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Transactions with related parties
 6 Months Ended
Jun. 30, 2023
Transactions with related parties  
Transactions with related parties
2.
 
Transactions with related parties
a)
 
Altair
 
Travel
 
Agency
 
S.A.
 
(“Altair”):
 
The
 
Company
 
uses
 
the
 
services
 
of
 
an
 
affiliated
 
travel
agent,
 
Altair,
 
which is
 
controlled by
 
the
 
Company’s Chairman
 
of the
 
Board. Travel
 
expenses for
 
the six
months
 
ended
 
June
 
30,
 
2023
 
and
 
2022
 
amounted
 
to
 
$
1,311
 
and
 
$
1,238
,
 
respectively,
 
and
 
are
 
mainly
included
 
in
 
fixed
 
assets,
 
vessel
 
operating
 
expenses
 
and
 
general
 
and
 
administrative
 
expenses
 
in
 
the
accompanying unaudited
 
interim consolidated
 
financial statements.
 
As of
 
June 30,
 
2023 and
 
December
31, 2022, an amount
 
of $
195
 
and $
136
, respectively,
 
was due to Altair,
 
included in due to
 
related parties
in the accompanying interim consolidated balance sheets.
 
b)
 
Steamship Shipbroking Enterprises Inc. or
 
Steamship:
 
Steamship is a company controlled by
our
 
Chairman
 
of
 
the
 
Board,
 
Mr.
 
Simeon
 
Palios
 
until
 
January
 
15,
 
2023
 
and
 
our
 
CEO
 
Mrs.
 
Semiramis
Paliou
 
thereafter.
 
Steamship
 
provides
 
brokerage
 
services
 
to
 
DSI
 
for
 
a
 
fixed
 
monthly
 
fee
 
plus
commissions on
 
the sale
 
and purchase
 
of vessels,
 
pursuant to
 
a Brokerage
 
Services Agreement
 
dated
February
 
22,
 
2023.
 
For
 
the
 
six
 
months
 
ended
 
June
 
30,
 
2023
 
and
 
2022,
 
brokerage
 
fees
 
amounted
 
to
$
1,950
 
and $
1,654
, respectively,
 
included in
 
general and
 
administrative expenses
 
in the
 
accompanying
unaudited interim consolidated statements of income.
 
For the six months ended June 30, 2023 and 2022,
the Company
 
also paid
 
commissions on
 
the sale
 
and purchase
 
of vessels
 
which amounted
 
to $
226
 
and
$
1,219
, respectively,
 
included in
 
the
 
cost
 
of vessels,
 
or
 
the gain
 
on the
 
sale of
 
vessels. As
 
of June
 
30,
2023 and December 31, 2022, there was
no
 
amount due to or from Steamship.
c)
 
Diana Wilhelmsen Management Limited, or DWM:
 
DWM is a joint venture between
 
Diana Ship
Management Inc., a
 
wholly owned subsidiary
 
of DSI,
 
and Wilhelmsen Ship
 
Management Holding AS,
 
an
unaffiliated third party,
 
each holding
50
% of DWM.
 
The DWM office
 
is in Athens, Greece.
 
As of June
 
30,
2023
 
and
 
December
 
31,
 
2022,
 
the
 
investment
 
in
 
DWM
 
amounted
 
to
 
$
708
 
and
 
$
506
,
 
respectively,
included in equity method investments in the
 
accompanying interim consolidated balance sheets. For the
six months
 
ended June
 
30, 2023
 
and 2022,
 
the investment
 
in DWM
 
resulted in
 
gain of
 
$
202
 
and $
767
,
respectively,
 
and
 
is
 
included
 
in
 
gain
 
from
 
equity
 
method
 
investments
 
in
 
the
 
accompanying
 
unaudited
interim consolidated statements of income.
DWM
 
provides
 
commercial
 
and
 
technical
 
management
 
to
six
 
of
 
the
 
Company’s
 
vessels
 
for
 
a
 
fixed
monthly
 
fee
 
and
 
a
 
percentage
 
of
 
the
 
vessels’
 
gross
 
revenues.
 
Management
 
fees
 
for
 
the
 
six
 
months
ended June 30, 2023 and 2022, amounted to
 
$
647
 
and $
228
, respectively,
 
and are separately presented
as management
 
fees to
 
related party
 
in the
 
accompanying unaudited interim
 
consolidated statements of
income. Also, for the
 
six months ended June 30,
 
2023, management fees amounting to
 
$
19
 
are included
in vessels,
 
net. Commissions
 
during the
 
six months
 
ended June
 
30, 2023
 
and 2022,
 
amounted to
 
$
194
and
 
$
83
 
respectively,
 
and
 
are
 
included
 
in
 
voyage
 
expenses.
 
As
 
of
 
June
 
30,
 
2023
 
and
 
December
 
31,
2022, there was an amount
 
of $
156
 
and $
216
 
due from DWM, included in
 
due from related parties in
 
the
accompanying interim consolidated balance sheets.
d)
 
OceanPal Inc.,
 
or OceanPal:
 
The Company
 
is the
 
holder of
500,000
 
Series B
 
Preferred Shares
and
10,000
 
Series
 
C
 
Convertible
 
Preferred
 
Shares
 
of
 
OceanPal.
Series B preferred shares entitle the
holder to 2,000 votes on all matters submitted to vote of the stockholders of the Company, provided
however, that the total number of votes shall not exceed 34% of the total number of votes, provided
further, that the total number of votes entitled to vote, including common stock or any other voting
security, would not exceed 49% of the total number of votes.
 
Series B Preferred Shares have no dividend
or distribution rights.
Series C preferred shares do not have voting rights unless related to amendments of the Articles of
Incorporation that adversely alter the preference, powers or rights of the Series C Preferred Shares or to
issue Parity Stock or create or issue Senior Stock.
 
Series
 
C
 
preferred
 
shares
 
have
 
a
 
liquidation
preference equal to the stated value of $
10,000
 
and are convertible into common stock at the Company’s
option commencing upon the
 
first anniversary of the
 
issue date, at a
 
conversion price equal to
 
the lesser
of
 
$
6.5
 
and
 
the
 
10-trading
 
day
 
trailing
 
VWAP
 
of
 
OceanPal’s
 
common
 
shares,
 
subject
 
to
 
adjustments.
Dividends
 
on each share of Series
 
C Preferred Shares are cumulative and
 
accrue from the original issue
date at the rate of
8
% per annum. Dividends are payable in cash or, at OceanPal’s election, in kind.
On February 1,
 
2023, the Company,
 
through a wholly
 
owned subsidiary,
 
entered into an
 
agreement with
OceanPal
 
to
 
sell
 
the
 
vessel
Melia
 
for
 
the
 
sale
 
price
 
of
 
$
14,000
,
 
of
 
which
 
$
4,000
 
in
 
cash,
 
paid
 
by
OceanPal on February
 
2, 2023, and
 
$
10,000
 
through the issuance
 
of
13,157
 
shares of OceanPal
 
Series
D Cumulative
 
Convertible Preferred
 
Stock. The
 
vessel was
 
delivered to
 
her new
 
owners on
 
February 8,
2023,
 
and
 
the
 
Company
 
received
13,157
 
Series
 
D
 
Cumulative
 
Convertible
 
Preferred
 
Shares.
 
The
Company
 
initially
 
measured
 
its
 
investment
 
on
 
Series
 
D
 
preferred
 
shares
 
at
 
fair
 
value
 
on
 
February
 
8,
2023,
 
the
 
issuance
 
date,
 
and
 
elected
 
to
 
subsequently
 
measure
 
such
 
investment
 
in
 
accordance
 
with
paragraph ASC 321-10-35-2. The fair
 
value of Series
 
D Preferred Shares
 
was determined through
 
Level
2 inputs of the fair value hierarchy by taking into consideration a third-party valuation
 
which was based on
the
 
income
 
approach,
 
taking
 
into
 
account
 
the
 
present
 
value
 
of
 
the
 
future
 
cash
 
flows
 
the
 
Company
expects to receive from holding the equity instrument.
 
Series D preferred shares are convertible into
 
common stock at the holder’s option, at a
 
conversion price
equal
 
to
 
the
 
10-trading
 
day
 
trailing
 
VWAP
 
of
 
OceanPal’s
 
common
 
shares,
 
provided
 
however
 
that
 
the
holder would not
 
beneficially own greater than
49
% of
 
OceanPal’s outstanding shares
 
of common stock.
Series D preferred shares have no voting rights
; dividends are cumulative, accruing at
 
the rate of
7
% per
annum, payable
 
in cash
 
or,
 
at OceanPal’s
 
election, in
 
PIK shares
 
(Series D
 
Preferred shares
 
issued to
the holder in lieu of cash dividends); and they have a liquidation
 
preference equal $
1,000
 
per share.
 
On
 
June
 
9,
 
2023,
 
the
 
Company
 
distributed
 
the
 
OceanPal
 
Series
 
D
 
Preferred
 
Shares
 
as
 
a
 
special
dividend to its shareholders of record on April 24, 2023. The Company accounted for the transaction as a
nonreciprocal
 
transfer
 
with
 
its
 
owners
 
in
 
accordance
 
with
 
ASC
 
845
 
and
 
measured
 
the
 
fair
 
value
 
of
 
the
preferred shares
 
on the
 
date of
 
declaration at
 
$
10,761
. The
 
fair value
 
of the
 
Series D
 
Preferred Shares
was determined through
 
Level 2
 
inputs of the
 
fair value hierarchy,
 
by using the
 
income approach, taking
into account the present value of the future cash flows, the
 
holder of shares would expect to receive from
holding the equity instrument. This resulted
 
in a gain of
 
$
761
, being the difference
 
between the fair value
and the
 
carrying value
 
of the
 
investment and
 
is separately
 
presented as
 
gain on
 
dividend distribution
 
in
the 2023 accompanying unaudited interim consolidated statement of
 
income.
As of June 30, 2023 and December 31,
 
2022, the aggregate value of investments in OceanPal, for which
the
 
Company
 
applies
 
the
 
guidance
 
for
 
equity
 
securities
 
without
 
readily
 
determinable
 
fair
 
values,
amounted to
 
$
7,744
 
and $
7,744
, respectively,
 
including dividends receivable
 
amounting to
 
$
168
 
in both
periods,
 
and
 
are
 
separately
 
presented
 
in
 
investments
 
in
 
related
 
parties
 
in
 
the
 
accompanying
 
interim
consolidated balance sheets. As of June 30, 2023 and December 31,
 
2022, the Company did not identify
any indications for impairment,
 
or any observable prices change for identical or similar investments of the
same issuer
 
and the investments continued to
 
qualify to be measured at
 
cost. For the six
 
months ended
June
 
30,
 
2023
 
and
 
2022, dividend
 
income
 
from the
 
Series
 
C
 
and
 
Series D
 
OceanPal
 
preferred shares
(from
 
the
 
date
 
of
 
acquisition
 
until
 
their
 
distribution
 
to
 
shareholders)
 
amounted
 
to
 
$
567
 
and
 
$
400
,
respectively,
 
included in
 
interest and
 
other income
 
in the
 
accompanying unaudited
 
interim consolidated
statements of income.
e)
 
Bergen Ultra LP,
 
or Bergen:
 
Bergen is a limited partnership between the Company
 
and Ecobulk
AS,
 
an
 
unrelated
 
third
 
party,
 
which
 
was
 
established
 
for
 
the
 
purpose
 
of
 
acquiring,
 
owning,
 
chartering
and/or operating a vessel. Bergen was
 
a wholly owned subsidiary of
 
Diana, which on February 14, 2023,
signed
 
a
 
Memorandum
 
of
 
Agreement
 
to
 
acquire
 
from
 
an
 
unaffiliated
 
third-party
 
the
Nord
 
Potomac
,
 
a
2016 Ultramax
 
dry bulk
 
vessel, for
 
$
27,900
 
which was
 
delivered on
 
April 10,
 
2023. On
 
March 30,
 
2023,
Bergen
 
entered
 
into
 
a
 
loan
 
agreement
 
with
 
Nordea
 
for
 
a
 
$
15,400
 
loan
 
to
 
finance
 
part
 
of
 
the
 
purchase
price of
 
the vessel.
 
On the
 
same date,
 
the Company
 
entered into
 
a corporate
 
guarantee with
 
Nordea to
secure
 
Bergen’s
 
obligations
 
under
 
the
 
loan
 
to
 
decrease
 
the
 
borrowing
 
cost
 
of
 
the
 
partnership,
 
in
exchange
 
for
 
a
 
fee
 
payable
 
to
 
Diana
 
by
 
Bergen.
 
On
 
April
 
28,
 
2023,
 
the
 
Company
 
entered
 
into
 
(i)
 
an
investment agreement with Ecobulk AS, under which Ecobulk AS acquired
75
% of the limited partnership
interests, for
 
$
11,025
; (ii)
 
an amended
 
limited partnership
 
agreement under
 
which the
 
Company acts
 
as
the
 
General Partner
 
of the
 
partnership through
 
its
 
wholly owned
 
subsidiary Diana
 
General Partner
 
Inc.;
(iii) an administrative service agreement
 
under which DSS provides
 
administrative services to Bergen for
an annual
 
fee
 
of $
15
; (iv)
 
a commission
 
agreement under
 
which the
 
Company is
 
paid a
 
commission of
0.8
% per
 
annum, on the
 
outstanding balance of
 
the loan,
 
as compensation for
 
the guarantee
 
it provided
to
 
Nordea
 
and
 
(v)
 
a
 
convertible
 
loan
 
agreement
 
for
 
$
27,900
 
plus
 
other
 
expenses,
 
with
 
Bergen
 
under
which
 
Bergen
 
would
 
have
 
to
 
repay
 
all
 
expenditures
 
made
 
by
 
the
 
Company
 
for
 
the
 
acquisition
 
of
 
the
vessel. Pursuant
 
to the convertible
 
loan, on April
 
28, 2023,
 
the Company received
 
from Bergen $
25,189
in cash while an
 
amount of $
3,675
 
was converted into partnership
 
interests in Bergen, representing
25
%
of the total partnership interests.
Upon
 
the
 
provisions
 
of
 
the
 
amended
 
partnership agreement,
 
the
 
general
 
partner
 
irrevocably
 
delegated
the
 
authority
 
to
 
Bergen’s
 
board
 
of
 
directors
 
to
 
have
 
the
 
power
 
to
 
oversee
 
and
 
direct
 
the
 
operations,
management and policies of Bergen. The Company evaluated its
 
variable interests in Bergen under ASC
810 and
 
concluded that
 
Bergen is
 
a VIE
 
and that
 
the Company
 
does not
 
individually have
 
the power
 
to
direct the
 
activities of the
 
VIE that most
 
significantly affect the
 
partnership’s performance. From
 
April 28,
2023
 
the
 
Company no
 
longer retains
 
the
 
power
 
to
 
control the
 
board
 
of directors.
 
As
 
of
 
the
 
same
 
date,
Bergen has been considered as an affiliate entity and not as a controlled subsidiary of the Company.
 
The
Company
 
accounted
 
for
 
the
 
deconsolidation
 
of
 
Bergen
 
in
 
accordance
 
with
 
ASC
 
610
 
and
 
the
 
retained
noncontrolling
 
interest
 
of
25
%
 
was
 
accounted
 
for
 
under
 
the
 
equity
 
method
 
due
 
to
 
the
 
Company’s
significant influence over Bergen.
On
 
the
 
date
 
of
 
deconsolidation,
 
the
 
Company
 
measured
 
the
 
fair
 
value
 
of
 
the
 
retained
 
noncontrolling
interest at
 
$
4,519
 
through Level
 
2 inputs
 
of the
 
fair value
 
hierarchy.
 
The Company
 
in order
 
to calculate
the fair value of its
25
% interest in accordance with ASC
 
610, took into consideration the fair
 
value of the
distinct
 
assets
 
and
 
liabilities
 
of
 
Bergen
 
on
 
the
 
date
 
of
 
the
 
deconsolidation.
 
This
 
resulted
 
in
 
a
 
gain
 
on
deconsolidation
 
amounting
 
to
 
$
844
,
 
separately presented
 
in
 
the
 
accompanying 2023
 
unaudited interim
consolidated
 
statement
 
of
 
income,
 
being
 
the
 
difference
 
between
 
the
 
fair
 
value
 
of
 
the
 
retained
noncontrolling interest plus the carrying value
 
the liabilities assumed by Bergen
 
and the carrying value of
the assets derecognized.
For
 
the
 
six
 
months
 
ended
 
June
 
30,
 
2023,
 
the
 
investment
 
in
 
Bergen
 
resulted
 
in
 
a
 
gain
 
of
 
$
42
 
and
 
is
included
 
in
 
gain
 
from
 
equity
 
method
 
investments
 
in
 
the
 
2023
 
accompanying
 
unaudited
 
interim
consolidated statement
 
of
 
income. As
 
of
 
June 30,
 
2023, the
 
investment in
 
Bergen
 
amounted to
 
$
4,561
and
 
is
 
included
 
in
 
equity
 
method
 
investments
 
in
 
the
 
accompanying
 
2023
 
consolidated
 
balance
 
sheet.
Also, for the
 
six months ended June
 
30, 2023, income from
 
management fees from Bergen
 
amounted to
$
3
,
 
included
 
in
 
time
 
charter
 
revenues
 
and
 
income
 
from
 
the
 
commission
 
paid
 
on
 
the
 
loan
 
guarantee
amounted
 
to
 
$
22
,
 
included
 
in
 
interest
 
and
 
other
 
income
 
in
 
the
 
2023
 
accompanying
 
unaudited
 
interim
consolidated statement
 
of
 
income. As
 
of
 
June 30,
 
2023, there
 
was an
 
amount of
 
$
25
 
due from
 
Bergen
included in due from related parties in the 2023 accompanying consolidated
 
balance sheet.