STOCKHOLDERS AGREEMENT, dated as of November 24, 1999, among ▇▇▇▇▇
▇▇▇▇▇▇▇▇ ("▇▇▇▇▇"), ▇▇▇▇ ▇▇▇▇▇▇▇▇ ("Oudi"), ▇▇▇▇ ▇▇▇▇▇▇▇▇ ("▇▇▇▇"), ▇▇▇▇▇▇ ▇▇▇▇▇
Recanati ("▇▇▇▇▇▇"), and ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ("▇▇▇▇▇") (the "Stockholders").
WHEREAS, the Stockholders are or will be the holders of certain shares
of Common Stock, $1.00 par value (such shares of Common Stock, together with all
shares of common stock or other equity securities issued in exchange or
substitution for or as a dividend or distribution on such shares of Common
Stock, including without limitation shares of common stock or other equity
securities of any Successor Entity referred to in Paragraph 3 below, being
herein referred to as the "Shares"), of Overseas Shipholding Group, Inc., a
Delaware corporation (such corporation, together with any "Successor Entity,"
being herein referred to as the "Company");
WHEREAS, the Stockholders desire to make provision for the voting,
transfer and possible sale of the Shares and for the other matters set forth
herein.
NOW, THEREFORE, the Stockholders agree as follows:
1. RESTRICTIONS ON TRANSFER OF SHARES; ETC.
(a) The Stockholders hereby agree that, except for transfers to
such permitted transferees as may be agreed to from time to time by the
Stockholders and as provided under Paragraph 3 below, no Shares shall be
directly or indirectly sold, assigned, transferred, pledged or otherwise
encumbered or disposed of, including without limitation as a result of the
sale, assignment, transfer, pledge or other encumbrance or disposition of any
interest in any entity directly or indirectly owning the Shares (any of the
foregoing, a "Prohibited Transfer").
(b) The Stockholders agree and acknowledge that any attempted
Prohibited Transfer in violation of the terms and conditions of this Agreement
shall be void AB INITIO, and that the Stockholders shall not engage in a
Prohibited Transfer or agree to engage in a Prohibited Transfer of any Shares
held by the Stockholders in violation of this Agreement.
(c) Except as specifically contemplated hereby, no Stockholder
shall directly or indirectly (i) grant any proxy or enter into or agree to be
bound by any voting trust or agreement with respect to any Shares, or (ii) enter
into any agreements or arrangements of any kind with any person or entity with
respect to any Shares inconsistent with the provisions of this Agreement.
(d) The Stockholders shall cause to be affixed to each
certificate evidencing their Shares a legend in substantially the following
form:
THE SECURITIES EVIDENCED BY THIS CERTIFICATE ARE
SUBJECT TO CERTAIN RESTRICTIONS ON TRANSFER AS SET
FORTH IN A STOCKHOLDERS AGREEMENT, DATED AS OF NOVEMBER
24, 1999, A COPY OF WHICH IS ON FILE AT DISCOUNT BANK &
TRUST CO., AT ITS PRINCIPAL OFFICE IN GENEVA,
SWITZERLAND. THE HOLDER OF THESE SECURITIES AGREES AND
ACKNOWLEDGES THAT NO REGISTRATION OF THE TRANSFER OF
SUCH SECURITIES WILL BE MADE ON THE BOOKS OF THE ISSUER
UNLESS AND UNTIL SUCH RESTRICTIONS SHALL HAVE BEEN
COMPLIED WITH.
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2. FAMILY MANAGEMENT COMMITTEE; VOTING OF SHARES; ETC.
(a) Other than in the case of any vote relating to a Sale as
contemplated in Paragraph 3(c) below (in which case all Shares shall be voted in
accordance with Paragraph 3 below), (i) each Stockholder hereby irrevocably
agrees to vote all Shares held by such Stockholder on all matters in accordance
with the recommendations (including nominees for directors of the Company), if
any, of the Company's management unless otherwise determined by the affirmative
vote or written consent of at least 80% of all the Members then serving on the
Family Management Committee referred to below (the "80% Vote of the FMC") and
(ii) in the absence any recommendation on any matter of the Company's management
as aforesaid, each Stockholder hereby irrevocably agrees to vote all Shares held
by such Stockholder on such matter in accordance with any determination of the
80% Vote of the FMC.
(b) The Stockholders hereby appoint ▇▇▇▇▇▇ ▇▇▇▇▇ ("▇▇▇▇▇") and
▇▇▇▇▇▇ ▇. ▇▇▇▇▇ ("▇▇▇▇▇") as the Class A Members of the Family Management
Committee. A Class A Member may not be removed from the Family Management
Committee except by the affirmative vote or written consent of at least 80% of
the Stockholders, which vote or written consent also shall be required to fill
any vacancy among the Class A Members.
(c) Each Stockholder shall at all times have the right to appoint
one Regular Member of the Family Management Committee (a Stockholder may appoint
himself or herself as such a Regular Member), to remove the Regular Member
appointed by such Stockholder or any predecessor thereof, and to fill any
vacancy occurring with respect to the Regular Member appointed by such
Stockholder or any predecessor thereof.
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(d) The Stockholders hereby agree that the Family Management
Committee shall have and may exercise the powers and authority set forth in this
Agreement. Other than with respect to the manner of their appointment and
removal as set forth in Paragraph 2(b) and (c) above, the power and authority of
the Class A Members and the Regular Members of the Family Management Committee
shall be identical, and the Class A Members and the Regular Members shall vote
as a single class.
3. POSSIBLE SALE OF THE SHARES; ETC.
(a) The Stockholders hereby appoint Leon, Oudi, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
("▇▇▇▇▇▇▇"), ▇▇▇▇▇ and ▇▇▇▇▇ to have and exercise the powers and authority
concerning the possible Sale of Shares and related matters set forth in this
Agreement. All actions and decisions of such five persons shall be by the
affirmative vote or written consent of a majority of all of such persons who
have not ceased to serve in such capacity due to death or incapacity (the
"Majority"). In the event of death or incapacity of any of ▇▇▇▇, ▇▇▇▇, ▇▇▇▇▇▇▇,
▇▇▇▇▇ or ▇▇▇▇▇, the survivors of them shall exercise the power and authority
granted hereunder.
(b) In the event the Majority shall determine it to be in the
best interests of the Stockholders, the Stockholders shall take such action as
shall be necessary and appropriate to engage in a Sale (as such term is defined
below) of all or part of the Shares of the Stockholders, as shall be determined
by the Majority. For purposes of this Agreement, a "Sale" of Shares shall
include any sale of the Shares or any other transaction (such as a merger,
consolidation, sale of assets or recapitalization involving the Company, any
other disposition of
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Shares by the Stockholders for value, or any similar transaction) which the
Majority determines to be a Sale for purposes of this Paragraph 3.
(c) In the event the Majority determines that a Sale is in the
best interest of the Stockholders, the Stockholders shall take such action as
shall be necessary and appropriate to appoint one or more members of the
Majority, as the sole and exclusive agents of the Stockholders, to negotiate and
consummate such Sale on the terms and conditions and for such price as the
Majority in the sole judgment thereof shall determine to be in the best
interests of the Stockholders. Subject to the provisions of Paragraph 3(e)
below, the decisions of the Majority acting under this Paragraph 3 shall be
final and binding upon the Stockholders, and the authority hereunder of the
Majority shall include the power to execute and deliver all documents and
instruments necessary and appropriate to effect the aforesaid transaction and
all matters related thereto. The Stockholders shall execute and deliver such
certificates and documents, and take such actions as may be necessary and
appropriate to facilitate and effect such a Sale, including, in any case where
the Sale is a merger or other transaction involving the Company, voting their
Shares in favor of the transaction and otherwise cooperating in effectuating
such transaction. Unless the Stockholders shall otherwise unanimously agree,
with respect to any Sale under this Paragraph 3, in the event of a determination
by the Majority to dispose of pursuant to the Sale only a part of the Shares
held by the Stockholders, the number of Shares so disposed of by each
Stockholders shall be determined on a pro rata basis (in proportion to the
number of Shares held by the respective Stockholders immediately prior to such
Sale).
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(d) In the case of any Sale in which the Stockholders receive as
consideration or partial consideration for their Shares common stock or other
equity securities in the Company, the purchaser, any successor to the Company or
any other entity, the Majority may determine that such common stock or other
equity securities shall be deemed Shares for all purposes of this Agreement and
that any such purchaser or other entity (a "Successor Entity") shall be deemed
the Company for all purposes of this Agreement.
(e) Notwithstanding anything to the contrary in this Agreement,
any determination under this Agreement by the Majority shall be subject to any
contrary determination by 80% of the Stockholders.
4. CUSTODIAL AGREEMENT AND DEPOSIT OF SHARES IN CUSTODY.
(a) Simultaneously with the execution of this Agreement, the
Stockholders have executed and delivered the Custody Agreement of even date
herewith among the Stockholders and Discount Bank & Trust Co., a Swiss
corporation (the "Custodian") and have assigned and delivered, or caused to be
assigned and delivered, to the Custodian all Shares owned by the Stockholders.
The Stockholders will also assign and transfer, or cause to be assigned and
transferred, to the Custodian all Shares acquired by the Stockholders during the
term of this Agreement. The Stockholders shall deposit with the Custodian the
certificates representing such Shares, duly endorsed in blank or accompanied by
stock powers executed in blank, free and clear of all liens, claims,
encumbrances or other rights of third parties, other than encumbrances or rights
created by agreements among the Stockholders.
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(b) Any cash dividends or cash distributions with respect to the
Shares held by the Custodian will be paid or distributed to the respective
Stockholders owning such Shares or as may otherwise be directed by such
respective Stockholders.
(c) The Stockholders hereby irrevocably authorize and direct the
Custodian to vote all Shares held in custody in accordance with the
recommendations of the Company's management (with written notice to the
Custodian by the then President of the Company being conclusive evidence for
such purpose of any such recommendation) unless otherwise determined by an 80%
Vote of the FMC (with written notice to the Custodian by the members of the
Family Management Committee constituting the 80% Vote of the FMC being
conclusive evidence for such purpose of any such recommendation), all as
contemplated by Paragraph 2 above; provided, however, that, notwithstanding the
foregoing, such Shares shall be voted in connection with any Sale in accordance
with the determination of the Majority (with written notice to the Custodian by
all of the members of the Majority being conclusive evidence for such purpose of
any such determination) unless otherwise determined by 80% of the Stockholders
(with written notice to the Custodian by 80% of the Stockholders being
conclusive evidence for such purpose of any such determination), all as
contemplated by Paragraph 3 above. In the case of any vote not relating to a
Sale and in which there has been no recommendation of the Company's management
as contemplated above, all Shares held in custody shall be voted in accordance
with any determination of the 80% Vote of the FMC (with written notice to the
Custodian by the members of the Family Management Committee constituting the 80%
Vote of the FMC being conclusive evidence for such purpose of such
determination). The Stockholders hereby irrevocably authorize and direct the
Custodian to take such actions as the Majority may
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direct in writing to insure compliance with the provisions of Paragraph 3 above
unless otherwise determined by 80% of the Stockholders (with written notice to
the Custodian by all of the members of the Majority or by 80% of the
Stockholders, as the case may be, being conclusive evidence for such purpose of
any such direction or determination). The Stockholders hereby irrevocably
authorize and direct the Custodian to take such actions as may be appropriate to
insure compliance with the provisions of Paragraph 1 above.
5. MISCELLANEOUS
(a) TERMINATION. This Agreement shall terminate only on the Sale
of all of the Shares under Paragraph 3 above (unless the Majority shall
determine under Paragraph 3(d) above that the common stock or other equity
securities received by the Stockholders as consideration or partial
consideration in such Sale shall continue to be deemed Shares for purposes of
this Agreement, in which case this Agreement shall remain in effect), provided
that, notwithstanding the foregoing, the provisions of Paragraph 1 above shall
terminate on the twentieth anniversary of the date of this Agreement.
(b) FURTHER ASSURANCES. Each Stockholder shall do and perform or
cause to be done and performed all such further acts and things and shall
execute and deliver all such other agreements, certificates, instruments, and
documents as any other Stockholder hereto or the Majority or the 80% Vote of
the FMC from time to time reasonably may request in order to carry out the
intent and accomplish the purposes of this Agreement and the consummation of
the transactions contemplated hereby.
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(c) GOVERNING LAW. This Agreement and the rights and obligations
of the parties hereunder shall be governed by, and construed and interpreted in
accordance with the laws of the State of New York without giving effect to the
choice of law principles thereof.
(d) DISPUTE RESOLUTION. All disputes arising out of or in
connection with this Agreement shall be finally resolved by arbitration in the
City of New York by a single neutral arbitrator who shall be the then President
of the Association of the Bar of the City of New York or (in the event of the
unavailability of such President) by a single neutral arbitrator meeting the
criteria set forth in the next sentence hereof who shall be selected by such
President. Any arbitrator selected by such President as aforesaid shall be a
member of such Association, shall be admitted to the Bar of the State of New
York for a period of at least 25 years and shall have served for at least 10
years (but need not then be serving) as a partner in a law firm consisting of at
least 50 partners. Such disputes shall be determined by such arbitrator in such
manner and according to such rules and procedures as such arbitrator shall
direct. Each Stockholder hereby consents to and submits his person to the
jurisdiction of the Supreme Court of the State of New York for the enforcement
of this Paragraph, and for the enforcement of any award resulting from an
arbitration conducted pursuant to this Paragraph. Each Stockholder and the
arbitrator shall use their best efforts to keep confidential the existence of
any dispute and arbitration proceedings and all information relating thereto
and, in the event of judicial proceedings for the enforcement of this Paragraph
or any award pursuant hereto, shall cooperate to seal the record of any such
arbitration or judicial proceeding. Notwithstanding anything to the contrary
contained herein, prior to requesting arbitration, the parties to any such
dispute shall
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consult in good faith with ▇▇▇▇▇ and ▇▇▇▇▇ (assuming they are still living) in
an attempt to resolve such dispute without recourse to arbitration.
(e) BINDING EFFECT. This Agreement shall be binding on and inure
to the benefit of the parties hereto. Other than the rights hereunder of (i) the
Members of the Family Management Committee, and (ii) ▇▇▇▇, ▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇
and ▇▇▇▇▇ as set forth in Paragraph 3, nothing in this Agreement either express
or implied is intended to confer on any person or entity other than the
Stockholders any rights, remedies or obligations under or by reason of this
Agreement.
(f) INVALIDITY OF PROVISION. If any provision of this Agreement
is invalid or unenforceable, the balance of this Agreement shall remain in full
force and effect and this Agreement shall be construed in all respects as if
such invalid or unenforceable provision were omitted.
(g) NOTICE. All notices, requests, claims, demands and other
communications under this Agreement shall be in writing (including telecopy, but
only if a telecopy number is specified for such party in this Paragraph 5(g)
below, or similar writing) and shall be effective (i) if given by telecopy, when
such telecopy is transmitted to the telecopy number specified in this Paragraph
5(g) and the appropriate telecopy confirmation is received or (ii) if given by
any other means, when delivered at the address specified in this Paragraph 5(g)
(or at such other address for a Stockholder as shall be specified by like
notice):
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If to ▇▇▇▇▇: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
If to Oudi: ▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇, ▇▇'▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇
Fax No.: ▇▇▇ ▇▇▇ ▇ ▇▇▇ ▇▇ ▇▇
If to ▇▇▇▇: ▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇ ▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇
Fax No.: ▇▇▇ ▇▇▇ ▇ ▇▇▇ ▇▇ ▇▇
If to ▇▇▇▇▇▇: ▇▇▇▇▇▇ ▇▇▇▇▇ Recanati
▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇
Israel
If to Ariel: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Fax. No.: ▇▇▇-▇▇▇-▇▇▇▇
With copies to: ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇, ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇ Pituah, 46701
Israel
Fax No.: ▇▇▇ ▇▇▇ ▇▇ ▇▇▇ ▇▇▇
▇▇▇▇▇▇ ▇. ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇. ▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Fax No.: ▇▇▇-▇▇▇-▇▇▇▇
(h) INDEMNIFICATION. The Stockholders hereby jointly and
severally agree to indemnify and hold harmless the Members of the Family
Management Committee against and in respect of any liability, loss, damage or
expense incurred by the Members of the
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Family Management Committee in connection with service on such Committee. The
Stockholders hereby jointly and severally agree to indemnify and hold harmless
▇▇▇▇, ▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇ and ▇▇▇▇▇ against and in respect of any liability,
loss, damage or expense incurred by any of them in connection with any action
taken by any of them pursuant to Paragraph 3.
(i) HEADINGS. The headings and captions contained herein are for
convenience of reference only and shall not control or affect the meaning or
construction of any provision hereof.
(j) EXECUTION IN COUNTERPARTS. This Agreement may be executed in
any number of counterparts, each of which shall be deemed to be an original
and all of which together shall constitute one and the same instrument.
(k) APPLICATION OF THIS AGREEMENT TO ▇▇▇▇▇. Notwithstanding
anything in this Agreement to the contrary, (i) the restrictions on Transfer of
Shares under Paragraph 1 shall not apply to ▇▇▇▇▇; (ii) the provisions of
Paragraph 3(a), (b), (c) and (e) shall apply to ▇▇▇▇▇ only at her option; and
(iii) the provisions relating to the deposit in custody, voting and restrictions
on Transfer of Shares under Paragraph 4 shall not apply to ▇▇▇▇▇.
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IN WITNESS WHEREOF, this Agreement has been executed by each of
the Stockholders on the date first above written.
/S/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
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▇▇▇▇▇ ▇▇▇▇▇▇▇▇
/S/ Oudi Recanati
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Oudi Recanati
/S/ ▇▇▇▇ ▇▇▇▇▇▇▇▇
----------------------------
▇▇▇▇ ▇▇▇▇▇▇▇▇
/S/ ▇▇▇▇▇▇ ▇▇▇▇▇ Recanati
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▇▇▇▇▇▇ ▇▇▇▇▇ Recanati
/S/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
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▇▇▇▇▇ ▇▇▇▇▇▇▇▇