EXHIBIT
99.1
OVERSEAS SHIPHOLDING GROUP,
INC.
STOCK
OWNERSHIP GUIDELINES FOR
SENIOR
MANAGEMENT EMPLOYEES LEVEL 21 AND ABOVE
I.
Introduction.
This
Stock Ownership Guidelines for Senior Management Employees Level 21 and Above
(the “
Stock Ownership
Guidelines
”) was adopted by the Board of Directors (the “
Board
”) of Overseas
Shipholding Group, Inc. (the “
Company
”) on December
9, 2009, subject to final approval by the Compensation Committee thereof, which
was obtained on January 19, 2010, and shall be effective commencing as of the
fiscal quarter of the Company beginning January 1, 2010. The purpose
of the Stock Ownership Guidelines is to encourage growth in stockholder value by
enhancing the linkage between the employees subject to the Stock Ownership
Guidelines and the Company’s stockholders, thereby mitigating the potential of
excessive risk-taking.
II.
Individuals Subject to the Stock
Ownership Guidelines.
The Stock Ownership Guidelines shall
apply during each fiscal quarter to all senior management employees of the
Company and its affiliates designated at Level 21 or above who hold such
positions as of the first day of such fiscal quarter (the “
Covered
Executives
”). Once an employee is determined to be a Covered
Executive for a fiscal quarter, such employee shall remain a Covered Executive
for such fiscal quarter notwithstanding any diminution of such Covered
Executive’s employment during such fiscal quarter to a level below Level 21,
other than as a result of the termination of the Covered Executive’s employment
for any reason. In the event that during a fiscal quarter an employee
commences employment with the Company at Level 21 or above or is promoted from a
position below Level 21 to a position Level 21 or above, such employee shall be
a Covered Executive for such fiscal quarter commencing as of such Covered
Executive’s date of hire or promotion.
III.
Stock Ownership
Guidelines.
The Stock Ownership Guidelines provide that a
Covered Executive may not dispose of any Net Profit Shares of common stock,
$1.00 par value per share, of the Company (the “
Common Stock
”) that
the Covered Executive acquired under an equity award granted to the Covered
Executive under the Overseas Shipholding Group, Inc. 2004 Stock Incentive Plan
(as amended and restated as of June 10, 2008) (the “
Stock Incentive
Plan
”), or any other incentive or equity plan maintained by the Company
(each an “
Equity
Plan
”), unless after such disposition of Common Stock the Covered
Executive would continue to own a number of shares equal to at least the Covered
Executive’s Quarterly Stock Ownership Requirement for the applicable fiscal
quarter in which such disposition is made. Notwithstanding the
foregoing, the Overseas Shipholding Group, Inc. 2000 Employee Stock Purchase
Plan (the “
ESPP
”) shall not be
included in the definition of “Equity Plan” for the purposes of the Stock
Ownership Guidelines.
A Covered
Executive’s “
Quarterly
Stock Ownership Requirement
” is equal to a number of shares of Common
Stock, as determined on the first day of each fiscal quarter (each a “
Measurement Date
”),
with a value, based on the closing price for the Common Stock on the last
trading day before the applicable Measurement Date, equal to the Covered
Executive’s rate of annual base salary as of the applicable Measurement Date
multiplied by the applicable Target Ownership Multiple set forth
below:
|
Position
|
Target Ownership
Multiple
|
|
President
and Chief Executive Officer (the “CEO”)
|
Three
(3) times rate of annual base salary
|
|
Tier
A Executives under the Company’s Severance Protection Plan amended and
restated as of December 31, 2008 (“Tier A Executives”) and Employees at or
above Level 24 who are Direct Reports of the CEO (“Direct
Reports”)
|
Two
(2) times rate of annual base salary
|
|
All
Other Covered Executives
|
One
(1) times rate of annual base
salary
|
Once
determined, a Covered Executive’s Quarterly Stock Ownership Requirement for a
fiscal quarter will not re-adjust automatically as a result of changes in his or
her rate of base salary or as a result of a promotion or diminution of such
Covered Executive’s employment during such fiscal
quarter. Notwithstanding the foregoing, the Quarterly Stock Ownership
Requirement for a Covered Executive who commences employment with the Company at
Level 21 or above or is promoted from a position below Level 21 to a position
Level 21 or above during a fiscal quarter shall be measured as of such Covered
Executive’s date of hire or promotion. In addition, the Quarterly
Stock Ownership Requirement for a Covered Executive who is a Tier A
Executive who ceases to be a Tier A Executive or who is a Direct Report who
ceases to be a Direct Report, but in each case who remains a Covered Executive,
shall remain unchanged during the fiscal quarter in which such change in
position occurred and thereafter shall be determined on each Measurement Date as
provided above. If a Covered Executive ceases to be designated at
Level 21 or above but remains an employee of the Company, his or her
Quarterly Stock Ownership Requirement shall remain unchanged during the fiscal
quarter in which such change in position occurred and thereafter, he or she
shall no longer be subject to the Stock Ownership Guidelines.
Covered
Executives may dispose of any Net Profit Shares of Common Stock they receive as
a result of an equity award granted under an Equity Plan to the extent that
following such disposition the Covered Executive would continue to own a number
of shares of Common Stock equal to or greater than the Covered Executive’s
Quarterly Stock Ownership Requirement for the applicable fiscal quarter in which
such disposition is made.
The Stock
Ownership Guidelines apply to all awards granted to Covered Executives under an
Equity Plan and to all shares of Common Stock received under such awards,
whether granted or received prior to, on, or following the date the individual
became a Covered Executive.
“
Net Profit Shares
”
are (i) the shares of Common Stock remaining after a Covered Executive exercises
an option less any such number of shares of Common Stock reduced, withheld or
sold in order to pay the option exercise price for such shares of Common Stock
and the taxes incurred as a result of such exercise and any such reduction,
withholding or sale, (ii) the shares of Common Stock remaining after restricted
stock granted to a Covered Executive vests less any shares of Common Stock
reduced, withheld or sold in order to pay the taxes incurred upon the vesting of
such restricted stock and any such reduction, withholding or sale, (iii) the
shares of Common Stock remaining after a vested restricted stock unit is settled
in shares of Common Stock less any shares of Common Stock reduced, withheld or
sold in order to pay the taxes incurred upon the vesting and settlement of such
restricted stock unit and any such reduction, withholding or sale, or (iv) the
shares of Common Stock remaining after a performance award is settled in shares
of Common Stock less any shares of Common Stock reduced, withheld or sold in
order to pay the taxes incurred upon the vesting and settlement of such
performance award and any such reduction, withholding or sale.
In
addition, to the extent that a Covered Executive uses other shares of Common
Stock he owns (as described in Section IV below), in order to satisfy the
Quarterly Stock Ownership Requirement, such shares shall be treated as Net
Profit Shares and shall be subject to the retention requirement applicable to
Net Profit Shares.
IV.
Ownership
Determination.
For purposes of the Stock Ownership Guidelines,
“ownership” includes all shares of Common Stock held by a Covered Executive,
whether held individually or jointly, including, without limitation, (a) shares
of Common Stock purchased on the open market or acquired upon the exercise of a
stock option or the settlement of a restricted stock unit for shares of Common
Stock, (b) vested restricted stock units held by a Covered Executive, (c) vested
shares of restricted Common Stock held by a Covered Executive, (d) shares of
Common Stock awarded to a Covered Executive under an award that is subject to
performance-based vesting for which the performance and service criteria has
been satisfied, (e) shares of Common Stock acquired by a Covered Executive under
the ESPP, and (f) vested shares of Common Stock allocated to a Covered
Executive’s account under any plan qualified under Section 401(a) of the
Internal Revenue Code of 1986, as amended (“
Qualified
Plans
”). “Ownership” does not include any (i) vested or
unvested options to purchase Common Stock, (ii) unvested restricted stock units
held by a Covered Executive, (iii) unvested shares of restricted Common Stock
held by a Covered Executive, (iv) any shares of Common Stock under an award that
is subject to performance-based vesting for which the performance criteria has
not been satisfied, or (v) unvested shares of Common Stock allocated to a
Covered Executive’s account under any Qualified Plan.
V.
Noncompliance.
Any
attempted disposition of Common Stock by a Covered Executive in violation of the
Stock Ownership Guidelines shall be void and of no effect and the Company shall
have the right to disregard the same on its books and records and to issue “stop
transfer” instructions to its transfer agent.
VI.
Administration.
Each
Covered Executive’s compliance with the Stock Ownership Guidelines shall be
reviewed at least annually by the Board, or the Compensation Committee thereof
(the “
Committee
”). The
Board or the Committee may impose such conditions, restrictions or limitations
on any Covered Executive as the Board or the Committee determines to be
necessary or appropriate in order to achieve the purposes of the Stock Ownership
Guidelines. The Board or the Committee, in its sole and absolute
discretion, may waive any condition set forth in the Stock Ownership Guidelines,
including if compliance would create severe hardship or prevent a Covered
Executive from complying with a court order.
VII.
Amendment and
Termination.
The Board or the Committee may amend, modify or
terminate the Stock Ownership Guidelines for any reason at any
time.
OVERSEAS
SHIPHOLDING GROUP, INC.
STOCK
OWNERSHIP GUIDELINES FOR
SENIOR
MANAGEMENT EMPLOYEES LEVEL 21 AND ABOVE
Acknowledgement
I,
____________________, hereby acknowledge that I have been informed by Overseas
Shipholding Group, Inc. (the “
Company
”) that
effective as of the fiscal quarter commencing _______________, 20____, I am
subject to the terms and conditions of the Company’s Stock Ownership Guidelines
for Senior Management Employees Level 21 and Above (the “
Stock Ownership
Guidelines
”). I hereby acknowledge that I have received a copy
of the Stock Ownership Guidelines and that I have read and familiarized myself
with the Stock Ownership Guidelines and that so long as I am subject to the
Stock Ownership Guidelines I will not dispose of any of shares of Common Stock
in any manner which violates the Stock Ownership Guidelines.
By my
signature below, I acknowledge, understand, accept and agree to be subject to
the terms and conditions of the Stock Ownership Guidelines.
|
______________________________________
|
____________________
|
|
(Employee
signature)
|
(Date)
|
OVERSEAS
SHIPHOLDING GROUP, INC.
Incentive Compensation
Recoupment Policy
for Executive
Officers
This Incentive Compensation Recoupment
Policy for Executive Officers (“
Policy
”) was adopted
by the Board of Directors (the “
Board
”) of Overseas
Shipholding Group, Inc. (the “
Company
”) on December
9, 2009, subject to final approval by the Compensation Committee thereof, which
was obtained on January 19, 2010, and shall be effective commencing January 1,
2010 (the “
Effective
Date
”).
In the event the Company determines
that a Restatement for any Look-Back Year is necessary, and the Board determines
that an Executive Officer received Incentive Compensation for the applicable
Look-Back Year in excess of the amount that would have been paid or awarded to
the Executive Officer had such Incentive Compensation been calculated based on
the Restatement results, the Board may, in its good faith discretion, require
the Executive Officer to repay all or a portion of the Incentive Compensation
paid or awarded to the Executive Officer with respect to such Look-Back Year in
an amount not to exceed the difference between (i) the actual amount of
Incentive Compensation paid or awarded to the Executive Officer for such
Look-Back Year and (ii) the amount of Incentive Compensation that the Board in
good faith determines would have been paid or awarded to the Executive Officer
for such Look-Back Year based on the Restatement results; provided, however,
that if the Executive Officer is not a Senior Executive Officer, the Board may
not require the Executive Officer to repay all or a portion of the Incentive
Compensation with respect to such Look-Back Year unless the Restatement is
necessary due to the Executive Officer’s fraud, misconduct, negligence or other
knowing actual involvement. In cases where the Executive Officer’s
conduct was not a contributing factor to the need for the Restatement, in
determining whether or not to seek such recoupment, the Board may take into
account the benefits and costs of such recoupment, as well as the relevant time
periods during which the relevant Incentive Compensation was earned and for
which the Restatement is required. Upon any such determination by the
Board, the Board shall notify the Executive Officer in writing of its
determination and the Executive Officer shall promptly repay the amount of
Incentive Compensation so determined.
For purposes of this Policy the
following terms shall have the meanings set forth below:
(i)
“
Executive Officer
”
means the Company’s Chief Executive Officer and employees of the Company or any
of its subsidiaries at or above Level 21 who hold such positions at the time of
payment or award of the applicable Incentive Compensation or at any time during
the measuring period for an Incentive Compensation payment or
award.
(ii) “
Senior Executive
Officer
” means the Company’s Chief Executive Officer, Tier A Executives
under the Company’s Severance Protection Plan amended and restated as of
December 31, 2008 (“Tier A Executives”), and employees of the Company or any of
its subsidiaries at or above Level 24 who are Direct Reports of the Chief
Executive Officer (“Direct Reports”) who hold such positions at the time of
payment or award of the applicable Incentive Compensation or at any time during
the measuring period for an Incentive Compensation payment or
award. In addition, for purposes of this Policy, a Senior Executive
Officer shall mean any employee of the Company and its affiliates not otherwise
referenced in the prior sentence who is specifically designated as a Senior
Executive Officer for purposes of this Policy by the Board, in its sole
discretion, at the time of payment or award of the applicable Incentive
Compensation and the employee is so notified.
(iii) “
Incentive
Compensation
” means cash bonuses, awards of the Company’s common stock
(“Common Stock”) or awards determined with regard to Common Stock, the amounts
of which are determined, whether specifically or generally, in whole or in part,
based on the level of attainment of financial or operating results or other
Company or individual performance metrics.
(iv) “
Look-Back Year
” means
each of the five (5) fiscal years of the Company prior to the fiscal year in
which the Board commences action toward determining whether a Restatement is
necessary. Notwithstanding the foregoing, with respect to any
Executive Officer, the term “Look-Back Year” shall not be limited to the five
(5) prior fiscal years where the Board determines, in its sole discretion, that
the fraud, misconduct, negligence or other knowing actual involvement of such
Executive Officer was a contributing factor to the need for such Restatement,
but shall include all fiscal years.
(v) “
Restatement
” means
any correction due to a material misstatement or inaccuracy in the financial or
operating results or other Company or individual performance metrics taken into
account in determining the amount of Incentive Compensation payable to an
Executive Officer for a Look-Back Year, whether such material misstatement or
inaccuracy is due to fraud, intentional misconduct or unknowing innocent error
in calculations or any other reason. For purposes of this Policy, a
Restatement shall not include a restatement due solely to changes in accounting
principles or applicable law.
If the Board determines that any award
of Incentive Compensation is recoverable from an Executive Office under this
Policy, the Board may, in its good faith discretion, seek recovery of such award
from the Executive Officer from any source or sources of compensation paid or
payable and/or provided or to be provided to the Executive Officer, including
without limitation: repayment by the Executive Officer of any prior
Incentive Compensation payments, reduction of future payments of Incentive
Compensation to the Executive Officer, cancellation of outstanding equity awards
granted to the Executive Officer (whether awarded as Incentive Compensation or
otherwise), reduction of future equity awards to be granted to the Executive
Officer (whether to be awarded as Incentive Compensation or otherwise), and/or
recovery of any gains realized by the Executive Officer on the exercise of stock
options and gains realized upon the subsequent sale of vested restricted stock
or shares of Common Stock acquired on the exercise of stock
options. Notwithstanding the foregoing or anything herein to the
contrary, the Board may not seek recovery of any amount of Incentive
Compensation by reducing any future amount that is payable and/or to be provided
to the Executive Officer and that is considered “non-qualified deferred
compensation” under Section 409A of the Internal Revenue Code of 1986, as
amended (the “
Code
”) and the
regulations and guidance promulgated thereunder.
This Policy shall be applicable to all
Incentive Compensation paid or awarded with respect to, or with regard to
vesting, based on, any Look-Back Year, commencing with the Look-Back Year
starting on the Effective Date. Application of this Policy does not preclude the
Company from taking any other action to enforce an Executive Officer’s
obligations to the Company, including termination of employment or institution
of civil or criminal proceedings.
This Policy is in addition to the
requirements of Section 304 of the Sarbanes-Oxley Act of 2002 that are
applicable to the Company’s Chief Executive Officer and Chief Financial Officer
and any other legal or fiduciary duties or requirements applicable to any
Executive Officer.
OVERSEAS
SHIPHOLDING GROUP, INC.
INCENTIVE
COMPENSATION RECOUPMENT POLICY
FOR
EXECUTIVE OFFICERS
It
is the policy of the Board of Directors (the “Board”) of Overseas Shipholding
Group, Inc. (the “Company”) that as an Executive Officer covered by the
Company’s Incentive Compensation Recoupment Policy for Executive Officers (the
“Policy”), you acknowledge your receipt of, and agree to be subject to the terms
and conditions of the Policy. A copy of the Policy is enclosed for
your records. You should thoroughly review the Policy, then complete
and sign the acknowledgement below and return it to the Company’s Office of
Human Resources. Please return the acknowledgement by
______________. Any questions regarding the Policy should be directed
to the Office of Human Resources.
Acknowledgement
I,
____________________, have received a copy of the Overseas Shipholding Group,
Inc. Incentive Compensation Recoupment Policy (the “Policy”) which outlines the
terms and conditions of the Policy and I have read the Policy.
I have
familiarized myself with the contents of the Policy. By my signature
below, I acknowledge, understand, accept and agree to be subject to the terms
and conditions of the Policy.
|
______________________________________
|
____________________
|
|
(Employee
signature)
|
(Date)
|