Company: DSX-PB
Filing Date: 2025-03-21
Form Type: 20-F
Source: 0001562762-25-000050
Chunk: 141

Company: DIANA SHIPPING INC.
Filing Date: 2025-03-21
Form: 20-F
Item: Item 5
Chunk 141
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 buyer. In most cases,

when a

vessel is

under time

charter and

the buyer

wishes to

assume that

charter,

the vessel

cannot be

acquired without the charterer’s

consent and the buyer entering into

a separate direct agreement (called

a

“novation agreement”) with the

charterer to assume the

charter. The

purchase of a

vessel itself does not

transfer

the

charter

because

it

is

a

separate

service

agreement

between

the

vessel

owner

and

the

charterer.

Where we identify any intangible assets or liabilities associated with the acquisition

of a vessel, we record

all

identified assets

or

liabilities at

fair

value.

Fair value

is

determined by

reference to

market

data. We

value any

asset or

liability arising

from the

market value

of the

time charters

assumed when

a vessel

is

acquired. The amount to be recorded as an asset or liability at the

date of vessel delivery is based on the

difference

between

the

current

fair

market

value

of

the

charter

and

the

net

present

value

of

future

contractual cash

flows.

When the

present value

of the

time charter

assumed is

greater than the

current

fair market

value of

such charter, the

difference is

recorded as

prepaid charter

revenue.

When the

opposite

situation occurs,

any difference,

capped to

the vessel’s

fair value

on a

charter-free basis, is

recorded as

deferred revenue.

Such assets and

liabilities, respectively, are amortized

as a reduction of,

or an increase

in, revenue over the period of the time charter assumed.

When we

purchase a

vessel and

assume or

renegotiate a

related time

charter,

among others,

we must

take the following steps before the vessel will be ready to commence

operations:

●

obtain the charterer’s consent to us as the new owner;

●

obtain the charterer’s consent to a new technical

manager;

73

●

in some cases, obtain the charterer’s consent to

a new flag for the vessel;

●

arrange