Note 2 — Chapter 11 Filing and Emergence from Bankruptcy:

Chapter 11 Filing

On November 14, 2012 (the “Petition Date”), the Company and 180 of its subsidiaries (together with OSG, the “Debtors”) filed voluntary petitions for reorganization under Chapter 11 of the U.S. Code (the “Bankruptcy Code”) in the U.S. Bankruptcy Court for the District of Delaware (the “Bankruptcy Court”). The Debtors filed with the Bankruptcy Court a plan of reorganization (the “Equity Plan”). The Bankruptcy Court confirmed the Equity Plan by order entered on July 18, 2014 (the “Confirmation Order”). On August 5, 2014 (the “Effective Date”), the Equity Plan became effective and OSG emerged from bankruptcy. As of May 8, 2015, only three of the original 181 Chapter 11 cases remain open as the Debtors continue to negotiate settlements on disputed claims.

Reorganization Items, net

The Company prepared its consolidated financial statements in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 852, Reorganizations, which requires that financial statements for periods subsequent to the Petition Date distinguish transactions and events that are directly associated with the reorganization from the ongoing operations of the business. Accordingly all transactions (including but not limited to, all professional fees and other expenses, realized gains and losses, and provisions for losses) directly associated with the reorganization and restructuring of the business are reported separately as reorganization items in the condensed consolidated statements of operations.

Reorganization items, net represent amounts incurred subsequent to the Petition Date as a direct result of the filing of our Chapter 11 cases and are comprised of the following:

	Three Months Ended
	March 31,
	2015		2014
Trustee fees	$	140	$	751
Professional fees		3,227		28,505
Other claim adjustments		120		-
	$	3,487	$	29,256

The Company incurred fees totaling $2,178 and $4,484 during the three month periods ended March 31, 2015 and March 31, 2014, respectively, for financial and reorganization services rendered to the Company by Greylock Partners LLC, a company founded and managed by a former member of the Company’s Board of Directors. Of such related party expenses, $696 and $4,484 incurred during the three month periods ended March 31, 2015 and March 31, 2014, respectively, are included in professional fees in the table above.

Cash paid for reorganization items was $6,096 and $16,636 for the three months ended March 31, 2015 and 2014, respectively.