Diamond S Shipping Inc. (Form: 10-Q, Received: 05/13/2020 16:04:48)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended March 31, 2020

Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the transition period from to

Commission File Number: 1-38771

DIAMOND S SHIPPING INC.

(Exact name of registrant as specified in its charter)

Republic of the Marshall Islands	98-1480128
(State or other jurisdiction	(I.R.S. Employer
of incorporation or organization)	Identification No.)

33 Benedict Place
Greenwich, CT	06830
(Address of principal executive offices)	(Zip Code)

(203) 413-2000

(Registrant's telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, par value $0.001 per share	DSSI	New York Stock Exchange

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No o

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes x No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer," "accelerated filer," "smaller reporting company" and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer o		Accelerated filer o
Non-accelerated filer x		Smaller reporting company o
		Emerging growth company x

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No x

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date. The number of shares outstanding of the issuer’s common stock as of May 8, 2020: 40,449,955 shares of common stock, par value $0.001 per share.

DIAMOND S SHIPPING INC. AND SUBSIDIARIES

INDEX

PART I.	FINANCIAL INFORMATION	PAGE

Item 1	Financial Statements

	Condensed Consolidated Balance Sheets (Unaudited) as of March 31, 2020 and December 31, 2019	6

	Condensed Consolidated Statements of Operations (Unaudited) for the three months ended March 31, 2020 and 2019	7

	Condensed Consolidated Statements of Comprehensive Income (Loss) (Unaudited) for the three months ended March 31, 2020 and 2019	8

	Condensed Consolidated Statements of Changes in Shareholders’ Equity (Unaudited) for the three months ended March 31, 2020 and 2019	9

	Condensed Consolidated Statements of Cash Flows (Unaudited) for the three months ended March 31, 2020 and 2019	10

	Notes to Condensed Consolidated Financial Statements (Unaudited)	11

Item 2	Management’s Discussion and Analysis of Financial Condition and Results of Operations	23

Item 3	Quantitative and Qualitative Disclosures About Market Risk	31

Item 4	Controls and Procedures	31

PART II.	OTHER INFORMATION	PAGE

Item 1	Legal Proceedings	31

Item 1A	Risk Factors	32

Item 2	Unregistered Sales of Equity Securities and Use of Proceeds	32

Item 6	Exhibits	33

Special Notice Regarding Forward-Looking Statements

This Quarterly Report on Form 10-Q contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, the provisions of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Forward-looking statements include financial projections, statements of plans and objectives for future operations, statements of future economic performance, and statements of assumptions relating thereto. Forward-looking statements may appear throughout this report, including without limitation, Part I, Item 2, “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” and are often identified by future or conditional words such as “will,” “plans,” “expects,” “intends,” “believes,” “seeks,” “estimates,” or “anticipates,” or by variations of such words or by similar expressions. There can be no assurance that forward-looking statements will be achieved. By their very nature, forward-looking statements involve known and unknown risks, uncertainties, assumptions, and other important factors that could cause our actual results or conditions to differ materially from those expressed or implied by such forward-looking statements.

The following important factors, and those important factors described elsewhere in this report, could affect (and in some cases have affected) our actual results and could cause such results to differ materially from estimates or expectations reflected in such forward-looking statements:

the cyclicality of the tanker industry;

changes in economic and competitive conditions affecting our business, including market fluctuations in charter rates;

the length and severity of the recent novel coronavirus (“COVID-19”) outbreak, including its impact on the demand for seaborne transportation of petroleum products;

risks related to an oversupply of tanker vessels;

changes in fuel prices;

decreases in the market values of tanker vessels;

risks related to the management of our growth strategy, counterparty risks and customer relations with key customers;

our ability to meet obligations under time charter agreements;

dependence on third-party managers and a limited number of customers;

our liquidity, level of indebtedness, operating expenses, capital expenditures and financing;

our interest rate swap agreements and credit facilities;

risk of loss, including potential liability from future litigation and potential costs due to environmental damage, vessel collisions and business interruption; risks related to war, terrorism and piracy;

risks related to the acquisition, modification and operation of vessels;

future supply of, and demand for, refined products and crude oil, including relating to seasonality;

risks related to our insurance, including adequacy of coverage and increased premium payments;

risks related to tax rules applicable to us;

our ability to clear the oil majors’ risk assessment processes;

future refined product and crude oil prices and production;

the carrying values of our vessels and the potential for any asset impairments;

our ability to maximize the use of our vessels, including the redeployment or disposition of vessels no longer under long-term time charter;

our continued ability to enter into long-term, fixed-rate time charters with our charterers and to re-charter our vessels as their existing charters expire at attractive rates;

failure to realize the anticipated benefits of the Merger (as defined herein), including as a result of integrating the businesses;

failure to maintain effective internal control over financial reporting;

our ability to implement our business strategy and manage planned growth; and

other risks and uncertainties disclosed in the Company’s reports filed from time to time with the Securities and Exchange Commission (“SEC”) under the Exchange Act.

Projections, assumptions and estimates of our future performance and the future performance of the industry in which we operate are necessarily subject to a high degree of uncertainty and risk. When considering these forward-looking statements, you should keep in mind the cautionary statements in this report and in our other SEC filings. These forward-looking statements speak only as of the date on which such statements were made, and we undertake no obligation to update these statements, except as required by the federal securities laws. These forward-looking statements are not guarantees of our future performance, and actual results and future developments may vary materially from those projected in the forward-looking statements.

Except to the extent required by applicable law or regulation, we undertake no obligation to release publicly any revisions to these forward-looking statements to reflect events or circumstances after the date of this report or to reflect the occurrence of unanticipated events.

Part 1. Financial Information

Item 1. Financial Statements

DIAMOND S SHIPPING INC. AND SUBSIDIARIES
Index to Condensed Consolidated Financial Statements (Unaudited)

	Page

Condensed Consolidated Balance Sheets as of March 31, 2020 and December 31, 2019	6
Condensed Consolidated Statements of Operations for the three months ended March 31, 2020 and 2019	7
Condensed Consolidated Statements of Comprehensive Income (Loss) for the three months ended March 31, 2020 and 2019	8
Condensed Consolidated Statements of Shareholders’ Equity for the three months ended March 31, 2020 and 2019	9
Condensed Consolidated Statements of Cash Flows for the three months ended March 31, 2020 and 2019	10
Notes to Condensed Consolidated Financial Statements	11

DIAMOND S SHIPPING INC. AND SUBSIDIARIES

Condensed Consolidated Balance Sheets
as of March 31, 2020 and December 31, 2019

(In Thousands, except for share and per share data)

(Unaudited)

	March 31, 2020			December 31, 2019
Assets
Current assets:
Cash and cash equivalents	$	110,903		$	83,609
Due from charterers – Net of provision for doubtful accounts of $1,302 and $1,415, respectively		76,464			80,691
Inventories		32,713			32,071
Prepaid expenses and other current assets		16,731			13,179
Total current assets		236,811			209,550

Noncurrent assets:
Vessels – Net of accumulated depreciation of $579,419 and $553,483, respectively		1,840,274			1,865,738
Other property – Net of accumulated depreciation of $660 and $584, respectively		579			642
Deferred drydocking costs – Net of accumulated amortization of $20,723 and $17,975, respectively		35,041			37,256
Restricted cash		5,674			5,610
Time charter contracts acquired – Net of accumulated amortization of $3,136 and $2,296, respectively		4,264			5,004
Other noncurrent assets		4,736			4,582
Total noncurrent assets		1,890,568			1,918,832
Total	$	2,127,379		$	2,128,382

Liabilities and Shareholders’ Equity
Current liabilities:
Current portion of long-term debt	$	134,389		$	134,389
Accounts payable and accrued expenses		35,143			44,062
Deferred charter hire revenue		3,699			1,934
Total current liabilities		173,231			180,385

Long-term debt – Net of deferred financing costs of $15,047 and $15,866, respectively		706,277			744,055
Total liabilities		879,508			924,440

Commitments and contingencies (Note 14)

Shareholders’ Equity:
Common stock, par value $0.001; 100,000,000 shares authorized; issued and outstanding 39,893,970 and 39,890,699 shares at March 31, 2020 and December 31, 2019, respectively		40			40
Treasury stock – at cost; 137,289 shares at March 31, 2020		(1,418	)		—
Additional paid-in capital		1,238,992			1,237,658
Accumulated deficit		(23,523	)		(68,567	)
Total Diamond S Shipping Inc. shareholders’ equity		1,214,091			1,169,131
Noncontrolling interests		33,780			34,811
Total equity		1,247,871			1,203,942
Total	$	2,127,379		$	2,128,382

See notes to condensed consolidated financial statements.

DIAMOND S SHIPPING INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Operations
for the Three Months Ended March 31, 2020 and 2019

(In Thousands, except for share and per share data)
(Unaudited)

	For the Three Months Ended March 31,
	2020			2019
Revenue:
Spot revenue	$	187,652		$	98,449
Time charter revenue		22,073			4,207
Voyage revenue		209,725			102,656

Operating expenses:
Voyage expenses		74,681			41,578
Vessel expenses		41,536			24,801
Depreciation and amortization expense		28,760			21,956
General and administrative expenses		8,124			6,288
Total operating expenses		153,101			94,623
Operating income		56,624			8,033
Other (expense) income:
Interest expense		(11,376	)		(9,370	)
Other income		333			517
Total other expense – Net		(11,043	)		(8,853	)
Net income (loss)		45,581			(820	)
Less: Net income attributable to noncontrolling interest		537			206
Net income (loss) attributable to Diamond S Shipping Inc.	$	45,044		$	(1,026	)

Net income (loss) per share – basic	$	1.13		$	(0.04	)
Net income (loss) per share – diluted	$	1.12		$	(0.04	)

Weighted average common shares outstanding – basic		39,891,346			27,731,252
Weighted average common shares outstanding – diluted		40,159,966			27,731,252

See notes to condensed consolidated financial statements.

DIAMOND S SHIPPING INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Comprehensive Income (Loss)
for the Three Months Ended March 31, 2020 and 2019
(In Thousands)

(Unaudited)

	For the Three Months Ended March 31,
	2020		2019
Net income (loss)	$	45,581	$	(820	)
Unrealized loss on cash flow hedges		—		(1,096	)
Other comprehensive loss		—		(1,096	)
Comprehensive income (loss)		45,581		(1,916	)
Less: comprehensive income attributable to noncontrolling interest		537		206
Comprehensive income (loss) attributable to Diamond S Shipping Inc.	$	45,044	$	(2,122	)

See notes to condensed consolidated financial statements.

DIAMOND S SHIPPING INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Changes in Shareholders’ Equity
for the Three Months Ended March 31, 2020 and 2019
(In Thousands)

(Unaudited)

	Common Stock		Treasury Stock			Additional Paid-in Capital		Accumulated Deficit			Noncontrolling Interests			Total
Balance – January 1, 2020	$	40	$	—		$	1,237,658	$	(68,567	)	$	34,811		$	1,203,942
Stock-based compensation		—		—			1,334		—			—			1,334
NT Suez Holdco LLC distribution		—		—			—		—			(1,568	)		(1,568	)
Shares repurchased		—		(1,418	)		—		—			—			(1,418	)
Net income		—		—			—		45,044			537			45,581
Balance – March 31, 2020	$	40	$	(1,418	)	$	1,238,992	$	(23,523	)	$	33,780		$	1,247,871

	Partners’ Contributions			Common Stock		Additional Paid-in Capital		Accumulated Other Comprehensive Income			Accumulated Deficit			Noncontrolling Interests		Total
Balance – January 1, 2019	$	994,771		$	—	$	2,558	$	4,387		$	(56,477	)	$	34,607	$	979,846
Cumulative effect of accounting change		—			—		—		—			(2,784	)		—		(2,784	)
Merger transaction (Note 3)		(994,771	)		40		1,231,579		—			—			—		236,848
Unrealized loss on cash flow hedges		—			—		—		(1,096	)		—			—		(1,096	)
Net loss		—			—		—		—			(1,026	)		206		(820	)
Balance – March 31, 2019	$	—		$	40	$	1,234,137	$	3,291		$	(60,287	)	$	34,813	$	1,211,994

See notes to condensed consolidated financial statements.

DIAMOND S SHIPPING INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Cash Flows
for the Three Months Ended March 31, 2020 and 2019
(In Thousands)

(Unaudited)

	For the Three Months Ended March 31,
	2020			2019
Cash flows from Operating Activities:
Net income (loss)	$	45,581		$	(820	)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation and amortization expense		28,760			21,956
Amortization of deferred financing costs		884			846
Amortization of time charter hire contracts acquired		740			76
Amortization of the realized gain from recouponing swaps		—			(696	)
Stock-based compensation expense		1,334			—
Changes in assets and liabilities		(4,827	)		(11,244	)
Cash paid for drydocking		(1,533	)		(4,232	)
Net cash provided by operating activities		70,939			5,886

Cash flows from Investing Activities:
Acquisition costs, net of cash acquired of $16,568		—			(292,683	)
Transaction costs		—			(17,785	)
Payments for vessel additions and other property		(1,513	)		(2,649	)
Net cash used in investing activities		(1,513	)		(313,117	)

Cash flows from Financing Activities:
Borrowings on long-term debt		—			300,000
Principal payments on long-term debt		(33,597	)		(17,748	)
Borrowings on revolving credit facilities		—			51,000
Repayments on revolving credit facilities		(5,000	)		(26,323	)
NT Suez Holdco LLC distribution		(1,568	)		—
Shares repurchased		(1,418	)		—
Payments for deferred financing costs		(485	)		(6,521	)
Net cash (used in) provided by financing activities		(42,068	)		300,408
Net increase (decrease) in cash, cash equivalents and restricted cash		27,358			(6,823	)
Cash, cash equivalents and restricted cash – Beginning of period		89,219			88,158
Cash, cash equivalents and restricted cash – End of period	$	116,577		$	81,335

Supplemental disclosures:
Cash paid for interest	$	11,889		$	9,109
Unpaid transaction costs in Accounts payable and accrued expenses at the end of the period	$	—		$	1,299
Unpaid vessel additions in Accounts payable and accrued expenses at the end of the period	$	151		$	2,514

See notes to condensed consolidated financial statements.

DIAMOND S SHIPPING INC. AND SUBSIDIARIES

(In Thousands, except for share and per share data)

Notes to Condensed Consolidated Financial Statements
(Unaudited)

BUSINESS AND BASIS OF PRESENTATION

Business — Diamond S Shipping Inc. (“DSSI”) was formed on November 14, 2018 under the laws of the Republic of the Marshall Islands for the purpose of receiving, via contribution from Capital Product Partners L.P. (“CPLP”), CPLP’s crude and product tanker business and combining that business with the business and operations of DSS Holdings L.P. (“DSS LP”) pursuant to the Transaction Agreement, dated as of November 27, 2018 (as amended, the “Transaction Agreement”), by and among CPLP, DSS LP, DSSI and the other parties named therein. DSS LP was a Cayman Islands limited partnership formed on October 1, 2007.

On March 27, 2019, DSSI and DSS LP and all of its directly-owned subsidiaries (the “DSS LP Subsidiaries”) completed a merger pursuant to the Transaction Agreement. Pursuant to the terms of the Transaction Agreement, on March 27, 2019, the DSS LP Subsidiaries merged with and into DSSI, with DSSI being the surviving corporation in the merger (the “Merger”). DSSI and the DSS LP Subsidiaries are hereinafter referred to collectively as the “Company.”

The Merger was accounted for as a reverse acquisition in accordance with the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 805, “Business Combinations” as the DSS LP Subsidiaries are the accounting acquirer for financial reporting purposes. Accordingly, the historical consolidated financial statements of the DSS LP Subsidiaries for periods prior to the Merger are considered to be the predecessor financial statements of the Company. Refer to Note 3 — Merger Transaction for further information.

The Company is a seaborne transporter of crude oil and refined petroleum products, operating in the international shipping industry. As of March 31, 2020, through its wholly-owned subsidiaries, the Company owns and operates 64 tanker vessels: 13 Suezmax crude carriers, one Aframax crude carrier and 50 medium range (“MR”) product carriers. The Company also controls and operates two Suezmax vessels through a joint venture (Refer to Note 5 — Joint Venture Investments).

Summary of SIGNIFICANT ACCOUNTING POLICIES

Principles of Consolidation — The accompanying condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) which includes the accounts of the Company and its direct and indirect wholly-owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation.

Basis of Presentation — The accompanying condensed consolidated financial statements have been prepared in accordance with U.S. GAAP for interim financial information and the rules and regulations of the Securities and Exchange Commission (the “SEC”). In the opinion of management of the Company, all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of financial position and operating results have been included in the statements. Certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. GAAP have been condensed or omitted. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements as of and for the year ended December 31, 2019 and notes thereto included in the Company’s annual report on Form 10-K (the “2019 Financial Statements”). The results of operations for the three months ended March 31, 2020 are not necessarily indicative of the operating results to be expected for the year ending December 31, 2020.

The Company is an “emerging growth company,” as defined in Section 2(a) of the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”). As such, the Company is eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies. Section 107 of the JOBS Act provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. The Company intends to take advantage of the benefits of this extended transition period for as long as it is available. The Company’s condensed consolidated financial statements may therefore not be comparable to those of companies that comply with such new or revised accounting standards. Section 107 of the JOBS Act provides that the decision not to opt out of the extended transition period for complying with new or revised accounting standards is irrevocable.

Cash and Cash Equivalents, and Restricted Cash — The following table provides a reconciliation of Cash and cash equivalents and Restricted cash reported within the consolidated balance sheets that sum to the total of the amounts shown in the condensed consolidated statements of cash flows:

	March 31, 2020		December 31, 2019		March 31, 2019		December 31, 2018
Cash and cash equivalents	$	110,903	$	83,609	$	76,106	$	83,054
Restricted cash		5,674		5,610		5,229		5,104
Total Cash and cash equivalents, and Restricted cash shown in the condensed consolidated statements of cash flows	$	116,577	$	89,219	$	81,335	$	88,158

Amounts included in restricted cash represent those required to be set aside by the $66 Million Facility, as defined in Note 8 below. The restriction will lapse when the related long-term debt is retired.

Revenue and Voyage Expense Recognition — Total voyage revenue includes revenue earned on fixed rate time charters, spot market voyage charters and spot market-related time charters. Pursuant to the new revenue recognition guidance, which was adopted as of January 1, 2019, revenue for spot market voyage charters is recognized ratably over the total transit time of each voyage, which commences at the time the vessel arrives at the loading port and ends at the time the discharge of cargo is completed at the discharge port.

As a result of the adoption of the new revenue recognition guidance on January 1, 2019, the Company recorded a net increase to the opening accumulated deficit of $2,784 for the cumulative impact of adopting the new guidance. The impact related primarily to the change in accounting for spot market voyage charters. Prior to the adoption of the new guidance, revenue for spot market voyage charters was recognized ratably over the total transit time of the voyage, which previously commenced the later of when the vessel departed from its last discharge port or when an agreement was entered into with the charterer, and ended at the time the discharge of cargo was completed at the discharge port. As a result of the adoption of the new guidance, revenue for spot market voyage charters is now being recognized ratably over the total transit time of the voyage which now begins when the vessel arrives at the loading port and ends at the time the discharge of cargo is completed at the discharge port. Additionally, the Company has identified that the contract fulfillment costs of spot market voyage charters consist primarily of the fuel consumption that is incurred by the Company from the end of the previous vessel employment until the arrival at the loading port. The fuel consumption during this period is deferred and recorded as deferred voyage costs included in Prepaid expenses and other current assets in the condensed consolidated balance sheet and is amortized ratably over the total transit time of the voyage from arrival at the loading port until the vessel departs from the discharge port and recognized as part of Voyage expenses. Refer also to Note 6 — Prepaid expenses and other current assets.

In time charters, operating costs including crews, maintenance and insurance are typically paid by the owner of the vessel and specified voyage costs such as fuel and port charges are paid by the charterer. These voyage expenses are borne by the Company when engaged in spot market voyage charters. As such, there are significantly higher voyage expenses for spot market voyage charters as compared to time charters. There are certain other non-specified voyage expenses, such as commissions, which are typically borne by the Company.

Recent Accounting Pronouncements

New accounting standards to be implemented — In February 2016, the FASB issued ASU No. 2016-02, “Leases (Topic 842)” (“ASU 2016-02”), which establishes a comprehensive new lease accounting model. ASU 2016-02 clarifies the definition of a lease, requires a dual approach to lease classification similar to current lease classifications, and causes lessees to recognize leases on the balance sheet as a lease liability with a corresponding right-of-use asset for leases with a lease term of more than twelve months. For the Company, ASU 2016-02 is effective for annual periods beginning after December 15, 2020, and interim reporting periods within annual reporting periods beginning after December 15, 2021, with early adoption permitted. The most significant effects of adoption relate to the recognition of right-of-use assets and lease liabilities on the balance sheet for operating leases and providing new disclosures about the Company’s leasing activities. The Company is currently analyzing its contracts and will then calculate the right-of-use assets and lease liabilities as of January 1, 2021 based on the present value of the Company’s remaining minimum lease payments, primarily due to the recognition of right-of-use assets and lease liabilities with respect to operating leases.

In June 2016, the FASB issued ASU No. 2016-13, “Financial Instruments—Credit Losses (Topic 326)” (“ASU 2016-13”), which amends several aspects of the measurement of credit losses on financial instruments based on an estimate of current expected credit losses. ASU 2016-13 will apply to loans, accounts receivable, trade receivables, other financial assets measured at amortized cost, loan commitments and other off-balance sheet credit exposures. ASU 2016-13 will also apply to debt securities and other financial assets measured at fair value through other comprehensive income. For the Company, ASU 2016-13 is effective for annual periods beginning after December 15, 2020, and interim reporting periods within annual reporting periods beginning after December 15, 2021, with early adoption permitted. The Company is currently evaluating the potential impact of this pronouncement on the condensed consolidated financial statements.

Merger Transaction

As discussed in Note 1, the Company completed a Merger on March 27, 2019. Directly prior to the Merger, the following took place:

DSSI formed four wholly-owned subsidiaries organized under the laws of the Republic of the Marshall Islands, referred to as “Products Merger Entity,” “Crude Merger Entity,” “Management Merger Entity” and “Surviving Merger Entity.”

CPLP separated its product and crude tanker businesses into separate lines of subsidiaries and contribute them to DSSI (the “Separation”).

DSSI issued 12,724,500 additional common shares in connection with the contribution by CPLP.

In the Separation, CPLP contributed to DSSI (1) CPLP’s crude and product tanker vessels, (2) an amount in cash equal to $10 million and (3) associated inventories.

On March 27, 2019, CPLP distributed on a pro rata basis all 12,725,000 then-outstanding common shares of DSSI to its unitholders of record as of March 19, 2019 (the “Distribution”).

Immediately following the Distribution, the Merger took place, which is detailed as follows:

The Pre-Mergers took place:

DSS Crude Transport Inc., a wholly-owned subsidiary of DSS LP, merged with Crude Merger Entity, with DSS Crude Transport Inc. surviving the merger,

DSS Products Transport Inc., a wholly-owned subsidiary of DSS LP, merged with Products Merger Entity, with DSS Products Transport Inc. surviving the merger, and

Diamond S Technical Management LLC, a wholly-owned subsidiary of DSS LP, merged with Management Merger Entity, with Diamond S Technical Management LLC surviving the merger.

Following the Pre-Mergers and pursuant to the same plan, each of DSS Crude Transport Inc., DSS Products Transport Inc. and Diamond S Technical Management LLC merged with the Surviving Merger Entity, with the Surviving Merger Entity surviving. The Surviving Merger Entity subsequently merged with DSSI, with DSSI surviving.

Pursuant to the Transaction agreement, the CPLP unitholders received 12,725,000 common shares in DSSI, and the DSS LP limited partners received common shares of DSSI that were determined by the factor to which DSS LP’s net asset value is to the net asset value of DSSI immediately after the Distribution, multiplied by the number of shares distributed to CPLP unitholders after the March 27, 2019 effective date. This equated to the DSS LP limited partners receiving 27,165,696 common shares.

The Merger completed on March 27, 2019, and the Company’s common shares commenced trading on the New York Stock Exchange on March 28, 2019.

The Merger was accounted for as a reverse acquisition in accordance with ASC 805, “Business Combinations.” Based on the structure of the Merger and other activities contemplated by the Transaction Agreement, relative outstanding share ownership, the composition of the Company's board of directors and the designation of certain senior management positions of the Company, the DSS LP Subsidiaries are the accounting acquirer for financial reporting purposes.

Further, in accordance with ASU 2017-01, the Merger was determined to be an asset acquisition as substantially all of the fair value of the gross assets acquired is concentrated in a group of similar identifiable assets.

The consideration transferred, assets acquired, and liabilities assumed are recognized as follows:

Consideration paid and transferred
Cash paid — net of cash received of $16,568	$	292,683
Common stock issued to CPLP		236,848
Transaction costs		20,738
Total consideration paid and transferred	$	550,269

Net assets acquired
Due from charterers	$	4,514
Inventories		6,969
Prepaid expenses and other current assets		1,152
Vessels		537,988
Time charter contracts acquired — assets		7,300
Other noncurrent assets		2,191
Accounts payable and accrued expenses		(7,478	)
Deferred charter hire revenue		(2,367	)
Net assets acquired	$	550,269

Further, as the Merger was determined to be an asset acquisition, the Company recorded the acquired assets and liabilities at the cost of the acquisition, including transaction costs, on the basis of relative fair value. The carrying value of the vessels were recorded in accordance with the principles set forth under ASC Topic 820, “Fair Value Measurement” based upon current market values obtained from at least two independent ship brokers. The time charter contract assets acquired represent an estimate of the fair value of the time charters acquired as of the date of the Merger, and considers the differential between the stated time charter rate and the contracts’ fair value at the time of the Merger.

In connection with the Merger, the incentive units granted under the DSS LP unit incentive plan expired with no value. Further, while the Company is now a public company, management believe that, pursuant to Section 883 of the U.S. Internal Revenue Code of 1986, the income related to vessel operations will continue to be exempt from U.S. federal income tax, although no assurance can be given that the Company will continue to satisfy this statutory exemption from U.S. federal income taxation.

Net earnings (Loss) Per Share

The computation of basic net earnings (loss) per share is based on the weighted-average number of common shares outstanding during the reporting period. The computation of diluted net earnings (loss) per share assumes the vesting of nonvested stock awards (refer to Note 13 — Stock-Based Compensation), for which the assumed proceeds upon vesting are deemed to be the amount of compensation cost attributable to future services and are not yet recognized using the treasury stock method, to the extent dilutive. For the three months ended March 31, 2020, 26,126 shares of restricted stock units were excluded from the computation of diluted net earnings per share because these were anti-dilutive (refer to Note 13 — Stock-Based Compensation).

	For the Three Months Ended March 31,
	2020		2019
Common shares outstanding, basic:
Weighted-average common shares outstanding, basic		39,891,346		27,731,252

Common shares outstanding, diluted:
Weighted-average common shares outstanding, basic		39,891,346		27,731,252
Dilutive effect of restricted stock awards		268,620		—
Weighted-average common shares outstanding, diluted		40,159,966		27,731,252

JOINT VENTURE INVESTMENTS

NT Suez Holdco LLC — In September 2014, the Company formed a joint venture, NT Suez Holdco LLC (“NT Suez”), to purchase two Suezmax newbuildings. The two vessels were delivered in October and November 2016.

NT Suez is owned 51% by the Company and 49% by WLR/TRF Shipping S.a.r.l (“WLR/TRF”). WLR/TRF is indirectly owned by funds managed or jointly managed by WL Ross & Co, LLC (“WLR”), including WLR Recovery Fund V DSS AIV, L.P. and WLR V Parallel ESC, L.P., which are also shareholders of the Company. WLR is a fund manager that manages the Company’s largest shareholders.

As of March 31, 2020 and December 31, 2019, the investments NT Suez received from the Company and WLR/TRF aggregated $74,104, which was used for shipyard installment payments and working capital. In February 2020, NT Suez distributed $1,632 and $1,568 to the Company and WLR/TRF, respectively.

Management has determined that NT Suez qualifies as a variable interest entity, and, when aggregating the variable interests held by the related parties (i.e. the Company and WLR/TRF), the Company is the primary beneficiary as the Company has the ability to direct the activities that most significantly impact NT Suez’s economic performance. Accordingly, the Company consolidates NT Suez.

Diamond Anglo Ship Management Pte. Ltd. — In January 2018, the Company and Anglo Eastern Investment Holdings Ltd. (“AE Holdings”), a third party, formed a joint venture, Diamond Anglo Ship Management Pte. Ltd. (“DASM”). DASM is owned 51% by the Company and 49% by AE Holdings as of March 31, 2020 and December 31, 2019, and was formed to provide ship management services to the Company’s vessels.

As of March 31, 2020 and December 31, 2019, the investments DASM received from the Company and AE Holdings totaled $51 and $49, respectively, which were used for general and administrative expenses.

Management has determined that DASM qualifies as a variable interest entity, and, when aggregating the variable interests held by the Company and AE Holdings, the Company is the primary beneficiary as the Company has the ability to direct the activities that most significantly impacts DASM’s economic performance. Accordingly, the Company consolidates DASM.

Prepaid Expenses and Other Current Assets

Prepaid expenses and other current assets consist of the following as of March 31, 2020 and December 31, 2019:

	March 31, 2020		December 31, 2019
Advances to Capital Ship Management Corp. (“CSM”) (Refer to Note 12 — Related Party Transactions)	$	7,102	$	5,757
Advances to technical managers		—		26
Insurance claims receivable		511		511
Prepaid insurance		1,872		1,093
Advances to agents		2,098		1,421
Deferred voyage costs		3,984		3,132
Other		1,164		1,239
Total prepaid expenses and other current assets	$	16,731	$	13,179

ACCOUNTS PAYABLE AND ACCRUED EXPENSES

Accounts payable and accrued expenses consist of the following as of March 31, 2020 and December 31, 2019:

	March 31, 2020		December 31, 2019
Trade accounts payable and accrued expenses	$	9,626	$	9,716
Accrued vessel and voyage expenses		24,435		32,201
Accrued interest		54		1,090
Accrued vessel and voyage expenses and Other current liabilities (Refer to Note 12 — Related Party Transactions)		1,028		1,055
Total accounts payable and accrued expenses	$	35,143	$	44,062

LONG-TERM DEBT

Long-term debt at March 31, 2020 and December 31, 2019 was comprised of the following:

	March 31, 2020			December 31, 2019
$360 Million Facility	$	308,750		$	327,500
$525 Million Facility		496,250			515,000
$66 Million Facility		50,713			51,810
Total		855,713			894,310
Less: Unamortized deferred financing costs		(15,047	)		(15,866	)
Less: Current portion		(134,389	)		(134,389	)
Long-term debt, net of deferred financing costs	$	706,277		$	744,055

$360 Million Facility — On March 27, 2019, in connection with the Merger, the Company entered into a $360,000 five-year Credit Agreement, as amended (the “$360 Million Facility”), for the purposes of financing the Merger and refinancing the $30 Million Line of Credit (defined below). The $360 Million Facility consists of a term loan of $300,000 and a revolving loan of $60,000, and is collateralized by the 25 vessels acquired in the Merger and the three vessels that collateralized the $30 Million Line of Credit, with reductions based on a 17 year age-adjusted amortization schedule, payable on a quarterly basis. The term loan component of the $360 Million Facility bears interest at the Eurodollar Rate for a three-month interest period, plus a 2.65% interest rate margin, and the interest is paid quarterly. Commitment fees on undrawn amounts related to the revolving loan component of the $360 Million Facility are 1.06%. As of March 31, 2020, $50,000 of the revolving loan was drawn, while $10,000 was available and undrawn.

The $360 Million Facility contains certain restrictions on the payments of dividends. The $360 Million Facility permits the Company to pay dividends so long as the payment of dividends does not cause an event of default, and limits dividends payable so that they do not exceed in any fiscal quarter an amount that is equal to 50% of the adjusted consolidated net income of the Company in such fiscal quarter.

$525 Million Facility — On December 23, 2019, the Company entered into a $525,000 five-year Credit Agreement (the “$525 Million Facility”), for the purposes of refinancing the $460 Million Facility, the $235 Million Facility and the $75 Million Facility (defined below). The $525 Million Facility consists of a term loan of $375,000 and a revolving loan of $150,000, and is collateralized by the 36 vessels that collateralized the $460 Million Facility, the $235 Million Facility and the $75 Million Facility, with reductions based on a 17 year age-adjusted amortization schedule, payable on a quarterly basis. The term loan component of the $525 Million Facility bears interest at the Eurodollar Rate for a three-month interest period, plus a 2.50% interest rate margin, and the interest is paid quarterly. Commitment fees on undrawn amounts related to the revolving loan component of the $525 Million Facility are 0.875%. As of March 31, 2020, $140,000 of the revolving loan was drawn, while $10,000 was available and undrawn.

The $525 Million Facility contains certain restrictions on the payments of dividends. The $525 Million Facility permits the Company to pay dividends so long as the payment of dividends does not cause an event of default, and limits dividends payable so that they do not exceed in any fiscal quarter an amount that is equal to 50% of the adjusted consolidated net income of the Company in the preceding fiscal quarter.

Prior to the December 2019 refinancing, the Company financed 26 MR vessels, which were acquired in September 2011, with a $460,000 five-year senior secured term loan facility, as amended (the “$460 Million Facility”). Interest was paid monthly, and the $460 Million Facility bore interest at the Eurodollar Rate for a one-month interest period, plus a 2.80% interest rate margin.

Also, prior to the December 2019 refinancing, the Company financed eight 2012-built Suezmaxes with a $235,000 five-year senior secured financing facility, as amended (the “$235 Million Facility”), which consisted of a term loan of $220 million and a revolving loan of $15,000. Interest on the term loan component was paid quarterly and the $235 Million Facility bore interest at the Eurodollar Rate for a three-month interest period, plus a 2.75% interest rate margin. Commitment fees on undrawn amounts related to the revolving loan component of the $235 Million Facility were 1.10%.

Lastly, prior to the December 2019 refinancing, the Company financed two 2016-built Suezmaxes vessels with a $75,000 seven-year senior secured term loan facility, as amended (the “$75 Million Facility”). Interest was paid quarterly, and the $75 Million Facility bore interest at the Eurodollar Rate for a three-month interest period, plus a 2.20% interest rate margin.

$66 Million Facility — On August 9, 2016, the Company entered into a $66,000 five-year senior secured term loan facility (the “$66 Million Facility”) for the purpose of financing two vessels controlled through the joint venture NT Suez (refer to Note 5 — Joint Venture Investments). The $66 Million Facility, which is collateralized by the two vessels controlled through NT Suez, is a nonrecourse term loan with reductions that are based on a 15-year amortization schedule, and are payable on a quarterly basis. Interest is paid quarterly, and the $66 Million Facility bears interest at the Eurodollar Rate for a three-month interest period, plus a 3.25% interest rate margin.

The $66 Million Facility contains certain restrictions on the payments of dividends by the NT Suez joint venture. The $66 Million Facility permits the NT Suez joint venture to pay dividends so long as the payment of dividends does not cause an event of default, and does not exceed an amount equal to 75% of the consolidated net income, as determined in accordance with GAAP, of the borrower, which is the consolidated accounts of NT Suez.

Interest Rates – The following table sets forth the effective interest rate associated with the interest costs for the Company’s debt facilities, including the rate differential between the fixed pay rate and the variable receive rate on the interest rate swap agreements that were in effect (refer to Note 9 — Interest Rate Swaps), combined, as well as the cost associated with the commitment fees. Additionally, the table includes the range of interest rates on the debt, excluding the impact of swaps and commitment fees:

	For the Three Months Ended March 31,
	2020	2019
Effective interest rate	4.62%	4.84%
Range of interest rates (excluding impact of swaps and unused commitment fees)	4.45% to 5.32%	4.80% to 6.06%

Restrictive Covenants — The Company’s credit facilities credit contain restrictive covenants and other non-financial restrictions. The $360 Million Facility and $525 Million Facility include, among other things, restrictions on the Company’s ability to incur indebtedness, limitations on dividends, minimum cash balance, collateral maintenance, leverage ratio requirements, minimum working capital requirements, and other customary restrictions. The $66 Million Facility includes restrictions and financial covenants including, among other things, the Company’s ability to incur indebtedness, limitations on dividends, minimum cash balance, collateral maintenance, and other customary restrictions. The Company was in compliance with its financial covenants as of March 31, 2020.

Maturities – The aggregate maturities of debt during the remaining nine months of the year ending December 31, 2020, and annually for the years ending December 31 are as follows:

2020 (for the remaining nine months of the year)	$	100,792
2021		177,421
2022		130,000
2023		130,000
2024		317,500
Total	$	855,713

INTEREST RATE SWAPS

The Company uses interest rate swaps for the management of interest rate risk exposure, as the interest rate swaps effectively convert a portion of the Company’s debt from a floating to a fixed rate. The interest rate swaps are agreements between the Company and counterparties to pay, in the future, a fixed-rate payment in exchange for the counterparties paying the Company a variable payment. The amount of the net payment obligation is based on the notional amount of the swap contract and the prevailing market interest rates. The Company may terminate the swap contracts prior to their expiration dates, at which point a realized gain or loss would be recognized. The value of the Company’s commitment would increase or decrease based primarily on the extent to which interest rates move against the rate fixed for each swap. All derivatives are recognized on the Company’s Consolidated Balance Sheets at their fair values. For accounting hedges, on the date the derivative contract is entered into, the Company designates the derivative as (1) a hedge of the fair value of a recognized asset or liability or of an unrecognized firm commitment (“fair value” hedge) or (2) a hedge of a forecasted transaction (“cash flow” hedge).

The Company previously entered into interest rate swap transactions, with multiple counterparties, which were designated as cash flow hedges. In September 2018, the Company re-couponed its swaps, receiving cash of $6,813, with the corresponding gain recognized ratably over the original term of the hedged instruments. The re-couponed swaps were terminated in December 2019 when the related $460 Million Facility was extinguished. Upon the swaps’ termination, the Company made a payment of $2,486 and recognized the remaining gain that resulted from the re-couponing in September 2018, which are recognized in Interest expense in the condensed consolidated statements of operations.

The changes in Accumulated other comprehensive income by component for the three months ended March 31, 2019 are as follows:

	2019
Accumulated other comprehensive income – January 1,	$	4,387
Other comprehensive (loss) income before reclassifications		(1,621	)
Amounts reclassified from Accumulated other comprehensive income		525
Other comprehensive (loss) income for the period		(1,096	)
Accumulated other comprehensive income – March 31,	$	3,291

The realized gain for the three months ended March 31, 2019 reclassified from Accumulated other comprehensive income consists of a realized loss of ($171) related to interest rate swap contracts and $696 related to the amortization of the gain on re-couponed swaps. The realized (loss) gain reclassified from Accumulated other comprehensive income are presented in Interest expense in the condensed consolidated statements of operations.

In April 2020, the Company entered into interest rate swaps transactions, with multiple counterparties, which were designated as cash flow hedges. In accordance with these transactions, the Company will pay an average fixed-rate interest amount of 0.54% and will receive floating rate interest amounts based on three-month LIBOR settings. These interest rate swaps have a total notional amount outstanding of $205,529 and have an end date of December 23, 2024.

10.

FAIR VALUE OF FINANCIAL INSTRUMENTS

The fair values and carrying amounts of the Company’s financial instruments at March 31, 2020 and December 31, 2019 that are required to be disclosed at fair value, but not recorded at fair value, are as follows:

	March 31, 2020				December 31, 2019
	Carrying Amount		Estimated Fair Value		Carrying Amount		Estimated Fair Value
Cash and cash equivalents	$	110,903	$	110,903	$	83,609	$	83,609
Restricted cash		5,674		5,674		5,610		5,610
Variable rate debt		855,713		855,713		894,310		894,310

The following methods and assumptions are used in estimating the fair value of disclosures for financial instruments:

Cash and cash equivalents, and Restricted cash: The carrying amounts reported in the condensed consolidated balance sheets for Cash and cash equivalents, and Restricted cash approximate fair value. Cash and cash equivalents, and Restricted cash are considered Level 1 items as they represent liquid assets with short-term maturities.

Variable Rate Debt: The fair value of variable rate debt is based on management’s estimate of rates the Company could obtain for similar debt of the same remaining maturities. Additionally, the Company considers its creditworthiness in determining the fair value of variable rate debt under the credit facilities. The carrying amounts in the above table, which exclude the impact of deferred financing costs, approximate the fair market value for the variable rate debt. Variable rate debt is considered to be a Level 2 item as the Company considers the estimate of rates it could obtain for similar debt.

The fair value of an asset or liability is based on assumptions that market participants would use in pricing the asset or liability. The hierarchies of inputs used when determining fair value are described below:

Level 1: Valuations based on quoted prices in active markets for identical instruments that the Company is able to access. Since valuations are based on quoted prices that are readily and regularly available in an active market, valuation of these instruments does not entail a significant degree of judgment.

Level 2: Valuations based on quoted prices in active markets for instruments that are similar, or quoted prices in markets that are not active for identical or similar instruments, and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets.

Level 3: Valuations based on inputs that are unobservable and significant to the overall fair value measurement.

The assessment of the significance of a particular input to the fair value measurement requires judgment and may affect the valuation of financial instruments and the placement of financial instruments within the fair value hierarchy.

The Company does not currently have any Level 3 financial assets and there have been no transfers in and/or out of Level 3 during the three months ended March 31, 2020 and 2019.

11.

REVENUE FROM TIME CHARTERS

The future minimum revenues, before inclusion of profit-sharing revenue, if any, expected to be received on irrevocable time charters for which revenues can be reasonably estimated and the related revenue days that the vessels are available for employment, and not including charterers’ renewal options for the remaining nine months of the year ending December 31, 2020, and annually for the years ending December 31 are as follows:

2020 (for the remaining nine months of the year)	$	41,399
2021		29,717
2022		13,457
Total future committed revenue	$	84,573

12.

Related Party Transactions

During the three months ended March 31, 2020 and 2019, the Company had the following related party transactions.

Capital Ship Management Corp. (“CSM”) — Pursuant to the Transaction Agreement, for a period of five years, CSM will provide commercial and technical management services for the 25 vessels acquired in the Merger. For the three months ended March 31, 2020 and 2019, the following transactions were recorded for these services:

$1,934 and $85, respectively, was incurred for technical management services, which is included in Voyage expenses in the condensed consolidated statements of operations and have been paid as of March 31, 2020.

$745 was incurred during the three months ended March 31, 2020 for commercial management services, which is included in Voyage expenses in the condensed consolidated statements of operations. There were no costs of this nature incurred during the three months ended March 31, 2019. As of March 31, 2020, $579 remains unpaid, and is included in Accounts payable and accrued expenses in the condensed consolidated balance sheet.

$497 was incurred during the three months ended March 31, 2020 for general management services, which is included in General and administrative expenses in the condensed consolidated statements of operations. There were no costs of this nature incurred during the three months ended March 31, 2019. As of March 31, 2020, $169 remains unpaid, and is included in Accounts payable and accrued expenses in the condensed consolidated balance sheet.

Working capital is advanced to CSM to procure both voyage and vessel costs. At March 31, 2020, the net funds advanced totaled $6,074, of which $7,102 is included in Prepaid Expense and Other Current Assets in the condensed consolidated balance sheet (refer to Note 6 — Prepaid Expenses and Other Current Assets), and the $1,028 liability is included in Accounts payable and accrued expenses in the condensed consolidated balance sheet (refer to Note 7 — Accounts Payable and Accrued Expenses). At December 31, 2019, the net funds advanced totaled $4,748, of which $5,757 is included in Prepaid Expense and Other Current Assets in the condensed consolidated balance sheet and the $1,009 liability is included in Accounts payable and accrued expenses in the condensed consolidated balance sheet.

At December 31, 2019, amounts received for activity that occurred prior to the Merger that are due to CSM total $46 and are included in Accounts payable and accrued expenses in the condensed consolidated balance sheet. These amounts were settled during the three months ended March 31, 2020.

13.

Stock-Based Compensation

2019 Equity Incentive Plan — Under the 2019 Equity Incentive Plan (“2019 Plan”), the Company’s Board of Directors, the Compensation Committee, or their designees may grant a variety of stock-based incentive awards representing an aggregate of 3,989,000 shares of common stock to the Company’s officers, directors, employees, and consultants. Such awards include stock options, stock appreciation rights, restricted (nonvested) stock, restricted stock units, and unrestricted stock.

Restricted Stock Units — The Company has issued restricted stock units (“RSUs”) under the 2019 Plan to certain members of the Board of Directors, an executive and certain employees of the Company, which represent the right to receive a share of common stock, or in the sole discretion of the Company’s Compensation Committee, the value of a share of common stock on the date that the RSU vests. Such shares of common stock will only be issued to certain directors, an executive and employees when their RSUs vest under the terms of their grant agreements and 2019 Plan described above.

The RSUs that have been issued to certain members of the Board of Directors vest one year from the date of grant. The RSUs that have been issued to other individuals vest ratably on each of the three anniversaries of the determined vesting date. The table below summarizes the Company’s unvested RSUs for the three months ended March 31, 2020:

			Weighted
	Number of		Average Grant
	RSUs		Date Price
Outstanding at January 1, 2020		74,716	$	14.03
Granted		—		—
Vested		—		—
Forfeited		—		—

Outstanding at March 31, 2020		74,716	$	14.03

The following table summarizes certain information of the RSUs unvested and vested as of March 31, 2020:

Unvested RSUs

Vested RSUs

March 31, 2020

Weighted

Average

Weighted

Average

Remaining

Average

Number of

Grant Date

Contractual

Number of

Grant Date

RSUs

Price

Life

RSUs

Price

74,716

14.03

2.3

—

The Company is amortizing these grants over the applicable graded vesting periods. Forfeitures are taken into account when they occur. As of March 31, 2020, unrecognized compensation cost of $531 related to RSUs will be recognized over a weighted-average period of 2.3 years. For the three months ended March 31, 2020, the Company recognized $261 of nonvested stock amortization expense for the RSUs, which is included in General and administrative expenses.

Restricted Stock — Under the 2019 Plan, grants of restricted common stock were issued to certain members of the Board of Directors, executives and employees. The restricted common stock issued to certain members of the Board of Directors vest one year from the date of grant. The restricted common stock issued to certain executives and employees ordinarily vest ratably on each of the three anniversaries of the determined vesting date. The table below summarizes the Company’s nonvested stock awards for the three months ended March 31, 2020 which were issued under the 2019 Plan:

				Weighted
	Number of			Average Grant
	Shares			Date Price
Outstanding at January 1, 2020		562,790		$	13.44
Granted		—			—
Vested		(6,289	)		13.70
Forfeited		(12,579	)		13.70

Outstanding at March 31, 2020		543,922		$	13.43

For the three months ended March 31, 2020, 6,289 shares vested under the 2019 Plan. There were no shares that vested under the 2019 Plan during the year ended December 31, 2019. For the three months ended March 31, 2020, the Company recognized $1,073 in nonvested stock amortization expense for the 2019 Plan restricted shares, which is included in General and administrative expenses.

The future compensation to be recognized for the aforementioned RSUs and restricted stock as of March 31, 2020 is as follows:

2020 (for the remaining nine months of the year)	$	2,075
2021		1,333
2022		312
Total	$	3,720

In April 2020, certain members of the Company’s management were granted 133,305 shares of restricted stock and RSUs and 133,305 performance restricted stock units. The restricted stock and RSUs vest ratably over a period of three years and have an estimated value of $1.8 million. The performance restricted stock units vest at the end of the three-year period, to the extent that the performance requirements are satisfied, and have an estimated value of $1.7 million.

14.

COMMITMENTS AND CONTINGENCIES

From time to time, the Company may be subject to legal proceedings and claims in the ordinary course of its business. Such claims, even if lacking merit, could result in the expenditure of significant financial and managerial resources. The Company is not aware of any legal proceedings or claims that it believes will have, individually or in the aggregate, a material effect on the Company, its financial condition, results of operations or cash flows.

15.

SEGMENT REPORTING

The Company is engaged primarily in the ocean transportation of crude oil and petroleum products in the international market through the ownership and operation of a diversified fleet of vessels. The international shipping industry has many distinct market segments based, in large part, on the size and design configuration of vessels required. Rates in each market segment are determined by a variety of factors affecting the supply and demand for vessels to move cargoes in the trades for which they are suited. Tankers are not bound to specific ports or schedules and therefore can respond to market opportunities by moving between trades and geographical areas. The Company’s vessels regularly navigate in international waters, over hundreds of trade routes, to hundreds of ports and, as a result, the disclosure of geographic information is impracticable. The Company charters its vessels primarily on voyage charters and on time charters.

The Company has two reportable segments, Crude Tankers and Product Carriers. Segment results are evaluated based on income (loss) from operations. The accounting policies applied to the reportable segments are the same as those used in the preparation of the Company’s consolidated financial statements.

Results for the Company’s revenue and loss from operations by segment for the three months ended March 31, 2020 and 2019 are as follows:

	Crude Tankers			Product Carriers			Total
Three Months Ended March 31, 2020
Voyage revenue	$	90,628		$	119,097		$	209,725
Voyage expenses		(28,349	)		(46,332	)		(74,681	)
Vessel expenses		(11,221	)		(30,315	)		(41,536	)
Depreciation and amortization		(9,946	)		(18,814	)		(28,760	)
General, administrative and management fees⁽¹⁾		(1,977	)		(6,147	)		(8,124	)
Income from operations	$	39,135		$	17,489		$	56,624

Three Months Ended March 31, 2019
Voyage revenue	$	35,409		$	67,247		$	102,656
Voyage expenses		(14,370	)		(27,208	)		(41,578	)
Vessel expenses		(6,760	)		(18,041	)		(24,801	)
Depreciation and amortization		(8,037	)		(13,919	)		(21,956	)
General, administrative and management fees⁽¹⁾		(1,761	)		(4,527	)		(6,288	)
Income from operations	$	4,481		$	3,552		$	8,033

__________________

(1)

Includes direct general and administrative expenses and indirect general and administrative expenses (allocated to each segment based on a formula).

The reconciliations of total assets of the segments to amounts included in the condensed consolidated balance sheets are as follows:

	March 31, 2020		December 31, 2019
Crude Tankers	$	892,728	$	896,897
Product Carriers		1,228,163		1,225,235
Corporate unrestricted cash and cash equivalents		4,940		2,609
Other unallocated amounts		1,548		3,641
Consolidated total assets	$	2,127,379	$	2,128,382

16.

SUBSEQUENT EVENTS

The Company has evaluated all subsequent events to ensure that these condensed consolidated financial statements include appropriate recognition and disclosure of recognized events as of March 31, 2020. Except as disclosed elsewhere in the condensed consolidated financial statements, there were no additional subsequent events that the Company believes require recognition or disclosure.

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion and analysis is designed to provide a better understanding of various factors related to the results of operations and financial condition of Diamond S Shipping Inc. (“we,” “us,” “our” or the “Company”). This discussion should be read in conjunction with our audited consolidated financial statements and the notes thereto included in our Annual Report on Form 10-K (the “2019 Annual Report”) for the year ended December 31, 2019, filed with the SEC on March 27, 2020, and our unaudited condensed consolidated financial statements and notes thereto contained in this report. This discussion contains a number of forward-looking statements, all of which are based on our current expectations and all of which could be affected by uncertainties and risks. Our actual results may differ materially from the results contemplated in these forward-looking statements as a result of many factors including, but not limited to, those described under “Cautionary Note on Forward-Looking Statements”.

Business Overview

Diamond S Shipping Inc. (“DSSI”) was formed on November 14, 2018 under the laws of the Republic of the Marshall Islands for the purpose of receiving, via contribution from CPLP, CPLP’s crude and product tanker business and combining that business with the business and operations of DSS LP pursuant to the Transaction Agreement. For a description of the Transaction Agreement and related Merger, please see Note 1 — Business and Basis of Presentation and Note 3 — Merger Transaction in the unaudited condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q.

We provide seaborne transportation of crude oil, refined petroleum, and other products in the international shipping industry. As of March 31, 2020, through our wholly owned subsidiaries, we owned and operated 64 tanker vessels: 13 Suezmax crude carriers, one Aframax crude carrier and 50 MR product carriers. As of the same date, we also controlled and operated two Suezmax vessels through a joint venture.

Factors to Consider When Evaluating the Company’s Results

The COVID-19 Pandemic

On March 11, 2020, the World Health Organization declared the recent novel coronavirus (“COVID-19”) outbreak a pandemic. In response to the outbreak, many countries, ports and organizations, including those where the Company conducts a large part of its operations, have implemented measures to combat the outbreak, such as quarantines and travel restrictions. Such measures have, and will likely continue to, negatively affect the global economy. The extent to which COVID-19 will impact the Company’s results of operations and financial condition, including possible impairments, will depend on future developments, which are highly uncertain and cannot be predicted, including new information which may emerge concerning the severity of the virus and the actions to contain or treat its impact, among others. Accordingly, an estimate of the impact of COVID-19 on the Company and its operations cannot be made at this time. However, if the pandemic worsens, additional restrictions are imposed or current restrictions are imposed for a longer period of time in response to the outbreak, it may have a material adverse effect on the Company’s future results of operation and financial condition.

The Merger

The Merger, as described in Note 3 — Merger Transaction in the unaudited condensed consolidated financial statements included herein, closed on March 27, 2019. Our condensed consolidated financial statements include operating results for the 25 vessels acquired for 4 days and 91 days during the three months ended March 31, 2019 and 2020, respectively, in addition to the 41 vessels historically owned by us for the full period and the two sold vessels in September 2019.

New Credit Facilities and Refinancings

For a description of the Company’s credit agreements and refinancings, please see Note 8 — Long-Term Debt in the unaudited condensed consolidated financial statements included herein.

Vessel Dispositions

In August 2019, our Board of Directors approved selling the Atlantic Aquarius and Atlantic Leo, both 2009-built MR vessels. We reached an agreement to sell the Atlantic Aquarius and Atlantic Leo, each for $16.0 million less a 1% broker commission payable to a third party. In September 2019, we completed the sale of the Atlantic Aquarius and Atlantic Leo.

Share Repurchase Program

On March 4, 2020, our Board of Directors approved a share repurchase program, providing authorization to repurchase up to $50 million of our common shares, effective for a period of one year. We may repurchase these shares in the open market or in privately negotiated transactions, at times and prices that we consider to be appropriate. As of March 31, 2020, we repurchased 137,289 shares for a total of $1.4 million under the share repurchase program.

Other Trends and Factors Affecting the Company’s Future Results of Operations

The principal factors that have affected our results of operations, and may in the future affect results of operations, are the economic, regulatory, financial, credit, political and governmental conditions prevailing in the tanker market and shipping industry generally and in the countries and markets in which our vessels are chartered.

The world economy has experienced significant economic and political upheavals in recent history. In addition, credit supply has been constrained and financial markets have been particularly turbulent. Protectionist trends, global growth and demand for the seaborne transportation of goods, including oil and oil products and overcapacity and deliveries of newly-built vessels have affected, and may further affect, the tanker market and shipping industry in general and the business, financial condition, results of operations and cash flows of the Company.

Some of the key factors that have affected our business, financial condition, results of operations and cash flows, and may in the future affect our business, financial condition, results of operations and cash flows, include the following:

levels of oil product demand and inventories;

supply and demand for crude oil and oil products;

charter hire levels (under time and bareboat charters) and the ability to re-charter vessels at competitive rates as their current charters expire;

developments in vessel values, which may affect compliance with covenants under credit facilities and/or debt refinancing;

compliance with covenants in credit facilities, including covenants relating to the maintenance of vessel value ratios;

the level of debt and the related interest expense and amortization of principal;

access to debt and equity and the cost of capital required to acquire additional vessels;

supply and order-book of tanker vessels;

the ability to increase the size of the fleet and make additional acquisitions that are accretive to earnings;

the ability of the commercial and chartering operations to successfully employ vessels at economically attractive rates, particularly as charters expire and the fleet expands;

the continuing demand for crude oil and oil products from China, India, Brazil and Russia and other emerging markets;

the ability to comply with new maritime regulations, the more restrictive regulations for the transport of certain products and cargoes and the increased costs associated therewith;

changes in fuel prices, including as a result of the imposition of sulfur oxide emissions limits in 2020 under new regulations adopted by the IMO (for those vessels that are not retrofitted with scrubbers);

the effective and efficient technical management of the vessels;

the costs associated with upcoming drydocking of vessels;

the ability to obtain and maintain major international oil company approvals and to satisfy technical, health, safety and compliance standards;

the strength of and growth in the number of the customer relationships, especially with major international oil companies and major commodity traders;

the prevailing spot market rates and the number of vessels operating in the spot market; and

the ability to acquire and sell vessels at satisfactory prices.

Operating Data

The following table represents the operating data for the three months ended March 31, 2020 and 2019 on a consolidated basis.

	For the Three Months Ended March 31,
	2020			2019			Change			% Change
	(In Thousands, Except Per Share and Share Data)
Revenue:
Spot revenue	$	187,652		$	98,449		$	89,203			90.6	%
Time charter revenue		22,073			4,207			17,866			424.7	%
Voyage revenue		209,725			102,656			107,069			104.3	%

Operating expenses:
Voyage expenses		74,681			41,578			33,103			79.6	%
Vessel expenses		41,536			24,801			16,735			67.5	%
Depreciation and amortization expense		28,760			21,956			6,804			31.0	%
General and administrative expenses		8,124			6,288			1,836			29.2	%
Total operating expenses		153,101			94,623			58,478			61.8	%
Operating income		56,624			8,033			48,591			604.9	%
Other (expense) income:
Total other expense — Net		(11,043	)		(8,853	)		(2,190	)		24.7	%
Net income (loss)		45,581			(820	)		46,401			(5,658.7	)%
Less: Net income attributable to noncontrolling interest		537			206			331			160.7	%
Net income (loss) attributable to Diamond S Shipping Inc.	$	45,044		$	(1,026	)	$	46,070			(4,490.3	)%

Net earnings (loss) per share – basic	$	1.13		$	(0.04	)	$	1.17			(2,925.0	)%
Net earnings (loss) per share –diluted	$	1.12		$	(0.04	)	$	1.16			(2,900.0	)%

Weighted average common shares outstanding – basic		39,891,346			27,731,252			12,160,094			43.8	%
Weighted average common shares outstanding – diluted		40,159,966			27,731,252			12,428,714			44.8	%

Results of Operations

Three months ended March 31, 2020 compared to the three months ended March 31, 2019

Voyage revenue

Voyage revenue increased by $107.0 million to $209.7 million during the three months ended March 31, 2020 as compared to $102.7 million for the three months ended March 31, 2019. The $107.0 million increase was principally driven by a 52.8% increase in revenue days due to an additional 2,127 revenue days during the three months ended March 31, 2020 due to the acquisition of the 25 vessels in the Merger coupled with strong market conditions in both the crude tankers and product carriers segments.

Voyage Expenses

Voyage expenses primarily consist of bunkers, port expenses, canal dues and commissions. Commissions were paid to shipbrokers for negotiating and arranging charter party agreements on the Company’s behalf. Voyage expenses incurred during time and pools are paid for by the charterer or pool manager, except for commissions, which were paid for by the Company. Voyage expenses incurred during voyage charters were paid for by the Company.

Voyage expenses increased by $33.1 million to $74.7 million during the three months ended March 31, 2020 as compared to $41.6 million for the three months ended March 31, 2019. The $33.1 million increase in voyage expenses was driven by a 30.1% increase in spot revenue days due to the Merger.

Vessel Expenses

Vessel expenses include crew wages and associated costs, the cost of insurance premiums, expenses relating to repairs and maintenance, lubricants and spare parts, technical management fees and other miscellaneous expenses.

Vessel expenses increased by $16.7 million to $41.5 million during the three months ended March 31, 2020 as compared to $24.8 million for the three months ended March 31, 2020. The $16.7 million increase in vessel expenses was driven a 51.3% increase in vessel operating days, which consists of an increase of 2,175 vessel operating days due to the Merger, offset by a decrease of 180 vessel operating days as a result of the sales of the Atlantic Aquarius and Atlantic Leo, which occurred in September 2019.

Vessel Depreciation and Amortization Expense

We depreciate the cost of our vessels on a straight-line basis over the expected useful life of each vessel. Depreciation is based on the cost of the vessel less its estimated residual value. We estimate the useful life of our vessels to be 25 years, and we estimate the residual value by taking the estimated scrap value of $300 per lightweight ton times the weight of the ship in lightweight tons. We continue to monitor changes in the oil and petroleum product supply chain that might have an impact on the useful operating life of our assets.

Depreciation and amortization expense increased by $6.8 million to $28.8 million during the three months ended March 31, 2020 as compared to $21.0 million during the three months ended March 31, 2019. This increase is due to the added depreciation expense for the 25 vessels acquired in the Merger, offset by the decrease in the depreciation and amortization expense related to the sale of the Atlantic Aquarius and Atlantic Leo in September 2019.

General and Administrative Expenses

For the three months ended March 31, 2020 and 2019, general and administrative expenses were $8.1 million and $6.3 million, respectively. The $1.8 million increase was primarily due to stock-based compensation costs, legal fees in connection with the annual filings and an increase in headcount to maintain the infrastructure of a public company and to manage a larger fleet employed in the spot market.

Total Other Expense, net

Total other expense, net, which includes term loan interest, amortization of deferred financing charges and commitment fees and net of interest income, was $11.0 million for the three months ended March 31, 2020 compared to $8.9 million for the three months ended March 31, 2019. The increase of $2.1 million was primarily driven by an increase in average debt balance due to entering into the $360 Million Facility on March 27, 2019.

Net Income Attributable to Noncontrolling Interest

The net income attributable to noncontrolling interest was net income of $0.5 million for the three months ended March 31, 2020 compared to net income of $0.2 million for the three months ended March 31, 2019. The net income attributable to noncontrolling interest primarily represents a 49% interest in NT Suez Holdco LLC, which owns and operates two Suezmax vessels and is 51% owned by the Company.

Liquidity and Capital Resources

As of March 31, 2020 and December 31, 2019, total cash, cash equivalents and restricted cash were $116.6 million and $89.2 million, including restricted cash of $5.7 million and $5.6 million, respectively. As of March 31, 2020 and December 31, 2019, the Company had $20.0 million and $15.0 million available and undrawn under its credit facilities, respectively.

Generally, the primary sources of funds have been cash from operations and undrawn amounts under credit facilities.

Effective upon completion of the Merger, the Company has indebtedness outstanding under a new term loan and revolving credit facility, arranged in connection with the Merger, and indebtedness under previously existing credit facilities of the Company. Refer to Note 8 — Long-Term Debt in our unaudited condensed consolidated financial statements included herein.

On December 27, 2019, we refinanced (i) the $460 Million Facility, (ii) the $235 Million Facility, and (iii) the $75 Million Facility with the proceeds of the $525 Million Facility.

At March 31, 2020, we were in compliance with all financial covenants under each of the Company’s credit facilities.

Passage of environmental legislation or other regulatory initiatives have in the past had, and may in the future may have, a significant impact on our operations. Regulatory measures can increase required costs related to operating and maintaining our vessels and may require us to retrofit our vessels with new equipment to comply with new or existing regulations.

Among other capital expenditures, in connection with the International Maritime Organization’s new limits for sulfur oxide emissions effective January 1, 2020, we contracted for the purchase and installation of scrubbers on five of our Suezmax vessels. Two of these scrubbers have been installed and the remaining three are expected to be installed before the end of 2020. The total aggregate capital expenditures for these five scrubbers is approximately $15.7 million, of which $7.7 million has been paid as of March 31, 2020. We may, in the future, determine to purchase additional scrubbers for installation on other vessels that we own or operate. In addition, with respect to vessels that are not retrofitted with scrubbers, we expect to incur expenditures to ensure those vessels are capable of efficiently using low-sulfur fuel, which expenditures are not expected to be significant or which have not yet been determined.

We entered into contracts to install ballast water treatment systems on 15 of our vessels for a total estimated cost of $16.9 million, of which $12.6 million has been paid as of March 31, 2020. These vessels have compliance dates that require such installations to be completed in 2019 and 2020.

We believe that we have sufficient capital resources to fund our operations and anticipated capital requirements for the next twelve months. However, should market conditions deteriorate beyond third-party forecasts, we would consider a number of liquidity enhancing measures, which could include refinancing a portion of our senior debt, exploring unsecured debt instruments, asset sales and sale-leaseback transactions on certain of our assets.

Cash Flows

The following table summarizes the Company’s cash and cash equivalents provided by or used in operating, financing and investing activities for the periods presented below (presented in millions):

	For the Three Months Ended March 31,
	2020			2019
Net Cash Provided by Operating Activities	$	70.9		$	5.9
Net Cash Used in Investing Activities		(1.5	)		(313.1	)
Net Cash (Used in) Provided by Financing Activities		(42.1	)		300.4

Net Cash Provided by Operating Activities

Net cash provided by operating activities during the three months ended March 31, 2020 and 2019 was $70.9 million and $5.9 million, respectively. The increase of $40.0 million was mainly attributable to more revenue days and higher charter rates that increased our revenues, and overall net income for the three months ended March 31, 2020, when compared to the three months ended March 31, 2019.

Net Cash Used in Investing Activities

Net cash used in investing activities refers primarily to cash used for vessel acquisitions and improvements, and the Merger. Net cash used by investing activities during the three months ended March 31, 2020 and 2019 was $1.5 million and $313.1 million, respectively. The $1.5 million net cash used by investing activities during the three months ended March 31, 2020 was for additions to vessels and other property, while the $313.1 million net cash used by investing activities during the three months ended March 31, 2019 included the consideration paid in connection with the Merger, with $292.7 million paid to CPLP to acquire the vessels, and $17.8 million paid in transaction costs.

Net Cash (Used in) Provided by Financing Activities

Net cash (used in) provided by financing activities during the three months ended March 31, 2020 and 2019 was ($42.1) million and $300.4 million, respectively. The change in cash (used in) provided by financing activities was due to the financing activities that we engaged in during the two comparable periods. During the three months ended March 31, 2020, the main outflows of cash for financing activities consisted of making debt payments of $38.6 million, making a $1.6 million distribution to the noncontrolling interest in the NT Suez Holdco LLC entity, and paying $1.4 million to repurchase shares under the share repurchase program. During the three months ended March 31, 2019 we had borrowings under the $360 Million Facility, consisting of $300 million in the term loan drawn and $45 million, which were offset by $26.4 million repaid on lines of credit that were cancelled in connection with the Merger, and $6.5 million in deferred financing costs paid in connection with the $360 Million Facility.

Off-Balance Sheet Arrangements

The Company does not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to investors.

Contractual Obligations and Contingencies

The following table summarizes the Company’s long-term contractual obligations as of March 31, 2020 (in thousands of U.S. dollars).

	Payment due by period
	Total		Less than 1 year		1 – 3 years		3 – 5 years		More than 5 years
Long-term Debt Obligations	$	855,713	$	100,792	$	307,421	$	447,500	$	—
Interest Obligations⁽¹⁾		73,523		19,936		35,339		18,248		—
Capital Obligations (scrubbers and ballast water treatment systems)		11,819		11,819		—		—		—
Lease Obligations		6,930		680		1,909		2,401		1,940
Total:	$	947,985	$	133,227	$	344,669	$	468,149	$	1,940

(1)

Interest has been estimated based on the LIBOR forward rates and the prescribed margin for each of our facilities. Refer to Note 8 — Long-Term Debt of our unaudited condensed consolidated financial statements contained herein.

Critical Accounting Policies

The Company’s condensed consolidated financial statements are prepared in accordance with U.S. GAAP. The preparation of these financial statements requires the Company to make estimates and judgments that affect the reported amount of assets and liabilities, revenues and expenses and related disclosure of contingent assets and liabilities at the date of our financial statements. Actual results may differ from these estimates under different assumptions or conditions.

Critical accounting policies are those that reflect significant judgments or uncertainties, and which could potentially result in materially different results under different assumptions and conditions. The Company has described below what its management believes are its most critical accounting policies. For a description of all of the Company’s significant accounting policies, see Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations — B. Liquidity and Capital Resources — Critical Accounting Policies and Note 2 — Summary of Significant Accounting Policies, each contained in our 2019 Annual Report, and in Note 2 — Summary of Significant Accounting Policies in our unaudited condensed consolidated financial statements included herein, for further information.

Revenue Recognition

During the three months ended March 31, 2020 and 2019, revenues are generated from time charters and voyage charters.

We recognize revenues over the term of the time charter when there is a time charter agreement, where the rate is fixed or determinable, service is provided and collection of the related revenue is reasonably assured. We do not recognize revenue during days the vessel is off-hire. Where the time charter contains a profit or loss sharing arrangement, the profit or loss is recognized based on amounts earned or incurred as of the reporting date.

For the three months ended March 31, 2020 and 2019, pursuant to the new revenue recognition guidance, which was adopted as of January 1, 2019, revenue for spot market voyage charters is recognized ratably over the total transit time of each voyage, which commences at the time the vessel arrives at the loading port and ends at the time the discharge of cargo is completed at the discharge port. Previously, revenue was recognized on the later of when the vessel departed from its last discharge port or when an agreement was entered into with the charterer, and ended at the time the discharge of cargo was completed at the discharge port. In time charters, operating costs including crews, maintenance and insurance are typically paid by the owner of the vessel and specified voyage costs such as fuel and port charges are paid by the charterer. These voyage expenses are borne by us when the vessels are engaged in spot market voyage charters. As such, there are significantly higher voyage expenses for spot market voyage charters as compared to time charters.

Vessel Lives and Impairment

The carrying value of each of the Company’s vessels represents its original cost (contract price plus initial expenditures) at the time of delivery or purchase less accumulated depreciation or impairment charges. The carrying values of vessels may not represent their fair market value at any point in time since the market prices of secondhand vessels tend to fluctuate with changes in charter rates and the cost of newbuildings. In recent years changing market conditions resulted in a decrease in charter rates and values of assets. We consider these market developments as indicators of potential impairment of the carrying amount of its assets.

In developing estimates of future undiscounted cash flows, we make assumptions and estimates about the vessels’ future performance, with the significant assumptions being related to charter rates, fleet utilization, vessels’ operating expenses, vessels’ capital expenditures and drydocking requirements, vessels’ residual value and the estimated remaining useful life of each vessel. The assumptions used to develop estimates of future undiscounted cash flows are based on historical trends. Specifically, we utilize the rates currently in effect for the duration of their current time charters, without assuming additional profit-sharing. For periods of time where the vessels are not fixed on time charters, we utilize an estimated daily time charter equivalent for its vessels’ unfixed days based on the most recent ten year historical one-year time charter average.

Although we believe that the assumptions used to evaluate potential impairment are reasonable and appropriate at the time they were made, such assumptions are highly subjective and likely to change, possibly materially, in the future. In recent years, the market values of vessels have experienced particular volatility, with substantial declines in many of the charter-free market value, or basic market value, of various vessel classes. As a result, the market value of our vessels may have declined below their carrying values, even though we did not impair their carrying values under our impairment accounting policy. This is due to management’s projection that future undiscounted cash flows expected to be earned by such vessels over their operating lives will exceed such vessels’ carrying amounts.

Deferred Drydocking Costs and Amortization

We use the deferral method of accounting for drydocking costs. Under the deferral method, drydocking costs are deferred and amortized on a straight-line basis over the useful life of the drydock, which is estimated to be approximately 30 to 60 months. Management uses judgment when estimating the period between drydocks performed, which can result in adjustments to the estimated amortization of drydock expense if drydocks occur earlier or later than originally estimated. We update our estimate of a vessel’s next scheduled drydock as necessary. If the vessel is disposed of before the next drydock, the remaining balance in deferred drydock is written-off as a component of the gain or loss upon disposal of vessels. We defer the costs associated with drydocking as they occur and amortize these costs on a straight-line basis over the period between drydocking. Deferred drydocking costs include actual costs incurred at the drydock yard, cost of travel, lodging and subsistence of our personnel sent to the drydocking site to supervise, and the cost of hiring a third party to oversee the drydocking. Expenditures for normal maintenance and repairs, whether incurred as part of the drydock or not, are expensed as incurred. If the vessel is drydocked earlier than originally anticipated, any remaining deferred drydock costs that have not been amortized are expensed at the beginning of the next drydock.

Recent Accounting Pronouncements

New Accounting Standards to be Implemented

In February 2016, the FASB issued ASU No. 2016-02, “Leases (Topic 842)” (“ASU 2016-02”), which establishes a comprehensive new lease accounting model. ASU 2016-02 clarifies the definition of a lease, requires a dual approach to lease classification similar to current lease classifications, and causes lessees to recognize leases on the balance sheet as a lease liability with a corresponding right-of-use asset for leases with a lease term of more than twelve months. For the Company, ASU 2016-02 is effective for annual periods beginning after December 15, 2020, and interim reporting periods within annual reporting periods beginning after December 15, 2021, with early adoption permitted. The most significant effects of adoption relate to the recognition of right-of-use assets and lease liabilities on the balance sheet for operating leases and providing new disclosures about our leasing activities. We are currently analyzing our contracts and will then calculate the right-of-use assets and lease liabilities as of January 1, 2021 based on the present value of our remaining minimum lease payments, primarily due to the recognition of right-of-use assets and lease liabilities with respect to operating leases.

In June 2016, the FASB issued ASU No. 2016-13, “Financial Instruments—Credit Losses (Topic 326)” (“ASU 2016-13”), which amends several aspects of the measurement of credit losses on financial instruments based on an estimate of current expected credit losses. ASU 2016-13 will apply to loans, accounts receivable, trade receivables, other financial assets measured at amortized cost, loan commitments and other off-balance sheet credit exposures. ASU 2016-13 will also apply to debt securities and other financial assets measured at fair value through other comprehensive income. For the Company, ASU 2016-13 is effective for annual periods beginning after December 15, 2020, and interim reporting periods within annual reporting periods beginning after December 15, 2021, with early adoption permitted. We are currently evaluating the potential impact of this pronouncement on the condensed consolidated financial statements.

Quantitative and Qualitative Disclosures About Market Risk

Interest Rate Risk

The Company is exposed to the impact of interest rate changes primarily through floating-rate borrowings that require it to make interest payments based on the Eurodollar Rate. Significant increases in interest rates could adversely affect operating margins, results of operations and our ability to service debt. The Company uses, interest rate swaps to reduce its exposure to market risk from changes in interest rates. The principal objective of these contracts is to minimize the risks and costs associated with floating-rate debt.

The Company is exposed to the risk of credit loss in the event of non-performance by the counterparties to the interest rate swap agreements. In order to minimize counterparty risk, the Company only entered into derivative transactions with counterparties that are rated A- or better by Standard & Poor’s Financial Services LLC or A3 or better by Moody’s Investors Service, Inc. at the time of the transactions. In addition, to the extent possible and practical, interest rate swaps are entered into with different counterparties to reduce concentration risk.

From time to time, the Company enters into interest rate swap agreements to modify its exposure to interest rate movements and to manage its interest expense. As of March 31, 2020, none of the debt was fixed and 100% was variable. Based on the Company’s March 31, 2020 outstanding variable rate debt balance, a one percentage point increase in annual Eurodollar Rates would increase its annual interest expense by approximately $8.2 million.

Inflation

Inflation has only a moderate effect on the Company’s expenses given current economic conditions. In the event that significant global inflationary pressures appear, these pressures would increase the Company’s operating, voyage, general and administrative and financing costs.

Foreign Exchange Risk

The shipping industry’s functional currency is the U.S. dollar. All of the Company’s revenues and most of its operating costs are in U.S. dollars. The Company incurred certain operating expenses, such as vessel and general and administrative expenses, in currencies other than the U.S. dollar, and the foreign exchange risk associated with these operating expenses has historically been immaterial. If foreign exchange risk becomes material in the future, the Company may seek to reduce its exposure to fluctuations in foreign exchange rates through the use of short-term currency forward contracts and through the purchase of bulk quantities of currencies at rates that management considers favorable. For contracts which qualify as cash flow hedges for accounting purposes, hedge effectiveness would be assessed based on changes in foreign exchange spot rates with the change in fair value of the effective portions being recorded in accumulated other comprehensive loss.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The information called for by Item 3 is set forth in Item 2 under the caption “Quantitative and Qualitative Disclosures About Market Risk” and is incorporated herein by reference.

ITEM 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

Management conducted an evaluation under the supervision and with the participation of our Chief Executive Officer and Chief Financial Officer, of the effectiveness of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, as of March 31, 2020. Disclosure controls and procedures are those controls and other procedures that are designed to ensure that information required to be disclosed in reports filed or submitted under the Exchange Act is recorded, processed, summarized, and reported, within the time periods specified by the rules and forms promulgated by the SEC. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that such information is accumulated and communicated to management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure. As a result of this evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective as of March 31, 2020.

Changes in Internal Control Over Financial Reporting

There were no changes to our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) that occurred during the three months ended March 31, 2020, that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

From time to time we are involved in litigation with respect to matters arising from the ordinary conduct of our business, and currently certain claims are pending against us. In the opinion of management, based upon presently available information, either adequate provision for anticipated costs have been accrued or the ultimate anticipated costs will not materially affect our consolidated financial position, results of operations, or cash flows.

ITEM 1A. RISK FACTORS

In addition to the other information set forth in this report, you should carefully consider the factors discussed in “Item 1A. Risk Factors” in the Company’s 2019 Annual Report, which could materially affect our business, financial condition or future results. The risks described in our 2019 Annual Report are not the only the risks facing our Company. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially adversely affect our business, financial condition, and/or operating results in the future.

The current COVID-19 pandemic and governmental responses thereto could adversely affect the Company’s business.

As previously disclosed by the Company, the recent and ongoing outbreak of the novel coronavirus (“COVID-19”) has caused severe global disruptions and has and may continue to negatively affect economic conditions regionally as well as globally and otherwise impact the Company’s operations and the operations of the Company’s customers and suppliers. Governments in affected countries have imposed travel bans, quarantines and other emergency public health measures in an effort to contain the outbreak. These measures have resulted in a significant reduction in global economic activity and extreme volatility in the global financial markets which has reduced the global demand for oil and refined petroleum products. Additionally, as a result of restrictive measures, the Company’s vessels may not be able to call on ports, or may be restricted from disembarking from ports, located in regions affected by the outbreak. The Company may also experience operational disruptions and delays, unavailability of normal port infrastructure and services including limited access to equipment, critical goods and personnel, disruptions to crew change, quarantine of ships and/or crew, counterparty solidity, closure of ports and custom offices, as well as disruptions in the supply chain and industrial production, which may lead to reduced cargo demand, amongst other potential consequences attendant to pandemic diseases. If the COVID-19 pandemic continues on a prolonged basis or becomes more severe, the rate environment in the crude and product markets may deteriorate and our operations and cash flows may be negatively impacted. A prolonged negative rate environment could result in the value of our vessels being impaired which could in turn impair our ability to borrow amounts under our revolving credit facilities or to access to credit and capital markets in the future on favorable terms or at all.

The extent to which COVID-19 will impact the Company’s results of operations and financial condition, including possible impairments, will depend on future developments, which are highly uncertain and cannot be predicted, including new information which may emerge concerning the severity of the virus and the actions to contain or treat its impact, among others. Accordingly, an estimate of the impact of COVID-19 on the Company and its operations cannot be made at this time. However, if the pandemic worsens, additional restrictions are imposed or current restrictions are imposed for a longer period of time in response to the outbreak, it may have a material adverse effect on the Company’s future results of operation and financial condition.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

There were no unregistered sales of equity securities in the three months ended March 31, 2020.

The following table sets forth the information with respect to purchases of our common stock made by or on behalf of us during the three months ended March 31, 2020:

Period	Total number of shares purchased	Average price paid per share	Total number of shares purchased as part of publicly announced plans or programs⁽¹⁾	Maximum approximate dollar value of shares that may yet be purchased under the plans or programs
January 1- 31, 2020
February 1-29, 2020
March 1-31, 2020	137,289	$10.33	137,289	$48.6 million

(1) On March 4, 2020, the Board of Directors approved a share repurchase program, providing authorization to repurchase up to $50 million of our common shares, effective for a period of one year. We may repurchase these shares in the open market or in privately negotiated transactions, at times and prices that we consider to be appropriate.

ITEM 6. EXHIBITS

Exhibit No.		Description
2.1		Transaction Agreement, dated as of November 27, 2018 (the “Transaction Agreement”), by and among DSS Holdings L.P., DSS Crude Transport Inc., DSS Products Transport Inc., Diamond S Technical Management LLC, Capital Product Partners L.P., Athena SpinCo Inc., Athena Mergerco 1 Inc., Athena Mergerco 2 Inc., Athena Mergerco 3 LLC, and Athena Mergerco 4 LLC (incorporated by reference to Exhibit 2.1 to the Company’s Registration Statement on Form 10, initially filed on December 21, 2018 (the “Form 10”))†

2.2		Amendment No. 1, dated March 7, 2019, to the Transaction Agreement (incorporated by reference to Exhibit 2.2 to the Form 10)

3.1		Articles of Amendment of the Articles of Incorporation of Athena SpinCo Inc. (now known as Diamond S Shipping Inc.) (incorporated by reference to Exhibit 3.2 to the Form 10)

3.2		Amended and Restated Articles of Incorporation of Diamond S Shipping Inc. (incorporated by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K filed with the SEC on March 21, 2019)

3.3		Amended and Restated Bylaws of Diamond S Shipping Inc. (incorporated by reference to Exhibit 3.2 to the Company’s Current Report on Form 8-K filed with the SEC on March 21, 2019)

4.1		Registration Rights Agreement, dated March 27, 2019 (incorporated by reference to Exhibit 10.8 to the Company’s Current Report on Form 8-K, filed on March 29, 2019 (the “March 29 Form 8-K”))

4.2		Director Designation Agreement, dated March 27, 2019, with certain former CPLP investors (incorporated by reference to Exhibit 10.2 to the March 29 Form 8-K)

4.3		Director Designation Agreement, dated March 27, 2019, with certain WLR investors (incorporated by reference to Exhibit 10.3 to the March 29 Form 8-K)

4.4		Director Designation Agreement, dated March 27, 2019, with First Reserve Investors (incorporated by reference to Exhibit 10.4 to the March 29 Form 8-K)

10.1		Employment Agreement, dated as of April 9, 2020, between Diamond S Management LLC and Craig H. Stevenson, Jr.

10.2		Employment Agreement, dated as of April 2, 2020, between Diamond S Management LLC and Kevin M. Kilcullen

10.3		Employment Agreement, dated as of April 7, 2020, between Diamond S Management LLC and Sanjay Sukhrani

31.1		Certification Pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934, As Adopted Pursuant To Section 302 of the Sarbanes-Oxley Act of 2002, by Craig H. Stevenson, Jr., Chief Executive Officer.

31.2		Certification Pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934, As Adopted Pursuant To Section 302 of the Sarbanes-Oxley Act of 2002, by Kevin M. Kilcullen, Chief Financial Officer.

32.1		Certification Pursuant to 18 U.S.C. Section 1350, As Adopted Pursuant To Section 906 of the Sarbanes-Oxley Act of 2002, by Craig H. Stevenson, Jr., Chief Executive Officer.*

32.2		Certification Pursuant to 18 U.S.C. Section 1350, As Adopted Pursuant To Section 906 of the Sarbanes-Oxley Act of 2002, by Kevin M. Kilcullen.*

101.INS		XBRL Instance Document

101.SCH		XBRL Taxonomy Extension Schema Document

101.CAL		XBRL Taxonomy Extension Calculation Linkbase Document

101.LAB		XBRL Taxonomy Extension Label Linkbase Document

101.PRE		XBRL Taxonomy Extension Presentation Linkbase Document

101.DEF		XBRL Taxonomy Extension Definition Linkbase Document

†

Certain schedules, exhibits and similar attachments have been omitted pursuant to Item 601(b)(2) of Regulation S-K. The registrant agrees to furnish a copy of any such omitted schedule or similar attachment to the SEC upon request.

The certifications attached as exhibits 32.1 and 32.2 to this quarterly report on Form 10-Q are “furnished” to the SEC pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and shall not be deemed “filed” by the Company for purposes of Section 18 of the Securities Exchange Act of 1934, as amended.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

		DIAMOND S SHIPPING INC.

Date:	May 13, 2020	By:	/s/ Craig H. Stevenson, Jr.
			Craig H. Stevenson, Jr.
			Chief Executive Officer and President
			(Principal Executive Officer)

Date:	May 13, 2020	By:	/s/ Kevin M. Kilcullen
			Kevin M. Kilcullen
			Chief Financial Officer
			(Principal Financial Officer)

Exhibit 10.1

This AMENDED AND RESTATED EMPLOYMENT AGREEMENT (this “Agreement”), dated as of April 9, 2020 (the “Effective Date”), between Diamond S Management LLC, a limited liability company organized under the laws of the Marshall Islands (the “Company”), and Craig H. Stevenson, Jr. (“Executive”).

WHEREAS, Executive is currently employed by the Company pursuant to an amended and restated employment agreement, dated September 27, 2011 between the Company and Executive (the “Previous Employment Agreement”).

WHEREAS, the parties desire to amend and restate the Previous Employment Agreement and to continue to employ Executive, and Executive desires to remain employed with the Company, subject to the terms and conditions set forth herein.

NOW, THEREFORE, in consideration of the covenants and agreements hereinafter set forth and other good and valuable consideration, and intending to be legally bound hereby, the parties hereto agree as follows:

1. Term. The Company agrees to continue to employ Executive, and Executive agrees to remain in the employ of the Company, subject to the terms and conditions of this Agreement, for the period commencing on the date hereof and ending on the second anniversary thereof (such period, the “Term”), unless such employment is earlier terminated in accordance with this Agreement. Notwithstanding the foregoing, the Term shall automatically be extended for additional one-year periods, unless, at least 60 days prior to the end of the then existing Term, either party hereto gives written notice to the other party that it does not desire the Term to be so extended.

2. Position, Duties and Responsibilities.

(a) During the Term, Executive shall serve as the Chief Executive Officer of the Company. Executive’s principal work location shall be at the Company’s offices at 33 Benedict Place, Greenwich, CT USA. Executive shall report directly and solely to the Board of Directors of Diamond S Shipping Inc., a Marshall Islands corporation (the “Parent”) (the Board of Directors of the Parent, hereinafter the “Board”) and shall have the duties customarily assigned to the chief executive officer of a public company operating in the Company’s industry.

(b) During the Term, Executive shall devote substantially all his working time to the business of the Company and the Parent, and each and all of the Company’s and the Parent’s respective direct and indirect affiliates and subsidiaries (collectively, the “Company Group”). Notwithstanding the foregoing, it shall not be a violation of this Agreement for Executive to (i) serve as a director or an officer of, or otherwise participate in, non-profit, educational, social welfare, religious and civic organizations, (ii) subject to the advance written approval of the Board (or the applicable committee or sub-committee to which such power has been delegated), serve as a director of a for-profit entity or (iii) manage his personal, financial (to the extent Executive makes passive investments only) and legal affairs, in each case, so long as any such activities do not unreasonably interfere with the performance of his duties and responsibilities to the Company and the Company Group and comply with the conflict-of-interest policies established by the Company and the members of the Company Group.

(c) Executive shall at all times comply with and be subject to all applicable law, rules and regulations and such policies and procedures as the Company, the Parent and Diamond S Management LLC, a limited liability company organized under the laws of Delaware (the “Delaware Entity”) may establish from time to time for the executives of the Company, the Parent and the Delaware Entity, including, without limitation the Code of Business Conduct and Ethics as adopted by the Parent, and, to the extent made known to Executive in writing, any other policy adopted by a member of the Company Group applicable to Executive, in each case as amended from time to time.

(d) Executive acknowledges and agrees that Executive has a fiduciary duty of loyalty, fidelity and allegiance to act at all times in the best interests of the Company and the Company Group and to do no act that could, directly or indirectly, injure the business, interests, or reputation of the Company or the members of the Company Group. In furtherance of the foregoing, Executive will present to the Board or other member of management all material business opportunities or ventures made known to Executive, independently or with others, that are within the business purposes of the Company and/or the Company Group, including, without limitation, opportunities that may compete with the Company or the members of the Company Group and could reasonably be expected to be implemented by the Company and/or the Company Group.

3. Compensation and Benefits.

(a) Base Salary. During the Term, Executive shall be paid an annual base salary of $969,000 (“Base Salary”). The Base Salary shall be payable monthly in accordance with the Company’s regular payroll practices. During the Term, the Base Salary shall be reviewed annually and is subject to upward adjustment, but in no event shall the Company pay Executive a Base Salary less than that set forth above.

(b) Bonus. During the Term, Executive shall have an opportunity to earn a cash bonus (“Annual Bonus”) for each fiscal year during the Term with a target amount of at least 100% of Executive’s Base Salary for the current fiscal year (“Target Bonus”). The Annual Bonus shall be subject to performance goals determined each fiscal year by the Board (or the applicable committee or sub-committee to which such authority has been delegated), of which 80% of the applicable Target Bonus shall be subject to goals based on the Parent’s performance and 20% of the applicable Target Bonus shall be subject to goals based on Executive’s individual performance. The aggregate amount of any Annual Bonus actually payable to Executive hereunder, if any, shall be determined by the Board (or the applicable committee or sub-committee to which such authority has been delegated) in its reasonable discretion as soon as practicable following the end of the applicable fiscal year, and shall be paid no later than the 15th day of the third month following such fiscal year end. In order to be eligible for any Annual Bonus, Executive must be in the active employ of the Company as of December 31 of the applicable fiscal year.

(c) Equity Compensation. During the Term beginning in fiscal year 2020, Executive shall be eligible to receive annual grants of long-term incentive awards (“LTIP Awards”) under the Parent’s 2019 Equity and Incentive Compensation Plan, as may be amended or superseded. Executive’s target LTIP Award opportunity with respect to each fiscal year shall be at least 100% of Executive’s Base Salary. The other terms and conditions of such LTIP Awards (including the mix of award types and vesting provisions) shall be substantially similar to the terms and conditions provided to other senior executives of the Company.

(d) Retirement, Savings and Welfare Plans. During the Term, Executive shall be eligible to participate in the retirement, savings, health and welfare benefit and perquisite and fringe benefit plans, programs, policies and practices substantially similar to those offered to other senior executives of the Company or the members of the Company Group.

(e) Vacation. During the Term, Executive shall be entitled in accordance with Company policies to take 25 days of paid vacation and 5 paid sick days per calendar year.

(f) Reimbursement of Business Expenses. During the Term, the Company shall reimburse Executive for all reasonable business expenses, including travel expenses, incurred by Executive in the performance of Executive’s duties, to the extent reimbursable in accordance with the applicable policies or practices of the Company, including the presentation of satisfactory statements of such expenses, and such reimbursements shall be made to Executive at such times as in accordance with the applicable policies or practices of the Company.

(g) Insurance and Indemnification. The Company, the Parent or other appropriate member of the Company Group shall maintain Directors and Officers Insurance during the Term. Further, Executive shall be subject to Paragraph 7(d) of the Amended and Restated Limited Liability Company Agreement of Diamond S Management LLC (a Marshall Islands Limited Liability Company) dated August 20, 2009, as amended from time to time (the “LLC Agreement”), in respect of indemnification.

4. Termination of Employment During the Term.

(a) Death or Disability. Executive’s employment shall terminate automatically upon Executive’s death. The Company may terminate Executive’s employment for Disability. For purposes of this Agreement, “Disability” means, by reason of any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for a continuous period of not less than twelve months, Executive’s being unable to engage in any substantial gainful activity for any consecutive period of six months or any non-consecutive periods aggregating six months or more in any 12-month period.

(b) Cause. The Company may terminate Executive’s employment for Cause. For purposes of this Agreement, “Cause” means:

(i)

the willful and continued failure by Executive to substantially perform Executive’s duties with the Company and the Company Group (other than any such failure resulting from Executive’s incapacity due to physical or mental illness);

(ii)

Executive has failed to follow the lawful reasonable directives of the Board;

(iii)

gross negligence or willful misconduct by Executive in the execution of Executive’s duties hereunder;

(iv)

Executive has materially breached any material policy or code of conduct of the Company or any member of the Company Group to which he is subject;

(v)

Executive has engaged in the use of illegal drugs, the persistent excessive use of alcohol or any other willful activity that materially impairs Executive’s ability to perform his duties hereunder or results in conduct bringing the Company or the members of the Company Group into substantial public disgrace or disrepute;

(vi)

indictment or conviction of Executive of, or a plea by Executive of nolo contendere to, a felony (or the equivalent thereof in a jurisdiction other than the United States) or any other crime of moral turpitude, other than, for the avoidance of doubt, minor traffic offenses;

(vii)

Executive has engaged in fraudulent or criminal activity (whether or not prosecuted) in the course of Executive’s employment; or

(viii)

a material breach by Executive of this Agreement.

“Cause” under Section 4(b)(i), (ii), (iv) or (viii) shall not exist until and unless the Company has given Executive notice of the applicable breach. Such notice shall specifically delineate such claimed breach and shall inform Executive that he is required to cure such breach (if curable and non-recurring) within 10 days (the “Cause Cure Period”) after such notice is given. If such breach is not so cured (or is not curable), the Company may terminate Executive for Cause under Section 4(b)(i), (ii), (iv) or (viii). If such breach is cured within the Cause Cure Period, Cause shall not exist for purposes of Section 4(b)(i), (ii), (iv) or (viii) with respect to such breach.

(c) Good Reason. Executive may terminate Executive’s employment for Good Reason. For purposes of this Agreement, “Good Reason” means the occurrence, without Executive’s written consent, of any of the events or circumstances set forth in clauses (i) through (iv) below:

(i)

the assignment to Executive of a title or duties inconsistent in any material respect with Executive’s title, position, authority or responsibilities set forth in this Agreement, or any other action or omission by the Company, in either case which results in a material diminution in such title, position, authority or responsibilities;

(ii)

a material reduction in Executive’s Base Salary below $969,000 annually, Target Bonus below 100% of Executive’s Base Salary or target LTIP Award below 100% of Executive’s Base Salary;

(iii)

a relocation of Executive’s principal work location by more than 50 miles (unless such relocation does not result in a material increase in distance from Executive’s residence to Executive’s principal work location); or

(iv)

any other material breach by the Company of this Agreement.

“Good Reason” shall not exist until and unless Executive has given the Company notice of the applicable event within 90 days of the date Executive knows or reasonably should have known of the initial existence of such event. Such notice shall specifically delineate such claimed breach and shall inform the Company that the Company shall have 30 days during which it may cure such breach (the “Good Reason Cure Period”) after such notice is given. If such breach is not so cured or disputed in writing by the Company during the Good Reason Cure Period, Executive may resign for Good Reason within 30 days after the end of the Good Reason Cure Period. If such breach is cured within the Good Reason Cure Period, Good Reason shall not exist hereunder with respect to such breach.

(d) Without Cause or Without Good Reason. The Company may terminate Executive’s employment without Cause and Executive may terminate his employment without Good Reason upon written notice at any time; provided, however, Executive shall be required to give the Company 30 days’ notice prior to any resignation without Good Reason (which notice period the Company may elect to waive).

(e) Expiration of the Term. Unless earlier terminated, Executive’s employment shall terminate automatically upon the expiration of the Term. In the event that Executive’s employment so terminates as a result of the Company’s election not to renew the Term, such termination of employment shall be deemed to be a termination by the Company without Cause for purposes of Section 5.

(f) Notice of Termination. Any termination of Executive’s employment hereunder by the Company for Cause or due to Disability or by Executive for Good Reason shall be communicated by an executed Notice of Termination given in accordance with this Agreement. For purposes of this Agreement, a “Notice of Termination” means a written notice that (i) indicates the specific termination provision in this Agreement relied upon, (ii) sets forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of Executive’s employment under the provision so indicated and (iii) specifies the intended termination date (which date, in the case of a termination for Cause or Good Reason that requires a Cause Cure Period or a Good Reason Cure Period, as applicable, shall not be before the expiration of any such period). The failure by Executive or the Company to set forth in the Notice of Termination any fact or circumstance that contributes to a showing of Good Reason or Cause shall not waive any right of Executive or the Company, respectively, to assert such fact or circumstance in enforcing Executive’s or the Company’s rights hereunder.

(g) Date of Termination. “Date of Termination” means (i) if Executive’s employment is terminated by the Company for Cause or by Executive for Good Reason, the date specified in the Notice of Termination, (ii) if Executive’s employment is terminated by the Company other than for Cause or due to Disability, the date on which the Company notified Executive of such termination, (iii) if Executive resigns without Good Reason, the date specified by Executive, which shall not be earlier than 30 days after the date Executive provides such notice; provided, however, the Company may waive such notice period, in which case the Date of Termination shall be any earlier date selected by the Company, (iv) if Executive’s employment is terminated by the Company due to Disability, the date specified in the Notice of Termination, (v) if Executive’s employment is terminated by reason of death, the date of Executive’s death or (vi) in the event of Executive’s termination pursuant to Section 4(e), the scheduled expiration of the Term.

5. Obligations of the Company Upon Termination. Following any termination of Executive’s employment hereunder, Executive shall not be otherwise compensated for the loss of employment or the loss of any rights or benefits under this Agreement or any such plans and programs, except as provided below:

(a) Good Reason; Other Than for Cause; Death; Disability. Except as provided in Section 5(b), if, during the Term, Executive’s employment is terminated (1) by the Company other than for Cause, (2) by Executive for Good Reason or (3) due to Executive’s death or Disability, then, subject to Executive’s (or Executive’s estate’s) execution, delivery and non-revocation of a general release of claims against the Company and other released parties in the form attached hereto as Annex A (the “Release”) that becomes irrevocable in accordance with its terms no later than 55 days after the Date of Termination, then Executive (or, in the event of Executive’s death, Executive’s heirs) shall be entitled to receive the following payments and benefits:

(i)

the Company shall pay an amount to Executive equal to Executive’s Base Salary for a period of 24 months, with one-half of such amount (the “First Severance Payment”) being paid in the form of 12 equal monthly installments, with all such installments being paid within one year of the Date of Termination, and the other half of such amount (the “Second Severance Payment”) being paid in the calendar year following the calendar year in which the Date of Termination takes place (the “Subsequent Calendar Year”), with the Company retaining the sole discretion to pay the Second Severance Payment in installments over the Subsequent Calendar Year or in lump sum on a date within the Subsequent Calendar Year; provided, however, that (A) until the 60th day following the Date of Termination, all installments in respect of the First Severance Payment that would otherwise be made during such 60-day period shall instead be withheld and paid on such 60th day subject to the Release becoming irrevocable as provided above, and no payment in respect of the Second Severance Payment shall be paid during such 60-day period, and (B) in the event Executive materially breaches Executive’s obligations under Section 6(a), (b), (c) or (d), the Company shall cease to be required to provide the payments specified in this Section 5(a)(i);

(ii)

for a period of 12 months following the Date of Termination, or until Executive becomes eligible for coverage under the group health plans of a successor employer, if earlier, the Company shall reimburse Executive for the premiums to continue Executive’s group health, dental and vision insurance under the Company’s plans under the terms of the Consolidated Omnibus Budget Reconciliation Act of 1985 (“COBRA”), provided the Company has received any satisfactory documentation needed to verify that payments to the insurer were made; provided, however, that (A) until the 60th day following the Date of Termination, all installments that would otherwise be made during such 60-day period shall instead be withheld and paid on such 60th day subject to the Release becoming irrevocable as provided above, (B) in the event Executive materially breaches Executive’s obligations under Section 6(a), (b), (c) or (d), the Company shall cease to be required to provide the payments specified in this Section 5(a)(ii), and (C) that if at any time the Company determines, in its sole discretion, that the reimbursement of the premiums as provided in this paragraph would result in a violation of the nondiscrimination rules of Section 105(h)(2) of the Internal Revenue Code of 1986, as amended (the “Code”) or any statute or regulation of similar effect (including, without limitation, the 2010 Patient Protection and Affordable Care Act, as amended by the 2010 Health Care and Education Reconciliation Act), then in lieu of providing the reimbursement for premiums under the plan, the Company shall instead pay Executive a fully taxable cash payment equal to the premiums for that month (or, in the case of a self-funded plan, the monthly cost of such coverage), subject to withholdings and deductions, provided Executive has not become eligible for coverage for that month under the group health plans of a successor employer, and in no event shall any payment described in this clause (C) be made after the last day of the Subsequent Calendar Year;

(iii)

the Company shall pay to Executive a single lump-sum cash amount equal to the cost of premiums under COBRA for a period of six months (the “Lump-Sum COBRA Amount”), payable in the Subsequent Calendar Year on the date that is 12 months following the Date of Termination, subject to applicable withholdings and deductions; provided, however, that (A) Executive shall not be entitled to any payment under this Section 5(a)(iii) in the event, prior to the date such payment is made, Executive (1) becomes eligible for coverage under the group health plans of a successor employer or (2) materially breaches Executive’s obligations under Section 6(a), (b), (c) or (d) of this Agreement, and (B) if, after the date that is 12 months following the Date of Termination but prior to the date that is 18 months following the Date of Termination, Executive (1) becomes eligible for coverage under the group health plans of a successor employer, or (2) materially breaches Executive’s obligations under Section 6(a), (b), (c) or (d) of this Agreement, Executive shall repay to the Company, within 30 days of the applicable triggering event, an amount equal to the Lump-Sum COBRA Amount multiplied by the percentage of such six-month period remaining after the occurrence of the applicable triggering event;

(iv)

the Company shall treat all outstanding LTIP Awards or other equity or incentive awards held by Executive in accordance with the terms of the applicable plan and award agreements; and

(v)

to the extent not previously paid or provided, the Company shall pay to Executive his Base Salary through the Date of Termination and any other amounts or benefits required to be paid or provided or that Executive is eligible to receive pursuant to the terms and conditions of the Company’s applicable employee benefit plans and programs, including accrued but unused vacation time, unreimbursed business expenses and any earned but unpaid Annual Bonus (such other amounts and benefits, the “Accrued Rights”).

(b) Change in Control. (i) If, during the Term, Executive’s employment is terminated by the Company without Cause or by Executive for Good Reason during the two-year period beginning on the date of consummation of a Change in Control (as defined below), then in lieu of the amounts described in Section 5(a), Executive shall be entitled to receive the following payments and benefits subject to execution, delivery and non-revocation of the Release that becomes irrevocable in accordance with its terms no later than 55 days after the Date of Termination:

(A)

the Company shall pay to Executive a single lump-sum cash amount equal to 24 months of Executive’s Base Salary, which shall be payable on the 60th day following the Date of Termination; provided, however, that in the event such Change in Control does not constitute a “change in the ownership or effective control of a corporation, or a change in the ownership of a substantial portion of the assets of a corporation” as set forth in Treas. Reg. Section 1.409A-3(i)(5), such amount shall instead be paid as set forth in Section 5(a)(i);

(B)

the Company shall pay to Executive a single lump-sum cash amount equal to Executive’s Target Bonus for the year in which the Date of Termination occurs, which shall be payable on the 60th day following the Date of Termination;

(C)

the Company shall pay to Executive a single lump-sum cash amount equal to the cost of premiums under COBRA for a period of 18 months following the Date of Termination, which shall be payable on the 60th day following the Date of Termination and subject to withholdings and deductions; provided, however, that in the event such Change in Control does not constitute a “change in the ownership or effective control of a corporation, or a change in the ownership of a substantial portion of the assets of a corporation” as set forth in Treas. Reg. Section 1.409A-3(i)(5), such amount shall instead be paid as set forth in Section 5(a)(ii) and (iii);

(D)

the Company shall treat all outstanding LTIP Awards or other equity or incentive awards held by Executive in accordance with the terms of the applicable plan and award agreements; and

(E)

the Company shall provide to Executive the Accrued Rights.

(ii)

Notwithstanding any other provision in this Agreement or any other agreement, contract, or understanding entered into by Executive with the Company or any member of the Company Group, in the event that it is determined by the reasonable computation by tax counsel or a nationally recognized certified public accounting firm that shall be selected by the Company and engaged at its expense (such tax counsel or accounting firm, the “Accountant”) that the aggregate amount of the payments, distributions, benefits and entitlements of any type payable by the Company or any member of the Company Group to or for Executive’s benefit under this Agreement or any other formal or informal plan or other arrangement, contract or understanding (including any payment, distribution, benefit or entitlement made by any person or entity effecting a change of control), in each case, that could be considered “parachute payments” within the meaning of Section 280G of the Code (such payments, the “Parachute Payments”) that, but for this Section 5(b)(ii) would be payable to Executive, exceeds the greatest amount of Parachute Payments that could be paid to Executive without giving rise to any liability for any excise tax imposed by Section 4999 of the Code (or any successor provision thereto) or any similar tax imposed by state or local law, or any interest or penalties with respect to such tax (such tax or taxes, the “Excise Tax”), then the aggregate amount of Parachute Payments payable to Executive shall not exceed the amount that produces the greatest after-tax benefit to Executive after taking into account any federal, state, local, Excise Tax and/or other applicable taxes to be payable by Executive in respect of such payments. For the avoidance of doubt, this provision shall reduce the amount of Parachute Payments otherwise payable to Executive, if doing so would place Executive in a better net after-tax economic position as compared with not doing so (taking into account the federal, state, local, Excise Tax and/or other applicable taxes payable in respect of such Parachute Payments). The Company shall reduce or eliminate the Parachute Payments by first reducing or eliminating the portion of the Parachute Payments that are payable in cash and then by reducing or eliminating the non-cash portion of the Parachute Payments, in each case in reverse order beginning with payments or benefits that are to be paid the furthest in time from the date of the Accountant’s determination. For purposes of making the calculations required by this paragraph, the Accountant may make reasonable assumptions and approximations concerning applicable taxes and may rely on reasonable, good faith interpretations concerning the application of Sections 280G and 4999 of the Code and shall make reasonable use of all available exemptions (including valuation of all applicable non-competition covenants).

(iii)

For purposes of this Agreement, “Change in Control” shall mean the occurrence of any of the following events:

(A)

any Person becomes the beneficial owner (within the meaning of Rule 13d-3 promulgated under the Securities Exchange Act of 1934 (the “Exchange Act”)) of 35% or more of either (i) the then-outstanding common stock of the Parent (the “Outstanding Company Common Stock”) or (ii) the combined voting power of the then-outstanding voting securities of the Parent entitled to vote generally in the election of directors (the “Directors”) of the Board (the “Outstanding Company Voting Securities”); provided, however, that for purposes of this Agreement, the following acquisitions shall not constitute a Change in Control: (1) any issuance by the Parent, (2) any acquisition by the Parent or any of its affiliates (as defined below), (3) any acquisition by any employee benefit plan (or related trust) sponsored or maintained by the Parent or any of its affiliates or (4) any acquisition pursuant to a transaction that complies with (C)(1), (2) and (3) below;

(B)

a majority of the Directors are not Incumbent Directors (as defined below);

(C)

consummation of a reorganization, merger, statutory share exchange or consolidation or similar transaction involving the Parent or any of its subsidiaries, a sale or other disposition of all or substantially all of the assets of the Parent or the acquisition of assets or securities of another entity by the Parent or any of its subsidiaries (each, a “Business Combination”), in each case, unless, following such Business Combination, (1) the beneficial owners of the Outstanding Company Common Stock and the Outstanding Company Voting Securities immediately prior to such Business Combination beneficially own, directly or indirectly, more than 50% of the then-outstanding shares of common stock (or, for a non-corporate entity, equivalent securities) and the combined voting power of the then-outstanding voting securities entitled to vote generally in the election of directors (or, for a non-corporate entity, equivalent governing body), as the case may be, of the entity resulting from such Business Combination (including an entity that, as a result of such transaction, owns the Parent or all or substantially all of the Parent’s assets either directly or through one or more subsidiaries), (2) no Person (excluding any entity resulting from such Business Combination or any employee benefit plan (or related trust) of the Company Group or such entity resulting from such Business Combination) beneficially owns, directly or indirectly, 35% or more of, respectively, the then-outstanding shares of common stock (or, for a non-corporate entity, equivalent securities) of the entity resulting from such Business Combination or the combined voting power of the then-outstanding voting securities of such entity, except to the extent that such ownership existed prior to the Business Combination, and (3) a majority of the members of the board of directors (or, for a non-corporate entity, equivalent governing body) of the entity resulting from such Business Combination were Incumbent Directors at the time of the execution of the initial agreement or of the action of the Board providing for such Business Combination; or

(D)

approval by the stockholders of the Parent of a complete liquidation or dissolution.

(iv)

For purposes of this Agreement, “affiliate” of any Person means any Person that directly or indirectly controls, is controlled by or is under common control with such Person. The term “control” (including, with the correlative meaning, the terms “controlled by” and “under common control with”), as applied to any Person, means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of such Person, whether through the ownership of voting or other securities, by contract or otherwise.

(v)

For purposes of this Agreement, “subsidiary” of any Person means a corporation, company or other entity (A) more than 50% of whose outstanding shares or securities (representing the right to ordinarily vote for the election of directors or other managing authority) are, or (B) which does not have outstanding shares or securities (as may be the case in a partnership, joint venture, limited liability company, unincorporated association or other similar entity), but more than 50% of whose ownership interest representing the right generally to make decisions for such other entity is, at such applicable time, owned or controlled, directly or indirectly, by such Person.

(vi)

For purposes of this Agreement, “Incumbent Directors” means the individuals who, as of the Effective Date, are Directors and any individual becoming a Director subsequent to the Effective Date whose election, nomination for election by the Parent’s stockholders or appointment was approved by majority vote of the then Incumbent Directors (either by a specific vote or by approval of the proxy statement of the Parent in which such individual is named as a nominee for Director without objection to such nomination); provided, however, that an individual will not be an Incumbent Director if such individual’s election or appointment to the Board occurs as a result of an actual or threatened election contest (as described in Rule 14a-12(c) of the Exchange Act) with respect to the election or removal of Directors or other actual or threatened solicitation of proxies or consents by or on behalf of a Person other than the Board.

(vii)

For purposes of this Agreement, “Person” means any individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Exchange Act).

(c) Cause; Other Than for Good Reason; Expiration of Term. If, during the Term, Executive’s employment shall be terminated for Cause or Executive terminates employment without Good Reason (and other than due to Executive’s death or Disability), or such employment terminates due to Executive’s election not to renew the Term, the Company shall provide to Executive the Accrued Rights and shall have no other obligations to Executive under this Agreement.

(d) Executive COBRA Obligations. If Executive is entitled to COBRA reimbursement or payment above, Executive must immediately notify the Company if Executive becomes eligible for coverage under another employer’s group health plan or otherwise ceases to be eligible for continued coverage under COBRA under the Company Group’s group health, dental and vision plans during the period of 18 months following the Date of Termination. Any applicable COBRA premiums that are paid under this Agreement will not include any amounts payable by Executive under a Code Section 125 health care reimbursement plan, which amounts, if any, are the sole responsibility of Executive.

6. Covenants.

(a) Non-Competition. Executive hereby agrees that during the Term and for a period of one year after the termination for any reason of Executive’s employment (the “Relevant Period”), Executive shall not, directly or indirectly, provide services, whether as principal, agent, director, officer, employee, consultant, advisor, shareholder, partner, member or otherwise, alone or in association with any other person, corporation, partnership, limited liability company, sole proprietorship or unincorporated business or any non-U.S. business entity (whether or not for profit) (any such entity, a “Business”), to any Competing Business (as defined below); provided, however, that Executive may provide services to a Competing Business that is engaged in one or more businesses other than the Business Area (as defined below) but only to the extent that Executive does not provide services, directly or indirectly, to the segment of such Competing Business that is engaged in the Business Area. For purposes of this Agreement, the term “Competing Business” shall mean any Business engaged in the Business Area. For purposes of this Agreement, the term “Business Area” shall mean the international flag marine transportation of crude oil and petroleum products. Nothing in this Section 6(a) shall be construed as denying Executive the right to own securities of any corporation listed on a national securities exchange in an amount up to 3% of the outstanding number of such securities. The Company reserves the right to pay Executive his Base Salary during the Relevant Period (or such lesser time that the Company determines in its discretion) in the event Executive resigns without Good Reason, but such payment shall not impose any additional restrictions or obligations on Executive under this Agreement, unless otherwise agreed to by Executive.

(b) Non-Solicitation. Executive hereby agrees that during the Term and for the Relevant Period, Executive will not, directly or indirectly, solicit or induce (i) any person who is employed by any member of the Company Group or was so employed within the six-month period prior to the Termination Date to discontinue such person’s employment with any member of the Company Group, nor will Executive employ any such person or (ii) any customer of any member of the Company Group to discontinue or reduce its business with any member of the Company Group (either through the transition of such business to a competitor of any member of the Company Group or otherwise). General solicitation of the public for employment will not constitute a solicitation hereunder so long as such general solicitation does not target any such person.

(c) Confidential Information. Executive shall use reasonable efforts and diligence both during the Term and after the termination of Executive’s employment for any reason to protect the confidential, trade secret and/or proprietary character of all Confidential Information and Trade Secret Information (as defined below). Executive shall not, directly or indirectly, use (for Executive’s benefit or for the benefit of any other person) or disclose any Confidential Information or Trade Secret Information, for so long as it shall remain proprietary or protectable, except as may be necessary for the performance of Executive’s duties for the Company. For purposes of this Agreement, “Confidential Information” shall mean all confidential information of any member of the Company Group, regardless of the form or medium in which it is or was created, stored, reflected or preserved, information that is either developed by Executive (alone or with others) or to which Executive shall have had access during any employment with the Company or any other member of the Company Group. Confidential Information includes, but is not limited to, Trade Secret Information, and also includes information that is learned or acquired by any member of the Company Group from others with whom the Company Group has a business relationship in which, and as a result of which, such information is revealed to any member of the Company Group. For purposes of this Agreement, “Trade Secret Information” shall mean all information, regardless of the form or medium in which it is or was created, stored, reflected or preserved, that is not commonly known by or generally available to the public and that: (A) derives or creates economic value, actual or potential, from not being generally known to, and not being readily ascertainable by proper means by, other persons who can obtain economic value from its disclosure or use and (B) is the subject of efforts that are reasonable under the circumstances to maintain its secrecy. The Company Group’s Trade Secret Information may include, but is not limited to, all confidential information relating to or reflecting any member of the Company Group’s strategic plans and activities; compilations of data; product plans; sales, marketing and business plans and strategies; pricing, price lists, pricing methodologies and profit margins; inventions, concepts, ideas, designs and formulae; current, past and prospective customer lists; current, past and anticipated customer needs, preferences and requirements; market studies; computer software and programs (including object code and source code); and computer and database technologies, systems, structures and architectures. Executive understands that Confidential Information and/or Trade Secret Information may or may not be labeled as such, and Executive shall treat all information that appears to be Confidential Information and/or Trade Secret Information as confidential unless otherwise informed or authorized by the Company. Nothing in this Agreement shall be construed to mean that the Company owns any intellectual property or ideas that were conceived by Executive before Executive commenced employment with the Company and which Executive has previously disclosed to the Company.

(i)

Executive agrees that both during the Term and after the termination of Executive’s employment for any reason, if Executive is legally required (whether by oral questions, interrogatories, requests for information or documents, subpoena, civil investigative demand or similar process) to disclose any Confidential Information or Trade Secret Information, Executive shall promptly notify the Company of such request or requirement so that the Company or other member of the Company Group may seek to avoid or minimize the required disclosure and/or to obtain an appropriate protective order or other appropriate relief to ensure that any information so disclosed is maintained in confidence to the maximum extent possible by the agency or other person receiving the disclosure, or, in the discretion of the Company, to waive compliance with the provisions of this Section 6(c). Thereafter, Executive shall use reasonable efforts, in cooperation with the Company or otherwise, to avoid or minimize the required disclosure and/or to obtain such protective order or other relief. If, in the absence of a protective order or the receipt of a waiver hereunder, Executive is compelled to disclose the Confidential Information or Trade Secret Information or else stand liable for contempt or suffer other sanction, censure or penalty, Executive shall disclose only so much of the Confidential Information or Trade Secret Information to the party compelling disclosure as Executive believes in good faith, on the basis of advice of counsel, is required by law, and Executive shall give the Company prior notice of the Confidential Information or Trade Secret Information Executive believes Executive is required to disclose. The Company shall reimburse any reasonable legal fees and related expenses Executive incurs in order to comply with this Section 6(c)(i).

(ii)

Nothing in this Section 6(c) or elsewhere in this Agreement prohibits Executive from: (A) filing and, as provided for under Section 21F of the Exchange Act, maintaining the confidentiality of a claim with the Securities and Exchange Commission (the “SEC”); (B) providing Confidential Information, Trade Secret Information, information about this Agreement or the Company or any of its subsidiaries or any similar information to the SEC, or providing the SEC with information that would otherwise violate any section of this Agreement, to the extent permitted by Section 21F of the Exchange Act; (C) cooperating, participating or assisting in an SEC investigation or proceeding without notifying the Company; or (D) receiving a monetary award as set forth in Section 21F of the Exchange Act. In addition, Executive is advised that Executive shall not be held criminally or civilly liable under any federal or state trade secret law for the disclosure of any Confidential Information, Trade Secret Information, information about this Agreement or the Company or its subsidiaries or any similar information that constitutes a trade secret to which the Defend Trade Secrets Act (18 U.S.C. § 1833(b)) applies that is made (1) in confidence to a federal, state or local government official, either directly or indirectly, or to an attorney, in each case, solely for the purpose of reporting or investigating a suspected violation of law or (2) in a complaint or other document filed in a lawsuit or proceeding, if such filings are made under seal. Further, an individual who files a lawsuit for retaliation by an employer for reporting a suspected violation of law may disclose the trade secret to the attorney of the individual and use the trade secret information in the court proceeding, if the individual files any document containing the trade secret under seal; and does not disclose the trade secret, except pursuant to court order.

(d) Non-Disparagement. During the Term and after the termination of Executive’s employment for any reason, (i) Executive shall not make, either directly or indirectly, any oral or written negative, disparaging or adverse statements or representations of or concerning the Company or any member of the Company Group, any of their current or former clients, customers or businesses, or any of their current or former directors, officers, employees or shareholders and (ii) the Company Parties (as defined below) shall not make any oral or written negative, disparaging or adverse statements or representations of or concerning Executive; provided, however, that nothing herein shall prohibit (A) critical communications between Executive and the Company or Company Parties during the Term and in connection with Executive’s employment, (B) Executive or any Company Party from disclosing truthful information if legally required (whether by oral questions, interrogatories, requests for information or documents, subpoena, civil investigative demand or similar process) or (C) either party from acting in good faith to enforce such party’s rights under this Agreement, including putting a future employer on notice of Executive’s restrictive covenants and compliance therewith. For purposes of this Agreement, the term “Company Parties” shall mean the executive officers and designated spokespersons of any member of the Company Group, acting in their capacity as representatives of the Company Group.

(e) Intellectual Property. Executive agrees that all ideas, concepts, processes, discoveries, devices, machines, tools, materials, designs, improvements, inventions, computer software and other things of value (“Intangible Rights”), if patented or subject to a patent application or intellectual property protection and Confidential Information and Trade Secrets, which are or have been conceived, made, invented or suggested, either by Executive alone or in collaboration with others, during his employment with the Company and relating to the business of the Company Group, have been and will be promptly disclosed in writing to the Company and are and will be the sole and exclusive property of the Company and the Company Group. Executive hereby assigns to the Company and the Company Group all of Executive’s right, title and interest in and to all such intangible rights that are patented or subject to a patent application by the Company or any member of the Company Group and their successors or assigns, and in and to Confidential Information. In the event that any of said Intangible Rights will be deemed by the Company or any member of the Company Group to be patentable or otherwise registerable under any federal, state, or foreign law, Executive further agrees that, at the expense of the Company or the Company Group, Executive will execute all documents and do all things necessary, advisable, or proper to obtain such patents or registrations, and to vest in the Company and the Company Group full title thereto. Executive agrees that all right, title and interest in any and all copyrights, copyright registrations and copyrightable subject matter that occur as a result of Executive’s employment with the Company are and will be the sole and exclusive property of the Company and the Company Group, and agrees that such works comprise “works for hire.” Executive hereby assigns and agrees to assign to the Company and the Company Group all right, title and interest in and to any and all such copyrights, copyright registrations, copyrightable subject matter that occur as a result of such employment.

(f) Return of Company Property. Other than as permitted by the Chairman of the Board (or his or her delegate) in writing, all documents (including Confidential Information), data, recordings or other property, including smartphones, tablets, computers and other business equipment, whether tangible or intangible, including all information stored in electronic form, obtained or prepared by or for Executive and utilized by Executive in the course of his employment with the Company shall remain the exclusive property of the Company and the Company Group, and Executive shall return all such property, documents and information upon any termination of his employment and as otherwise requested by the Company or any member of the Company Group during the Term.

(g) Resignation from Offices. Upon termination of Executive’s employment for any reason, Executive agrees to resign, effective as of the Date of Termination, from any positions that Executive holds with the Company and the other members of the Company Group, including the Board (and any committees thereof) and the board of directors or other governing body (and any committees thereof) of any of the members of the Company Group. Executive hereby agrees to execute any and all documentation of such resignations upon request by the Company or any member of the Company Group, but shall be treated for all purposes as having so resigned upon termination of employment, regardless of when or whether Executive executes any such documentation.

(h) Reasonableness. Executive acknowledges that, in his capacity as a senior executive of the Company, Executive will have significant exposure and access to the Company’s and the Company Group’s Confidential Information and Trade Secret Information. In addition, Executive acknowledges that information regarding the Company’s and Company Group’s business and financial relations with its vendors and customers is Confidential Information and is proprietary to the Company and the Company Group and that any interference with such relations based directly or indirectly on the use of such information would cause immeasurable and irreparable damage to the Company and the Company Group. Furthermore, Executive acknowledges that information regarding the Company’s and the Company Group’s employment relationships and service arrangements with its directors, officers and employees is Confidential Information, that the Company and the members of the Company Group depend upon the unique talents, knowledge and expertise of their directors, officers and employees for its continued performance and that interference with such employment relationships or service arrangements would cause immeasurable and irreparable damage to the Company and the Company Group. Therefore, Executive acknowledges that the limitations and obligations contained in this Section 6 are, individually and in the aggregate, reasonable and properly required by the Company and the Company Group. Executive agrees that Executive shall not challenge or contest the reasonableness, validity or enforceability of any such limitations and obligations.

7. Injunctive Relief. Executive acknowledges that a violation on Executive’s part of any of the covenants contained in Section 6 would cause immeasurable and irreparable damage to the Company and the Company Group in an amount that would be material but not readily ascertainable, and that any remedy at law would be inadequate. Accordingly, Executive agrees that the Company and the members of the Company Group (in addition to any other rights they may have under this Agreement) shall be entitled (without the necessity of showing economic loss or other actual damage) to injunctive relief in any court of competent jurisdiction for any actual or threatened violation of any such covenant in addition to any other remedies they may have. Executive agrees that in the event that any arbitrator or court of competent jurisdiction shall finally hold that any provision of Section 6 hereof is void or constitutes an unreasonable restriction against Executive, the provisions of such Section 6 shall not be rendered void but shall be deemed to be modified to the minimum extent necessary to remain in force and effect for the greatest period and to such extent as such arbitrator or court may determine constitutes a reasonable restriction under the circumstances. Additionally, in the event of a breach or violation by Executive of Section 6, the applicable Relevant Period set forth in Section 6 will be tolled until such breach or violation has been cured.

8. Miscellaneous.

(a) Notices. Except as otherwise required by law, any written notice hereunder will be deemed validly given, made or served (i) on the date on which it is delivered personally, (ii) five business days after it will have been sent by registered or certified mail (receipt requested and postage prepaid), or (iii) one business day after it is sent by a recognized overnight courier (charges prepaid).

If to the Company, addressed to:

	Diamond S Management LLC
	33 Benedict Place, 2^nd Floor
	Greenwich, CT 06830
	United States of America
	Attention:	Group General Counsel

Copy to (which shall not constitute notice):

	Seward & Kissel LLP
	One Battery Park Plaza
	New York, New York 10004
	Attention:	Lawrence Rutkowski
		Anne C. Patin

If to Executive:

	The most recent address on file with the Company.

(b) Withholding. All payments to be made to Executive hereunder will be subject to all applicable required withholding of federal, state, local and foreign taxes, including income and employment taxes.

(c) Governing Law. This Agreement and any disputes arising hereunder or related hereto (whether for breach of contract, tortious conduct or otherwise) shall be governed by and construed in accordance with the laws of the State of Connecticut, without reference to its conflicts of law principles.

(d) Jurisdiction. Each party irrevocably agrees that any legal action, suit or proceeding against it arising out of or in connection with Executive’s employment, this Agreement or the transactions contemplated by this Agreement or disputes relating hereto (whether for breach of contract, tortious conduct, discrimination, retaliation or otherwise) shall be brought exclusively in the federal and state courts located in Fairfield County, Connecticut, and hereby irrevocably accepts and submits to the exclusive jurisdiction and venue of the aforesaid courts in personam, with respect to any such action, suit or proceeding. The parties hereby waive, to the fullest extent permitted by applicable law, any objection that they now or hereafter have to personal jurisdiction or to the laying of venue of any such suit, action or proceeding brought in such court. The parties agree not to commence any action arising out of or relating to Executive’s employment or this Agreement in a forum other than the forum described in this Section 8(d). Each party shall pay its own costs, legal, accounting and other fees and all other expenses associated with enforcing its rights under this Agreement.

(e) Amendment. No provisions of this Agreement may be modified, waived or discharged unless such modification, waiver or discharge is agreed to in writing signed by the parties hereto. The provisions of this Agreement may be waived only in writing signed by the party or parties entitled to the benefit thereof. A waiver or any breach or failure to enforce any provision of this Agreement shall not in any way affect, limit or waive a party’s rights hereunder at any time to enforce strict compliance thereafter with every provision of this Agreement.

(f) Assignment; Successors. This Agreement is personal to Executive and without the prior written consent of the Company shall not be assignable by Executive, and any assignment in violation of this Agreement shall be void. This Agreement shall inure to the benefit of and be enforceable by Executive’s heirs, successors, assigns and legal representatives. The Company shall require any successor (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business and/or assets of the Company to assume expressly and agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform it if no such succession had taken place. No such assignment will be deemed to be a termination of employment by the Company without Cause or by Executive for Good Reason. Without limiting the foregoing, the parties hereto agree that the Company may assign this Agreement to the Delaware Entity.

(g) Counterparts. This Agreement may be executed in two or more counterparts (including by facsimile or PDF), each of which shall be deemed an original but all of which together shall constitute one and the same instrument. If any signature is delivered by facsimile transmission or by PDF, such signature shall create a valid and binding obligation of the party executing (or on whose behalf the signature is executed) with the same force and effect as if such facsimile or PDF signature were an original thereof.

(h) Construction. The headings in this Agreement are for convenience only and shall not control or affect the meaning or construction of any provision of this Agreement. As used in this Agreement, words such as “herein”, “hereinafter”, “hereby” and “hereunder”, and words of like import, refer to this Agreement, unless the context requires otherwise. The words “include”, “includes” and “including” shall be deemed to be followed by the phrase “without limitation”. The headings in this Agreement are for convenience only and shall not be used to interpret or construe its provisions.

(i) Sections 409A and 457A of the Code.

(i)

It is intended that the payments and benefits under this Agreement comply with Section 409A of the Code and the regulations promulgated thereunder (“Section 409A”) and, to the extent applicable, Section 457A of the Code and the regulations promulgated thereunder (“Section 457A”), and, accordingly, to the maximum extent permitted, all provisions of this Agreement shall be construed and interpreted in a manner consistent with the requirements for avoiding taxes or penalties under Section 409A and, to the extent applicable, Section 457A, all in a manner intended to maintain, to the maximum extent practicable, the original intent of the applicable provision without violating the requirements of Section 409A and, to the extent applicable, Section 457A. In no event whatsoever shall the Company or any other member of the Company Group be liable for any additional tax, interest or penalty that may be imposed on Executive by Section 409A and/or Section 457A or damages for failing to comply with Section 409A and/or Section 457A.

(ii)

Neither Executive nor any of his creditors (other than the Company and the members of the Company Group) or beneficiaries shall have the right to subject any “nonqualified deferred compensation” (within the meaning of Section 409A) payable under this Agreement or under any other plan, policy, arrangement or agreement of or with the Company or any member of the Company Group (this Agreement and such other plans, policies, arrangements and agreements, the “Company Plans”) to any anticipation, alienation, sale, transfer, assignment, pledge, encumbrance, attachment or garnishment. Except as permitted under Section 409A, any “nonqualified deferred compensation” (within the meaning of Section 409A) payable to Executive under any Company Plan may not be reduced by, or offset against, any amount owing by Executive to the Company or any member of the Company Group.

(iii)

Notwithstanding anything to the contrary in this Agreement, if, at the time of Executive’s separation from service (within the meaning of Section 409A), (A) Executive is a “specified employee” (within the meaning of Section 409A and using the identification methodology selected by the Company from time to time) and (B) the Company shall make a good faith determination that an amount payable under the Company Plans constitutes deferred compensation (within the meaning of Section 409A) the payment of which is required to be delayed pursuant to the six-month delay rule set forth in Section 409A in order to avoid taxes or penalties under Section 409A, then the Company and the Company Group shall not pay such amount on the otherwise scheduled payment date, but shall instead accumulate such amount and pay it, without interest, on the first business day after such six-month period. A termination of employment shall not be deemed to have occurred for purposes of any provision of this Agreement providing for the payment of any amounts or benefits upon or following a termination of Executive’s employment unless such termination is also a “separation from service” (within the meaning of Section 409A) and, for purposes of any such provision of this Agreement, references to a “termination,” “termination of employment” or like terms shall mean “separation from service.”

(iv)

For purposes of Section 409A, each payment hereunder will be deemed to be a separate payment as permitted under Treas. Reg. Section 1.409A-2(b)(2)(iii).

(v)

Notwithstanding anything to the contrary in this Agreement, to the extent that reimbursements or other in-kind benefits provided under this Agreement constitute “nonqualified deferred compensation” for purposes of Section 409A, (1) the reimbursements or other in-kind benefits provided to Executive under this Agreement and any Company Plan during any calendar year shall not affect the reimbursements or other in-kind benefits to be provided to Executive in any other calendar year, (2) the right to such reimbursements or other in-kind benefits cannot be liquidated or exchanged for any other benefit and shall be provided in accordance with Treas. Reg. Section 1.409A-3(i)(1)(iv) or any successor thereto, and (3) reimbursement payments shall be made to Executive in accordance with the applicable policies of the Company and the Company Group, but in no event later than the last day of the calendar year following the calendar year in which the underlying expense is incurred.

(j) No Waiver. No failure by either party hereto at any time to give notice of any breach by the other party of, or to require compliance with, any condition or provision of this Agreement will be deemed a waiver of similar or dissimilar provisions or conditions at the same or at any prior to subsequent time.

(k) Severability. It is a desire and intent of the parties that the terms, provisions, covenants, and remedies contained in this Agreement will be enforceable to the fullest extent permitted by law. If any such term, provision, covenant, or remedy of this Agreement or the application of any such term, provision, covenant, or remedy to any person, association, or entity or circumstances will, to any extent, be construed to be invalid or unenforceable in whole or in part, then such term, provision, covenant, or remedy will be construed or re-written in a manner so as to permit its enforceability under the applicable law to the fullest extent permitted by law. In any case, the remaining provisions of this Agreement or the application of the remaining provisions of this Agreement to any person, association, or entity or circumstances other than those to which they have been held invalid or unenforceable, will remain in full force and effect.

(l) Entire Agreement. This Agreement and the other agreements and arrangements referred to in this Agreement supersede and replace any previous agreements (including the Previous Employment Agreement) and discussions pertaining to the subject matter covered herein. This Agreement and the Annex hereto (collectively, the “Employment Documents”) constitute the entire agreement of the parties with regard to the terms of Executive’s employment, termination of employment, and severance benefits, and contain all of the covenants, promises, representations, warranties, and agreements between the parties with respect to such matters. Executive acknowledges that no representation, inducement, promise, or agreement, oral or written, has been made by either party with respect to the foregoing matters that is not embodied in the Employment Documents, and that no agreement, statement, or promise relating to the employment of Executive by the Company that is not contained in the Employment Documents will be valid or binding. Executive acknowledges that neither the Company and/or any member of the Company Group, nor any representative of the Company and/or any member of the Company Group, has made and Executive has not relied upon any representation or promise to Executive other than as expressly set forth herein. Executive represents that he has complied with all restrictive covenants, obligations of confidentiality, and intellectual property provisions contained in any prior employment agreement between Executive and the Company, any member of the Company Group, or any prior employer.

(m) Waiver of Punitive Damages. The parties recognize and acknowledge, and hereby expressly waive, any right any of them may have to punitive damages, except as provided by statute or otherwise required by law.

(n) Cooperation. During any period during which any post-employment payments or other monies are being paid to Executive under this Agreement after the Date of Termination, Executive will provide to the Company and the Company Group reasonable levels of assistance to the Company and the Company Group in answering questions or otherwise cooperating concerning the business of the Company and the Company Group, transition of responsibility, or litigation; provided that (i) Executive will be fully and promptly reimbursed for all out of pocket travel and related expenses of Executive reasonably incurred in connection with such assistance and (ii) any such assistance will not interfere or conflict with the obligations that Executive may owe to any other employer.

9. Acknowledgement. Executive represents that he is fully competent to manage his business affairs, he has read this document carefully, he understands all of its contents, he fully understands the final and binding effect of this Agreement, he had the opportunity to consult with his attorney, and he executes this Agreement freely and voluntarily. Executive represents and acknowledges that in executing this Agreement he does not rely (and has not relied) upon any representation or statement not set forth herein made by the Company, any member of the Company Group, or the Board, or by any of their respective agents, representatives, or attorneys with regard to the subject matter, basis, or effect of this Agreement or otherwise.

IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first above written.

	DIAMOND S MANAGEMENT LLC,

	By:	/s/ Kevin Kilcullen
		Name: Kevin Kilcullen
		Title: Manager and Chief Financial Officer

	ALL PAYMENTS HEREUNDER GUARANTEED BY DIAMOND S SHIPPING INC.,

	By:	/s/ Kevin Kilcullen
		Name: Kevin Kilcullen
		Title: Chief Financial Officer

	EXECUTIVE,

	By:	/s/ Craig H. Stevenson, Jr.
		Craig H. Stevenson, Jr.

Annex A

[General Release of Claims]

This Agreement and Release (the “Agreement”) is between ________ (“Executive”) and Diamond S Management LLC, a limited liability company organized in the Marshall Islands (the “Company”).

WHEREAS, Executive and the Company entered into an employment agreement dated as of _______ (the “Employment Agreement”);

WHEREAS, the Employment Agreement provides that Executive shall be entitled to certain payments and benefits upon the termination of Executive’s employment subject to the execution and non-revocation of a general release of claims; and

WHEREAS, Executive and the Company hereby desire to settle any and all claims Executive may have against any of the Released Parties (as defined below).

NOW, THEREFORE, the parties agree as follows:

1. Subject to the Company’s timely receipt of a fully executed copy of this Agreement, the expiration of the revocation period set forth in Section 9 and Executive’s compliance with the terms of this Agreement, the Company will pay Executive [to insert consideration].

2. The payments and benefits made hereunder shall be less applicable deductions and withholdings.

3. The payments and benefits set forth in Section 1 include any and all amounts due or arguably due to Executive on account of wages, bonuses, salary, separation pay, vacation pay, paid time off, sick time, business expenses, deferred compensation, profit sharing, benefits or any other form of compensation or amounts from any of the Released Parties (as defined below) under the Employment Agreement or otherwise.

4. (a) In exchange for the payments and benefits provided for in this Agreement and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, Executive, on behalf of Executive and Executive’s heirs, executors, administrators, representatives and assigns, hereby forever unconditionally and irrevocably releases and discharges the Company, Diamond S Shipping Inc., Diamond S Management LLC (a Delaware limited liability company), any related or affiliated entity, their parent entities, subsidiaries, general partners, members, managing members, direct and indirect affiliates, predecessors, successors and assigns, any employee benefit plans established or maintained by any of the foregoing entities, and each and all of their current and former officers, directors, employees, trustees, agents, attorneys, plan administrators, representatives, partners, members, advisors and shareholders (collectively and individually, the “Released Parties”), from any and all claims, causes of action, complaints, agreements, promises, contracts, undertakings, covenants, guarantees, grievances, liabilities, damages, rights, obligations, expenses, debts and demands whatsoever, in law or equity, known or unknown, whether present or future and without regard to the subsequent discovery or existence of facts in addition to or different from those which Executive now knows or believes to be true, that Executive, Executive’s heirs, executors, administrators, representatives and assigns ever had, now have or hereafter can, shall or may have, for, upon or by reason of any alleged or actual matter, cause or thing from the beginning of time until the date Executive signs this Agreement, including, but not limited to, those arising out of in connection with or relating to in any way the terms and conditions of Executive’s employment, the Employment Agreement or the cessation of Executive’s employment.

(b) Executive understands and acknowledges that by signing this Agreement Executive is waiving and releasing any and all claims Executive may have against the Released Parties concerning the terms and conditions of Executive’s employment and the termination of Executive’s employment under any federal, state, city or local law, including those prohibiting discrimination on the basis of sex, age, race, color, disability, religion, creed, national origin, ancestry, sexual orientation, pregnancy, handicap, marital status, citizenship or any other protected factor or characteristic, prohibiting discrimination for requesting or taking a family or medical leave, prohibiting discrimination with regard to benefits or any other terms and conditions of employment, or prohibiting retaliation in connection with any complaint or claim of alleged discrimination or harassment and that Executive intends to do so. As such, this release includes, but is not limited to, regardless of whether such laws apply to the Released Parties, any claims arising under the Age Discrimination in Employment Act of 1967 (“ADEA”), the Older Workers Benefit Protection Act, the Civil Rights Act of 1866, Title VII of the Civil Rights Act of 1964, the Civil Rights Act of 1991, the Employee Retirement Income Security Act (“ERISA”), the Equal Pay Act, the Americans with Disabilities Act, the Genetic Information Nondiscrimination Act, the Family and Medical Leave Act of 1993, the Worker Adjustment and Retraining Notification Act (“WARN”), the Uniformed Services Employment and Reemployment Rights Act, the U.S. Sarbanes Oxley Act of 2002, §§ 748(h)(1), 922(h)(1) and 1057 of the Dodd-Frank Wall Street Reform and Consumer Protection Act, the New York Paid Family Leave Law, the New York State Labor Law, the New York State and City Human Rights Laws, each as amended, and any other federal, state or local statute, rule or regulation or the common law.

(c) Executive hereby intends to expressly waive and relinquish, to the fullest extent permitted by law, all claims Executive may have whether or not known or suspected to exist in Executive’s favor at the time of executing this Agreement. Executive further acknowledges that Executive is aware that Executive may hereafter discover facts in addition to or different from those which Executive now knows or believes to be true with respect to the subject matter of this Agreement, but it is Executive’s intention to, and Executive fully, finally and forever settles and releases any and all claims against the Released Parties in any forum whatsoever, relating in any way to the claims being released herein, whether known or unknown, suspected or unsuspected, which now exist, may hereafter exist, or heretofore have existed, and without regard to the subsequent discovery or existence of such different additional facts. Nothing herein, however, shall be deemed to prevent Executive from challenging this release and waiver of Executive’s rights under the ADEA solely on the grounds that this release and waiver was not made knowingly and voluntarily, as more fully set forth in Section 6 below.

5. Executive represents that Executive has not filed any claim, action, lawsuit, charge, complaint, arbitration or proceeding of any kind against the Company or any of the Released Parties. Executive further covenants and agrees that Executive will not bring any claim, action, lawsuit, charge, complaint, arbitration or proceeding of any kind, at law or in equity, against the Company or any of the Released Parties arising out of, in connection with or relating to in any way the claims released in this Agreement, Executive’s employment, the termination of Executive’s employment or any other matter. In the event Executive violates this Section 5, Executive agrees to pay all costs and expenses of defending against any such claim, action, lawsuit, charge, complaint, arbitration or proceeding incurred by the Company or any of the Released Parties, including reasonable attorneys' fees. Nothing in this Section 5 or otherwise in this Agreement, however, shall limit Executive’s right, where applicable, to file an administrative charge or complaint or participate in an investigative proceeding of the Equal Employment Opportunity Commission, the National Labor Relations Board, the Occupational Safety and Health Administration, the Securities and Exchange Commission (the “SEC”) or any other federal, state or local governmental agency, commission or body (each a “Governmental Agency”). To the extent permitted by law, Executive agrees that Executive shall not be entitled to, and Executive waives and releases any right to, recovery of individual monetary relief or other individual remedies, including but not limited to damages, fees, costs or disbursements, from any of the Released Parties in connection with or relating to any such charge or complaint, but in no event shall such waiver limit Executive’s right to seek and obtain a whistleblower award from the SEC pursuant to Section 21F of the Securities Exchange Act of 1934. Further, nothing in this Section 5 shall prevent Executive from enforcing Executive’s rights under this Agreement.

6. Notwithstanding anything in the foregoing paragraphs or otherwise in this Agreement to the contrary, no penalty, condition precedent (including any requirement that Executive tender back the consideration being paid under this Agreement) or other limitation shall be imposed if Executive challenges the waiver of Executive’s rights under Section 4 or the covenant not to sue pursuant to Section 5 under the ADEA on the grounds that the waiver or covenant not to sue was not made knowingly and voluntarily. However, nothing herein shall affect the Company’s rights to seek restitution, recoupment or setoff or any other remedy in connection with any such challenge.

7. Notwithstanding anything in the foregoing paragraphs or otherwise in this Agreement to the contrary, nothing herein shall release any Released Party from (a) any claims or damages based on any right or claim that arises after the date Executive executes this Agreement, (b) any right that is not waivable under applicable law or (c) any right of Executive to be indemnified and held harmless pursuant to the Company’s (or any member of the Company Group’s, as applicable) charter or by-laws (including the LLC Agreement (as defined in the Employment Agreement)) and to coverage as an insured under any applicable directors and officers liability insurance policy.

8. Executive hereby acknowledges that:

(a) the payments and benefits Executive will receive under this Agreement are more than Executive would have been entitled to had Executive not signed this Agreement;

(b) Executive is hereby advised by the Company to consult with an attorney concerning the terms of this Agreement and its effect on Executive before signing it;

(c) Executive has in fact read this Agreement, has had an adequate opportunity to review its terms, understand its terms and consequences and is executing it freely and voluntarily; and

(d) Executive is hereby advised that Executive has a period of at least twenty-one (21) calendar days from the date Executive received this Agreement to decide whether to sign it.

9. Executive understands that for a period of 7 calendar days following the execution and delivery of a signed copy of this Agreement to the Company, this Agreement may be revoked by delivering written notice revoking same within that time period to Anoushka Kachelo, General Counsel (or her successor), Diamond S Shipping Inc., 33 Benedict Place, Greenwich, CT. If the Agreement is not revoked during that 7-day period, it shall become final. Should Executive revoke this Agreement, Executive understands that the Company has no obligation to provide the consideration set forth above, that Executive shall have the same rights with respect to the Company that Executive had prior to signing this Agreement, and that Executive shall have no entitlement to any amounts under this Agreement. The payments and benefits described in Section 1, if otherwise due, shall be held by the Company until the expiration of the 7-day revocation period.

10. Executive acknowledges and reaffirms that Executive’s obligations in respect of Non-Competition, Non-Solicitation, Confidential Information, Non-Disparagement and Intellectual Property as set forth in Sections 6(a)-(e) and Cooperation under Section 8(n) of the Employment Agreement remain in full force notwithstanding the termination of Executive’s employment and Executive acknowledges and agrees that Executive has remained in full compliance with such provisions up to the date Executive signs this Agreement. The Company acknowledges and reaffirms its obligations in respect of Non-Disparagement as set forth in Section 6(d).

11. (a) Executive understands that the confidentiality of this Agreement is important, and hereby agrees that the terms of this Agreement will not be disclosed without the prior written consent of the Company, except to Executive’s immediate family, attorney or accountant, and then only after securing the agreement of such individual to maintain the confidentiality of this Agreement, or in response to a subpoena or other legal process. Notwithstanding the foregoing, Executive may disclose the terms of Section 10 hereof and Section 6 of the Employment Agreement to any prospective employer or business partner. In the event Executive receives a subpoena related to Executive’s employment with the Company, except where prohibited by law, Executive shall promptly notify Anoushka Kachelo, General Counsel (or her successor) in writing so that the Company will have adequate time to consider and take any appropriate action to object to such disclosure or preserve the confidentiality of any information sought.

(b) Executive agrees to cooperate fully in all respects with the Released Parties in connection with any and all existing or future claims, investigations, arbitrations, proceedings, litigations or examinations involving any of the Released Parties which relate to Executive’s service. This shall include, without limitation, making Executive available on reasonable notice for interviews and other communications with in-house and outside counsel acting on behalf of the Company in connection with any such matter and appearing without a subpoena for a deposition or to give testimony in any hearing, trial or arbitration at the request of the Company.

(c) Nothing in this Section 11 or elsewhere in the Agreement is intended in any way to interfere with, or shall operate to prohibit Executive from providing complete and truthful information (i) in response to a subpoena, in testifying in any action or proceeding, or in connection with any regulatory inquiry, (ii) as required or protected by law rule or regulation; or (iii) in communicating directly with any Governmental Agency or self-regulatory organization regarding a potential securities law violation without notice to the Company.

12. (a) Executive represents that Executive has returned to the Company all property and equipment of any kind of the Company or any member of the Company Group (as defined in the Employment Agreement) in Executive’s possession or control. This includes computer equipment (hardware and software), smartphone or similar device, credit cards, office keys, security access cards, badges, identification cards and all Confidential Information (as defined in the Employment Agreement), files, documents, copies (including drafts) of any documentation or information (both electronic or hard copy, however stored), relating to the business of the Company and the members of the Company Group. Executive further represents that Executive has downloaded onto a disk or flash drive and returned to the Company any property of the Company and the members of the Company Group stored or saved on any computer, storage device or cloud storage system (excluding those at the Company’s offices) Executive has used or has had access to, and has taken all steps necessary to purge any and all property of the Company and the members of the Company Group permanently from any such computer, storage device or cloud storage system Executive has used or have had access to (excluding those at the Company’s offices).

(b) Executive hereby agrees to resign, effective as of the Date of Termination (as defined in the Employment Agreement), from any positions that Executive holds with any member of the Company Group, including the Board (as defined in the Employment Agreement) (and any committees thereof) and the board of directors or other governing body (and any committees thereof) of any of the members of the Company Group. Executive hereby agrees to execute any and all documentation of such resignations upon request by the Company or any member of the Company Group, but shall be treated for all purposes as having so resigned upon termination of employment, regardless of when or whether Executive executes any such documentation.

(c) Executive represents that Executive has provided the Company with all log-in, password, account and other information of any kind for any documents, programs, accounts or other password protected materials of any kind in Executive’s possession or control that relate to the business of the Company or any member of the Company Group.

13. This Agreement amicably resolves any issues between the parties and they agree that this Agreement shall neither be interpreted nor construed as an admission of any wrongdoing or liability on Executive’s part or any of the Released Parties.

14. This Agreement shall be governed by and construed in accordance with the laws of the State of Connecticut, without regard to principles of conflicts of law.

15. This Agreement shall be binding on and shall inure to the benefit of Executive’s heirs, executors, administrators, representatives and assigns and the Company’s successors in interest and assigns. Executive may not assign any of Executive’s rights or duties hereunder, except with the written consent of the Company. Executive represents that Executive has not assigned or attempted to assign any rights or claims Executive may have against any of the Released Parties at any time prior to signing this Agreement.

16. Subject to Section 6, in the event that the release or covenant not to sue contained in Sections 4 and 5 of this Agreement is held to be invalid, void or unenforceable for any reason as a result of a challenge by Executive, the Company may elect to enforce the remainder of the Agreement, or cancel it and get back from Executive any consideration paid. If any other provision of this Agreement is found invalid, void or unenforceable, it will be deemed severed from this Agreement without affecting the remainder which will remain in full force and effect.

17. Subject to Section 6, in the event Executive materially breaches this Agreement, the Company’s obligations shall cease and it shall be entitled to recover all amounts paid under this Agreement in addition to any other remedies at law or in equity it may have.

18. This Agreement contains the entire agreement between Executive and the Company and supersedes and cancels any prior agreement or understanding between the parties on the subjects covered herein and no agreements, representations or statements of either party not contained in this Agreement shall bind that party. Executive acknowledges that neither the Company, nor any representative of the Company, has made and Executive has not relied upon any representation or promise to Executive other than as expressly set forth herein. This Agreement may be modified, or any provision waived, only in a writing signed by both parties.

19. Executed copies of this Agreement may be delivered by facsimile, email (PDF) or other electronic means and all such copies will be deemed original copies of this Agreement.

Signature page follows.

IN WITNESS WHEREOF, the parties have entered into this Agreement and Release.

	DIAMOND S MANAGEMENT LLC

	By:
		[Name]
		[Title]


		Date

ALL PAYMENTS HEREUNDER GUARANTEED
BY DIAMOND S SHIPPING INC.

By:
[Name]
[Title]


Date

ACCEPTED AND AGREED TO:


[Name]


Date

Exhibit 10.2

EMPLOYMENT AGREEMENT (this “Agreement”), dated as of April 2, 2020 (the “Effective Date”), between Diamond S Management LLC, a limited liability company organized under the laws of the Marshall Islands (the “Company”), and Kevin Kilcullen (“Executive”).

WHEREAS, the Company desires to continue to employ Executive, and Executive desires to remain employed with the Company, subject to the terms and conditions set forth herein.

2. Position, Duties and Responsibilities.

(a) During the Term, Executive shall serve as the Chief Financial Officer of the Company. Executive’s principal work location shall be at the Company’s offices at 33 Benedict Place, Greenwich, CT USA. Executive shall report directly and solely to the Chief Executive Officer of the Company (the “CEO”) and shall have the duties customarily assigned to the chief financial officer of a public company operating in the Company’s industry.

(b) During the Term, Executive shall devote substantially all his working time to the business of the Company and Diamond S Shipping Inc., a Marshall Islands corporation and sole owner of the Company (the “Parent”), and each and all of the Company’s and the Parent’s respective direct and indirect affiliates and subsidiaries (collectively, the “Company Group”). Notwithstanding the foregoing, it shall not be a violation of this Agreement for Executive to (i) serve as a director or an officer of, or otherwise participate in, non-profit, educational, social welfare, religious and civic organizations, (ii) subject to the advance written approval of the CEO, serve as a director of a for-profit entity or (iii) manage his personal, financial (to the extent Executive makes passive investments only) and legal affairs, in each case, so long as any such activities do not unreasonably interfere with the performance of his duties and responsibilities to the Company and the Company Group and comply with the conflict-of-interest policies established by the Company and the members of the Company Group.

(d) Executive acknowledges and agrees that Executive has a fiduciary duty of loyalty, fidelity and allegiance to act at all times in the best interests of the Company and the Company Group and to do no act that could, directly or indirectly, injure the business, interests, or reputation of the Company or the members of the Company Group. In furtherance of the foregoing, Executive will present to the CEO of the Company or other member of management all material business opportunities or ventures made known to Executive, independently or with others, that are within the business purposes of the Company and/or the Company Group, including, without limitation, opportunities that may compete with the Company or the members of the Company Group and could reasonably be expected to be implemented by the Company and/or the Company Group.

3. Compensation and Benefits.

(a) Base Salary. During the Term, Executive shall be paid an annual base salary of $450,000 (“Base Salary”). The Base Salary shall be payable monthly in accordance with the Company’s regular payroll practices. During the Term, the Base Salary shall be reviewed annually and is subject to upward adjustment, but in no event shall the Company pay Executive a Base Salary less than that set forth above.

(b) Bonus. During the Term, Executive shall have an opportunity to earn a cash bonus (“Annual Bonus”) for each fiscal year during the Term with a target amount of at least 70% of Executive’s Base Salary for the current fiscal year (“Target Bonus”). The Annual Bonus shall be subject to performance goals determined each fiscal year by the Board of Directors of the Parent (the “Board”) (or the applicable committee or sub-committee to which such authority has been delegated), of which 70% of the applicable Target Bonus shall be subject to goals based on the Parent’s performance and 30% of the applicable Target Bonus shall be subject to goals based on Executive’s individual performance. The aggregate amount of any Annual Bonus actually payable to Executive hereunder, if any, shall be determined by the Board (or the applicable committee or sub-committee to which such authority has been delegated) in its reasonable discretion as soon as practicable following the end of the applicable fiscal year, and shall be paid no later than the 15th day of the third month following such fiscal year end. In order to be eligible for any Annual Bonus, Executive must be in the active employ of the Company as of December 31 of the applicable fiscal year.

(e) Vacation. During the Term, Executive shall be entitled in accordance with Company policies to take 25 days of paid vacation and 5 paid sick days per calendar year.

(g) One-Time Expenses. The Company shall reimburse Executive in an aggregate amount not to exceed $50,000 for reasonable out-of-pocket expenses (other than relocation-related expenses but including legal expenses) incurred in 2019 and 2020 in connection with his accepting and commencing employment with the Company and entering into this Agreement subject to receipt of satisfactory documentation that such expenses were incurred by Executive.

(h) Insurance and Indemnification. The Company, the Parent or other appropriate member of the Company Group shall maintain Directors and Officers Insurance during the Term. Further, Executive shall be subject to Paragraph 7(d) of the Amended and Restated Limited Liability Company Agreement of Diamond S Management LLC (a Marshall Islands Limited Liability Company) dated August 20, 2009 (the “LLC Agreement”), in respect of indemnification.

4. Termination of Employment During the Term.

(b) Cause. The Company may terminate Executive’s employment for Cause. For purposes of this Agreement, “Cause” means:

(i)

(ii)

Executive has failed to follow the lawful reasonable directives of the CEO or the Board;

(iii)

gross negligence or willful misconduct by Executive in the execution of Executive’s duties hereunder;

(iv)

Executive has materially breached any material policy or code of conduct of the Company or any member of the Company Group to which he is subject;

(v)

(vi)

(vii)

Executive has engaged in fraudulent or criminal activity (whether or not prosecuted) in the course of Executive’s employment; or

(viii)

a material breach by Executive of this Agreement.

(i)

(ii)

a material reduction in Executive’s Base Salary below $450,000 annually, Target Bonus below 70% of Executive’s Base Salary or target LTIP Award below 100% of Executive’s Base Salary;

(iii)

(iv)

any other material breach by the Company of this Agreement.

(i)

(ii)

(iii)

(iv)

the Company shall treat all outstanding LTIP Awards or other equity or incentive awards held by Executive in accordance with the terms of the applicable plan and award agreements; and

(v)

(A)

(B)

(C)

(D)

the Company shall treat all outstanding LTIP Awards or other equity or incentive awards held by Executive in accordance with the terms of the applicable plan and award agreements; and

(E)

the Company shall provide to Executive the Accrued Rights.

(ii)

(iii)

For purposes of this Agreement, “Change in Control” shall mean the occurrence of any of the following events:

(A)

(B)

a majority of the Directors are not Incumbent Directors (as defined below);

(C)

(D)

approval by the stockholders of the Parent of a complete liquidation or dissolution.

(iv)

(v)

(vi)

(vii)

For purposes of this Agreement, “Person” means any individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Exchange Act).

6. Covenants.

(i)

(ii)

(f) Return of Company Property. Other than as permitted by the CEO in writing, all documents (including Confidential Information), data, recordings or other property, including smartphones, tablets, computers and other business equipment, whether tangible or intangible, including all information stored in electronic form, obtained or prepared by or for Executive and utilized by Executive in the course of his employment with the Company shall remain the exclusive property of the Company and the Company Group, and Executive shall return all such property, documents and information upon any termination of his employment and as otherwise requested by the Company or any member of the Company Group during the Term.

8. Miscellaneous.

If to the Company, addressed to:

	Diamond S Management LLC
	33 Benedict Place, 2^nd Floor
	Greenwich, CT 06830
	United States of America
	Attention:	Chief Executive Officer
		Group General Counsel

Copy to (which shall not constitute notice):

	Seward & Kissel LLP
	One Battery Park Plaza
	New York, New York 10004
	Attention:	Lawrence Rutkowski
		Anne C. Patin

If to Executive:

	The most recent address on file with the Company.

(i) Sections 409A and 457A of the Code.

(i)

(ii)

(iii)

(iv)

For purposes of Section 409A, each payment hereunder will be deemed to be a separate payment as permitted under Treas. Reg. Section 1.409A-2(b)(2)(iii).

(v)

(l) Entire Agreement. This Agreement and the other agreements and arrangements referred to in this Agreement supersede and replace any previous agreements and discussions pertaining to the subject matter covered herein. This Agreement and the Annex hereto (collectively, the “Employment Documents”) constitute the entire agreement of the parties with regard to the terms of Executive’s employment, termination of employment, and severance benefits, and contain all of the covenants, promises, representations, warranties, and agreements between the parties with respect to such matters. Executive acknowledges that no representation, inducement, promise, or agreement, oral or written, has been made by either party with respect to the foregoing matters that is not embodied in the Employment Documents, and that no agreement, statement, or promise relating to the employment of Executive by the Company that is not contained in the Employment Documents will be valid or binding. Executive acknowledges that neither the Company and/or any member of the Company Group, nor any representative of the Company and/or any member of the Company Group, has made and Executive has not relied upon any representation or promise to Executive other than as expressly set forth herein. Executive represents that he has complied with all restrictive covenants, obligations of confidentiality, and intellectual property provisions contained in any prior employment agreement between Executive and the Company, any member of the Company Group, or any prior employer.

IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first above written.

	DIAMOND S MANAGEMENT LLC,

	By:	/s/ Craig H. Stevenson, Jr.
		Name: Craig H. Stevenson, Jr.
		Title: President, Chief Executive Officer and Secretary

	ALL PAYMENTS HEREUNDER GUARANTEED BY DIAMOND S SHIPPING INC.,

	By:	/s/ Craig H. Stevenson, Jr.
		Name: Craig H. Stevenson, Jr.
		Title: President and Chief Executive Officer

	EXECUTIVE,

	By:	/s/ Kevin Kilcullen
		Kevin Kilcullen

Annex A

[General Release of Claims]

This Agreement and Release (the “Agreement”) is between ________ (“Executive”) and Diamond S Management LLC, a limited liability company organized in the Marshall Islands (the “Company”).

WHEREAS, Executive and the Company entered into an employment agreement dated as of _______ (the “Employment Agreement”);

WHEREAS, Executive and the Company hereby desire to settle any and all claims Executive may have against any of the Released Parties (as defined below).

NOW, THEREFORE, the parties agree as follows:

2. The payments and benefits made hereunder shall be less applicable deductions and withholdings.

8. Executive hereby acknowledges that:

(a) the payments and benefits Executive will receive under this Agreement are more than Executive would have been entitled to had Executive not signed this Agreement;

(b) Executive is hereby advised by the Company to consult with an attorney concerning the terms of this Agreement and its effect on Executive before signing it;

(c) Executive has in fact read this Agreement, has had an adequate opportunity to review its terms, understand its terms and consequences and is executing it freely and voluntarily; and

(d) Executive is hereby advised that Executive has a period of at least twenty-one (21) calendar days from the date Executive received this Agreement to decide whether to sign it.

9. Executive understands that for a period of 7 calendar days following the execution and delivery of a signed copy of this Agreement to the Company, this Agreement may be revoked by delivering written notice revoking same within that time period to Anoushka Kachelo, General Counsel, Diamond S Shipping Inc., 33 Benedict Place, Greenwich, CT. If the Agreement is not revoked during that 7-day period, it shall become final. Should Executive revoke this Agreement, Executive understands that the Company has no obligation to provide the consideration set forth above, that Executive shall have the same rights with respect to the Company that Executive had prior to signing this Agreement, and that Executive shall have no entitlement to any amounts under this Agreement. The payments and benefits described in Section 1, if otherwise due, shall be held by the Company until the expiration of the 7-day revocation period.

11. (a) Executive understands that the confidentiality of this Agreement is important, and hereby agrees that the terms of this Agreement will not be disclosed without the prior written consent of the Company, except to Executive’s immediate family, attorney or accountant, and then only after securing the agreement of such individual to maintain the confidentiality of this Agreement, or in response to a subpoena or other legal process. Notwithstanding the foregoing, Executive may disclose the terms of Section 9 hereof and Section 6 of the Employment Agreement to any prospective employer or business partner. In the event Executive receives a subpoena related to Executive’s employment with the Company, except where prohibited by law, Executive shall promptly notify Anoushka Kachelo, General Counsel (or her successor) in writing so that the Company will have adequate time to consider and take any appropriate action to object to such disclosure or preserve the confidentiality of any information sought.

(c) Nothing in this Section 10 or elsewhere in the Agreement is intended in any way to interfere with, or shall operate to prohibit Executive from providing complete and truthful information (i) in response to a subpoena, in testifying in any action or proceeding, or in connection with any regulatory inquiry, (ii) as required or protected by law rule or regulation; or (iii) in communicating directly with any Governmental Agency or self-regulatory organization regarding a potential securities law violation without notice to the Company.

14. This Agreement shall be governed by and construed in accordance with the laws of the State of Connecticut, without regard to principles of conflicts of law.

19. Executed copies of this Agreement may be delivered by facsimile, email (PDF) or other electronic means and all such copies will be deemed original copies of this Agreement.

Signature page follows.

IN WITNESS WHEREOF, the parties have entered into this Agreement and Release.

	DIAMOND S MANAGEMENT LLC

	By:
		[Name]
		[Title]


		Date

ALL PAYMENTS HEREUNDER GUARANTEED
BY DIAMOND S SHIPPING INC.

By:
[Name]
[Title]


Date

ACCEPTED AND AGREED TO:


[Name]


Date

Exhibit 10.3

This AMENDED AND RESTATED EMPLOYMENT AGREEMENT (this “Agreement”), dated as of April 7, 2020 (the “Effective Date”), between Diamond S Management LLC, a limited liability company organized under the laws of the Marshall Islands (the “Company”), and Sanjay Sukhrani (“Executive”).

WHEREAS, Executive is currently employed by the Company pursuant to an amended and restated employment agreement, dated May 1, 2011 between the Company and Executive (the “Previous Employment Agreement”).

WHEREAS, the parties desire to amend and restate the Previous Employment Agreement and continue to employ Executive, and Executive desires to remain employed with the Company, subject to the terms and conditions set forth herein.

2. Position, Duties and Responsibilities.

(a) During the Term, Executive shall serve as the Chief Operating Officer of the Company. Executive’s principal work location shall be at the Company’s offices at 33 Benedict Place, Greenwich, CT USA. Executive shall report directly and solely to the Chief Executive Officer of the Company (the “CEO”) and shall have the duties customarily assigned to the chief operating officer of a public company operating in the Company’s industry.

(d) Executive acknowledges and agrees that Executive has a fiduciary duty of loyalty, fidelity and allegiance to act at all times in the best interests of the Company and the Company Group and to do no act that could, directly or indirectly, injure the business, interests, or reputation of the Company or the members of the Company Group. In furtherance of the foregoing, Executive will present to the CEO of the Company or other member of management all material business opportunities or ventures made known to Executive, independently or with others, that are within the business purposes of the Company and/or the Company Group, including, without limitation, opportunities that may compete with the Company or the members of the Company Group and could reasonably be expected to be implemented by the Company and/or the Company Group.

3. Compensation and Benefits.

(a) Base Salary. During the Term, Executive shall be paid an annual base salary of $482,000 (“Base Salary”). The Base Salary shall be payable monthly in accordance with the Company’s regular payroll practices. During the Term, the Base Salary shall be reviewed annually and is subject to upward adjustment, but in no event shall the Company pay Executive a Base Salary less than that set forth above.

(b) Bonus. During the Term, Executive shall have an opportunity to earn a cash bonus (“Annual Bonus”) for each fiscal year during the Term with a target amount of at least 50% of Executive’s Base Salary for the current fiscal year (“Target Bonus”). The Annual Bonus shall be subject to performance goals determined each fiscal year by the Board of Directors of the Parent (the “Board”) (or the applicable committee or sub-committee to which such authority has been delegated), of which 80% of the applicable Target Bonus shall be subject to goals based on the Parent’s performance and 20% of the applicable Target Bonus shall be subject to goals based on Executive’s individual performance. The aggregate amount of any Annual Bonus actually payable to Executive hereunder, if any, shall be determined by the Board (or the applicable committee or sub-committee to which such authority has been delegated) in its reasonable discretion as soon as practicable following the end of the applicable fiscal year, and shall be paid no later than the 15th day of the third month following such fiscal year end. In order to be eligible for any Annual Bonus, Executive must be in the active employ of the Company as of December 31 of the applicable fiscal year.

(e) Vacation. During the Term, Executive shall be entitled in accordance with Company policies to take 25 days of paid vacation and 5 paid sick days per calendar year.

4. Termination of Employment During the Term.

(b) Cause. The Company may terminate Executive’s employment for Cause. For purposes of this Agreement, “Cause” means:

(i)

(ii)

Executive has failed to follow the lawful reasonable directives of the CEO or the Board;

(iii)

gross negligence or willful misconduct by Executive in the execution of Executive’s duties hereunder;

(iv)

Executive has materially breached any material policy or code of conduct of the Company or any member of the Company Group to which he is subject;

(v)

(vi)

(vii)

Executive has engaged in fraudulent or criminal activity (whether or not prosecuted) in the course of Executive’s employment; or

(viii)

a material breach by Executive of this Agreement.

(i)

(ii)

a material reduction in Executive’s Base Salary below $482,000 annually, Target Bonus below 50% of Executive’s Base Salary or target LTIP Award below 100% of Executive’s Base Salary;

(iii)

(iv)

any other material breach by the Company of this Agreement.

(i)

the Company shall pay an amount to Executive equal to Executive’s Base Salary for a period of 12 months, with such amount (the “Severance Payment”) being paid in the form of 12 equal monthly installments, with all such installments being paid within one year of the Date of Termination; provided, however, that (A) until the 60th day following the Date of Termination, all installments in respect of the Severance Payment that would otherwise be made during such 60-day period shall instead be withheld and paid on such 60th day subject to the Release becoming irrevocable as provided above, and (B) in the event Executive materially breaches Executive’s obligations under Section 6(a), (b), (c) or (d), the Company shall cease to be required to provide the payments specified in this Section 5(a)(i);

(ii)

(iii)

the Company shall treat all outstanding LTIP Awards or other equity or incentive awards held by Executive in accordance with the terms of the applicable plan and award agreements; and

(iv)

(A)

the Company shall pay to Executive a single lump-sum cash amount equal to 12 months of Executive’s Base Salary, which shall be payable on the 60th day following the Date of Termination; provided, however, that in the event such Change in Control does not constitute a “change in the ownership or effective control of a corporation, or a change in the ownership of a substantial portion of the assets of a corporation” as set forth in Treas. Reg. Section 1.409A-3(i)(5), such amount shall instead be paid as set forth in Section 5(a)(i);

(B)

(C)

the Company shall pay to Executive a single lump-sum cash amount equal to the cost of premiums under COBRA for a period of 12 months following the Date of Termination, which shall be payable on the 60th day following the Date of Termination and subject to withholdings and deductions; provided, however, that in the event such Change in Control does not constitute a “change in the ownership or effective control of a corporation, or a change in the ownership of a substantial portion of the assets of a corporation” as set forth in Treas. Reg. Section 1.409A-3(i)(5), such amount shall instead be paid as set forth in Section 5(a)(ii);

(D)

the Company shall treat all outstanding LTIP Awards or other equity or incentive awards held by Executive in accordance with the terms of the applicable plan and award agreements; and

(E)

the Company shall provide to Executive the Accrued Rights.

(ii)

(iii)

For purposes of this Agreement, “Change in Control” shall mean the occurrence of any of the following events:

(A)

(B)

a majority of the Directors are not Incumbent Directors (as defined below);

(C)

(D)

approval by the stockholders of the Parent of a complete liquidation or dissolution.

(iv)

(v)

(vi)

(vii)

For purposes of this Agreement, “Person” means any individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Exchange Act).

(d) Executive COBRA Obligations. If Executive is entitled to COBRA reimbursement or payment above, Executive must immediately notify the Company if Executive becomes eligible for coverage under another employer’s group health plan or otherwise ceases to be eligible for continued coverage under COBRA under the Company Group’s group health, dental and vision plans during the period of 12 months following the Date of Termination. Any applicable COBRA premiums that are paid under this Agreement will not include any amounts payable by Executive under a Code Section 125 health care reimbursement plan, which amounts, if any, are the sole responsibility of Executive.

6. Covenants.

(i)

(ii)

8. Miscellaneous.

If to the Company, addressed to:

	Diamond S Management LLC
	33 Benedict Place, 2^nd Floor
	Greenwich, CT 06830
	United States of America
	Attention:	Chief Executive Officer
		Group General Counsel

Copy to (which shall not constitute notice):

	Seward & Kissel LLP
	One Battery Park Plaza
	New York, New York 10004
	Attention:	Lawrence Rutkowski
		Anne C. Patin

If to Executive:

	The most recent address on file with the Company.

(i) Sections 409A and 457A of the Code.

(i)

(ii)

(iii)

(iv)

For purposes of Section 409A, each payment hereunder will be deemed to be a separate payment as permitted under Treas. Reg. Section 1.409A-2(b)(2)(iii).

(v)

IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first above written.

	DIAMOND S MANAGEMENT LLC,

	By:	/s/ Craig H. Stevenson, Jr.
		Name: Craig H. Stevenson, Jr.
		Title: President, Chief Executive Officer and Secretary

	ALL PAYMENTS HEREUNDER GUARANTEED BY DIAMOND S SHIPPING INC.,

	By:	/s/ Craig H. Stevenson, Jr.
		Name: Craig H. Stevenson, Jr.
		Title: President and Chief Executive Officer

	EXECUTIVE,

	By:	/s/ Sanjay Sukhrani
		Sanjay Sukhrani

Annex A

[General Release of Claims]

This Agreement and Release (the “Agreement”) is between ________ (“Executive”) and Diamond S Management LLC, a limited liability company organized in the Marshall Islands (the “Company”).

WHEREAS, Executive and the Company entered into an employment agreement dated as of _______ (the “Employment Agreement”);

WHEREAS, Executive and the Company hereby desire to settle any and all claims Executive may have against any of the Released Parties (as defined below).

NOW, THEREFORE, the parties agree as follows:

2. The payments and benefits made hereunder shall be less applicable deductions and withholdings.

8. Executive hereby acknowledges that:

(a) the payments and benefits Executive will receive under this Agreement are more than Executive would have been entitled to had Executive not signed this Agreement;

(b) Executive is hereby advised by the Company to consult with an attorney concerning the terms of this Agreement and its effect on Executive before signing it;

(c) Executive has in fact read this Agreement, has had an adequate opportunity to review its terms, understand its terms and consequences and is executing it freely and voluntarily; and

(d) Executive is hereby advised that Executive has a period of at least twenty-one (21) calendar days from the date Executive received this Agreement to decide whether to sign it.

9. Executive understands that for a period of 7 calendar days following the execution and delivery of a signed copy of this Agreement to the Company, this Agreement may be revoked by delivering written notice revoking same within that time period to [Anoushka Kachelo, General Counsel, (or her successor),] Diamond S Shipping Inc., 33 Benedict Place, Greenwich, CT. If the Agreement is not revoked during that 7-day period, it shall become final. Should Executive revoke this Agreement, Executive understands that the Company has no obligation to provide the consideration set forth above, that Executive shall have the same rights with respect to the Company that Executive had prior to signing this Agreement, and that Executive shall have no entitlement to any amounts under this Agreement. The payments and benefits described in Section 1, if otherwise due, shall be held by the Company until the expiration of the 7-day revocation period.

14. This Agreement shall be governed by and construed in accordance with the laws of the State of Connecticut, without regard to principles of conflicts of law.

19. Executed copies of this Agreement may be delivered by facsimile, email (PDF) or other electronic means and all such copies will be deemed original copies of this Agreement.

Signature page follows.

IN WITNESS WHEREOF, the parties have entered into this Agreement and Release.

	DIAMOND S MANAGEMENT LLC

	By:
		[Name]
		[Title]


		Date

ALL PAYMENTS HEREUNDER GUARANTEED
BY DIAMOND S SHIPPING INC.

By:
[Name]
[Title]


Date

ACCEPTED AND AGREED TO:


[Name]


Date

Exhibit 31.1

CERTIFICATION PURSUANT TO

RULE 13a-14 OF THE SECURITIES EXCHANGE ACT OF 1934,

AS ADOPTED PURSUANT TO

SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

CERTIFICATION

I, Craig H. Stevenson, Jr., certify that:

I have reviewed this Quarterly Report on Form 10-Q of Diamond S Shipping Inc.;

Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: May 13, 2020

/s/ Craig H. Stevenson, Jr.

Craig H. Stevenson, Jr.

Chief Executive Officer, President and Director

Exhibit 31.2

CERTIFICATION PURSUANT TO

RULE 13a-14 OF THE SECURITIES EXCHANGE ACT OF 1934,

AS ADOPTED PURSUANT TO

SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

CERTIFICATION

I, Kevin M. Kilcullen, certify that:

I have reviewed this Quarterly Report on Form 10-Q of Diamond S Shipping Inc.;

Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: May 13, 2020

/s/ Kevin M. Kilcullen

Kevin M. Kilcullen

Chief Financial Officer

Exhibit 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Diamond S Shipping Inc. (the “Company”) on Form 10-Q for the period ending March 31, 2020, as filed with the Securities and Exchange Commission as of the date hereof (the “Report”), I, Craig H. Stevenson, Jr., Chief Executive Officer, President and Director of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that:

(1)

The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)

The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: May 13, 2020

/s/ Craig H. Stevenson, Jr.

Craig H. Stevenson, Jr.

Chief Executive Officer and President

Exhibit 32.2

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Diamond S Shipping Inc. (the “Company”) on Form 10-Q for the period ending March 31, 2020, as filed with the Securities and Exchange Commission as of the date hereof (the “Report”), I, Kevin M. Kilcullen, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that:

(1)

The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)

The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: May 13, 2020

/s/ Kevin M. Kilcullen

Kevin M. Kilcullen

Chief Financial Officer