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Board Of Directors' Report At TORM's Extraordinary General Meeting On 9 January 2013

I will provide a brief summary of the events leading up to the Company's Annual General Meeting held on 23 April 2012, at which I reported on the conditional agreement in principle between the bank group, the time charter partners and TORM.

The summary will be followed by a report on the most significant events leading up to the completion of the final restructuring agreement on 5 November 2012 and the subsequent listing prospectus.

Entering the conditional agreement in principle

Since 2010, TORM has worked on improving the Company's capital structure and liquidity situation by seeking to tap into different corporate bond markets and through other measures. Mainly due to the Company's strategic position as a spot-oriented company, low freight rates and the generally challenging conditions in the capital markets, TORM was unable to obtain this type of financing. With the continuously low freight rates and cyclically low vessel values since fall 2011, TORM's Board of Directors did not find it prudent to inject new equity in the Company at the time without substantial amendments to the existing credit facilities. In October 2011, TORM therefore presented a proposal to the banks that combined an equity injection of USD 100 million with subscription rights for existing shareholders and a bank moratorium. The proposal was not accepted by the banks, but the Company achieved a standstill agreement with the banks, which was extended several times during 2012 to ensure that a long-term, comprehensive financing solution was found and implemented.

Throughout the whole process, TORM's Board of Directors and Executive Management have worked on avoiding bankruptcy or other in-court solutions in Denmark or abroad in order to best preserve value and put all stakeholders in the best possible position. However, the process also involved detailed negotiations and preparations for a suspension of payments, including under the US "Chapter 11" rules. In the spring of 2012, TORM also succeeded in obtaining conditional offers from reputable, international shipping investors as well as institutional investors, who were prepared to make new investments in the Company provided that substantially amended bank terms were agreed. However, the banks chose not to enter into substantive negotiations with any of these investors as they did not find the investor proposals sufficiently attractive.

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