as if such illegal and
invalid provision never existed.

12. Withholding.

            The Company or an Employer, as the case may be, shall have the right
to make such provisions as it deems necessary or appropriate to satisfy any
obligations it may have to withhold federal, state or local income or other
taxes incurred by reason of payments or accrual pursuant to this Plan.

13. Assignment.

            This Plan shall be binding upon and inure to the benefit of the
Employers, their successors and assigns and the Participants and their heirs,
executors, administrators and legal representatives. In the event that the
Company or an Employer sells all or substantially all of the assets of its
business and the acquiror of such assets assumes the obligations hereunder, the
Company and Employers shall be released from any liability imposed herein and
shall have no obligation to provide any benefits payable hereunder.

14. Non-Alienation of Benefits.

            The benefits payable under this Plan shall not be subject to
alienation, transfer, assignment, garnishment, execution or levy of any kind,
and any attempt to cause any benefits to be so subjected shall not be
recognized.

                                       7
<PAGE>

15. Governing Law.

            To the extent legally required, the Code and ERISA shall govern this
Plan and, if any provision hereof is in violation of any applicable requirement
thereof, the Company reserves the right to retroactively amend this Plan to
comply therewith. To the extent not governed by the Code and ERISA, this Plan
shall be governed by the laws of the State of New York, without regard to
conflict of law provisions.

16. Amendment or Termination of Plan.

            The Board or the Committee may amend this Plan from time to time in
any respect, and may at any time terminate the Plan in its entirety. In
addition, at any time, the Board or the Committee may exclude any Participant
from further participation in the Plan. In the event of any amendment,
termination or exclusion, the Participant shall have a vested right to a benefit
from this Plan equal to his total vested benefit from this Plan as of the date
of such termination, amendment or exclusion. In the event of a termination of
the Plan or exclusion of a Participant, the Company may distribute to each or
any Participant, as it deems appropriate, the Actuarial Equivalent of his
accrued benefit as of such date (as if a Termination of Employment had occurred)
and have no further obligation hereunder. Section 3(e) above shall continue to
apply to the Participant. Any such action by the Board or the Committee with
respect to the Plan shall be binding on the Company, Employers and Employee.

17. Non-Exclusivity.

            The adoption of the Plan by the Employers shall not be construed as
creating any limitations on the power of the Employers to adopt such other
supplemental retirement income arrangements as it deems desirable, and such
arrangements may be either generally applicable or limited in application.

18. Gender and Number.

            Wherever used in this Plan, the masculine shall be deemed to include
the feminine and the singular shall be deemed to include the plural, unless the
context clearly indicates otherwise.

19. Headings and Captions.

            The headings and captions herein are provided for reference and
convenience only. They shall not be considered part of the Plan and shall not be
employed in the construction of the Plan.

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<PAGE>

IN WITNESS WHEREOF, the Company has caused this Plan to be executed this 4th day
of November, 2002.

                                              OVERSEAS SHIPHOLDING GROUP, INC.

                                              By:   s/ ROBERT N. COWEN
                                                  ------------------------------
                                                  Title: Senior Vice President

                                       9
<PAGE>

                                     TABLE A

                                           ADDITIONAL MONTHLY ADJUSTMENT AMOUNT
PARTICIPANT                                (As a fixed monthly amount)
-----------                                ---------------------------

Robert N. Cowen                            $1,926.35
Morton P. Hyman                            $4,376.08

                                       10
<PAGE>

                                    EXHIBIT A

Change of Control

            For purposes of this Plan, a "Change of Control" shall be deemed to
have occurred if: (i) any person (as defined in Section 3(a)(9) of the
Securities Exchange Act of 1934, as amended (the "Exchange Act") and as used in
Sections 13(d) and 14(d) thereof)), excluding the Company, any "Subsidiary", any
employee benefit plan sponsored or maintained by the Company or any Subsidiary
(including any trustee of any such plan acting in his capacity as trustee) and
any person who (or group which includes a person who) is the beneficial owner
(as defined in Rule 13(d)-3 under the Exchange Act) as of January 1, 1994 of at
least fifteen percent (15%) of the common stock of the Company, becomes the
beneficial owner (as defined in Rule 13(d)-3 under the Exchange Act) of shares
of the Company having at least thirty percent (30%) of the total number of votes
that may be cast for the election of directors of the Company; (ii) the
shareholders of the Company shall approve any merger or other business
combination of the Company, sale of all or substantially all of the Company's
assets or combination of the foregoing transactions (a "Transaction"), other
than a Transaction involving only the Company and one or more of its
Subsidiaries, or a Transaction immediately following which the shareholders of
the Company immediately prior to the Transaction continue to have a majority of
the voting power in the resulting entity (excluding for this purpose any
shareholder of the Company owning directly or indirectly more than ten percent
(10%) of the shares of the other company involved in the Transaction if such
shareholder is not as of January 1, 1994, the beneficial owner (as defined in
Rule 13(d)-3 under the Exchange Act) of at least fifteen percent (15%) of the
common stock of the Company); or (iii) within any twenty-four (24) month period
beginning on or after the date hereof, the persons who were directors of the
Company immediately before the beginning of such period (the "Incumbent
Directors") shall cease (for any reason other than death) to constitute at least
a majority of the board of directors of the Company, or the board of directors
of any successor to the Company (the "Board"), provided that, any director who
was not a director as of the date hereof shall be deemed to be an Incumbent
Director if such director was elected to the Board by, or on the recommendation
of or with the approval of, at least two-thirds of the directors who then
qualified as Incumbent Directors either actually or by prior operation of the
foregoing unless such election, recommendation or approval was the result of an
actual or threatened election contest of the type contemplated by Regulation
14a-11 promulgated under the Exchange Act or any successor provision.
Notwithstanding the foregoing, no Change of Control of the Company shall be
deemed to have occurred for purposes of this Plan by reason of any Transaction
which shall have been approved by action or vote of a majority of the Incumbent
Directors.

                                       11
<PAGE>

                                    EXHIBIT B

                       Participants as of January 1, 2002

                               Morton P. Hyman
                               Robert N. Cowen
                               Robert Johnston
                               Peter Swift
                               Richard Raskin
                               Ian Blackley
                               Malcolm Hedley
                               Keith Moorhouse
                               Michael A. Recanati
                               Andrew Neuman
                               Gabriel Kahana

                                       12
<PAGE>

                                    EXHIBIT C

            1. Morton P. Hyman shall be credited with four (4) years extra
service for purposes of calculating his Supplemental Plus Benefit and the death
benefit. In addition, Mr. Hyman's Supplemental Plus Benefit shall be calculated
using 75% of final average compensation if Mr. Hyman remains employed by the
Company through December 31, 2002. If Mr. Hyman is involuntarily terminated
without "cause," terminates for "good reason," dies while employed or his
employment is terminated as a result of a "disability" during such three year
period, he shall be treated as if he completed such three year period. In the
event Mr. Hyman shall terminate employment with the Company without "good
reason" during such three year period, his Supplemental Plus Benefit shall be
calculated by increasing the percentage of final average compensation in such
formula by 5% for each December 31st (but not above 15%) after January 1, 2000
that he was employed by the Company. For purposes of the foregoing, the terms
"cause" and "good reason" shall have the meanings set forth in Mr. Hyman's
Change of Control Agreement dated October 21, 1996 and "disability" shall mean
Mr. Hyman's inability to substantially perform the duties of his position for a
period of at least six (6) months, as determined by the Committee. Furthermore,
the death benefit payable to Mr. Hyman's spouse in the event of his death after
his attainment of age sixty-five (65) and prior to his commencement of benefits
shall be paid in a lump sum equal to the amount that would have been paid to Mr.
Hyman if he had terminated for "good reason" and received his benefit in a lump
sum on the day before his death. The foregoing form of death benefit shall not
be considered when calculating actuarial value equivalent of benefit forms for
Mr. Hyman. Notwithstanding the foregoing, for purposes of calculating the
Actuarial Equivalent of benefits payable under the Plan to Mr. Hyman, the
mortality factors and interest rate under the Qualified Plan which would be used
if benefits were paid out on his Normal Retirement Date shall be used instead of
those in effect at the time of the calculation if the use of such factors in the
aggregate would yield a benefit more favorable to Mr. Hyman. In addition, if the
use of such factors would yield a benefit more favorable to Mr. Hyman, Mr. Hyman
will receive an additional benefit under this Plan in an amount equal to the
difference in the Actuarial Equivalent of his benefit under the Basic Plan had
his benefit under the Basic Plan been calculated using the mortality factors and
interest rate under the Qualified Plan which would be used if benefits under the
Basic Plan were paid out on his Normal Retirement Date and his benefit under the
Basic Plan calculated using the terms thereunder.

            2. Robert Johnston shall be credited with six (6) years extra
service for purposes of calculating his Supplemental Plus Benefit and the death
benefit.

            3. The Supplemental Plus Benefit payable with respect to Peter Swift
shall be equal to the differential, if any, between (a) and (b) where (a) is
equal to the theoretical actuarial value of the sum of the pension benefits that
would be payable to him under the Qualified Plan and the Basic Plan, assuming
that for purposes of such theoretical calculation, service with Maritime
Overseas Corporation, Ltd.("MOCL") (and any predecessor) as well as service with
the Company shall be considered and (b) is equal to the sum of the actuarial
value of the pension benefits actually payable to him under the pension plan
maintained by MOCL and the actuarial value of the sum of the pension benefits
actually payable to him under the Qualified Plan and the Basic Plan. For
purposes of such comparison, the conversion from pounds to

                                       13
<PAGE>

dollars shall be based on the applicable conversion rate at Citibank, N.A. at
the time of Mr. Swift's retirement and the actuarial assumptions shall be based
on those set forth in the Qualified Plan, to the extent applicable.

            4. The Supplemental Plus Benefit payable with respect to Ian
Blackley, Malcolm Hedley and Keith Moorhouse each shall be equal to the
differential, if any, between (a) and (b) where (a) is equal to the theoretical
actuarial value of the sum of the pension benefits that would be payable to each
of them under the Qualified Plan and, if a Participant in the Basic Plan, under
the Basic Plan, assuming that for purposes of such theoretical calculation,
service with Maritime Overseas Corporation, Ltd. ("MOCL") (and any predecessor)
as well as service with the Company shall be considered and (b) is equal to the
sum of the actuarial value of the pension benefits actually payable to each of
them under the pension plan maintained by MOCL and the actuarial value of the
sum of the pension benefits actually payable to each of them under the Qualified
Plan and, if applicable, the Basic Plan. For purposes of such comparison, the
conversion from pounds to dollars shall be based on the applicable conversion
rate at Citibank, N.A. at the time of such individual's retirement and the
actuarial assumptions shall be based on those set forth in the Qualified Plan,
to the extent applicable.

            5. The Supplemental Plus Benefit payable with respect to Richard
Raskin shall be a monthly payment of $833.33 payable on or about the first day
of each month after Mr. Raskin's attainment of age sixty-five (65) payable for a
period of ten (10) years. In the event of Mr. Raskin's death, such monthly
payments (or the balance thereof) shall be payable to Mr. Raskin's surviving
spouse during her life, commencing the first day of the month following Mr.
Raskin's death. No such payments shall be made to the estate of Mr. Raskin or
the estate of his surviving spouse.

            6. Michael Recanati shall be credited with two (2) years extra
service for purposes of calculating his Supplemental Plus Benefit and the death
benefit.

            7. Andrew Neuman shall be credited with two (2) years extra service
for purposes of calculating his Supplemental Plus Benefit and the death benefit.

            8. Gabriel Kahana shall be credited with one and one-half (1 1/2)
years extra service for purposes of calculating his Supplemental Plus Benefit
and the death benefit.

                                       14
<PAGE>

                                    EXHIBIT D

                                                 SUPPLEMENTAL PLUS BENEFIT
                                                 AS OF JANUARY 1, 2002
PARTICIPANT                                      (As a fixed monthly amount)
-----------                                      ---------------------------

Michael A. Recanati                              $1,766.48

                                       15EXHIBIT 10(iii)(i)

                                January 24, 2003

Mr. Ariel Recanati 176 East 71st Street, Apt. # 17B
New York, NY 10021

Dear Ariel:

This letter agreement and the General Release attached hereto set forth the
arrangement agreed to by Overseas Shipholding Group, Inc. ("OSG") and you in
connection with the termination of your employment with OSG.

1.    Your employment with OSG shall terminate as of January 31, 2003. Except as
      set forth herein, January 31, 2003 shall be the termination date for
      purposes of your participation in and coverage under all employee benefit
      plans and programs sponsored by OSG or its subsidiaries, including but
      not, limited to vacation accrual, tuition reimbursement, participation in
      any pension plan or savings plan, and eligibility for short-term and
      long-term disability benefits and life insurance.

2.    You shall resign as Senior Vice President of OSG and as an officer and
      director of any of its subsidiaries effective as of January 31, 2003.

3.    OSG shall pay you on the Effective Date (as defined in the penultimate
      paragraph of this letter agreement) the gross amount of $500,000.

4.    During the period from February 1, 2003 through April 30, 2003 (the
      "Transition Period"), you shall serve as a consultant to OSG and shall
      perform such

<PAGE>

      consulting services as the Chief Executive Officer of OSG shall reasonably
      request to assist OSG in effecting an orderly and efficient transition in
      respect of your duties as a Senior Vice President of OSG. Effective as of
      the end of the Transition Period, you shall cease to be a consultant of
      OSG. During the Transition Period, OSG shall pay you a consulting fee of
      $41,666.66 per month, payable in accordance with OSG's standard payroll
      practices. During the Transition Period, OSG shall pay or reimburse you,
      in accordance with the OSG's reimbursement and expense policies, for all
      reasonable expenses incurred by you at the request of the Chief Executive
      Officer of OSG in performing consulting services for OSG.

5.    Your aggregate accrued monthly retirement benefit under the Pension Plan
      for Employees of OSG Ship Management, Inc. ("OSGM") and the related
      Supplemental Employee Retirement Plans will reflect the additional
      credited service provided for you under the OSGM 2001 Transition Plan for
      the years 2001 and 2002 (i.e., a total of two years of credited service
      for each of the years 2001 and 2002). The amount payable under section 3
      of this letter agreement shall not be taken into account as compensation
      for 2003 for purposes of any pension or supplemental retirement plan
      benefits. The present value of amounts payable to you pursuant to the
      Supplemental Employee Retirement Plans (taking into account the provisions
      of this section 5) shall be paid to you in a lump sum as soon as
      practicable after the Effective Date.

6.    (a) OSG will make matching contributions on your behalf to OSG's 401(k)
      plan with respect to your compensation as an employee of OSG for January
      2003

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<PAGE>

      and with respect to the incentive compensation bonus paid to you pursuant
      to Section 10(i) of this letter agreement, all in accordance with OSG's
      401(k) plan. OSG shall also pay you the difference between $12,000 and the
      amount of matching contributions it makes pursuant to the preceding
      sentence within 30 days after it makes the last such matching
      contribution.

      (b) You do not have any accrued and unused vacation time.

7.    For a period of one year beginning February 1, 2003, you will be eligible
      to continue medical coverage under the OSGM medical benefits plan. You
      will be required to make the same contributions towards your continued
      medical coverage as you did as an active employee, and OSG shall pay the
      balance. This one-year period will run concurrently with your eligibility
      for benefits under the Consolidated Omnibus Budget Reconciliation Act
      ("COBRA"), and at the end of this period you will be eligible to continue
      coverage for the remainder of the COBRA period at your own expense.

8.    For a period of one year beginning February 1, 2003, OSG will provide you
      with life insurance benefits, comparable (with respect to level of
      benefits, terms and payment responsibility) to those life insurance
      benefits provided to you prior to January 31, 2003.

9.    On the Effective Date, OSG shall pay you $17,000 for automobile expenses.

10.   OSG shall pay you (i) an incentive compensation bonus that is comparable
      as a percentage of base salary in 2002 and in timing of payment to the
      incentive compensation bonuses paid to the other Senior Vice Presidents of
      OSG pursuant

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<PAGE>

      to OSG's incentive compensation plan for 2002, (ii) an incentive
      compensation bonus that is comparable as a percentage of base salary in
      2002 and in timing of payment to the incentive compensation bonuses paid
      to the other Senior Vice Presidents of OSG pursuant to OSG's incentive
      compensation plan for 2003, provided that your bonus shall be pro rated
      based on your length of service in 2003 (i.e. one month of service in
      2003), and (iii) a bonus that is comparable as a percentage of base salary
      in 2002 and in timing of payment to each other bonus, if any, paid in the
      future to the other Senior Vice Presidents of OSG in respect of periods
      ending prior to January 1, 2003.

11.   You currently hold stock options for 56,600 shares at $19.50 of which all
      but 11,320 are vested and exercisable; for 60,000 shares at $12.50, all of
      which are vested and exercisable; and for 90,000 shares at $14.625 of
      which all but 30,000 are vested and exercisable. Effective January 31,
      2003, all your options which are not yet vested will become fully vested
      and exercisable, except that no such options may be exercised prior to the
      Effective Date. Thereafter, all such options shall be subject to the terms
      and conditions of the applicable stock option plans, provided that such
      options shall remain exercisable until the first anniversary of the
      Effective Date.

12.   OSG shall provide you with the use of your current office and secretary at
      OSG's expense through March 31, 2003.

13.   Beginning at the end of March 2003, and for so long as such space is
      leased by OSG, OSG will make available to you and to persons assisting you
      in your work, for use by you and such persons as an office, the conference
      room located on the

                                       4
<PAGE>

      17th floor of 511 Fifth Avenue, New York, New York. You will be
      responsible to pay rent and all related occupancy expenses for this space
      at a cost equal to that which OSG would have paid for the space. You may
      notify OSG of your intention to vacate this space at any time on not less
      than 60 days prior written notice. You will not be responsible for any
      future rent or related occupancy expenses for this space after (i) such 60
      day period and (ii) you vacate such space.

14.   (a) You agree not to disclose any information, files, documents and other
      materials proprietary to OSG and not in the public domain which relate to
      OSG or its business and which are treated as confidential by OSG, its
      subsidiaries, affiliates or related companies, except (i) with the prior
      consent of OSG, or (ii) as otherwise required by law or legal process.
      Nothing in the preceding sentence shall be deemed to limit what you may
      discuss with the other directors of OSG.

      (b) For a period of one year beginning February 1, 2003, you agree not to
      use any proprietary or confidential information relating to OSG, its
      subsidiaries, affiliates or related companies ("Confidential Information")
      in any commercial activity in which you engage, whether as an officer,
      employee, director, owner, partner or otherwise, provided, however that
      Confidential Information shall not include any information which is or has
      been acquired by you other than only through your position as an officer
      or director of OSG, its subsidiaries or affiliates.

15.   Until such time as OSG files this document with the Securities and
      Exchange Commission, (i) except as may be required by law or legal
      process, OSG shall keep the terms of this letter agreement confidential
      and not disclose such terms to

                                       5
<PAGE>

      anyone other than to directors, officers, employees, attorneys, advisers,
      auditors and agents of OSG, its subsidiaries, affiliates and related
      companies, without your prior consent, each of whom shall be requested by
      OSG to maintain such information in confidence and (ii) you agree to keep
      the terms of this letter agreement confidential and not to disclose its
      contents to anyone, without OSG's prior consent, except members of your
      family (which shall include relatives up to your first cousins) and your
      attorney, financial consultant or other professional advisor, each of whom
      shall be requested by you to maintain such information in confidence.

16.   You agree not to make, participate in the making of, or encourage any
      other person to make, any statements, written or oral, which criticize,
      disparage, or defame the goodwill or reputation of OSG, its subsidiaries,
      affiliated or related companies, or any of their respective directors,
      officers and employees. OSG agrees not to make, participate in the making
      of, or encourage any employees or any other person to make, any
      statements, written or oral, which criticize, disparage, or defame your
      reputation.

17.   Before OSG issues any public announcement or press release regarding the
      termination of your employment, it shall provide you with a copy of the
      proposed announcement or press release and will consider any comments you
      may have about the announcement or press release.

18.   Any breach of the provisions of section 14, 15 and 16 hereof by you or any
      person to whom you have made a permitted disclosure of the terms of this
      letter agreement shall be considered a material breach of this letter
      agreement. In the

                                       6
<PAGE>

      event of such breach, and due to the difficulties in calculating the
      damages that might be sustained (directly or indirectly) as a result of
      such breach, you specifically consent to the entry of injunctive relief
      against you, in addition to any and all of OSG's remedies under the law,
      and you further agree that OSG may obtain the foregoing relief without the
      posting of a bond.

19.   The parties agree that a certain agreement dated as of March 24, 1999
      between OSG and you, as amended by an agreement dated June 21, 2002,
      relating to a Change of Control of OSG shall, as of the date hereof, be
      cancelled and deemed of no further force and effect.

20.   OSG, on behalf of itself and any affiliated companies and their past and
      present parents and subsidiaries, agree to forever release you, your wife,
      children, estate, agents, attorneys, heirs, executors, successors and
      assigns from any and all claims, demands, causes of action, controversies,
      agreements, promises and remedies, in connection with or in relationship
      to your capacity as (i) an employee or officer of OSG or any of its
      subsidiaries and (ii) a director of any subsidiary of OSG, which they may
      have as of the date hereof, whether known or unknown (collectively, the
      "Company Release") provided, however, that the Company Release shall not
      apply with respect to any conduct on your part which is fraudulent or
      illegal or otherwise violative of any applicable laws or rules or
      regulations issued under such laws.

21.   This letter agreement and the General Release contain the entire agreement
      between you and OSG and fully supersede any and all prior agreements or
      understandings with respect to the subject matter hereof and the terms and

                                       7
<PAGE>

      provisions of this letter agreement may not be modified or amended except
      in a writing signed by both parties.

22.   You have the right to consider fully the terms of this letter agreement
      for a period of up to twenty-one (21) days, and you are advised to consult
      with an attorney of your choosing in connection therewith and the General
      Release, before deciding whether or not to sign.

23.   You represent and warrant that (i) you have carefully read this letter
      agreement and the General Release in their entirety and you fully
      understand the significance of all of the terms and conditions hereof and
      the General Release, and (ii) you are signing this letter agreement
      voluntarily and of your own free will, and assent to all the terms and
      conditions contained therein.

24.   No waiver by either party of any breach by the other party of its
      obligations hereunder shall be deemed a waiver of any prior or subsequent
      breach. Except to the extent otherwise specifically provided herein, any
      waiver must be in writing and signed by you or an authorized officer of
      OSG, as the case may be.

25.   Nothing contained in this letter agreement or the General Release shall
      (a) affect your rights to compensation, reimbursement and indemnification,
      in your continued capacity as a director of OSG provided that (i) your
      rights to receive non-employee director fees from OSG shall begin on May
      1, 2003 and (ii) you shall not be eligible for an Initial Option under the
      1999 Non-Employee Director Stock Option Plan of OSG and the year of the
      first Annual Grant Date for you under such Plan shall be 2003, and (b)
      affect or limit your ability to perform your duties and obligations as a
      director of OSG.

                                       8
<PAGE>

26.   All payments made by OSG to you pursuant to this letter agreement shall be
      subject to appropriate deductions for FICA, Federal, State and local
      income taxes.

27.   This letter agreement and the General Release shall be governed by,
      construed and enforced in accordance with the laws of the State of New
      York applicable to contracts to be performed therein.

28.   This letter agreement and all the provisions hereof shall inure to the
      benefit of, and be binding upon, the successors, permitted assigns, heirs,
      executors and administrators of the parties hereto.

This letter agreement and the General Release shall not become effective until
the eighth (8th) day following your execution thereof (the "Effective Date"),
and you may revoke this letter agreement prior to that date by giving written
notice of such revocation to the undersigned, whereupon this letter agreement
and the General Release shall become null and void. Any revocation of the
General Release shall also be deemed to be a revocation of this letter
agreement.

                                       9
<PAGE>

If you agree to the foregoing, please so indicate by dating and signing both
enclosed copies of this letter agreement and of the General Release, and having
your signature on the General Release notarized. One copy of the letter
agreement and the General Release should be returned to the undersigned. The
second original of each is for you.

Sincerely,

OVERSEAS SHIPHOLDING GROUP, INC.

By: s/ ROBERT N. COWEN
    ----------------------------------
       Name:  Robert N. Cowen
       Title: Senior Vice President

I hereby agree to be bound by the terms and conditions of the above letter
agreement.

Date: January 28, 2003                          s/ARIEL RECANATI
                                    ------------------------------------------
                                                 Ariel Recanati

                                       10
<PAGE>

                                                                       EXHIBIT A

                                 GENERAL RELEASE

Reference is made to the letter agreement dated January 24, 2003 which I
countersigned on January ___, 2003, between Overseas Shipholding Group, Inc.
("OSG") and the undersigned, Mr. Ariel Recanati, residing at 176 East 71st
Street. Apt. #17B, New York, NY 10021 (herein referred to as the "Agreement"). I
hereby agree as follows:

      I, on behalf of myself, as well as my heirs, executors, administrators,
      successors and assigns, hereby irrevocably and unconditionally release and
      discharge OSG, OSG Ship Management, Inc., their predecessors and
      transferors and affiliated and related companies, all of their respective
      officers, directors, employees, agents, principals, advisors, parents, and
      subsidiaries, and each of their respective heirs, executors,
      administrators, successors and assigns (collectively, the "Company
      Released Parties" and each, a "Company Released Party"), from all claims,
      demands, causes of action, controversies, agreements, promises and
      remedies, in connection with or in relationship to the my capacity as an
      employee, officer or director of any of the Company Released Parties which
      I may have as of the date hereof, whether known or unknown, including
      under any statute, rule, order, law or ordinance, express or implied
      contract, public policy or otherwise (collectively, "Employee Claims").
      This General Release applies to all Employee Claims, including any and all
      Employee Claims relating to the terms and conditions of my employment with
      any of the Company Released Parties or the termination of my employment;
      any and all Employee Claims for discrimination on the basis of age,
      alienage, color, creed, disability, gender, handicap, marital status,
      national origin,

<PAGE>
General Release
Page 2

      race, religion, sex or sexual orientation; any and all claims arising
      under Title VII of the Civil Rights Act of 1964, the Age Discrimination in
      Employment Act, the Equal Pay Act, the Rehabilitation Act, the Americans
      with Disabilities Act, the New York State Human Rights Act, the New York
      City Human Rights Law, all as amended, and any other federal, state or
      local statute, ordinance, rule, regulation or order relating to employment
      and any and all Employee Claims for attorney's fees, costs or
      disbursements.

      I agree that I will not, from any source or proceeding, seek or accept any
      award or settlement with respect to any Employee Claim covered hereunder.
      In addition, except as otherwise prohibited by law, I represent and
      warrant that I will not sue or commence any proceeding (judicial or
      administrative), or participate in any action, suit or proceeding, against
      any of the Company Released Parties, with respect to any act, event,
      occurrence, or any alleged failure to act, released hereunder.

      Notwithstanding the foregoing, nothing herein shall be deemed to release
      the Company Released Parties in respect of my rights (i) under the
      Agreement including, but not limited to, to my rights pursuant to sections
      4 and 25 of the Agreement, (ii) to indemnification, in my capacity as a
      current or former director or officer of any of the Company Released
      Parties, under the by-laws and articles of incorporation of each Company
      Released Party, as in effect from time to time, or pursuant to
      indemnification policies maintained by one or more of the Company Released
      Parties, (iii) any unpaid salary, (iv) to reimbursement pursuant to the
      policies of any Company Released Party for expenses incurred by me prior

<PAGE>
General Release
Page 3

      to January 31, 2003 or pursuant to section 4 of the Agreement, and (v) to
      any benefits payable to me pursuant to any qualified pension plan
      maintained by the Company Released Parties.

      I represent and warrant that I have carefully read this General Release in
      its entirety; that I have had an opportunity to consider fully the terms
      of this General Release for twenty-one (21) days; that I have been advised
      by OSG in writing to consult with an attorney of my choosing in connection
      with this General Release; that I fully understand the significance of all
      of the terms and conditions of the Agreement and this General Release;
      that I have discussed it with my independent legal counsel, or I have had
      a reasonable opportunity to do so; that I have had answered to my
      satisfaction any questions I have asked with regard to the meaning and
      significance of any of the provisions of the Agreement and this General
      Release; and that I am signing this General Release voluntarily and of my
      own free will and I assent to all the terms and conditions contained in
      the Agreement and herein.

      I further acknowledge that after executing the General Release I have
      seven (7) days to revoke it by delivery of a Notice of Revocation to the
      Released Parties, directed to the attention of Mr. Robert Cowen, prior to
      the eighth (8th) day after execution and delivery by me of the General
      Release. I understand that if so revoked by me, this General Release and
      the Agreement shall be deemed to be null and void.

<PAGE>
General Release
Page 4

      IN WITNESS WHEREOF, I have executed this General Release this ____ day of
January 2003.

---------------------
Ariel Recanati

STATE OF NEW YORK     )
                      ) ss.:
COUNTY OF NEW YORK    )

On this day of January, 2003, before me personally came Ariel Recanati, to me
known and known to me to be the person described in and who executed the
foregoing General Release, and he duly acknowledged to me that he executed the
same.

                         ------------------------------
                                 Notary Public

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