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

The bank debt remained unchanged at USD 1,794 million as of 30 September 2012. The book value of the fleet excluding vessels under finance leases as of 30 September 2012 was USD 2,167 million. TORM's quarterly impairment test as of 30 June 2012 supported the carrying amount of the fleet based on the same test and principles as used by the Company since the Annual Report for 2009. Based on broker valuations, TORM's fleet excluding vessels under finance leases had a market value of USD 1,316 million as of 30 September 2012, which was USD 851 million lower than the carrying amount. The recognized equity amounted to USD 358 million as of 30 September 2012.

Going forward, interest on the existing debt will only be paid if the Company has sufficient liquidity, and otherwise the remainder will be accumulated until at least 30 June 2014 with potential extension until 30 September 2014. On average the interest margin will increase to approximately 240 basis points on the bank debt. The Company will pay interest on the new working capital facility until 30 September 2014.

The new financing agreements provide for a deferral of installments on the bank debt until 30 September 2014, in which period rescheduled principal amortizations will only be payable if the Company has sufficient liquidity. Provided that the Company generates sufficient positive cash flows, certain cash sweep mechanisms will apply. Annualized minimum amortizations of USD 100 million will commence with effect from 30 September 2014 until 31 December 2016. If vessels are sold, the related secured debt will fall due.

Changed legal group structure

As part of the restructuring agreement, TORM has implemented substantial changes to the Company's internal legal group structure, including transfers of vessels to separate legal entities in Denmark and Singapore based on the individual loan facilities. All legal entities are ultimately owned by TORM A/S.

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